At the Crossroads: Where Non-Fiction Meets Fraud

AUTHOR'S POST

Mandy Moody
ACFE Social Media Specialist

After 10 years of watching my best friend lose more and more hours of his days to alcohol and drug abuse, visiting him at the various rehab centers he frequented and desensitizing myself to loading a dishwasher full of bent spoons and used needles, I found it unbelievable to hear in the summer of 2006 that he was successfully completing a recovery program.

Maybe it was curiosity, maybe it was the angst of being in my early 20s, but for whatever reason, I wanted to understand why these last 10 years of his life had gone the way they had. I wanted to know why a guy who had everything made countless decisions to lose it all. And, most importantly, I wanted to understand recovery: the good, the bad and the ugly. That is when I bought, and savored, A Million Little Pieces by James Frey.

It wasn’t that he successfully conned Oprah, which I must say is in itself a ballsy move, that angered me. (Oprah can hold her own.) It wasn’t the lies or embellishment of a life as an addict and criminal that “kept me up at night.” It was the fact that the personal connection I made with Frey when I read his “memoir” turned out to be a connection between me and a character. Don’t get me wrong, Frey was a brilliantly developed character that I identified with and grew compassionate for, but he turned out to be a creative writer, not the autobiographer I so anxiously wanted to understand. 

Yesterday, USA TODAY announced that two Montana lawmakers hit Three Cups of Tea author Greg Mortenson and his charity, the Central Asian Institute (CAI) with a class-action lawsuit claiming “fraud, deceit, breach of contract, RICO (Racketeer Influenced and Corrupt Organizations Act) violations and unjust enrichment.”

The suit, most likely to be the first of many, comes just weeks after “60 Minutes” reported on an investigation into CAI-allocated funds being used for Mortenson’s personal use, as well as parts of his acclaimed non-fiction novel being speckled with fiction. Even Jon Krakauer, author of Into the Wild, published an online article, Three Cups of Deceit, outlying Mortenson’s fabrications and lies in his best-selling book.

These two incidents got me thinking about the crossroads at which a non-fiction author must stand when deciding whether to stick to the facts or add a little, or in these cases a lot, of poetic liberties. When does non-fiction become fraud? Also, does the fraud triangle exist for authors?

P.S. For those wondering, my friend has been sober for five years and he is doing amazingly well. I am thankful for him every day.

Rising to the Challenge

GUEST BLOGGER

James D. Ratley, CFE, ACFE President

Remember this scene in The Godfather, Part II? In 1959, pre-Castro Havana, mafioso Hyman Roth boasts, “We now have what we’ve always needed – partnership with a government…We’re bigger than U.S. Steel!”

Real-life gangster Meyer Lansky actually made that claim. Rising to the challenge, Congress and President Nixon created the Racketeer Influenced and Corrupt Organizations Act (RICO) in 1970.

Fast forward to New York’s Tribeca 2010 Film Festival, in which a Russian documentary, Thieves by Law (Vory v Zakone), earned praise for its chilling interviews of wealthy, vicious underworld bosses. These vory – high-ranking criminals – are among those who banded together in communist prisons and strictly adhered to their own law – a thieves’ code of conduct.

When the Soviet Union collapsed, released vory drove forcefully into the resulting power vacuum, establishing alliances with corrupt government officials and obtaining funding for criminal enterprises. Many left their homeland on cross-border quests for plunder. One of their specialties is healthcare fraud.

This Time It’s Different

The movie may be out, but the vory are far from defeated. Case in point: On Oct. 13, the U.S. Department of Justice indicted 44 alleged members and associates of an Armenian-American organized crime ring on charges related to more than $100 million in fraudulent Medicare billing – the largest such scheme ever perpetrated.

The defendants allegedly stole the identities of dozens of physicians and thousands of Medicare beneficiaries while operating at least 118 phony clinics in 25 states. The primary suspect, a California resident, migrated to the United States from Armenia, a former Soviet republic; the FBI believes he is a vor.

Meanwhile, our nation’s healthcare system is undergoing enormous changes under The Affordable Care Act of 2010. The new law encourages doctors and hospitals to join forces in controlling medical costs, and offers bonuses if they succeed.

Some provider networks are eager to consolidate without undue hindrance. As quoted in the New York Times, Charles N. Kahn III, president of the Federation of American Hospitals, said, “To provide a fertile field to develop truly innovative, coordinated care models, [related] fraud and abuse laws should be waived altogether.”

Conflicting pressures for stronger anti-fraud resources and more economical healthcare systems will put fraud fighters to the test.

Let’s rise to the challenge. Let’s be extra alert for the signs and agents of Medicare and Medicaid fraud. That means keeping up with the latest detection and prevention techniques. For those who need it, upcoming courses like the ACFE’s Principles of Fraud Examination and Healthcare Fraud offer comprehensive practical instruction.

CFEs, working together, will help America overcome this challenge.