June 19th, 2007 10:18 EST
The FBI And A New Twist on Identity Theft
Late last month, we helped wrap up a case that took identity theft to a whole new level: one company trying to steal $23 million by pretending to be another company.
It was made possible by a remarkable coincidence: two private security companies with nearly identical names. One of the firms, based in Michigan, was named Executive Outcome Inc. The other, based in South Africa, was called Executive Outcomes Inc.
The criminal maneuvering began in late 2001, when a British debt collector called the Michigan-based Executive Outcome, run by Pasquale John DiPofi. The collection agency asked if DiPofi wanted help collecting $23 million owed by the government of Sierra Leone for military equipment, security, and training.
One slight problem. The millions of dollars weren't owed to DiPofi's company. It was owed to the other firm, Executive Outcomes, a half a world away.
"This probably started as a crime of opportunity," says Special Agent William Fleming, who worked the case out of our office in Clinton Township, Michigan. "When the call came in, the coincidences of the similar company names and all that money on the table must have been a huge temptation."
And one DiPofi couldn't resist. He hired the collection agency to pursue the debt. He and an employee, Christopher Belan, then began producing documents to back up their claim. They also registered a new company in Michigan and in England to mirror the name of the South African company.
The debt collector went ahead and filed paperwork with the government of Sierra Leone on DiPofi's behalf. That's when alarm bells starting ringing: Sierra Leone had already agreed to a payment plan with the South African company. Understandably, the government balked when the new claim was submitted. A legal skirmish followed between DiPofi and the South African company.
Then, the conflict turned malicious. A representative of the South African company got a phone call urging him not to be "greedy" and to reach a settlement with DiPofi's company soon-or else. The representative also received a letter with several interior pictures of his homes in London and Paris.
That's when we got involved. The representative called the police…who called our special agent assigned as a Legal Attaché in London…who turned the case over to Agent Fleming.
Obtaining a search warrant, Fleming searched DiPofi's office and found evidence of the forged documents. Most were conveniently created on DiPofi's office computer.
DiPofi and Belan never collected a dime. They both pled guilty to conspiracy, wire fraud, and other charges. Each received prison time and paid $51,000 to the South African representative they threatened to compensate for the extra security he hired.
"This was definitely one of the most unusual cases I've worked: an American company pretending to be a foreign company to scam a foreign government," Fleming says. "We're just glad he didn't get away with it—for the sake of the South African company and the government of Sierra Leone."
Does this kind of corporate identity theft happen often? Not that we've seen, but it's good for businesses to be alert to the possibility. You just never know…