The downside to old-school fraud in digital age

Pardon me while I take a moment to be amazed at what people try to get away with. I don’t mean Donald Trump and other high-flying scammers. I mean average people, our fellow travelers through middle class Maryland, and the occasional doctor.

Once upon a time, it seemed possible, however illegal, for the sleazy, greedy and desperate among us to get away with lying on mortgage applications, setting up phony bank accounts, hiding income to avoid taxes or making false disability claims.

Certainly some people got caught in the past through the hard work of auditors and tax agents. One of them, Pete Twardowicz, was a local legend for his skills at rooting out political corruption and corporate crimes as a Baltimore-based agent for the Internal Revenue Service.

But that was before the world became wired, before transactions became electronic, before technology and federal laws increased scrutiny of just about everything we do with money.

And yet, countless cases of sleaze, greed and desperation continue to come through the courts — in Maryland, just about every day — suggesting that certain people have not adjusted to the higher risk of getting caught and going to prison.

Maybe, as always, they just decide to live dangerously. Maybe they figure, in this age of grotesque income inequality and

Trumpian impudence, they might as well give white-collar a crime a try. Still, it amazes me. In pleading guilty last month to fraud schemes, a woman from Grasonville, in Queen Anne’s County, admitted to spending $175,000 of embezzled funds “in a local bingo hall.”

In more than 40 years of watching criminal cases that come through the U.S. District Court in Baltimore, that’s a first for me. I never considered bingo as potentially addictive as, say, slots or sports betting, even the daily lottery.

Let me quickly add, less you get the wrong idea, that having cash for bingo was not the sole motivation for the Grasonville woman’s fraud schemes. According to the U.S. Attorney’s Office, she embezzled about $900,000 from the trade association where she worked as an administrator and bookkeeper for eight years, and she dropped a lot of the cash in stores and restaurants.

The same woman faces sentencing in September for taking $75,000 in Social Security disability benefits she didn’t deserve and another $140,000 in fraudulent disability payments from an insurance company. She also evaded nearly $250,000 in federal taxes. She faces prison time, big restitution and the forfeiture of assets.

Trying to get away with this stuff seems almost intentionally self-destructive.

Another case, much bigger in terms of loot, came through federal court in February — an old-school kickback case involving the owner of a Harford County company that made industrial barrels and drums.

The 78-year-old owner of the company cut a deal to sell his Maryland-made drums to a New York company that produces oils and extracts for the food industry. The New York buyers suggested that the owner of the Harford County company submit bogus invoices for more drums than he actually sold them. They, in turn, would falsify invoices and split the extra funds. That’s a classic kickback scheme.

According to the U.S. Attorney’s Office, it lasted eight years and reached $20 million in fraud.

I mean, wow.

Please tell me what the brain is thinking here. That no one at the New York company will notice $20 million in drums that were never received? Did all three conspirators think that, while the scheme might not last, it could let them live large for a few years? Did the near-octogenarian owner of the barrel-and-drum company think he might as well have a blast because a federal judge would never send a man his age to prison? (He faces 23 years behind bars; sentencing has not yet been scheduled.)

A far more sinister kickback case ended in February with the sentencing of a Baltimore County doctor who, at age 65, decided he could use an extra $66,000 from a drug company that helped fuel the nation’s opioid crisis.

The doctor, who was associate medical director of a pain management practice in Owings Mills and Towson, took kickbacks for prescribing a fentanyl-based drug to patients who did not fit the Food and Drug Administration’s criteria for the pain medication. The kickbacks to the doctor were disguised as “honoraria” for speaking engagements on behalf of the pharmaceutical company. Federal prosecutors called that arrangement a “sham.”

Imagine wasting a medical degree and your reputation for what, in the long run of a doctor’s career, was a relatively small amount of money. Imagine agreeing to such a scheme in the midst of a national epidemic of fentanyl-related overdoses, with increased scrutiny of the opioid industry.

I guess some people are built for scheming up ways to augment their incomes without moonlighting at Starbucks.

But, compared to cyber crimes and all the identity theft that continues to occur, this kind of scheming seems unsophisticated, amateurish — as I said, old-school conniving in the digital age.

Maybe some people assume that, in a country of 330 million, the feds can’t possibly catch them.

Or maybe they’re stupid. I mean, is there really any difference between someone who thinks they can practice old-school fraud in the digital age and the bank robber who writes a stickup note on his personal stationery? For certain defendants, I say, again, the Rodricks Plea — guilty, but mostly stupid — should be an option.