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Nabbing Michael Cassini, the king of con
Seattle Times staff reporter
Some say the bigger the lie, the easier it is to swallow.
And so it was with Michael Cassini, a man prosecutors call the most successful solo scam artist in Washington history.
"It was like going to the movies," a judge would say of Cassini's story.
Actually, it was better than anything Hollywood could dream up. Cassini's take: more than $4.5 million by the time he was 26.
According to court records and interviews, he repeatedly fooled sophisticated bankers and lawyers. He fooled insurance companies and the courts. He fooled employers and a real-estate expert and an aviation company and, some say, a kind-hearted family that still gives him its support, along with permission to marry a 19-year-old daughter.
In Cassini's own words
"I knew what I was doing was wrong in the eyes of the law, but I also knew that the rest of the country was overstating their income and such. I thought at one point that a bank would turn me down, but that never happened. Why ... I still have no idea."
"If the bank had done their verification steps as they should do for any credit application, I would not have committed any crimes because the applications would have been declined."
"It was not hard at all to convince the banks to give me the loans. [A private banker] told me that bankers just like to hear that you will make large deposits in their bank and then in most cases a banker gets greedy to have an account in his or her portfolio that has large deposits."
And he lived a life of luxury, traveling the world, driving a collection of Porsches and Ferraris and mingling with the moneyed crowd. He even put a deposit on a $5.6 million airplane.
Then his name crossed the desk of Special Agent Joe Velling.
A bureaucrat from an obscure investigative branch of the Social Security Administration, Velling didn't know all this at first. He just felt something in his gut.
"I know right and wrong," Velling said, "and this is wrong."
His first clue: The suspect had two names.
A millionaire pose
Every con man needs a story. Michael Cassini had a good one: He was a Microsoft millionaire, a claim particularly believable in a city that once had the highest concentration of millionaires in the country.
He certainly looked the part, even carrying a wireless computer mouse in his pocket. Scrawny and nerdy-looking, he'd make his rounds nicely dressed, but he had hygiene problems such as dandruff and bad breath, according to people who met him.
Cassini kept documentation sure to impress, including tax returns prepared by a prominent accountant, and frequently boasted that he had hired one of Seattle's biggest law firms, Preston Gates & Ellis.
"Because he looked and talked like you might expect a techno-geek Microsoft millionaire to look like — different from you and I — I think people gave him the benefit of the doubt," Velling said.
In May 2003, when he was 24, Cassini called on a local KeyBank branch, showing his pile of paperwork and asking for a loan. Cassini claimed a net worth of $12.3 million, an annual income of $700,000; $8 million on account at Barclays Bank, and more. It was all right there on paper.
And it was a complete lie, numbers plucked from the air, court records show.
KeyBank officials declined to talk about the case with a reporter, but if they had verified his claims, they would have learned Cassini didn't have millions in assets. He didn't even really work for Microsoft. Instead, he had been assigned there through several temp agencies, but he was let go because he didn't have the computer skills he claimed.
One thing Cassini did have was nerve. He convinced KeyBank to extend a line of credit totaling $298,000.
Why would banks loan money without thorough background checks?
Cassini, in a telephone interview from prison, says KeyBank's "private banking" division made it easy. This is banking for the well-to-do, people who have money to invest and want extra services. Typically, they're referred to the bank by someone reputable, and the banks are eager to please.
"It's easier to walk into a bank and get $1 million than it is to get $50,000," Cassini explained. Ask for $50,000, and "you're the standard average Joe person. They're going to check all your stuff. You walk in the bank and say you want $1 million, you must have the wherewithal.
"They don't want to embarrass you by questioning you, so they give you the money."
Cassini said a private banker told him all this early on. All he needed was to show the right paperwork.
He gave it a try and waited to see if it worked.
It may have been easy to get a loan. It was harder to pay it back.
When Cassini couldn't come up with the money, he strung KeyBank along with a story that he had been the victim of identity theft and had recently changed his name. At least part of that was true: He had legally changed his name from Jeffrey Leavitt. He also changed his Social Security number. He told them that caused problems when he tried to transfer money out of other banks and into KeyBank. But they would get their money soon, he said.
The bank was getting fed up. In December 2003, a bank investigator decided to check out his story and found herself on the phone with Velling at Social Security.
A former Navy lawyer with a meticulous, soft-spoken manner, Velling spends most of his time tracking identity thieves from behind a desk.
He's quick to point out, however, the job isn't just about following the dollar.
"We have to protect the integrity of the enumeration system," he said several times, noting that's part of his sworn mission. A lot of the 9 / 11 hijackers had Social Security numbers, he pointed out.
So he was immediately concerned when the KeyBank investigator asked him: Is it possible for a person to have two names and two Social Security numbers?
As Velling explained, it's possible to get a second Social Security number, but it isn't easy — and for good reason. Social Security numbers are the Holy Grail, sought by scam artists, undocumented aliens and, yes, terrorists.
Sitting in his office on the 10th floor of the Washington State Convention and Trade Center, he punched the name into the Social Security database. Cassini did have two names and Social Security numbers. Somehow, he had managed to get the new number within eight weeks. And his evidence of identity theft wasn't very convincing. Cassini accomplished the impossible by hounding an agency clerk and bringing in his attorney from Preston Gates & Ellis.
"It was amazing the power that carried with it," said Special Assistant U.S. Attorney Norman Barbosa, referring to the law firm's intervention.
It was not, however, a crime.
"To me, what we've got is a bully beating up on a Social Security employee and bringing in a heavy-hitting law firm," Velling said. "You don't do that."
In the midst of several other investigations, Velling spent every spare moment researching Cassini.
Shortly before he got the new Social Security number, Cassini had been arrested for fraud in Dallas, Velling found. (The case was never prosecuted.)
Cassini also seemed to have a habit of filing police reports claiming his property was stolen. In addition, Velling found police reports from people who claimed that Cassini had sold them items on eBay, but that they hadn't received what they were promised. That seemed odd for a man who claimed to be worth millions.
He wrongfully collected more than $13,000 in unemployment payments and got caught trying to rip off a former employer by charging $2,400 of personal expenses on his company credit card.
It just didn't add up.
"There was nothing in the reports that made me think this guy was a Microsoft millionaire," Velling said.
What's more, Velling began to suspect the basis for the name change was bogus. No one had been convicted or even charged with stealing Cassini's identity, and some of his claims were provably false.
Velling suspected that Jeffrey Leavitt ran up debt, couldn't pay it off, and came up with a clever way to wipe the slate clean: Become Michael Cassini.
"He turned identity theft on its head," Velling said. "He claimed victim status and used it as a shield."
Velling didn't know what Cassini was up to, but he thought the FBI should hear about it.
By the summer of 2004, an analyst and two federal prosecutors were assigned to the case. A hard-charging CPA, Special Agent Nathan Parks, was in charge of number-crunching — a painstaking task.
Said Velling, "I had no idea the next thing we were going to see would be these million-dollar loans."
Toys and travel
The day Cassini got the KeyBank loan, he bought a new 2003 Porsche 911 Turbo. Perfect for a Microsoft millionaire. But he didn't stop there.
In subsequent months, Cassini bought two Ferraris, a Lotus and a BMW M5. Then he spent $4,300 a month leasing garage space.
He bought an airplane — then put a deposit down on a second one that cost $5.6 million.
Even his $139,000 Porsche wasn't good enough: He had $40,000 worth of work done. Then he leased a second one.
He also opened a business, eventually leasing a 6,000-square-foot office space. Aventura, he said, was developing a program for dental billing and did high-tech consulting work. He hired a handful of employees, although it's unclear what they did. Two of them later told authorities that they never saw a customer.
While in the midst of this business startup, Cassini traveled to Singapore, Japan, Thailand, Brazil, Egypt, Kenya, Korea, Germany, Sweden, Finland, Italy and France. On one trip, he had his Porsche shipped to Germany so he could enter a race.
This lifestyle, of course, had its costs — sometimes up to $60,000 a week, Barbosa said. Cassini funded it by running up more than $380,000 in credit-card debt.
And he used his Microsoft millionaire routine again and again, fooling more Seattle-area banks into lending him money.
October 2003, Cowlitz Bank: $122,000, in two loans.
December 2003, Pacific Northwest Bank: $240,000.
January 2004, KeyBank agreed to give him another loan, this one for $249,000.
"I think Mr. Cassini got on a roll that he couldn't get out of and that it's an addiction," his criminal-defense lawyer, John Henry Browne, would later tell a judge.
Experts call it loan kiting. According to Lauren Jassny, chief credit officer at The Commerce Bank, you borrow a small amount from one bank, then borrow a slightly larger amount from another bank. You use the second loan to make payments on the first, "so it looks like you're performing." The process goes on and on, and the amounts typically get larger and larger.
When Cassini was running out of money, he'd simply apply for another line of credit.
On the trail
From a "war room" in the U.S. Attorney's Office filled with bank documents and flow charts, the team retraced his steps. It wasn't easy catching up.
In the records from KeyBank, team members found checks written on other bank accounts. Then they called those banks with the bad news: They were likely the victims of fraud.
"The problem was he could go anywhere and make applications," Velling said. "How many banks are there in the city?"
March 2004, Cowlitz Bank: $66,000.
May 2004, The Commerce Bank: $1,050,000.
Investigators watched as his MBNA credit-card limit was increased from $50,000 to $75,000 and beyond.
In September 2004, after placing a call to Silicon Valley Bank, they realized how good Cassini was. Did you happen to make a loan to a guy named Michael Cassini? Barbosa asked. And how much was it?
$1.5 million. Barbosa and Velling were stunned.
"That's when we said, 'Oh my God, this thing has just exploded,' " Velling recalled.
They had to stop him. And fast.
No Mr. Nice Guy
There are two ways to go about being a con man.
"You can be charming and suave," Barbosa said, "or you can be mean and nasty." Although the latter may seem counterintuitive, it plays into the stereotype of the brash young millionaire.
That was the face Cassini showed to many of those he tried to con, according to several people.
"Whenever anybody would hesitate when he was trying to steal from them, he would start yelling at them," Barbosa said.
After a flight instructor wouldn't let him fly a plane solo without proof that he'd logged enough hours, he filed a complaint with the Federal Aviation Administration (FAA), then threatened to sue, the instructor said.
When someone who bought a $6,700 motorcycle from him complained that it was damaged and that he never received the title, Cassini mocked the buyer in e-mails. When police opened an investigation, he told them the buyer was just a "nut case."
When a private investigator started looking into another complaint, Cassini filed for a protection order, claiming the investigator had harassed him.
"He used the system to stop me from going after him," the investigator, Gary Vanous, said. "The kid is good."
The Biehl family of University Place, Pierce County, saw none of that. When things got tough, they would turn out to be his only true friends.
He met family members in the spring of 2004, when he inquired about a pilot's license. Barbara Biehl, a warm and motherly type who works at the FAA, soon embraced Cassini as family. So did her husband.
"He was likeable," she said. "He was needy."
Around the Biehls, he was kind and warm and giving. Especially around their daughter, Molly, whom he met in September 2004. Attractive, athletic and intelligent, Molly was a college student whom he treated with respect, like a grown-up. It wasn't long before they were engaged to be married.
Barbara Biehl was tickled. (Molly Biehl declined an interview request.)
"He was setting up a legitimate business," Barbara Biehl said of Cassini, whom she sometimes refers to as her son-in-law. "He doesn't drink, basically. He doesn't smoke. He's a nice kid. Plus, he can talk to adults."
One thing he wouldn't talk about was his family. Whenever Biehl asked, he mumbled and changed the subject.
The Biehls later found out why.
He was born in Washington, D.C., to Janice and Henry Leavitt. The family moved to Southern California when Cassini (then Jeff Leavitt) and his older brother were still young. His father had a government job overseeing medical-research grants and was rarely home.
They lived in a home of about 4,600 square feet, a former neighbor, psychologist Margot Vogel, wrote in a letter for the judge to consider at sentencing. But it was "hardly fit to live in," she wrote, stuffed to the ceiling with new purchases still in boxes, piles of laundry and stacks of paper.
"[Janice] was what you might call a hoarder," Vogel wrote. "She was pre-occupied with 'things' rather than caring for her family."
Cassini's father was domineering and volatile, according to several letters to the court. Vogel wrote that she once overheard him screaming "these bastards should never have been born."
The couple divorced and Henry Leavitt got full custody, but he didn't seem to want the kids after that, several people told the court.
When he was about 13, Cassini attempted suicide and his father took him to a mental hospital. When he got out, he went to a shelter. Finally, Cassini returned to live with his mother around age 15.
"I believe he developed a need to prove himself," Vogel wrote.
The result, according to Cassini's lawyer, Browne, was a young man who lost his way.
"Michael Cassini has always found it easier to be more than he is," Browne said at a court hearing, "[rather] than to just be who he is."
By mid 2004, Cassini was falling behind on several of his loans, and the banks weren't buying his excuses.
KeyBank filed suit in May. The Commerce Bank did the same in October.
He had to scramble now, juggling money from one account to another. The pace, Velling said, was "almost frenetic.
"We were nervous he was going to keep getting more loans."
By early 2005, they had enough evidence to make an arrest. They took him into custody March 31, 2005, in the parking lot of his new Bellevue office.
He was carrying a false tax return, a phony job offer and a list of bank locations. In his house, investigators found more loan applications. A former employee said this time, he was trying to get at least $2 million.
"Once you get into the rhythm of something, it's hard to get out," Cassini told The Seattle Times.
He was charged with one count of loan fraud. Desperate to pay for a lawyer, he told Barbara Biehl to sell his designer watches. He didn't mention he had filed an insurance claim saying they were stolen. Prosecutors slapped Cassini with additional charges.
Last July, Cassini pleaded guilty to 10 counts of bank fraud and one count of wire fraud. The Biehls were stunned.
"It's not the Michael we know," Barbara Biehl said recently. Her eyes began to tear up. "When you're basically raised like an orphan and you're not 6-foot-2, eyes of blue, what are you going to do to become somebody?"
They continue to support him.
Now the judge was stunned. From the bench she urged the Biehls to turn and run and compared Cassini to Frank Abagnale, the young, prolific and particularly interesting con played by Leonardo DiCaprio in the movie "Catch Me If You Can."
"He was wrong, absolutely," Barbara Biehl said. But "nobody lost their job. Nobody was hurt other than Michael ... I hate to say except banks, but it's bank-application fraud. Nobody was held up at gunpoint. Payments were made."
All of Cassini's toys have been confiscated. Two truckloads of car parts, office furniture and other items went for $1,700. He's been ordered to pay nearly $3.5 million in restitution and was sentenced to seven years in prison.
At sentencing, he was contrite.
"I'm here today because I made some wrong choices; but more importantly, because I'm really willing to take responsibility for those choices," Cassini told the judge.
Having been behind bars since his arrest in March, he said he was a changed man.
"I'm humbled by the simple things in life, such as telephone calls, a toothbrush, warm bedding and postage stamps," he said at sentencing. "Know that I'm coming out of this situation as a new person."
Every day from federal prison in Taft, Calif., Cassini writes a letter to Molly Biehl. Every day, Molly writes back. The Biehl family has grown even more attached as Cassini has shared some of his deepest feelings in letters to them.
He shared some of his feelings with a Times reporter, too. In a letter written in response to questions, he complained about his lawyer and said he deserved a shorter sentence. He plans to appeal.
And he apparently has given some more thought to what he did wrong.
"In my eyes, what I did the rest of the country does except I used a much higher dollar figures," he wrote. "Everyone in America overstates assets to get a loan."
In his view, the banks are partly to blame.
"If the banks had verified everything I had given them, I wouldn't have committed the offense," he said in an interview. "If they did due diligence they would have said, 'You're full of crap.' "
Maureen O'Hagan: 206-464-2562 or firstname.lastname@example.org
Seattle Times news researcher Gene Balk contributed to this story.
Copyright © 2006 The Seattle Times Company