Last month (Feb. 17, 2010) I attended a lecture at Millsaps College by Mr. Frank Abagnale. The lecture was part of a The Else School of Management's Forum on Ethics. Mr. Abagnale was especially qualified to discuss ethics as between the ages of 16 & 21 he defrauded various companies, particularly airlines out of $2.5 Million by writing fraudulent checks in every state and 26 foreign countries. At various times Abagnale passed himself off as a Pilot, Attorney, College Professor, & a Pediatrician. His escapades were so fascinating that Steven Spielberg turned his life story into a film starring Leonardo DiCaprio and Tom Hanks, "Catch Me if You Can."
During the lecture Abagnale down played the exotic image of travel/swashbuckling portrayed in the film and emphasized the loneliness of spending holidays in hotel rooms around the world, and in dealing with the reality of knowing that one day, he would be caught. The following are some interesting gems I took from from the lecture.
Abagnale was relatively tall and mature looking for a 16 year old. Despite this however, he was crushed when his parents divorced. So much so that during the proceedings he ran out of the court room never to see his father again and going 8 years before seeing his mother. Faced with life alone and armed only with a check book his father had given him, he quickly learned that by displaying a bit of charm, along with proper mannerisms exuding confidence, maturity, and perhaps some moxie, that he could cash checks at any bank, not just his local one. Therefore, when the scant few dollars that he had in his bank account ran out, he simply continued to write checks at different banks. From their he went on to learn how to defraud airlines. From their he began his piloting career though he never actually flew a plane.
It was the cashing of bad checks that gave him the idea to travel. The reason being, there were more banks who didn't know who he was, and because of his mannerisms, he could convince virtually any cashier into cashing a check. He learned that airlines cash checks for airline employees regardless of the specific company for up to $300. A practice that continues today. He mentioned that in some airports, it would take him 8 hours to go to each terminal and cash a check on a given day, and by the time he finished there would be a shift change and he would simply repeat the process.
Abagnale quipped that many assert how smart he was with some of his schemes for defrauding various companies/industries, but he lamented that had he been smart, he wouldn't have done it. However, his modesty has to be excused. He passed himself off as a pediatrician in Atlanta. Living in a singles apartment complex he soon discovered another doctor had moved in. This doctor liked to chat about various aspects of medicine. After becoming completely lost in several conversations, Abagnale took up residency during the day at Emory Unievrsity's library brushing up on the latest studies, information, and technologies in the medical field. He eventually began to talk his neighbors ear off to the point that he was no longer asked about medicine.
Some months later, after passing himself off as an Attorney he was faced with the dilemma of coming clean on his lie, or taking a position with the State's Attorney's office, he passed the Louisiana Bar after a mere 8 week prep course.
The key to Abagnale's "success" according to him was his ability to prey upon people's ignorance, acceptance of normalcy, and assumption of authoritarianism. Few people in an airport are going to question the authority of someone who is dressed like and speaks with the lingo of a pilot. Few people question physicians or attorneys. They are looked upon as authoritative figures.
On the topic of ethics here are some of the more interesting points Abagnale made:
– "White Collar Crime tops $950 Billion annually." As he noted, this would pay for health care, help decrease national debt, and cure many more government problems. But why is the fact that it's "white collar crime" significant? White Collar crime is generally committed by the upper levels of society (E.g., Bernie Madoff). People who have above average incomes, above average intelligence, and above average educations. Which begs the question why?
– One reason, asserts Abagnale, is that technology makes crime easier and faster. It has throughout history and continues to accelerate it.
– Secondly, we have an un-ethical society. There is little ethics taught in the home, schools, or as he correctly pointed out higher education. Few undergraduate programs require even 3 hours of ethics class and only a few graduate programs require scant addressing of ethics, usually highly if only specific to that niche/genre/profession. Even law-schools have a relatively small number of credit hours devoted to ethics, despite the fact that attorneys deal with ethics issues daily.
– "Technology breeds crime." He emphasized this point essentially saying that for every new advance in technology there is a new criminal activity.
– His solution to these problems, was very simple, but perhaps impossible…. simply put, "Character & Ethics stop crime." People with sufficient character who are also ethical will not perpetrate crimes regardless of gains.
Abagnale then discussed his expertise: Identity Protection. Identity Theft has been the fastest growing crime for a number of years. Throughout all his years of crime, Abagnale essentially passed himself off as someone he was not. As a result, after serving jail sentences in France, Sweden, and the U.S. he was asked to help the FBI Check Fraud division. Abagnale eventually developed many of the technologies that allows the FBI to catch criminals guilty of Identity Theft of various kinds. Abagnale eventually began to teach at the FBI training academy and still does so today. He gave these tips to protect yourself from fraud:
1) There are only 4 entities that ever need your Social Security Number; Law Enforcement, Health Care Providers, Financial Institutions, and Municipalities. The gym you belong to with the teeny-bopper in spandex behind the desk doesn't need it.
2) Simple Awareness. He preyed upon ignorance and acceptance of normalcy and authority. Don't merely accept things as being so. Question! Especially when it comes to your money, you have a right to know.
3) He offered the following Top Three Tips for Identity Protection:
A) Shred EVERYTHING! Even catalogs. They have an ID number on them that identifies you to that company, which has information on you, name, address, potentially credit card numbers, purchase habits, etc. Use "Micro Shredders." Straight and Criss Cross shredders can be put back together. He mentioned that at the FBI academy, they teach Special Agents to put together entire documents that have been shredded within a few hours. However, they have not been able to achieve this with micro shredders.
B) Use a credit monitoring service. He said, "Lifelock sucks.," as it merely freezes your credit. He stated, that he didn't want frozen credit, reasoning that he might need his credit in an emergency. He recommended a credit monitoring service that monitored all 3 credit bureaus and notified you immediately upon suspicious activity. I.e., not a monthly report.
C) Don't write checks. Abagnale explained that a check has all the information he needed to become you. Name, address, SS#, drivers license #, bank account #, etc. He recommends paying for things with a credit card for the following reasons: There is zero liability with a credit card. When you dispute a purchase, that purchase is stricken until the investigation by the credit card company and/or law enforcement is complete. He gave the example of the recent Credit and Debit card numbers stolen from Target stores. People who's debit card numbers were stolen were still fighting to get money put back into their accounts and overdraft fees taken off. He suggested a card that gave you points on purchases in order to off-set ATM fees, etc. His primary point was using the credit card as a tool.
Certainly all food for thought. It was also interesting to me that Abagnale is the only person that has worked for the FBI in the capacity as he has. He lamented how easy crime was however. He told the story of how when traveling with FBI agents, because of their security clearance they can bypass security check points and the waiting in line that that entails, he never does however. He chooses to go through the security checks. The reason being he says that invariably, he can find a loophole in the security. Often it is a single person who is either incompetent or who has insufficient character that works for TSA. With some of TSA's recent short comings that point is hard to argue against.He mentioned that there is always, some, small, "insignificant", minor detail that is not adhered or given attention to, and that causes a weak link that could cause a break down in the entire system.
Definitely things to consider in this day of rapid technological advancement.
Also, special thanks to Millsaps College, and the Else School of Management for being excellent hosts.