Fraud unit backlog frustrates public

September 8, 2008 6:02:46 PM PDT
A small business owner in San Francisco has a complaint. He says that a former employee has been raiding his bank accounts for the past three months and he cannot get the police to help.

This is a sign of a bigger problem -- the San Francisco Police Department's fraud unit is so understaffed, the case backlog has increased to seven to eight months. If it is your bank account that is being raided, each day seems like a lifetime.

"I get upset thinking about it. I don't understand why someone would be malicious like that," said Pat Williams who had a terrible scare about a week ago. The single mother thought she was being fired from her job at San Francisco Window Factory in an e-mail from the owner, but it turns out the e-mail was a fake.

"I don't know what kind of kicks someone gets out of doing stuff like this, but it affects real people," said Williams.

Williams believes it is part of a campaign of harassment by former office manager 24-year-old Eddie Feinstein. When he quit the company three months ago, Feinstein apparently took the passwords to the e-mail, bank and credit card accounts with him.

Dan Noyes: "How much money has he siphoned off?"

Hossein Vaheid (San Francisco Window Factory owner): "I can sum it up to $50,000-60,000 -- enough that I can easily close my business and ask for bankruptcy."

Feinstein has cut checks to himself, withdrawn money online, charged customers' credit cards, bought airline tickets on the owner's personal account and even set up an automatic monthly thousand-dollar payment for his 2006 Range Rover.

Vaheid tried for weeks to get in touch with the fraud inspector assigned to his case. When he finally reached the inspector by phone, Vaheid was not happy with what he said.

Hossein Vaheid: "'I have a stack of paper on my desk, I'm going to look over them and I will get back to you.' I said, 'This is my cell number, please write it down and give me a call if you have any questions.'"

Dan Noyes: "Has he called you back?"

Hossein Vaheid: "No."

It has been almost three months, so the I-Team went to the SFPD's fraud unit and found a lot of empty desks. Chief Heather Fong has cut the number of inspectors in that office from 19 four years ago to just six today.

"Well, the waiting time has probably gotten longer because of the reduction in our manpower. There's obviously a correlation between those two figures," said Acting Lt. Gregory Ovanessian with the SFPD fraud unit.

The head of the fraud unit says he has a backlog of seven to eight months, with 80 cases waiting to be assigned, many of them involving more than a million dollars. It is a frustrating situation for this 18-year veteran of the fraud unit.

"Certainly, I would love to have more people working in this office so we could do more of these cases and do them quicker," said Ovanessian.

Through her staff, Chief Fong declined to be interviewed, and she did not attend the police commission meeting last week where we tried to catch up to her. We wanted to ask why she has made cuts at the fraud unit.

Her press office issued a statement saying, in part, "The investigation of financial-related crimes is important ... but the immediate safety of the public will always be the top priority."

One of the department's top brass tells the I-Team that Chief Fong has been too concerned with knee-jerk reactions to high-profile crime on the street, so these white-collar crimes are being neglected.

"Obviously, we'd like things to move faster," said Police Commissioner Joe Marshall. Marshall says staffing is being addressed in a top-down audit of the department.

"It may take more money, it may take more officers, we don't know that, but certainly it's a good place to be in, this entire evaluation of the department, so that we can shore up some of these areas that don't always work as well as we'd like them to work," said Marshall.

The audit will not be done until December. Vaheid needs help now to stop his former office manager from taking any more money.

"He's there and laughing. He says come and catch me, if you can. Come and catch me, if you can -- and who's going to catch him?" said Vaheid.

The I-Team reached Feinstein this weekend at his home in North Hollywood. He denied everything and agreed to an interview, but then backed out. We also checked his record and found several felony convictions for fraud, forgery, grand theft, and elder theft. Read more about the new accusations against him in our I-Team blog here.

By the way, the head of the fraud unit called Vaheid for a meeting Monday afternoon. It looks like his case has risen to the top of the heap.


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