Con artists, sleight of hand artists and salesmen who push a product that is too good to be true have always had a place. Cassie L. Chadwick is a prime example of an old school scam artist who moved to the United States from Canada and defrauded banks out of millions of dollars by claiming to be an illegitimate daughter of the notorious bachelor, Andrew Carnegie in the early 1900s.
While it would seem that due to the internet age, and the sheer amount of information available to the average smartphone owner, scams would be harder to pull off in a grandiose way. You may be surprised at how many con artists are still operating. Here are 10 unbelievable expensive scams.
10 Multi-Level Marketing
Although there have been laws and legislation passed that have tried to protect consumers from these specific type of pyramid schemes, multi-level marketing is still alive and taking people’s money. The basic premise of this type of scam is that people who are signed on as employees or contractors of the business end up spending large amounts of money to keep an inventory or product, and encouraged to sign up friends and families as sellers as well.
Thus the money from the people who are contracted to the company is usually the only actual income generated. Some recent examples of this type of company are Lularoe, Cutco, Mary K, and Nerium.
9 Nigerian Prince Scam
This type of scam has been in effect for a long time, long enough so that it was even joked about on SNL more than ten years ago by Anne Hathaway. It involves receiving a letter or an email from someone overseas who will tell you they are royalty and ask for your help in securing their funds by transferring them overseas safely.
They’ll offer to you pay you a portion if you’ll provide your bank number and then will likely drain your account and disappear. This may seem like a blatantly obvious fraud, but according to CNBC, this type of scam still generates over $700,000 per year, so beware.
8 Rudy Kurniawan
Rudy Kurniawan is an Indonesian citizen who moved to the state of California at the age of 16 and is known for being the first person convicted of wine fraud. Kurniawan broke into the elite wine scene and rubbed elbows with many wealthy people while spending part of his family’s fortune on some of the most expensive bottles at wine auctions. He was later convicted for auctioning off fraudulent bottles from his own collection that he had actually blended in his own kitchen and put into reused bottles.
Kurniawan scammed tens of millions from some of the world’s wealthiest people, including William Koch, which is documented in the 2016 Netflix documentary Sour Grapes.
Theranos is a recent scam you may have heard of if you’re a true crime nerd. The Dropout podcast by ABC radio and the TV version on Hulu were released early last year and chronicled the rise and fall of Elizabeth Holmes and her tech startup, which was marketed as revolutionizing health care by changing the way we do blood testing.
It was later found that while Holmes was accepting large amounts of money from investors and even had a partnership with Walgreens, the technology the company was started for never even worked. At the height of her rise to success in 2014, Theranos was valued at $9 billion, and Holmes herself was valued at $4.5 billion.
6 Romance Scams
Romance scams are an incredibly expensive racket. With the rise of online and app dating, more and more people are finding themselves not matched with a well-meaning stranger looking to find love. But instead, a fraudster trying to trick them into sending money.
According to the Federal Trade Commission, people reported losing $143 million to romance scams in 2018. That’s not to say that more money wasn’t lost, and didn’t get reported. Fraudsters will usually pretend to have a job abroad and, after building trust, will ask for money to pay for medical expenses, plane tickets, or gambling debts.
5 Anna Sorokin
Anna Sorokin is a Russian scam artist who moved to the US and posed as a German heiress with a trust fund of 60,000,000 €, Anna Delvey. Sorokin created a lavish lifestyle with fancy parties, designer clothes, and celebrity trainers and was able to break into wealthy New York social circles before she was eventually found out after spending $60,000 of her former friend’s money on a lavish trip to Morocco.
Sorokin created false documents in the hopes of getting a bank loan for $22,000,000. Her story has been turned into a Netflix limited series created and produced by Scandal creator, Shonda Rhimes. Inventing Anna will premiere in 2020.
4 Bernie Madoff
Bernie Madoff was born in Queens, New York, and created a multibillion-dollar investment firm with the help of his wife and an initial investment of $50,000 from his in-laws. His firm was called Bernard L. Madoff Investment Securities, LLC, and grew a high profile client list including Kyra Sedgwick, Kevin Bacon, and Steven Spielberg.
Madoff created the quintessential Ponzi scheme in which he spent recent investor’s money to pay off older investors, while he never actually generated any profit from the money that clients had given him. Madoff defrauded his clients of $65 billion. He is currently serving a 150-year sentence.
3 Fyre Festival
Billy McFarland, the CEO of Fyre Media and creator of Magnesis, had a big year in the public eye after both Netflix and Hulu released documentaries about the highly publicized disaster, Fyre Festival. McFarland’s scams relied heavily on young people’s desire to be part of an exclusive group, and he made grand promises to his clients and investors that he never kept.
All in all, after the disastrous Fyre Festival Mcfarland, pled guilty to two counts of wire fraud and is serving a six-year sentence, and pled guilty to other charges relating to a separate scam, NYC VIP Access. He admitted to defrauding Fyre Festival investors of $26,000,000.
Perhaps one of the most well-known scams of the 1990s, Enron was an energy company based in Houston, Texas that had one of the biggest bankruptcy restructurings in 2001.
The business was using sneaky tactics to report its finances, even as it was losing money. Both Kenneth L. Lay and Jeffrey Skilling, the chief executives of the company were charged with fraud and conspiracy
1 Lou Pearlman
Lou Pearlman was the manager and founder of several 90’s boy bands, including N’Sync and Backstreet Boys. He was later convicted for conspiracy, money laundering, and making false statements.
In a recent Youtube documentary, former boy band member Lance Bass opened up about how Pearlman had defrauded the young boys at the start of their careers.
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