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Double Your Money – Part Twenty One

Victor Lustig (1890 – 1947)

For the prospective fraudster, nirvana may be the ability to print your own money whenever you want. Our old friend, Victor Lustig, went one further. He made his money by selling the prospect of being able to print your own money.

Lustig would carry around with him a box of tricks which he called a money-printing machine. When he had piqued someone’s interest he would wheel the small box out and give a demonstration of its capabilities. It would whirl away and eventually a perfect hundred-dollar bill would pop out. The mark would be hooked and be anxious to get their hands on the machine that could print their fortune. Money was no object and Lustig was able to command a price of up to $30,000 for a machine.

There was only one problem”, confessed Lustig. “The machine is very slow and takes six hours to print a bill”. Sure enough, the machine whirred away and after twelve hours just two more bills had been produced. But the mark soon ran into a bigger problem. Thereafter the money-printing machine only spewed out blank pieces of paper. Of course, sitting in the back of the machine had been three $100 bills and once they had been ejected, there was nothing left. By the time the mark had realised that they had been scammed, Lustig was long since gone. A classic example of where there is greed, there is someone keen to exploit it.

Lustig had the good sense to carry out only a gentle scam on the notorious American gangster, Al Capone. He interested Scarface in an investment and took $50,000 from him. This he put in a deposit box for safe keeping. Two months later he went back to Capone and told him that the deal had fallen through but that he was able to return him his investment. The grateful gangster, impressed by Lustig’s seeming integrity, handed him a tip of $5,000. Naturally, there was never ever any investment and what Lustig wanted to do was extract some money from the gangster without incurring his wrath. His scheme worked perfectly.

But even successful and confident tricksters like Lustig are influenced by the lure of the big one. In 1930 he teamed up with a Nebraskan chemist, Tom Shaw. Shaw’s job was to produce the engraving plates required to produce counterfeit notes. Lustig then developed a group of associates through whom he passed hundreds of thousands of dollars in counterfeit notes into circulation. So successful was Lustig in keeping the lid on his operations, even his associates did not realise that they were handling hot money.

All good things, however, must come to an end and what did for Lustig was the jealousy of his mistress, Billie May. Thinking that he was having an affair with Shaw’s mistress, she made an anonymous call to the police, tipping them off about Lustig’s activities. He was arrested and although his briefcase only contained clothes, expensive (natch), the police found a key in his wallet. This opened a locker in the subway station at Times Square where the detectives found hidden some $51,000 of counterfeit money and the engraving plates.

The day before his trial, Lustig escaped but was recaptured some 27 days later in Pittsburgh. He was sentenced to 20 years in Alcatraz prison and died of pneumonia in 1947. Lustig was a colourful character and the authorities couldn’t quite come to terms with his profession and expertise. They recorded his occupation on his death certificate as an assistant salesman!

Double Your Money – Part Twenty

Victor Lustig (1890 – 1947)

Born in Hostinne which was in the Austro-Hungarian Empire but is now in the Czech Republic, Lustig has been called America’s greatest fraudster. Whether that was really the case or not, he made a career out of scamming, his piece de resistance being the sale of the Eiffel Tower, not once but twice.

Paris in 1925 was emerging from the doldrums of the First World War but its iconic landmark was proving a drain on the civic resources, requiring constant maintenance and decoration. Reading a newspaper article about the city’s dilemma over the tower, which was only ever intended to be a temporary structure, gave Lustig an idea. Using forged government papers and posing as the deputy-general of the Ministry of Posts and Telegraphs, Lustig invited the heads of six of the city’s scrap metal dealers to a meeting at the Hotel de Crillon.

There he laid out a tale of woe. The bill for the upkeep of the Eiffel Tower was so high that the authorities had only one course of action – to demolish it and sell the structure off for scrap. Because the public outcry would be great if news of the plan leaked out, the scrap metal dealers, who had been selected for their probity, had to keep everything under their chapeaux. The dealers would have the opportunity to bid for the business. Only when the demolition began, would the public be aware of what was going on.

The dealers were then taken on a tour of inspection, giving Lustig the opportunity to see who was the keenest for the business. He identified Andre Poisson as his mark – Poisson was struggling to break into the big time and saw this as his opportunity. He took the bait. La Poisson, however, smelled a rat and wondered why everything was being transacted with such speed and secrecy. Lustig offered Poisson another meeting in which he revealed that times was hard, it was difficult to make ends meet on an official salary and if Poisson could see a way to grease his palms, he would be guaranteed the contract. The sum mentioned was a whopping $100,000.

Poisson who had fallen for the scam hook, line and sinker went to his office, returned with the money and, surprise, surprise, Lustig and his colleague took a train to Vienna with a suitcase of money to let the dust settle. Poisson was so embarrassed by being duped that he didn’t report the scam to the police. Lustig had chosen his mark well.

As the police had not been alerted, Lustig returned to Paris and, astonishingly, convened a meeting with another group of six scrap dealers, rolling out the same story and scam. This time, the chosen mark became suspicious and took the forged documentation to the gendarmerie. By the time they came a-calling, Lustig and his accomplice had made good their escape.

To Lustig is attributed the Ten Commandments for Con Men. As well as being a good listener, never looking bored and being tidy and sober, the master fraudster recommended agreeing with the political and religious views of your victim. Key to a successful scam was never prying into the mark’s personal circumstances – they will reveal them themselves – and never boast. Advice to lock away in the memory, for sure.

We will look at some of Lustig’s other scams next time.