There are payroll mistakes and then there are payroll mistakes, and Conde Nast, which creates of some of the most important magazines in the fashion industry, made one doozy of a payroll mistake late last year. With just one email, a Texan man duped the Vogue publisher into diverting $8 million in payments that should have gone to its printing press directly to his bank account.
Forbes reports that 57 year old Andy Surface sent an email to some corporate department or other at the company last November. Attached was an Electric Payment Authorization form that appeared to have been sent by Quad/Graphics, the press that prints a number of Conde Nast’s magazines, asking that future payments be delivered to an account named Quad Graph. (The account was housed in a BBVA Compass Bank branch in Alvin, Texas.) Conde Nast filled out the form and faxed it back to Surface, believing that it was simply following through with business as usual.
It wasn’t alarming until Quad/Graphics asked someone at Conde Nast why they stopped making payments on their account. Per Forbes:
Then, on December 30, the lawsuit says, someone at Quad/Graphics–the actual printer–contacted someone at Condé Nast asking why Quad/Graphics hadn’t been paid by Condé Nast since mid-November … It appears the company quickly went to the feds, including the Secret Service, which when not protecting President Obama, investigates stuff like wire fraud.
At this point, the US Attorney’s Office is acting on Conde Nast’s behalf, trying to retrieve the money it mistakenly turned over to Surface. Fortunately for them, Surface still has the money in two accounts, about $50,000 in a personal account and the rest in the fake Quad Graph account. In January, “the feds got a federal court warrant and grabbed the funds for safekeeping pending the lawsuit.”
So now it’s not a question as to whether Surface is going to jail, but when. (The mugshot of him above is from a disorderly conduct tussle he was involved in last December, about two weeks before Conde Nast realized they’d paid him millions for nothing at all.)
We would have thought an operation as slick as Conde Nast would have been more careful about where its money was going, because when you think about it, this scam is about as bad as those guys who email you saying your distant Nigerian prince cousin who you never met just died and wants to leave you a ton of cash. But hey, sometimes learning a lesson the hard way is better than not learning it at all.