Fraudsters eye huge stimulus pie, consultant says Companies will face extra requirements to prevent problems

By Greg Morcroft, MarketWatch

NEW YORK (MarketWatch) -- Swindlers, con men, and thieves could siphon off as much as $50 billion of the government's planned stimulus package as the money begins flooding the economy in coming months, according to David Williams, who runs Deloitte Financial Services Advisory and counsels clients on fraud prevention.
Williams predicted that about $500 billion of the total $787 billion stimulus would be channeled into the traditional procurement network for government contracts, while the rest will be spent directly by the government or outside the corporate network.
"The rule of thumb typically is that of the about $500 billion worth of money that's going to run through the procurement process, somewhere between 5% and 10% of that usually finds it way into potential problems," Williams said. "That's sort of the benchmark that I use."
Companies will face increased pressure to try to stem the tide, and need to be prepared to safeguard data as well as the cash, according to Williams.
Williams said this week that the money flowing from the current stimulus package is particularly vulnerable to fraud because almost all movement of money is now done electronically.
"We're telling our clients to be very careful and to make sure their firms are resilient in terms of dealing with the potential opportunities for fraud and waste," Williams said.
That means keeping an eye out for the traditional scams such as billing for services not performed. But it also means firms must become even more diligent about electronic records and network security.

CIA Recruiting Laid-Off Bankers in NYC
Thursday, June 18, 2009 11:07 PM

NEW YORK Laid off from Wall Street? The CIA wants you -- as long as you can pass a lie detector test and show that you are motivated by service to your country rather than your wallet. The Central Intelligence Agency has been advertising for recruits and will be holding interviews on June 22 at a secret location in New York. "Economics, finance and business professionals, if the quest for the bottom line is just not enough for you, the Central Intelligence Agency has a mission like no other," one radio advertisement for the agency says.
"Join CIA's directorate of intelligence and be a part of our global mission as an economic or financial analyst. Make a difference in your career and for your nation," it says. Ron Patrick, a spokesman for recruitment and retention at the CIA, told Reuters Television the agency had received several hundred resumes so far from applicants ranging from people just out of graduate school to laid-off bankers. "It's going to be a very different use of their skill set than perhaps they've used on Wall Street," Patrick said.
Recruits will have to pass rigorous background and medical checks, as well as a polygraph, or lie-detector test. ( learn more at )

Hyperinflation Could Hit US In 5-10 Years:

by: Krystina Gustafson

Special to CNBC.com CNBC.com

19 Jun 2009 03:44 PM ET

The US is headed toward hyperinflation, and within five to 10 years it could have inflation rates of 10 to 20 percent, said Marc Faber, editor and publisher of the Gloom, Boom & Doom Report.
"In every society, when you have large fiscal deficits combined with easy monetary policies … the likelihood that you will have high inflation is very, very high," Faber said. "And it happens very quickly." These numbers rise so speedily because the government "massively" understates the country's rate of inflation, Faber said. To get a true reading, he said, people need to ditch core inflation numbers and include CPI in their analysis. "It’s a lie what they publish," said Faber. "If you underweigh education costs, and if you underweigh health care costs, then you come to a totally different result." In such a volatile market, Faber said the safest place to invest is in equities or assets. "I'm not very bullish about real estate prices in the U.S., but I'd rather be in real estate than in 30-year U.S. bonds."© 2009 CNBC.com

We have created a monster … banks with access to public funds In Economic Crisis Iain Macwhirter

Sunday HeraldJune 14, 2009

“Readers of the nation’s press over the last six months might have been forgiven for believing that there was an economic recession. Headlines like: Doom Britain, It’s Worse Than The Great Depression and Mothers Start Selling Children For Food might have led casual readers to conclude that Britain was in a very severe financial crisis. We would like to make it clear that there was not a jot or tittle of truth in these reports and that the British economy is bouncing back, house prices are booming and happy days are here again. On behalf of all newspapers and politicians, we would like to apologise for any confusion. Mr Robert Peston of the BBC has agreed to a 40% salary reduction, which he will donate to charity.”

It is the most dramatic turnaround in economic history: from bust to boom in a matter of weeks. The pound is up, oil prices are up, consumer confidence is up, bank lending is up and house prices rose 2.6% in May. That last figure is the most astonishing, since hardly any houses are actually being sold right now, and the vast majority of mortgages require a 25% deposit. But who am I to argue with the green shoots consensus? Killjoys might point out that unemployment is still growing fast, that most of our manufacturing industry is collapsing, and that personal and public debt levels remain at intolerable levels. You could point out that the Baltic Dry Shipping index - a measure of world trade - has collapsed again. But the word has gone out that the recession has “bottomed out” and anyone who departs from it is seen as talking down the economy.
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