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The Biggest Fraud Cases in U.S. History (Part 1)

March 28, 2015 by  
Filed under Blog

Insurance and other fraud cases have become the norm in the U.S. and you may hear about them via small newspaper stories and nothing more. However, there have been some very significant fraud cases in the history of the country, ones that made headlines around the world and are still mentioned in popular media regularly. We take a special interest in such cases, because they can teach us many things about fraudsters and how the operate.

Today we will talk about 10 of the biggest fraud cases in American history. It will take more than just one blog post, so we will break the information into two separate blogs. So, here are the first 5 fraud cases that shocked the nation:

10- The Qwest Case

In 2000, Qwest emerged as a leader in the communication industry and its stock skyrocketed. But little did investors know that the CEO of the company, a Mr. Joseph Nacchio, was involved in insider trading. The resulting investigation and case led to a 400 million dollar settlement, which still didn’t cover all the money that people invested in the company.

9- Tyco International

A CEO and CFO duo of Dennis Kozlowski and Mark Swartz siphoned more than $150 million from their company, Tyco International. After a comprehensive SEC investigation, two individuals were found guilty and who are still serving their prison sentences. There were also class action lawsuits filed against the company; the resulting settlements cost the company about 3 billion dollars.

8- HealthSouth

The health industry giant HealthSouth was hit with a fraud scandal when SEC investigated then CEO Richard M. Scrushy of inflating the earnings of the company. He was sued by the investors of the company and asked to pay $2.8 billion.

7- Fannie Mae

Another instance of company big wigs lining their own pockets was observed in the Fannie Mae fraud case. The CEO, CFO and another executive were charged with falsifying the company’s earnings to receive bigger bonuses.

6- WorldCom

A company that once had assets totaling in at nearly $104 billion was cleaned out because of fraudulent accounting and book keeping. The executive at the company hid the losses of the company to maintain the prices of the company’s stock. The class action suit against the company resulted in a payout of about $6 billion.

The five cases above shocked and surprised us at the time, but there are five more cases that we have yet to discuss. If you want to engage any of our insurance investigative services, then fill out a form of the relevant services and our representative will get back to you as soon as possible. And stay tuned for the next part of this blog.


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