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White Collar Crime

Hidden in Plain Sight: How Yale Missed a $40 Million Procurement Fraud

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For years, Yale University School of Medicine administrator Jamie Petrone lived a lifestyle far beyond what her job title suggested. She drove a Mercedes-Benz G550, a Range Rover Autobiography edition, and other luxury cars. She owned three houses in Connecticut and another in Georgia. Her social media accounts showed off her wealth for everyone to see. Yet it took nearly a decade before anyone at the prestigious Ivy League school asked how she could afford it.

The shocking truth: Jamie was orchestrating a massive fraud from inside Yale. She secretly ordered thousands of tablet computers—mostly Microsoft Surface Pros—and shipped them to an out-of-state business. That business paid her personally through her own company’s bank account. By the time an anonymous tip finally exposed the scheme in 2021, Yale had lost more than $40 million.

As told in an episode of Oh My Fraud, this case represents one of the most significant procurement fraud schemes ever perpetrated against an academic institution.

A Trusted Employee Exploits the System

Jamie joined the Yale School of Medicine’s Department of Emergency Medicine in 2008 and rose to become Director of Finance and Administration by 2019. With years of experience, she knew Yale’s procurement procedures inside and out, giving her the perfect roadmap to commit fraud.

In 2020, Jamie’s supervisors questioned why her department’s budget showed a big spike in computer purchases. She claimed the department was updating equipment and collaborating on a new project with Yale New Haven Health. No one pressed her further.

The $10,000 Threshold Trick

One simple rule made Jamie’s fraud possible: She could approve any purchase under $10,000 without extra oversight. Rather than submitting big orders for 50 or 100 tablets at once, she broke them into smaller requests—each one kept below the $10,000 limit. With no second approval required, her orders sailed through accounting.

According to the FBI, Jamie placed thousands of these small orders. In one case, she directed a coworker to purchase 100 Surface Pro tablets in 13 separate purchase orders. Twelve orders were for 8 tablets each, totaling about $9,100 each, and one order was for 4 tablets at $4,551. By splitting them up, she avoided the automated controls meant to detect high-value purchases.

Jamie then claimed the tablets were for department research or other official projects. Instead, she shipped them straight to a third-party reseller in New York, which sent payments to her company, Maziv Entertainment LLC. This arrangement racked up millions of dollars of profit, all at Yale’s expense.

Suspicious Spending Hiding in Plain Sight

While Jamie carefully hid the paper trail, she did not hide the results. She drove multiple luxury vehicles, including a Range Rover Autobiography and a Mercedes G550. She amassed four homes and flaunted her lifestyle on Instagram. Even without a full investigation, her lavish, conspicuous spending should have raised questions.

According to the Association of Certified Fraud Examiners (ACFE), “living beyond one’s means” is the top behavioral red flag among fraudsters. Despite this common red flag, nobody at Yale confronted the glaring mismatch between her university administrator salary and her multimillion-dollar expenditures—until an anonymous whistleblower reported seeing her load stacks of computers into her Range Rover in 2021.

The Anonymous Tip and FBI Investigation

In August 2021, Yale received a tip about large quantities of computer equipment leaving its campus. After confirming that Jamie was ordering suspiciously high volumes of tablets, the university notified the FBI. Investigators got a search warrant and began tracking packages Jamie sent from a FedEx location in Orange, Connecticut, to a reseller in New York.

Within days, they intercepted several boxes containing 94 Surface Pro tablets. Records showed she had recently placed a $144,000 order for more hardware—far beyond any legitimate department need. Realizing the investigation was closing in, Jamie turned herself in on September 3, 2021.

Guilty Plea and Aftermath

Jamie eventually admitted to the scheme, telling investigators she had done it for years—perhaps as many as ten. In March 2022, she pleaded guilty to one count of wire fraud and one count of filing a false tax return. She had not filed tax returns at all from 2017 through 2020, and earlier returns falsely claimed stolen equipment as business expenses.

In October 2022, Jamie was sentenced to nine years in prison. She forfeited six luxury vehicles, four houses, and more than $560,000 held in her company’s account. Yale’s official loss totaled $40,504,200. The U.S. Treasury was also shorted over $6 million in unpaid taxes.

Lessons for Every Organization

This fraud shows how easily a single employee can exploit weak procurement controls—even at an elite institution with a $41 billion endowment. Here are some key lessons:

  1. No One Is Above Suspicion: Long-term employees often have the trust and insider knowledge needed to commit major fraud. Familiarize yourself with employees’ roles and watch for unexplained changes in lifestyle.
  1. Monitor Repetitive Sub-Threshold Purchases: Splitting one large order into many small ones is a common trick. Regularly examine patterns of similar purchases under approval limits.
  1. Heed Behavioral Red Flags: Living beyond means, unusual personal expenditures, or unexplained wealth should prompt further review.
  1. Take Every Tip Seriously: The ACFE’s research shows that most frauds are uncovered by tips. Encourage a culture that supports whistleblowers and investigates promptly.
  1. Don’t Overlook Tax Implications: Illicit income is still taxable. Filing false returns or failing to file can lead to extra penalties and charges.

Hear the Whole Story and Earn CPE

For more details on this case—along with expert insights on fraud and ethics—listen to the full “Oh My Fraud” podcast episode. You can also earn free CPE credit by enrolling in the course on Earmark. 

The story of how such a large-scale fraud remained hidden for so long offers valuable lessons about the power of small gaps in oversight—and the big price organizations pay when those gaps go unaddressed.

From Sponsorships to Fake Consultants—Inside the Airbus Bribery Scheme

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Modern corporate bribery rarely looks like someone handing over a briefcase of cash. It often masquerades as something legitimate: a sports sponsorship, an inflated “consulting” contract, or a generous commission payment. 

As discussed in an episode of Oh My Fraud, one of the most striking examples is the Airbus bribery scandal, which resulted in the largest bribery fine in world history—€3.6 billion.

From Watergate to the FCPA

Corporate bribery isn’t new, but its legal and ethical landscape changed significantly in the 1970s after the Watergate scandal revealed a web of illicit corporate payments. In response, Congress passed the Foreign Corrupt Practices Act (FCPA) in 1977, prohibiting bribery of foreign officials and requiring accurate financial records. The FCPA doesn’t just apply to U.S. companies; it also covers foreign companies listed on U.S. stock exchanges or operating within the United States. This means that industry giants like Airbus can face American prosecution if they’re caught bribing, no matter where they are located.

Airbus Takes Flight—and Then Self-Reports

Founded in 1970 by French, German, and British aerospace firms (Spain joined later), Airbus’s mission was to compete with American manufacturers like Boeing. By 2003, Airbus surpassed Boeing and became the world’s largest commercial aircraft maker. 

Yet in 2016, an internal Airbus audit discovered a systemic bribery operation: “secret agents” were allegedly bribing officials to secure plane sales worldwide. Faced with French laws that would revoke operating licenses for bribery convictions—and an even steeper potential fine of €8 billion—Airbus surprised everyone by self-reporting to the Parquet National Financier (PNF), France’s financial crimes investigative body.

Inside the Massive Bribery Scheme

The Airbus bribery setup was surprisingly elaborate:

Secret Agents and Shell Companies
Airbus hired intermediaries—sometimes called “secret agents”—to close deals. These agents requested large “commissions” Airbus paid to shell companies with opaque ownership. A portion of that money went to officials in Ghana, Sri Lanka, Malaysia, Taiwan, Indonesia, China, and elsewhere.

Sports Sponsorships as Kickbacks
In one example, Airbus paid $50 million to sponsor a sports team owned by an airline executive. In return, the airline ordered 180 planes. Even if each plane were the least expensive model (over $70 million apiece), Airbus captured a staggering deal in exchange for a $50 million bribe concealed as “sponsorship.”

Consulting Contracts for Spouses
Another scheme involved hiring an airline executive’s spouse as a highly paid consultant. The spouse had zero aviation experience, making it clear the contract’s real purpose was to influence purchasing decisions.

These arrangements gave Airbus “plausible deniability”: officially, they were paying for legitimate-sounding services.

The Record-Breaking Settlement

By cooperating fully after their self-disclosure, Airbus negotiated a Deferred Prosecution Agreement (DPA) rather than face trial. Under the DPA:

Historic Fine
Airbus agreed to pay €3.6 billion—the largest bribery fine ever imposed. If they hadn’t turned themselves in, estimates suggest it could have topped €8 billion.

Three-Way Split
The French PNF, the UK’s Serious Fraud Office (SFO), and the U.S. Department of Justice (DOJ) shared the settlement. The DOJ alone collected roughly half a billion euros.

Leadership Shakeup
Although he wasn’t forced out, CEO Tom Enders resigned, expressing genuine remorse and a desire for Airbus to reform. An ongoing class action lawsuit from Airbus shareholders claims the company misled investors about its business practices.

Is It Marketing or a Bribe?

One reason corporate bribery is so insidious is that it can closely resemble legitimate business development. From event tickets to lavish client dinners, there is often no bright line defining when hospitality veers into bribery. Private-sector organizations don’t always have a rigid gift limit—like the $20 rule, the U.S. military has—making it even harder to police.

According to the 2024 ACFE Report to the Nations, the median loss to corruption is $200,000. Yet tracking actual losses is complicated. In Airbus’s case, officials needed new aircraft either way, so the “loss” might be seen as switching from one vendor to another for questionable reasons. It underscores how intangible “costs” can be when bribes drive commercial decisions.

Lessons for Finance Professionals

The Airbus scandal highlights a rapidly evolving corruption landscape:

Structural Sophistication
Bribes are concealed through sponsorships, commissions, and consulting contracts rather than suitcases of cash.

Gray Areas vs. Bright Lines
Understanding intent is crucial. Based on purpose and scale, the same “thank you” gift can be innocent or corrupt.

Robust Compliance Measures
Basic compliance and traditional red flags may fail to uncover cleverly disguised bribery. Periodic internal audits, detailed transaction analysis, and cultural shifts emphasizing ethics are vital.

Global Enforcement
In an interconnected world, bribery probes are often multinational. Being listed or doing business in certain countries (like the U.S.) exposes companies to multiple layers of enforcement.

In the end, Airbus’s self-reporting likely saved the company from greater financial and operational damage, yet the scandal still cost billions and tarnished its reputation. To hear a more in-depth discussion of how Airbus got “AirBusted,” check out the full Oh My Fraud podcast episode.

DC Solar’s Billion-Dollar Green Energy Con

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The following article is based on the “Burned by Solar” episode of the Oh My Fraud podcast, which provides a behind-the-scenes look at how DC Solar orchestrated one of the largest green energy frauds in U.S. history.

In December 2018, 175 federal agents from the FBI, IRS, and U.S. Marshals raided the headquarters of DC Solar and the California home of its CEO, Jeff Carpoff (sometimes spelled “Karpov” in news reports). This dramatic event unveiled one of the largest frauds ever prosecuted in the Eastern District of California—a scheme that claimed to sell 17,000 portable solar generators when, in reality, only about 6,000 existed.

Origins and Ambitions

Jeff Carpoff spent most of his life in Martinez, California. After failing to run successful auto repair shops and briefly selling drugs, he sobered up and co-founded a shop specializing in Land Rover repairs. Eventually, he latched onto a promising idea—creating portable, solar-powered generators he called the “Solar Eclipse.” This invention would supposedly replace traditional gas or diesel generators on movie sets, at disaster sites, and even in stadium parking lots during tailgates.

DC Solar marketed these generators as versatile, eco-friendly power sources that could be towed anywhere to provide clean energy. While the vision looked sound, it was the business model—centered on a lucrative federal tax credit—that truly turned heads among investors.

The 30% Tax Credit Hook

The U.S. government offered a 30% tax credit for investments in alternative energy equipment, including solar. DC Solar pitched a straightforward proposition to prospective investors:

  1. Purchase DC Solar’s generators, sold at a hefty price of $150,000 each.
  2. Pay only 30% of that cost upfront (the exact amount investors would recoup via the federal tax credit).
  3. DC Solar would cover the remaining 70% of the purchase price through lease revenue.

In theory, investors could fully offset their upfront cost with tax credits—and possibly earn additional returns if leasing income exceeded loan payments. Companies like Sherwin-Williams, T-Mobile, and even Warren Buffett’s Berkshire Hathaway bought into the hype, hoping to cut their tax bills while backing a “green” initiative.

Early Warning Signs

Despite its promise, DC Solar’s operations quickly drew skepticism. During a visit to one of the company’s facilities, Sherwin-Williams representatives discovered only a few rows of fully assembled units. Behind them, dozens of unfinished generator shells suggested the product was far less complete than advertised. Confronted about it, Carpoff reportedly brushed the issue aside.

Other troubling red flags emerged:

  • Performance Failures: Some trailers lost power on major film sets and at concerts, forcing DC Solar to sneak in diesel generators to cover the outage.
  • Lease Rate Discrepancies: DC Solar claimed that 80–90% of its generators were leased out, but internal accounts put the rate closer to 5%.

Faced with cash flow pressures, the company devised a “circular” approach: using money from new investors to fulfill lease payments it had promised to earlier investors. Internally, DC Solar employees allegedly referred to this patchwork as “re-renting,” but investigators later described it as classic Ponzi activity.

Fraudulent Tactics

To sustain the illusion, DC Solar:

  • Faked VINs: Employees scraped VIN stickers off certain generators and reapplied them onto others, matching whatever batch investors expected to see.
  • Synthetic Tracking: GPS transponders were buried in vacant fields so investors believed their units were deployed.
  • Paper Leases: Executives fabricated large, long-term leasing contracts with major telecom and entertainment companies, sometimes enlisting outside patsies to sign phony agreements in exchange for sizeable payouts.

Meanwhile, Carpoff and his wife, Paulette, enjoyed the spoils. They amassed a fleet of 149 classic cars—many of them gas-guzzling muscle cars, paradoxically funded by a “green energy” enterprise—purchased stakes in a Napa winery, rented private jets, and even sponsored a NASCAR race (the DC Solar 300). They also bought the Martinez Clippers, an independent league baseball team, and emblazoned their company parking spots with initials like “JMFC,” short for “Jeff Motherf***** Carpoff.”

The Whistleblower and the Raid

The scheme began to unravel when a DC Solar employee, Sebastian Giuliano, realized the company was paying old investors with new investor money and filed a whistleblower report to the SEC. Suspicions deepened when the IRS audited some of DC Solar’s earliest deals, concluding that the actual fair market value of each generator was around $13,000—far below the $150,000 asking price.

In December 2018, armed with information from the whistleblower and their own investigations, federal agents descended on DC Solar’s facilities and the Carpoff residence. They seized $1.7 million in cash from a safe, confiscated the entire muscle car collection, and gathered further evidence of fraud.

Aftermath and Sentencing

DC Solar collapsed into bankruptcy by early 2019, owing millions to creditors, NASCAR, racetracks, and various vendors. Major investors, including Berkshire Hathaway, announced the probable loss of hundreds of millions of dollars in invalidated tax credits.

Criminal charges soon followed. In 2020, Jeff Carpoff pleaded guilty to conspiracy to commit wire fraud and money laundering; he was sentenced to 30 years in prison. His wife, Paulette, received an 11-year prison term. Several other executives, including the CFO and outside conspirators who fabricated leases or faked verification reports, also received prison sentences ranging from three to eight years.

Lessons and Oversight Gaps

DC Solar’s downfall highlights several vulnerabilities in green energy tax credit oversight:

  1. Physical Verification: Authorities relied too heavily on documents without insisting on direct, thorough inspections. Fake VINs and strategically placed GPS devices allowed DC Solar to fabricate nearly 11,000 nonexistent generators.
  2. Valuation Transparency: Inflated price tags ($150k vs. $13k real value) went unchecked, maximizing undeserved credits.
  3. Circular Financing Scrutiny: Leasing revenue was artificially maintained with new investor funds, a hallmark of Ponzi schemes, yet it initially escaped scrutiny.
  4. Due Diligence and Audits: Complex alternative energy incentives require rigorous checks to confirm the actual equipment, usage, and economic substance of each deal.

For accountants, attorneys, and investors, the DC Solar saga is a sobering lesson. Fraudsters can exploit these incentives no matter how appealing a tax benefit or environmentally friendly pitch may sound. Robust financial controls, thorough audits, and consistent physical verifications are key to safeguarding genuine green energy efforts.

For a more in-depth exploration of DC Solar’s rise and fall—and the comedic twists along the way—listen to the Oh My Fraud podcast episode linked above. The story of DC Solar stands as a testament to how easily good intentions and generous credits can be warped into massive fraud when accountability is lax.