in this issue

Jerome Mayne, our contributing author, writes about the five valuable lessons he learned along the way after serving 21 months in federal prison.


How did I wind up in prison? Well, I didn't start out with a scheme or a plan, but I definitely got involved.

In 1994 I had a career as a loan officer. I was approached by a group of investors who were buying and selling homes. Over the next several months I worked on loans for their buyers and sensed the documents provided by these buyers were not on the up–and–up. I never acted on my suspicions. I didn't ask, and they didn't tell.

It did not take me long to decide that I didn't want to do business with them anymore.

I stopped accepting any new loan applications. Before I completely cut all ties with them there was one last transaction that sealed my fate. I bought a house, put it on the market at a higher price but couldn't find a qualified buyer. I called the investors for help. They found a buyer for my house. We netted around $20,000 from the sale and split it, and we all went our separate ways.

At the end of 1998 the FBI arrested me outside of a restaurant and charged me with conspiracy to commit mail fraud, wire fraud and money laundering. These charges were in connection with my involvement in the mortgage fraud scheme perpetrated by the investors, who I worked with four years earlier.

My suspicions about the buyers proved to be true. They were straw buyers who defaulted on the loans I closed resulting in more than $200,000 in losses for the lender. I fought the charges but I eventually plead guilty. I received a 21–month sentence, which started November 4, 1999.

I'm often asked why I kept working with these guys for all those months. Some people say it was greed; but I honestly don't think so. I was making plenty of money. It was quite a while ago, but I think I worked with them because the difficult loans proved to be a challenge, and I liked them. The head of the scam had befriended me and I didn't want to let him down.

I have learned some valuable lessons from my journey and have summarized a few of them below. Hopefully they will help you avoid taking the path I walked on. Or, you can take the following Action steps and you too can change your career and your life forever; for the worse.

1) Subscribe To 'Business As Usual' Attitudes

I know your mother told you one white lie could lead to another, then another and another. Before you know it you're in way over your head. Have you ever cut a corner by disregarding a policy or procedure at work? For some, refusing to cut corners can seem exceedingly difficult when they are trying to keep their job or retain clients, but policies and procedures are in place to protect their company. Cut a corner once and it becomes easier and easier to keep cutting.

Action: Don't listen to your mother. Go with the flow and cut corners.

2) Don't Just Turn a Blind Eye—Help Out

Studies have revealed that a significant amount of reported fraud losses involve collaboration, collusion or knowledge from industry insiders. In other words, someone on the inside; the person keeping the books or adding up the numbers suspects, knows or is outright helping facilitate the scheme. If you're a licensed professional it is unlikely you are being completely duped by someone at your own game.

Action: Make a conscious decision to ignore your gut feeling and assume your instinct is telling you to do the wrong thing, first.

3) Trust Everyone

This step addresses the balance of the significant amount of reported fraud losses I refer to in step 2. Confidants, or con–men for short, are good at their craft. They construct a façade; a persona of sincerity and honesty that for the most part will not be transparent. They will become your friend. They don't care about you, your company or your family. They will use every resource available to get you to do what they want; assist them in perpetrating a scam. They actually can beat you at your own game.

Action: Trust everyone.

4) Justify Your Unethical Actions

My involvement in the scam included several justifications. I told myself, since the kingpin did not explicitly tell me that the documents I received were fake, it was not my job to act on my suspicions and verify them. After all I didn't create any fake documents. I even told myself that if the documents were fakes, it probably wasn't going to hurt anyone or create more risk.

Action: Lie to yourself until you feel okay.

5) If A Money Tree Falls In The Forest And No One Is Around, You Can Take All The Money

This might seem like a no–brainer but you'd be surprised. Being a felon, I've rubbed elbows with some unsavory sorts. I'd say at least half of them felt they committed fraud by need, and felt it was justified. They knew of a loophole or weakness in the system but never exploited it because it would be wrong, unethical and perhaps even criminal. For weeks, months or years they never took advantage of the loophole. Then one day, BAM! The sick aunt broke a hip, had no health insurance and the temptation was too great. There was an opportunity and a need, and no one would ever know.

Action: The money is yours as long as nobody is looking.

Some may feel the above steps can be placed in categories ranging from big to small, and severe to not so severe. Know this: Every corner that is cut, trims a little piece from the soul; and it is almost impossible to get that back. There is no gray area; there is only a thin line. You are either on one side of it or the other.

My sentence ended in March 2001. But my loss of self–confidence, self–esteem and the stigma associated with being a felon did not. Once a person with fearless entrepreneurial characteristics, I was now scared to apply for a job as a copier salesman.

I eventually found some confidence and self–respect, or they found me and I've been able to contribute in a useful way to society. My career and passion today are speaking at conferences and conventions about the consequences of fraud and the importance of doing the right thing; helping professionals make the right decisions when the right decisions aren't easy.

Jerome Mayne is an international keynote speaker on fraud and ethics. He is the author of the book, Diary of a White Collar Criminal and co–author of Mortgage Fraud and Predatory Lending — what every agent should know (Kaplan Publishing). He has worked with dozens of companies and associations around the country helping business professionals to stay out of prison. To hear all the details of the mortgage fraud scheme and his account of what it was like on the inside, book Jerome for an upcoming event, he can be reached at,

His books are available on Amazon.

© 2017, Jerome Mayne



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