Some Business Shortcuts Lead to a Prison Cell

Success in business is not easy. Most entrepreneurs follow the rules and grind away with various marketing methods to convince customers to part with their hard-earned money in return for a product or valuable service. But every now and then, an Enron or Charles Ponzi comes along, and through greed or outright deceit, cheats people out of money that makes it even tougher for honest businesses to make a sale.

Gear up and allow us to take you on a tour of some of the biggest scams in the history of modern business.

In July of 2018, Mark Charles Barnett of Ocala, Florida was convicted on federal charges of attempted arson, possession of an unregistered destructive device and manufacturing of bombs. Yes, I said bombs.

But unlike most bombers, Barnett wasn’t your typical “I’m going to make a statement” or terrorist type of bomber.

Mark Barnett plotted to place bombs at Target stores along the East Coast, hoping to profit when the retailer’s stock price dropped.

Witnesses testified that he offered people as much as $10,000 to place bombs hidden in food packages in Target stores in Florida, Virginia, and New York.

Evidence at his trial indicated that he bought bomb components and assembled at least ten improvised explosive devices, which he concealed in packages for stuffing mix, breakfast bars, and pasta. Barnett offered the money to place the devices in stores with the theory that the company’s stock prices would dramatically drop because of bad publicity and allow him to buy shares cheaply before they rebounded.

Fortunately, he was caught before any of the devices were placed or detonated. He’ll have 40 years to think about his next big business opportunity.

And now to the case of Emmanuel Nwude. Nwude is a Nigerian fraudster who was once the Director of the Union Bank of Nigeria. In 1995, he defrauded a Brazilian bank Director, Nelson Sakaguchi, out of millions by impersonating the then Governor of the Central Bank of Nigeria. Posing as the Governor, he convinced Sakaguchi to invest in a new airport located in Nigeria’s capital city. In exchange for arranging the deal, he asked for a $10 million commission.

The problem is the airport never actually existed.

The scam remained undetected for two years until a Spanish bank took over Sakaguchi’s Banco Noroeste Brazil. When an official from the Spanish bank inquired about the massive some of Noroeste’s money, which was sitting in the Cayman Islands unmonitored, it led to a criminal investigation. It was found that Sakaguchi paid a total of $242 million over three years to Nwude, who promised them an airport that never existed.

Five people associated with the scam were charged with over 86 counts of fraud and 15 counts of bribery. In 2005, Nwude plead guilty and was sentenced to 29 years in prison. But the only served a year and was released in 2006. I wonder who else got paid off to make that happen?

Did you know that the Eiffel Tower was sold for scrap? Twice.

Victor Lustig was a con man who orchestrated the Eiffel Tower scam. He began his foray into business by actually manufacturing “money-printing machine” which would produce $100 dollar bills. He got away with that scam after milking clients out of thousands. But Lustig’s biggest fraud came to fruition in 1925 when he read about repairs needed to keep the Eiffel Tower in good condition. Seeing a chance to profit, he posed as a government official, and convinced six scrap metal dealers that the Eiffel Tower was to be dismantled. He asked each to submit bids and ended up securing a “deal.” For finalizing the deal, scrap dealer Andre Poisson offered a large bribe to Lustig. After receiving the funds, Lustig disappeared, and Poisson was too embarrassed to contact authorities. A month later, Lustig returned to Paris and repeated the same trick. His second victim did report the crime, but Lustig evaded capture.

In later years, Lustig was finally captured after he conned Al Capone, manufactured counterfeit US currency, and ultimately died in prison after his girlfriend dropped the dime on him as revenge for cheating on her.

For all the time and efforts these scammers put into cheating people, wouldn’t it be a lot easier and less stressful to put that same effort into a legitimate business?