The Economist - Health-care fraud: The $272 billion swindle < 5min

Why thieves love America’s health-care system ... INVESTIGATORS in New York were looking for health-care fraud hot-spots. Agents suggested Oceana, a cluster of luxury condos in Brighton Beach. The 865-unit complex had a garage full of Porsches and Aston Martins—and 500 residents claiming Medicaid, which is meant for the poor and disabled. Though many claims had been filed legitimately, some looked iffy. Last August six residents were charged. Within weeks another 150 had stopped claiming assistance, says Robert Byrnes, one of the investigators. ... Health care is a tempting target for thieves. Medicaid doles out $415 billion a year; Medicare (a federal scheme for the elderly), nearly $600 billion. Total health spending in America is a massive $2.7 trillion, or 17% of GDP. No one knows for sure how much of that is embezzled, but in 2012 Donald Berwick, a former head of the Centres for Medicare and Medicaid Services (CMS), and Andrew Hackbarth of the RAND Corporation, estimated that fraud (and the extra rules and inspections required to fight it) added as much as $98 billion, or roughly 10%, to annual Medicare and Medicaid spending—and up to $272 billion across the entire health system.

The Economist - Scientific research: Looks good on paper < 5min

A flawed system for judging research is leading to academic fraud … As China tries to take its seat at the top table of global academia, the criminal underworld has seized on a feature in its research system: the fact that research grants and promotions are awarded on the basis of the number of articles published, not on the quality of the original research. This has fostered an industry of plagiarism, invented research and fake journals that Wuhan University estimated in 2009 was worth $150m, a fivefold increase on just two years earlier. … Chinese scientists are still rewarded for doing good research, and the number of high-quality researchers is increasing. Scientists all round the world also commit fraud. But the Chinese evaluation system is particularly susceptible to it.

Bloomberg - The African Startup Using Phones to Spot Counterfeit Drugs 5-15min

A Ghanaian entrepreneur thinks he has the answer to Africa’s fake medicine problem ... Drug Lane runs through a market in the heart of Accra, Ghana. It’s past the office towers going up to the east of the central business district, past the pushy vendors with fake Louis Vuitton luggage, and past the women selling trays of raw beef under the midday sun. The alley bristles with signboards for pills, powders, and other substances. One store is packed to the rafters with boxes of painkillers and antibiotics. On the wall are two posters: One is for Coartem, a malaria treatment made by the Swiss drug company Novartis, and the other advertises something called Recharger, supposedly made from the male silkworm moth. ... Like 85 percent of the people selling medicine in Ghana, he isn’t a pharmacist. Most of his stock comes from China, India, and Malaysia, imported by Ghanaian distributors who supply everyone from “licensed chemical sellers” like him to actual pharmacies and hospitals. It’s a system so porous that as many as one in three medicines sold on Drug Lane could be counterfeit, according to the U.S. Centers for Disease Control and Prevention, compared with about 1 percent in the U.S. and Europe. The fake drugs often have no active ingredient at all, or just enough to pass quality-control tests, and visually they can be indistinguishable from the real thing. ... MPedigree sells software that manufacturers use to label individual packs of medication with a random 12-digit code hidden under a scratch-off panel on the packaging. When a person buys medicine, she can text the code to MPedigree for free and get an instant reply telling her whether the product is authentic.

Slate - Unhealthy Fixation 5-15min

I’ve spent much of the past year digging into the evidence. Here’s what I’ve learned. First, it’s true that the issue is complicated. But the deeper you dig, the more fraud you find in the case against GMOs. It’s full of errors, fallacies, misconceptions, misrepresentations, and lies. The people who tell you that Monsanto is hiding the truth are themselves hiding evidence that their own allegations about GMOs are false. They’re counting on you to feel overwhelmed by the science and to accept, as a gut presumption, their message of distrust. ... Second, the central argument of the anti-GMO movement—that prudence and caution are reasons to avoid genetically engineered, or GE, food—is a sham. Activists who tell you to play it safe around GMOs take no such care in evaluating the alternatives. They denounce proteins in GE crops as toxic, even as they defend drugs, pesticides, and non-GMO crops that are loaded with the same proteins. They portray genetic engineering as chaotic and unpredictable, even when studies indicate that other crop improvement methods, including those favored by the same activists, are more disruptive to plant genomes. ... Third, there are valid concerns about some aspects of GE agriculture, such as herbicides, monocultures, and patents. But none of these concerns is fundamentally about genetic engineering. Genetic engineering isn’t a thing. It’s a process that can be used in different ways to create different things. To think clearly about GMOs, you have to distinguish among the applications and focus on the substance of each case. If you’re concerned about pesticides and transparency, you need to know about the toxins to which your food has been exposed. A GMO label won’t tell you that. And it can lull you into buying a non-GMO product even when the GE alternative is safer.

Salon - A most brilliant art world con: A near-perfect scheme, barely unraveled, straight from Hollywood < 5min

Without question, attempting to pass off a counterfeit Rembrandt was an incredibly brazen move on Ely Sakhai’s part. But brazen he was, and he did have a certain advantage in his scheme: the legitimate ownership of the authentic painting that he had his artists copy. The authenticity of his Rembrandt, The Apostle James, was not questioned. Nor was the fact that it was purchased by Ely Sakhai from a reputable source. So when he would offer what he purported to be the painting for sale, it didn’t raise questions about authenticity, if only because those interested in the painting perhaps failed to imagine the nefarious scheme of the seller. Thanks in large measure to his travels in the Far East with his wife, Sakhai made it his mission to establish a steady clientele in Tokyo and Taiwan too. and in June 1997, he sold his Rembrandt to the Japanese businessman and art collector Yoichi Takeuchi. ... Call it karma or serendipity, but Sakhai would be undone by circumstances as simple as his scheme was complex. Not content to simply make enormous profits on the fakes he sold to unsuspecting buyers, Sakhai’s greed led him to sell the original authentic works too.

Boston Magazine - Hook, Line, and Sinker 5-15min

He told potential investors he was about to salvage billions of dollars’ worth of Russian platinum lost inside the Port Nicholson when it was sunk en route to New York from Halifax. It would be easy. Brooks talked about potential returns as high as 100 to 1 and “was throwing out the word ‘guaranteed,’” claims Gorham resident Gary Auger. “He sold it like we were going to be multimillionaires within a year.” ... In Gorham, a town of 16,000 just outside of Portland with a tiny historic district, word of mouth spreads fast and reputation counts for a lot. Important for Brooks, the enterprise enjoyed the backing of one of Gorham’s most respected citizens: John Hardy Sr., a La-Z-Boy store owner and generous philanthropist who was Brooks’s landlord and only partner in Sea Hunters. Many people in Gorham trusted Brooks because Hardy vouched for him. One early meeting about Brooks’s venture took place after-hours at Hardy’s store in nearby Scarborough, with potential investors standing among the La-Z-Boys to hear the pitch. ... Brooks and Hardy raised a total of $5 million in 2008 and 2009 to salvage the Port Nicholson—much of it from small, middle-class investors in southern Maine, some from deeper-pocketed speculators in New York City. ... After a third summer with no returns, investors were growing concerned. Brooks blamed bad weather, rough currents, lost anchors, and equipment failures. “It seemed like every time he was just about to get it,” Auger says, “all of a sudden, he needed more money.” ... The two U-boat hustlers found each other. Michaud helped Brooks search for documents about his alleged Casco Bay U-boat. And Brooks helped Michaud hunt for his elusive sub, until—according to a court filing by Michaud—Brooks’s towfish was eaten by a shark.

Bloomberg - How Much of Your Audience is Fake? 5-15min

Increasingly, digital ad viewers aren’t human. A study done last year in conjunction with the Association of National Advertisers embedded billions of digital ads with code designed to determine who or what was seeing them. Eleven percent of display ads and almost a quarter of video ads were “viewed” by software, not people. According to the ANA study, which was conducted by the security firm White Ops and is titled The Bot Baseline: Fraud In Digital Advertising, fake traffic will cost advertisers $6.3 billion this year. ... Fake traffic has become a commodity. There’s malware for generating it and brokers who sell it. Some companies pay for it intentionally, some accidentally, and some prefer not to ask where their traffic comes from. It’s given rise to an industry of countermeasures, which inspire counter-countermeasures. ... All a budding media mogul—whether a website operator or a traffic supplier—has to do to make money is arbitrage: Buy low, sell high. The art is making the fake traffic look real, often by sprucing up websites with just enough content to make them appear authentic. Programmatic ad-buying systems don’t necessarily differentiate between real users and bots, or between websites with fresh, original work, and Potemkin sites camouflaged with stock photos and cut-and-paste articles.

Bloomberg - The Rise and Fall of Shaolin’s CEO Monk 5-15min

For centuries, the monks of the Shaolin Temple mostly prayed and practiced martial arts, while living off the land and the donations of worshippers. Under Yongxin, their activities expanded to include food and medicine sales, construction, entertainment, and consulting. In 2006 the temple teamed with a Shenzhen media company to produce Kungfu Star, an American Idol-style TV competition. Shaolin announced last year that it would begin developing mobile apps, including instructional kung fu software. The Shaolin Village project in Australia was only the next logical step in the abbot’s expansionist theo-corporate empire. “If China can import Disney resorts,” he said in March, “why can’t other countries import the Shaolin Monastery?” ... One evening I was sitting in a nearby guesthouse, reading a copy of Yongxin’s memoir, when an old man with a long white beard shuffled over. His son accompanied him and said his father had studied at the temple long ago. The old man stepped to the center of the room and performed an elegant kung fu routine, striking and kicking invisible enemies. Here it was, I thought: living heritage, unsullied by crass commercialism. When the man finished, I applauded and went to shake his hand. “Now give me some money,” he said.

Fortune - A Biofuel Dream Gone Bad 5-15min

All told, the company spent more than $600 million. In its brief time in operation, it generated $2.3 million in revenue; when it filed for bankruptcy it listed assets of $58.3 million. ... The next generation of biofuels, made from plants and biowaste (so-called cellulosic materials), which have lower carbon emissions than oil, were a particular passion. Khosla invested hundreds of millions of dollars in about a dozen biofuel and biochemical companies. ... His ambitions were audacious. Khosla declared “a war on oil.” As he wrote in 2006, “I believe we can replace most of our gasoline needs in 25 years with biomass.” He dismissed incumbent energy companies in a 2007 interview as not investing heavily in biofuels because they weren’t “used to innovation and the rate of innovation we are likely to see in this business.” ... Unlike most failed startups, KiOR hasn’t just shut its doors and disappeared into oblivion. Today recriminations, investigations, and litigation continue to surround it. The Securities and Exchange Commission has been examining whether the company made false statements, including on a critical point: the yield of its biofuel (the amount that can be made per ton of wood chips). Two KiOR executives and Khosla himself are also facing a class action suit alleging that company executives misled investors about production volumes and yield. ... The state of Mississippi is also suing Khosla and key KiOR executives on similar grounds, claiming they hoodwinked the state to obtain a $75 million loan.

BuzzFeed - The Tennis Racket 5-15min

Secret files exposing evidence of widespread match-fixing by players at the upper level of world tennis can today be revealed by BuzzFeed News and the BBC. ... It has been seven years since world tennis authorities were first handed compelling evidence about a network of players suspected of fixing matches at major tournaments including Wimbledon following a landmark investigation, but all of them have been allowed to continue playing. ... The investigation into men’s tennis by BuzzFeed News and the BBC is based on a cache of leaked documents from inside the sport – the Fixing Files – as well as an original analysis of the betting activity on 26,000 matches and interviews across three continents with gambling and match-fixing experts, tennis officials, and players. ... Players are being targeted in hotel rooms at major tournaments and offered $50,000 or more per fix by corrupt gamblers. ... as the 2016 Grand Slam season begins on Monday with the Australian Open, former integrity chiefs from within world tennis are breaking ranks to accuse the sport of failing to stamp out match-fixing.

Financial Times - Crime gangs look to clean up as Europe’s black market balloons < 5min

The financial crisis has fuelled a huge expansion of organised crime in Europe with 3,600 criminal syndicates now active across the continent, profiting even from such prosaic products as household detergents, the head of Europol has warned. … Rob Wainwright, director of the EU’s crime-fighting agency, said Europe’s black market in counterfeit foodstuffs, pharmaceuticals and machine parts doubled to a value of about €2bn in the early years of the recession. … The groups are profiting from an increased demand for cheap goods and finding ways to cash in on EU member states’ attempts to boost tax revenues … a new breed of cyber criminals in Russia, Ukraine and other parts of eastern Europe are carrying out increasingly sophisticated online attacks on financial services groups. … In the UK, for instance, the VAT rate increased in early 2011 from 17.5 per cent to 20 per cent, making any fake claim on this tax instantly more profitable. VAT fraud is now estimated to be worth €100bn a year across Europe.

California Sunday Magazine - The Big Cow Con 5-15min

The women, it turned out, didn’t even catch the worst of the damage Arno Smit wrought in the Central Valley. He arrived in the late ’90s — boom times for the California dairy industry. Business had dried up by the time Arno disappeared in 2009, but by then he’d made off with an estimated $12 million from local dairymen he’d duped in a massive fraud. Locals were so embarrassed about how badly they’d been taken by Arno Smit that, for a time, most of them didn’t speak about it, even to one another. Their sheepishness meant the extent of his fraudulent activity in the Central Valley wasn’t fully appreciated until after he’d left — until an investigator named Rocky Pipkin came along. ... The scale and scope of the crimes vary. Honey embezzlement. Almond heists. One time, Rocky and his agents spent months on a sting operation to expose an elaborate organic fertilizer fraud. That case involved a decoy plant where the crooks pretended to make organic fertilizer with fish meal and bird guano; a second plant, fortified by walls of wooden pallets stacked 40 feet high, where they actually made the product with chemicals; and an intricate underground pumping system that would clandestinely fill the “organic” tanks with the conventionally made fertilizer.

Bloomberg - The Super Bowl Coin Toss Has a Dark Secret < 5min

Flipping a metal disk to determine which group of muscle-bound men gets to play with a football first may sound like a nonevent. But like everything else about the Super Bowl, the simple act has evolved into one of the rites of that pseudoreligious ceremony. The first nine coin flips, like the first nine Super Bowls, featured relatively little pomp, just a referee and the competing teams’ captains. From there the stakes grew with the TV ratings, gaining honorary coin-flippers from sitting presidents (Ronald Reagan, via satellite) to military heroes (David Petraeus) and becoming a popular wager for casual gamblers and junkies alike. The betting site Bovada offers more than 500 bets on the Super Bowl—How long will the national anthem last? What color Gatorade will be dumped on the winning coach?—and says the coin toss is among the top five most active. ... Meadlock discovered that Irving, a Montreal native, was well-known to securities regulators around the world. By the time of their initial meeting in Montreal, the elder Kott had survived two assassination attempts, including a prematurely detonated car bomb, described in the Canadian press as mob-related, and had received what was then the largest civil fine in Canadian history, for stock fraud. Irving had also run what Dutch authorities described as the most successful boiler room in the world.

Fortune - Hoaxwagen 5-15min

How the massive diesel fraud incinerated VW’s reputation—and will hobble the company for years to come. ... “Hoax,” of course, is a layman’s word. But plenty of legal terms also arguably apply, including “consumer fraud” and “false advertising.” They are fueling an explosion of litigation. That and the horrific reputational damage are subjecting Volkswagen to one of the severest challenges in its nearly 80-year history. ... The U.S. Department of Justice and the EPA have filed a civil suit that could theoretically subject VW to up to $45 billion in fines (though, in fairness, no one expects penalties quite that draconian). The DOJ and the EPA are also pursuing a criminal inquiry, as are prosecutors in Germany, France, Italy, Sweden, and South Korea. All 50 state attorneys general in the U.S. are also on the warpath, armed with state laws that, nominally at least, are every bit as crushing as the federal law. ... All of that comes on top of more than 500 class actions filed on behalf of owners and lessors of Volkswagen diesel cars ... VW’s misbehavior did not come out of nowhere. The company has a history of scandals and episodes in which it skirted the law. Each time—till now—it has escaped without dire consequences. ... VW is driven by a ruthless, overweening culture. Under Ferdinand Piëch and his successors, the company was run like an empire, with overwhelming control vested in a few hands, marked by a high-octane mix of ambition and arrogance—and micromanagement—all set against a volatile backdrop of epic family power plays, liaisons, and blood feuds. It’s a culture that mandated success at all costs.

Bloomberg - How to Hack an Election 5-15min

For eight years, Sepúlveda, now 31, says he traveled the continent rigging major political campaigns. With a budget of $600,000, the Peña Nieto job was by far his most complex. He led a team of hackers that stole campaign strategies, manipulated social media to create false waves of enthusiasm and derision, and installed spyware in opposition offices, all to help Peña Nieto, a right-of-center candidate, eke out a victory. ... Sepúlveda’s career began in 2005, and his first jobs were small—mostly defacing campaign websites and breaking into opponents’ donor databases. Within a few years he was assembling teams that spied, stole, and smeared on behalf of presidential campaigns across Latin America. He wasn’t cheap, but his services were extensive. For $12,000 a month, a customer hired a crew that could hack smartphones, spoof and clone Web pages, and send mass e-mails and texts. The premium package, at $20,000 a month, also included a full range of digital interception, attack, decryption, and defense. The jobs were carefully laundered through layers of middlemen and consultants. Sepúlveda says many of the candidates he helped might not even have known about his role; he says he met only a few. ... His teams worked on presidential elections in Nicaragua, Panama, Honduras, El Salvador, Colombia, Mexico, Costa Rica, Guatemala, and Venezuela. ... He’s serving 10 years in prison for charges including use of malicious software, conspiracy to commit crime, violation of personal data, and espionage, related to hacking during Colombia’s 2014 presidential election.

Financial Times - The fight against food fraud 5-15min

Thanks to a process involving rapid evaporative ionisation mass spectrometry (Reims), developed at Imperial College London, the computer can identify the smoke’s unique “molecular fingerprint”. This £500,000 machine, together with another £5m-worth of equipment in the Belfast-based Institute for Global Food Security, have inspired the lab’s nickname “Star Trek”, as it boldly pushes technological frontiers in the battle against food crime. The only other Reims machine in the UK is at Charing Cross Hospital, London, where it is used by the oncology department to distinguish between healthy and malign tissue. Here, the machine is being asked to make a formal identification of the fish fillet: is it cod? Or is it something else? ... food analysis is inching ever closer to forensic investigation. Fraud, adulteration and contamination can happen to almost any edible commodity that you care to think of. Or, more likely, that you care not to think of — not just beef burgers with a hidden equine component but staples such as fish, spices and fruit juices. ... “What we eat and where it comes from, generally, we don’t know any more. It’s a very complex web. Every time you have a transaction [in the supply chain], there’s another opportunity to cheat.” And every week his lab picks up several cases of food fraud happening somewhere in the world. ... The institute is monitored by 24-hour security — with food fraud as yet hard to bring to successful conviction, any refinement in methods of detection is a potential threat to organised crime.

Bloomberg - Fantastic Fakes: Busting a $70 Million Counterfeiting Ring < 5min

The bills were from a family of counterfeits that had bedeviled agents more than any other, with at least $50 million worth recovered around the world since 1999. Agents called them the Russian-Israeli notes. This particular variation, with “77” stamped in the lower right corner and a set of subtle errors—smudged chevrons, an extra line under one “THE”—was catalogued as Secret Service Circular 23332. It was so common and so good, agents referred to it as the No. 1 note. ... The heyday of American counterfeiting came in the decades before and after the Civil War, when each bank issued its own currency. Amid the confusion, an estimated 1 in 3 bills in circulation was fake. To stop the epidemic, Abraham Lincoln established the Secret Service on April 14, 1865, the day he was assassinated. (The agency wouldn’t officially be tasked with guarding the president until after William McKinley’s killing in 1901.) Then in 1877, the federal government began printing all currency. The counterfeiting trade never recovered, and today the Secret Service estimates just one bill in 10,000 is phony. But with $1.4 trillion in U.S. currency in circulation, that’s still a lot of money. During the last fiscal year, the agency seized about $146 million in fake bills. ... The Russian-Israelis weren’t “supernotes,” the nearly flawless counterfeits the North Korean government has made. They struck a balance between craftsmanship and cost. Any better, and they might not have been profitable.

Bloomberg - Sixty Million Car Bombs: Inside Takata’s Air Bag Crisis 5-15min

It will take at least three years for Takata and other manufacturers to make enough air bags to replace the company’s defective ones. Because of their chemistry, Takata’s devices become less stable over time. That leaves millions of drivers with cars that could contain an air bag that’s like a ticking time bomb. ... Takata, founded by the Takada family in the 1930s as a textile maker, produced parachutes for the Imperial Japanese Army during World War II. In 1960, Takata began manufacturing seat belts for Japan’s carmakers, which were leading the country’s industrial expansion. It was the only company whose seat belts passed the U.S. National Highway Traffic Safety Administration (NHTSA) crash test standards in 1973. ... Air bags deploy in controlled explosions. Their designs are drawn from rockets and munitions. A former Honda engineer, Saburo Kobayashi, described Takada’s reservations in a 2012 memoir. “If anything happens to the air bags, Takata will go bankrupt,” Takada said, according to the book. “We can’t cross a bridge as dangerous as this.” Eventually, he relented. ... Lillie says he left Takata in 1999, partly because the company ignored his warnings about ammonium nitrate. He says Takata’s executives and workforce were unprepared to take on such a difficult design and manufacturing process. “Takata engineers claimed they had this magic,” he says. “No one else could figure it out, and they had.”

Bloomberg - The Fake Factory That Pumped Out Real Money 5-15min

Biodiesel scams are puny compared with Medicare and Social Security fraud. For sheer moxie, though, it’s hard to beat Phil Rivkin. ... He started Green Diesel in October 2005, two months after President George W. Bush signed legislation creating the Renewable Fuel Standard program. The law directed the EPA to oversee a regulatory regime designed to foster production of alternative transportation fuels, including corn-based ethanol, as well as biodiesel derived from vegetable oils, animal fats, and used cooking grease. ... The statute was a boon to renewable fuel makers—and an irritant to gasoline and diesel refiners—because it required refiners to blend at least 4 billion gallons of ethanol (for gasoline) and biodiesel (for diesel fuel) into their products in 2006, with the amount rising to 7.5 billion gallons by 2012. The program now calls for 36 billion gallons in 2022, with varieties of ethanol representing the bulk of the requirement. Each year, the EPA sets obligations for individual refiners. Most years, ExxonMobil is on the hook to blend the largest amounts of renewables. ... Making biodiesel is simple enough that high school students do it in chemistry class. In a process called transesterification, producers use a chemical catalyst such as methanol to separate methyl esters—the scientific name for biodiesel—from glycerin in such feedstocks as poultry fat. ... Per EPA rules, each gallon of ethanol or biodiesel produced is assigned a 38-digit number—a renewable identification number, or RIN—that travels with the product as it moves from producer to refiner to end user. Ethanol RINs generally remain fixed to their respective gallons throughout the process. But the EPA allows biodiesel makers to strip RINs off their product and sell them separately as tradable credits. Refiners who fall short of blending the statutory minimum of biodiesel into their refined products must buy RINs to make up the difference or pay penalties. ... It isn’t hard to see how Rivkin was able to snooker Fortune 100 companies. To them, Green Diesel—or some equally innocuous broker that had bought RINs from it—was merely an entry on a computer offering to make a problem go away. The refiners needed RINs, Rivkin was selling, and the price was trifling.

Bloomberg - The Disastrous $45 Million Fall of a High-End Wine Scammer 12min

One of the biggest players in the fine wine market, Premier Cru had $20 million in annual revenue in the mid-to-late 2000s. ... wines were being offered on “pre-arrival,” defined on the company’s website as “wines we have purchased (typically abroad) that have not yet arrived. Depending on the particular wine, the arrival time is typically 6+ months to over two years.” ... This practice isn’t that unusual. Pre-arrival is a way for collectors to lock in allocations of highly sought-after bottles that might sell out—and often on favorable terms. To many clients, this arrangement had another advantage. Premier Cru sold mostly young wines; rather than having to age them in their own cellars, buyers were happy to let Premier Cru hold on to them. Better yet, its owner, John Fox, never charged for storage. ... Fox promised clients access to these nuanced beauties through a gray market. This means buying from brokers and other secondary merchants, mainly in Europe, as opposed to working with official importers. Although it’s legal in California, the gray market has its share of shady operators. Poor storage and handling is a common problem. The discounted bottles that Fox obtained, though, were always pristine, according to the four clients interviewed for this story. The trade-off was that Premier Cru was slower to deliver. Other gray-market retailers usually kept customers waiting no more than four to six months; with Premier Cru, the waits ran to years. ... Fox, it would be revealed, easily bilked wealthy bankers, experts who’d amassed fortunes reading the market, of hundreds of thousands of dollars. He led less wealthy oenophiles into deluding themselves they’d found a too-good-to-be-true source. And Fox, now 66, managed a remarkable juggling act for more than 20 years, all while fitting into his complex financial contortions a series of twentysomething girlfriends he found and paid online. In the end, he owed former clients $45 million.

Bloomberg - How Hampton Creek Sold Silicon Valley on a Fake-Mayo Miracle 5min

Hampton Creek never publicly admitted its numbers were wrong. It scrubbed its site of sustainability claims, and the Cookie Calculator vanished. Such quiet backpedaling might be forgivable at many young companies—overeager math isn’t unheard of in Silicon Valley. But at Hampton Creek, it fits a pattern of mistaken or exaggerated claims that may prove to be deliberately deceptive. ... the company deployed a national network of contractors to secretly buy back Just Mayo from grocery store shelves. ... Tetrick used supermarket sales figures much as he used the environmental claims—to raise venture capital ... His pitch: He would liberate billions of hens from the fetid misery of overstuffed cages—and in the process save water and grain and cut carbon pollution. Profane, charismatic, and built like the linebacker he once was, Tetrick became a tenacious evangelist for eliminating animal protein from the world’s diet. ... Tetrick contends that the mayo buyback program was primarily for quality-control purposes and cost just $77,000. ... A former accounting employee who worked with the company’s profit and loss statements says costs for the buybacks were included in several expense categories on the P&L, including one line item called “Inventory Consumed for Samples and Internal Testing.” As buybacks surged in 2014, Hampton Creek expensed about $1.4 million under this unusual category over five months, compared with $1.9 million of net sales in the period.

Bloomberg - An Immigrant-Funded Biotech Center in Rural Vermont? What Could Go Wrong? 13min

Jay Peak had consisted only of a ski area and a roach-ridden lodge. Now it had three hotels, six restaurants, some 200 cottages, an indoor water park, an ice rink, a spa, and a convention center, all tended to by 600 employees. The $280 million transformation had been made possible by a U.S. government program known as EB-5, which allows prospective immigrants to invest $500,000 in hard-up areas in exchange for temporary residency for themselves and their families. Anyone whose investment creates 10 jobs can then become a permanent resident. The only faster way to become an American is to marry one. ... The EB-5 program has opened up all sorts of possibilities since it was started in 1990—mischief, abuse, and fraud among them. Initially it required investors to put in $1 million and show direct evidence that the money had led to those 10 new jobs. But after two years, Congress modified the program to encourage investment in rural and underdeveloped areas, permitting prospective immigrants to invest less money in projects and count “indirect” jobs estimated by economic models. ... These projects get sponsored by federally approved regional centers, which serve as economic-development organizations drawing on EB-5 money. There are now 861 such centers, all of which—except for Vermont’s—are privately run. ... The tangled financing they’d uncovered left more than half of the 731 foreigners who had placed their money with Stenger and Quiros vulnerable to deportation, and threw $83 million that had been invested in the biotech project into limbo.

Nikkei - A look at the global eel trade reveals widespread fraud 4min

The glass eel trade is coming under international scrutiny. ... Already, cultured eels account for more than 99% of the world's supplies. But the farming of these eels is totally reliant on elvers born in the wild. ... Although techniques to create artificial breeders to allow for the full cultivation of eels have been established, commercial production, as in the case of tuna, remains impossible. ... A big problem is that much of the glass eel trade essentially takes place in the dark. ... In the fishing season of 2015, for example, 18.3 tons of baby eels were procured domestically, while 3 tons were imported. The volume of eel caught domestically thus came to 15.3 tons. But data from prefectural governments, once tabulated, puts the total amount of domestic catches at 5.7 tons.

Bloomberg - How Antibiotic-Tainted Seafood From China Ends Up on Your Table 12min

The overuse of antibiotics has transformed what had been a hypothetical menace into a clear and present one: superbugs, bacteria that are highly resistant to antibiotics. By British government estimates, about 700,000 people die each year from antibiotic-resistant infections worldwide. If trends continue, that number is expected to soar to 10 million a year globally by 2050—more people than currently die from cancer. ... Research has found that as much as 90 percent of the antibiotics administered to pigs pass undegraded through their urine and feces. This has a direct impact on farmed seafood. The waste from the pigpens at the Jiangmen farm flowing into the ponds, for example, exposes the fish to almost the same doses of medicine the livestock get—and that’s in addition to the antibiotics added to the water to prevent and treat aquatic disease outbreaks. The fish pond drains into a canal connected to the West River, which eventually empties into the Pearl River estuary, on which sit Guangzhou, Shenzhen, Hong Kong, and Macau. The estuary receives 193 metric tons (213 tons) of antibiotics a year, Chinese scientists estimated in 2013. ... distribution networks that move the seafood around the world are often as murky as the waters in which the fish are raised. Federal agencies trying to protect public health face multiple adversaries: microbes rapidly evolving to defeat antibiotics and shadowy seafood companies that quickly adapt to health regulations to circumvent them, moving dirty seafood around the world in much the same way criminal organizations launder dirty money. ... China’s rates of drug resistance remain among the highest in the world. ... harvested in China but was passed through Malaysia, where it acquired Malaysian certificates of origin. This illegal transshipping, as the maneuver is called

Paleofuture - All American Huckster: The Untold Story of Napoleon Hill, the Greatest Self-Help Scammer of All Time 65min

Napoleon Hill is the most famous conman you’ve probably never heard of. Born into poverty in rural Virginia at the end of the 19th century, Hill went on to write one of the most successful self-help books of the 20th century: Think and Grow Rich. In fact, he helped invent the genre. But it’s the untold story of Hill’s fraudulent business practices, tawdry sex life, and membership in a New York cult that makes him so fascinating. ... The past few decades have been a profitable era for all sorts of self-help and business success books. Napoleon Hill blazed a trail for an entire industry. But Napoleon’s early work is seen as “the source” when people get deep into self-help and business success literature. Hill’s Think and Grow Rich is passed around in certain business and real estate circles like some kind of ancient text. ... The legend of Napoleon Hill has grown and morphed over the years. He really did live an extraordinary life, just not the life that his thousands of disciples over the years have claimed. ... Hill was a product of the late 19th century New Thought movement and the magic that came along with believing that mere thoughts could move mountains, or at the very least cure cancer. ... Hill was involved in countless scams over the years. One of his earliest involved buying lumber on credit, never paying his suppliers, and selling the lumber to others for cash at rates well below market value. ... There are only so many times that a man can be arrested for the sale of unlicensed stock, altering checks, and outright theft, before you have to question the official history.