Business Crime: Surface tension in publisher's accounts department

Quad / Graphics is a major print supplier to the huge magazine publisher Conde Nast. So it's no surprise that there are big bills to pay.

When Andy Surface opened a bank account in the name Quad Graph, he knew exactly what he was doing. And he knew that Conde Nast's accounts department would be busy.

He wrote them an e-mail with a form of acknowledgement attached to be signed and faxed back to him. In that e-mail, he gave details of the new account.

And, almost immediately, Conde Nast began making substantial credits to the account.

After several weeks, the printer asked Conde Nast why no payments were being received. The fraud was promptly uncovered. Then came a strategic error: Conde Nast reported the fraud to the FBI. They went to the bank where the account was held and found that all the USD8 million was still there. So they froze the account.

That leaves Conde Nast to find USD8 million to pay the printer.

So now the publisher is suing the fraudster for the return of the money which the Feds hold.

Nigel Morris-Cotterill, Head, The Anti Money Laundering Network (and ultimate owner of ChiefOfficers.Net) says "it's not always the best plan to go straight to the police. If you think you know where the money is, then get to it first, get a court order over it and then report it. Otherwise it's evidence and that means it can be tied up for years while a trial concludes. Yes, this really irritates the police who use confiscation figures to boost their image. But it's your money not theirs and you need to protect your business. They can evidence the crime from records: they don't need the actual money to secure a conviction."