Sage Advice Set CFE on Path to Uncovering Fraud

An interview with Peter Donnelly, CFE. As a deputy constable in Tarrant County, Texas, Donnelly has worked more than 1,000 non-real estate judgment writs and has collected more than $800,000 for plaintiffs in two and a half years.

January 2015

ACFE Member Profile

An assistant U.S. attorney once told Peter Donnelly, CFE: “All fraud starts with a lie; somebody told a lie to get what they wanted illegally. Find the lie and who benefited from it.” He has followed this advice throughout his career as a deputy constable in Tarrant County, Texas. Donnelly has worked more than 1,000 non-real estate judgment writs and has collected more than $800,000 for plaintiffs in two and a half years.

Where were you born and raised?

I was born in Indiana and raised in Chicago.

 

How did you become passionate about fighting fraud?

I became passionate about fighting fraud when I transferred to Texas as a postal inspector; I had worked mainly street and internal crimes prior to that. In Fort Worth, Texas, I was initially assigned to a credit card fraud team and later served on the Southwest Financial Crimes Task Force. I went back to external street crimes, but I found that mail thieves had gotten more sophisticated in what they stole and how they used the information. This meant that there were more crimes involving banks, credit unions and other financial institutions. A simple check forgery, for example, represents identity theft, because of the forgery and ID used: bank fraud, wire fraud and bank larceny. Around that time a fellow postal inspector and former ACFE Regent, Marty Biegelman, CFE, suggested I become a Certified Fraud Examiner (CFE). 

 

What is one of the biggest lessons you have learned since becoming a CFE?

This is something the same assistant U.S. attorney mentioned earlier told me: “When you are looking for a particular tree, be sure to look at the whole forest,” i.e., the big picture.

 

What steps led you to your current position?

When I “rode the circuit” as a postal inspector in East Texas, I worked a territory the size of the state of Indiana. I worked not only postal-related offenses, but I also pitched in and helped sheriffs, police officers and other federal agents with their cases. While doing this I developed a healthy respect for Texas Peace Officers, who are basically underpaid, overworked and have impressive personal integrity. After I retired from federal law enforcement, I decided on a post-retirement career (kind of backwards compared to the way most careers progress). I took the Texas Peace Officer test, passed it, and the state of Texas gave me credit for all my years of service and training. I am now a Master Texas Peace Officer.

 

What is your current role and what does it entail?

I’m a deputy constable assigned to execute non-real estate judgment writs. I’ve had nine defendants attempt to hide assets, mainly through transfers to family members, or by creating new shell companies and then “selling” the property to them. These instances are where my CFE training has really helped. I’ve found that once you discover the scheme, having followed the money or property, and confronted the defendant, the defendant can’t open his wallet or checkbook fast enough.

 

One case involved a company that went out of business and then reformed as a new company with the same officers, location, mailing address, phone numbers and trucks. This was discovered through examination of real property records when the old company sold the new company a landfill. When I confronted one of the officers with what I’d found out the company paid the judgment.

 

Did you always plan to pursue the role you are currently in?

I always wanted to be a small town police chief but after what I’ve learned and experienced, I think I’ll stay where I am. I’ve simply allowed my talents and aptitudes to guide me.

 

What is a memorable case or project that you have worked on?

There have been so many! These are just a few of many cases:

 

A ghost payroll/embezzlement case in Chicago involving a job-training program sponsored and operated by a church. 

A counterfeit ID case with some of the best fake drivers’ licenses I’ve ever seen.

A major check theft and counterfeiting ring gang.

A major credit card fraud gang whose victims included famous people.

A job training funds abuse case in Indiana that led to the abrupt resignation of three high state officials once they realized they were under investigation.

A husband and wife fraud team that opened bank accounts to wash stolen checks, using the names and ID information readily available in obituaries.

And finally, a mail theft gang in the Bronx, robbing letter carriers in Manhattan at gunpoint to get their keys and mail.

 

I’ve learned that sometimes the simplest schemes do the most damage.

 

What do you wish someone would have told you about your career when you were just starting out?

How to write a decent report!

 

What advice do you have for those looking to become a CFE?

Explore all opportunities, like government inspector general agencies, and commercial and industrial special investigation units, and learn as much as you can about the areas you’d like to investigate. Above all, be ethical.

 

What activities or hobbies do you like to do outside of work?

I teach child protection courses for my church, sing in the choir and I am a member of the Knights of Columbus. I enjoy quality time with my two dogs, a shot of good bourbon with a good cigar. I also play the piano (badly, I might add) and enjoy shooting sports.