Larry C. Adams, CPA
Phoenix, Arizona USA
Certified Public Accountant
Certified Fraud Examiner
Telephone (602) 995-8008
November 2001 Topics
Bribe Payers Index (BPI),
Corruption Perceptions Index (CPI), Examine, Gundeck, G.D., Pencil-whip,
Radio-in, Laddering, Spike a Job,
Yo-Yo Deal, Spot Delivery, and
Conditional Spot Financing
Businesses in Sweden,
Australia, and Canada are the least willing to pay bribes.
Fraud In Other Words: Professional Jargon and Uncensored Street Slang
By Larry C. Adams, CFE, CPA, CIA, CISA
Bribe Payers Index (BPI) /
Corruption Perceptions Index (CPI)
The Bribe Payers Index ranks 19 leading exporting countries in the
degree to which their companies are perceived to be paying bribes to win
international business. Businesses in Sweden, Australia, and Canada are
the least willing to pay bribes in the 1999 BPI. The United States only
9th. China, South Korea, Taiwan, and Italy rank at the bottom
because their businesses have the greatest propensity to pay bribes. The
Corruption Perceptions Index ranks 99 countries in the degree to which
corruption is perceived to exist among public officials and politicians.
Public officials in Finland, Denmark, and New Zealand are perceived as the
least corrupt in the 2000 CPI. The United States ranks 14th.
Nigeria, Yugoslavia, Ukraine, and Azerbaijan rank as the most corrupt.
Transparency International (TI) commissioned Gallup International to
conduct thousands of in-depth interviews for the index surveys.
Transparency International is a global anti-corruption organization
founded in 1993. TI is based in Berlin and has national chapters in 70
www.transparency.org, June 20, 2001.
To analyze something in detail in order to understand or expose it. An
scale has a pointed tongue in the center to indicate
which tray outbalances the other. In Latin, the tongue of a scale is
called examen or examinis. “To examine” means to watch this
indicator and weigh in the balance.
Jordan Almond, Dictionary of Word Origins: A History of
the Words, Expressions, and Clichés We Use, Citadel Press, New York, 1985,
Gundeck (G.D., Pencil-whip, Radio-in)
Navy slang meaning to hide
something, to falsify a report, or to cut corners. In the 18th
century, naval officers and chiefs frequented the breezy main deck of a
warship. To hide something from their superiors, sailors would bypass or
avoid them by walking on the lower gun decks where the cannons were
situated. Today, gundecking is committed by sailors, contractors, and
vendors. A common motive for gundecking is to hide poor maintenance,
shabby workmanship, or work that is never completed. “Pencil-whipping”
refers to intentionally falsifying logs or records by filling in
the blanks just before an inspection. “Radioing-in” refers to logging in
work before it is performed.
Noel and Beach, Naval Terms Dictionary, Naval Institute
Press, Annapolis, Maryland, 1966.
A questionableWall Street practice that takes advantage of customers
eager to gain access to an IPO (initial public offering) and subsequent
hot IPOs. Underwriters require their customers to purchase additional
shares of a company’s common stock in the aftermarket at predetermined
prices, progressively higher than the IPO value. If a client wanted a
block of 20,000 shares, an underwriter might insist the client buy a
portion of the stock after the sale of the original offering, otherwise
the client might only be allocated 5,000 shares. Laddering enables the
underwriters and some of their customers to reap enormous profits by
buying stock at the IPO price and then selling it later for a profit at
artificially inflated aftermarket prices. The pattern is a modest IPO
price followed by a fast price run-up, before a swift decline. Some
and underwriters also require their customers to kick back a portion of
their profits in the form of secret commissions. These excessive and
undisclosed commissions are calculated after the fact, based on how much
profit each investor had made from his IPO stock allocation. The
Securities and Exchange Commission (SEC) has warned banks against tie-ins.
Underwriters are prohibited from soliciting purchases of unregistered
securities and aftermarket shares before an IPO has occurred.
Pete Gallo, “PlanetRx and Underwriters Sued by Hedge
Fund Over IPO Laddering,” April 09, 2001,
June 20, 2001.
Spike a Job
To engage in a short con (a petty hustle) in which a crooked
contractor starts work on a house without authorization and is then paid
to finish the job.
Tom Dalzell, The Slang of Sin, Merriam-Webster,
Incorporated, Springfield, Massachusetts, 1998, pages 256, 269.
Yo-yo Deal (Spot Delivery, Conditional Spot
A financing scam frequently used by an unscrupulous auto dealer.
“Drive it off today” is the sales pitch. A consumer signs all documents
for the purchase or lease of a vehicle, and obtains insurance on the
vehicle. The consumer gets any terms he wants, but is unaware of the fine
print which allows the dealer to change them. The buyer takes immediate
delivery “on the spot”, and drives off in the vehicle thinking the
transaction is complete. But, the dealer does not finalize the
transaction. The dealer calls him back 5 or 10
days later and says “I
can’t get your financing approved, so you have to come in to sign a new
financing contract.” When the consumer returns to the auto dealership, the
dealer demands more down payment money and raises the interest rate and
monthly payments considerably. If the consumer refuses to sign the new
financing agreement, he must return the vehicle. Often the consumer is
unable to recover his trade-in vehicle because the dealer quickly sold it.
The consumer winds up with a more expensive financing agreement, a
different car, or no car at all.
Bob Golfen, “Car Buyer’s Best Friend: “Bulldog” Takes a
Bite Out of Auto Fraud,” Arizona Republic, Phoenix, Arizona, June 20,
2001, pages D1, D8.
Adams, CFE, CPA, CIA, CISA,
is a consultant, author and e-mentor in Phoenix, Arizona. He founded the
ACFE’s Arizona Chapter and earned the Distinguished Achievement Award.
His e-mail address is:
Copyright 2001 Larry C. Adams.
All rights reserved.
|This article is in the
November 2001 issue of The White Paper: Topical Issues on White-Collar Crime,
the Journal of Association of
Certified Fraud Examiners.
the book - Fraud In Other Words
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