Fraud Watch

THE COUNTERFEIT COUNT WHO CONNED CAPONE

Two columns back I wrote about the "Counterfeit Count", Victor Lustig, the legendary con man who sold the Eiffel Tower twice. This big time bunco artist who led a life of endless, highly profitable, schemes and scams, once said, "Life seems empty and depressing when I don't have a new sucker on the horizon. I really don't understand honest people, they lead desperate lives full of boredom".

Besides the Eiffel Tower scam, the count operated enough bogus investment frauds to fill a dozen columns. I'm going to tell of two, the "fabulous money making machine" and a scam he ran on Al Capone.

While touring the United States, the nefarious knave made hundreds of thousands of dollars selling fake counterfeit money making machines. You put a $20 bill in, wait 24 hours for "secret mechanisms and inks" to set and dry, and start cranking out new $20s on "special" treasury paper cut to size.

Working by himself, and occasionally with a "steer man", (someone who is very good at spotting gullible people) the cheatin' Czech lured suckers to hotel rooms where he displayed the magic machine. Using his gifts of verbal persuasion, and an extraordinary understanding of human nature, he made a show of placing a $20 bill in the machine, along with a stack of the "special" paper. After waiting 24 hours, he cranked out new $20s. However, unknown to the astonished mark, a stack of real $20s was placed in the machine earlier, ready to be cranked out.

This machine never sold for less than $4,000 and most often for $20 - $25,000 and once for $43,000. He sold a lot of them.

While passing through Chicago, which was run by murderous gangster Al Capone, Lustig approached Big Al and offered a deal whereby he could double his money in 60 days. Capone put up $50,000. The count merely put that money in a safe deposit box, and went to New York. After 60 days, Lustig went back to Capone, and apologized for losing his money in an investment gone bad. As you can imagine, the homicidal Big Guy became irate and began relating all of the new, varied and interesting tortures that Lustig was about to experience.

However, the count quickly interrupted and told Capone that since he had invested solely on his faith in the count, he felt obligated to return Capone's stake. He handed over Big Al's own money. Capone was astounded. Again Lustig apologized and mentioned losing all of his own money in the scheme. As he turned to leave, Capone stopped him and said he was sorry about the count's losses, then peeled off $5,000 to "get back on your feet" with. This happened to be Lustig's target in the first place.

The count was later arrested on counterfeiting charges and while awaiting sentencing, escaped jail through a sixth floor washroom window. While climbing down a rope made of bedsheets, the noon hour lunch crowd spotted him and a mob formed. He made it down the last five stories by imitating the elaborate motions of a windowwasher, and on reaching the ground, ran off.

He was at large for several months and was eventually caught, tried, and sentenced to 25 years imprisonment. He died in prison in 1947.

Nolan Young is a private investigator with Bay Street Investigations, and also a fraud consultant to Paymaster Corp.