The First Crime Was a Bottle of Wite-Out

Matthew Cox tells Lex Fridman that the first illegal thing he ever did was erase a 30-day late on a rental history. He was 29, a month into the job at Eagle Lending in Tampa, and his first borrower was about to die in underwriting. His manager, Gretchen Zayas, pulled a bottle of Wite-Out from a drawer, handed it over, and said if she were him she would white it out, make a copy, and stick it back in the file.

Cox said he knew it was fraud and that he might go to jail. Zayas told him they did this all the time, nobody was calling the FBI, and the worst case was that underwriting caught it and fired him. He was behind on his truck and his mortgage. He had banked on becoming a broker after a fine-arts degree, a failed year as an insurance adjuster, and years in construction. He trusted her, did what she said, and sweated for four or five days.

The loan closed. He got a check for about $3,500. A normal person, he says, would have treated it as a one-time thing. It emboldened him. The next file needed last year's W-2 bumped from $45,000 to $51,000; that closed too. Within weeks he was changing pay stubs, appraisals, and verifications of rent and telling himself he was doing God's work for people the banks would not touch. Years later Zayas went to prison for fraud. Cox served 13 years. The indictment against him at one point put the number at $55 million.

To understand what Cox built next, he says most people have the credit system backwards. A file is a name, a date of birth, an address, and a Social Security number. The bureaus do not already know who you are. The first time they hear about you is the first time you apply. Before that, there is nothing.

The concrete path came from a customer with a 750 score whose W-2 Social Security number did not match the credit report. After a divorce had wrecked the couple's credit, a friend told her she could turn on utilities with a child's Social Security number. She did. Then she used it for an apartment, then for pre-approved cards, then for a Ford Motor Credit car loan. She made the payments and grew a 750 file on a four-year-old's number.

Cox went to the file cabinet, pulled 1040s, copied children's names and Social Security numbers, changed the birthdays to adult ages, and pulled credit. No fraud alert. No mismatch. Just "no file found." He applied for two cards on one of those numbers, pulled again, and the report now showed two inquiries. A brand-new credit subject had been born. He called them phantom borrowers. Law enforcement later used a cleaner name: synthetic identity.

A name and a number were not enough. Cox wanted a person with papers, an address, and bank history. He tried forging Social Security cards, then found it was easier to walk into the government and ask for real ones. His first calls were clumsy. Claiming he was 31 and had never been issued a number got him told to bring a driver's license. Claiming a hospital-born toddler got him told the child already had one.

After about ten calls he had a script that worked: a baby born out of state with a midwife, never issued a number, now out of the country and under 12 months old. That required a birth certificate and a shot record. He ordered void-if-copied security paper, copied county blank forms, filled in the vaccine schedule, and wore down a homemade "Richland County" seal with 220-grit sandpaper. He thought the finished certificate was artwork. The clerk grabbed it, felt the paper, and said sit over there.

He learned it was easier to have the state issue a license than to make one. Over the whole run he walked into DMVs in seven states and left with 27 genuine licenses, plus about two dozen passports, which in those years did not take fingerprints. He would bring six documents when three were required and let the clerk pick. He walked out with a card still warm, smelling of melted plastic, and felt like telling them to look closer.

Six months of on-time payments on secured cards produced scores around 700. Banks would do 95 percent loans at 620. A pure scammer might have maxed cards and personal loans for $50,000 or $80,000 per identity. Cox could lever those files against houses. Each phantom, he says, was worth a few million.

In Tampa's Ybor City, crumbling houses went for about $50,000, with $25,000 of rehab. He bought four at a time, paid extra documentary stamps, and recorded the sales at $190,000 or $200,000. Then he trimmed trees, painted the porch, and blacked out the windows so a drive-by appraisal looked fine. The three "comps" supporting each subject were the other houses he had just recorded. The FBI later said the ring did 109 houses. Cox doubts the count. After he left, Forbes listed the Ybor zip among the 20 fastest-rising appraisal markets in the country. Locals, he says, blamed him, "because this place is a dump."

When an identity had five or six houses, extra mortgages, cards, and personal loans, he retired it with a car wreck rather than a fake death certificate, which might have triggered mortgage insurance. He would paste the borrower's name into a real I-4 pileup story, print it on newsprint, highlight the name, and mail collectors a letter from a fictional sister: coma, never work again, just take the houses. Collectors wanted a reason. People do get in accidents.

Lenders wanted down payment seasoned 60 or 90 days, matching tax IDs on W-2s, and companies that existed on the Florida secretary of state's site. Cox learned those checks the hard way, when a broker under him got caught because a tax ID did not match. The next move was not only to fake the borrower. It was to fake the bank.

Around 2000 he and a friend stood up Bank of Ybor on a DIY website, cutting and pasting from real banks, with a 1-800 number into voicemail. If a California underwriter called to confirm a $50,000 balance, a "colleague" — Gretchen, a broker, a girlfriend — would tap imaginary keys and read the number back. Later, on the run in Nashville, he built Southern Exchange Bank the same way and used a real bank's routing number.

When Secret Service agents later slapped a statement on the table showing $190,000 in that bank, Cox asked if they had called. They had left messages. He asked what they thought of the website. One agent, he says, went quiet and swore. The line was already disconnected. The money had never existed. The whole thing, Cox told them, was an illusion.

Zayas later opened her own shop, Creative Financing, and the two families vacationed together. When the FBI came for a cash-back straw-buyer ring, her husband asked Cox to pull $75,000 out of a refinance to pay the lawyer. The lawyer's advice was to wear a wire. At a pizza place she started talking about the Bureau asking questions. Cox buried himself on tape, then noticed both cell phones on the table and wondered if they were microphones. She started crying: "Matt, I'm sorry. I have a kid. I can't go to jail."

His first federal case ended in three years of probation and the loss of his broker's license. A lawyer offered a pretrial deal: walk in the brokers' worst files and skip indictment. Cox refused. He had seen *The Godfather*. When the next scam collapsed, those same people went to the FBI with lawyers. The only person who never talked, he says, was his ex-wife. Agents kept coming to her door. She told them to speak to her lawyer.

After prison he no longer believes in street codes. You cannot do scumbag things with scumbag people and then expect omertà. A corrections officer told him more than half the compound had cooperated, and 100 percent of them were lying about it. The "standup guy" who took 30 years often lost his wife, his kids, and anyone who put money on his books. Cox eventually talked too. He is not proud of it. He also does not pretend the alternative was honor.

On probation he could not own the mortgage company. A CPA named Dave Walker bought it and paid him about $9,000 a month as a consultant. Cox told himself he would flip houses honestly. He was already seasoning synthetic files. When Joel Cologne, the first phantom, printed 700 scores, he sold a renovated house into that name instead. Later identities got Reservoir Dogs names: James Red, Michael White, Lee Black. A judge, he says, looked at him like a jackass.

The second round was larger than the first, and it ran while he was still on federal paper. A high-school friend, Travis Hayes, walked into a bank with a bad $100,000 check, got arrested, and fed a task force the cute names in Hillsborough County records. Subpoenas hit title companies. A *St. Petersburg Times* reporter started calling. Then sheriff's deputy Steve Sutton walked into the office in uniform: a girlfriend on the task force said the FBI would be there in a couple of days.

Cox pulled about $80,000 in cash and packed. Rebecca Hauck, a woman he had been seeing for a month, walked in, heard that every agency was looking for him, and asked to come. He got a nose job, a mini facelift, two hair transplants, liposuction, and new teeth. They traded the Audi and drove to Atlanta as Scott Cugno, a former customer whose birthplace and mother's maiden name Cox had pried out in small talk. He ordered a real birth certificate and Social Security card, then walked into an Alabama DMV and bought a genuine license for about $20.

In Atlanta he rented a house from Michael Shanahan, forged Bank of America satisfactions of mortgage with a bought notary stamp, and filed them. Shanahan kept paying. The bank was not notified. When public records finally showed the house free and clear, Cox posed as the landlord and took about $150,000 from each of three hard-money lenders, roughly $400,000 in a week. A bank manager later counted out a $29,000 cashier's check, then said he felt apprehensive. Cox said, "It'll come to you," and walked out. Secret Service showed up about a week later. That check, he says, was one of the last they cashed.

He needed identities that would not collide with a real person's life. At a stoplight he looked at a man with a sign and walked over with $20. He typed up a "federal statistical survey," pinned on a Salvation Army badge, and paid $20 cash for five minutes. Seventeen questions covered name, birthday, Social Security number, mother's maiden name, birthplace, military service, passports, states of ID, arrests, and last steady job. Homeless men had numbers and birth certificates they barely used. They did not drive, did not take out loans, and often said they would not be employed in two years. "They were perfect for my purposes," Cox says, "as horrible as I know that sounds." Lex asked if he felt bad. Cox said no.

In Las Vegas he surveyed Gary Sullivan, who listed prostitution arrests. Cox later used that ID in South Carolina, signed a mortgage satisfaction as C. Montgomery Burns from *The Simpsons*, and stacked wraparound refinances until one identity owed on the order of $1.3 million. Pulled over once, an officer ran NCIC, saw the Vegas hits, and Cox had to admit he was "from Vegas." Over three years he moved through seven states and more than 50 identities. He was on the FBI's Most Wanted list. Marshals hunted the fugitive. Secret Service took the identity theft.

Becky, bipolar and off her medication, screamed at 1 a.m. until neighbors called the police, which Cox could not afford. After a blowup in Houston he took about $98,000, left his IDs in a storage unit she keyed, and drove off. From a Baton Rouge gas station he called his mother, then a former broker, then FBI agent Candace, who offered seven years if he turned himself in at Tampa and cooperated against his ex-wife. He hung up, threw the phone out the window, and later learned from a FOIA file that marshals had been dispatched to the Subway while he was still eating.

In Charlotte he picked up his car, bought a venti vanilla latte, and watched two people from the apartment complex stare. As he buckled in, a man yelled, "He's right here." Two U.S. Marshals ran at the bumper. He punched it, then a mile later stopped at a homeless shelter to survey three white men in their thirties. In Nashville a landlord looked at his car and a Manufactured Funding Group business card and said he looked like an honest young man. Within two weeks he had a Joseph Carter license, a CarMax car, and a new house-flipping loop. He told Fridman those years were the best of his life. He was not looking over his shoulder. He was getting cocky.

Amanda Gardner found $40,000 in the freezer and learned that Joseph Carter was not his name and that every federal agency was looking. She stayed. National magazines and a *Dateline* special, "The Thief of Hearts," built on Becky's story, were coming. Cox planned Australia, which then wanted money and a business plan but not fingerprints. Amanda's friend Trina was asked to cash checks, called the Secret Service instead, and, Cox says, got $10,000. They watched the house for three days and took him down. One of the first things he thought in handcuffs was that he would miss *Casino Royale* that Friday.

They flew him Con Air through Oklahoma to Atlanta. Counts stacked toward 150 years on paper; the real fight was sentencing guidelines. Loss numbers started around $25 million, rose toward $55 million with the old mill thrown in, then came down. His lawyer, Millie Dunn, said he was overwhelmingly guilty and had to cooperate. Everyone in Tampa already had. The government called *Dateline* and an ethics course for mortgage brokers "substantial assistance," then said it was not enough. The judge hammered every enhancement. Cox got 316 months, 26 years and four months. He cried, he says, like a small child.

More than 20 years to serve put him in the medium at Coleman, Florida, even though his security score said camp. His first day, the yard locked down. Someone had been stabbed. Cox asked if the man was dead. His new cellmate said they had just stabbed him up a little bit. He taught residential real estate to men who thought they would get out and flip houses, and some later sent him money. After a newspaper mentioned his FBI interviews, staff put him in the hole for his own protection. A biker named Bubba told him not to walk the yard. Cox walked it anyway.

He settled in to do the time. He wrote a memoir, *Shark in the Housing Pool*. He wrote an outline for Efraim Diveroli, later played by Jonah Hill in *War Dogs*. He got a *Rolling Stone* story into print and watched most of his words go out under someone else's byline. When the Bureau decided the 2008 bank crisis was bigger than his remaining codefendants, the indictments he had been promised never came. Three lawyers on the street told him that in the Eleventh Circuit he could not force a Rule 35. He was, they said, done.

Frank Amodeo arrived at Coleman as a disbarred lawyer with rapid-cycling bipolar disorder and features of schizophrenia. Since his teens he had believed God had ordained him emperor of the world. He had stolen close to $200 million from the federal government and drawn 22 years. The delusions, Cox says, did not touch the legal work. Amodeo ran a prison law firm, taught research, and walked men to receiving with years cut off. Cox avoided him for a year because everyone said he was crazy. Then he had nowhere else to go.

Amodeo's first speech on the case mixed a march on Washington with a demand for transcripts and a 2255. The theory was that every government ask — *Dateline*, *American Greed*, the ethics course — reset the one-year clock, so Cox was not time-barred, and that Dunn had been ineffective for letting him plead on a hope. The government said he was barred. Months of paper later, prosecutors asked the court to stay the case, appoint a lawyer, and talk Rule 35. Esther Panitch flew in and offered one level, 30 months. When she heard who had written the motion, she said he was taking advice from a mentally incompetent person. Cox asked why she was there if they could crush him so easily.

The judge gave three levels, seven years, and said nine was never going to happen. Amodeo said they would eat the elephant a spoonful at a time. Later Cox learned that Ron Wilson, a Ponzi defendant, had hidden cash with a soon-to-be-ex-wife. He fed the Secret Service the lead, asked Wilson questions on the compound, and pushed for a hearing until prosecutors offered three more levels, five years. Twelve years off. His original out date was 2030. "I didn't have a prayer without that guy," Cox says. "I'm supposed to be in prison right now." Amodeo got himself out too, went back, got out again, and lives in Orlando.

Only his mother and brother picked him up. Driving off the compound, his brother said he must be glad to leave. Cox cried, and the car went quiet. It was survivor's guilt, he says: he was leaving the first real friends he had ever had, men who wanted nothing from him. Inmate Tommy put $400 on his books so he would not walk into the halfway house empty. Cox spent $300 of it at Walmart, the first Walmart of his life. A childhood friend, Treon Calta, hired him at a gym for minimum wage. Other prisoners mailed laptops and editing software so he could put their stories on a site.

He emailed Danny Jones of the *Koncrete* podcast: "My name's Matt Cox and I'm a conman. I was recently released from federal prison." Jones called it one of the best emails he had ever gotten. A guest fell through; the episode did about two million views. Patrick Bet-David, Soft White Underbelly, and Vlad followed. Cox now interviews criminals on YouTube as Inside True Crime. His father, a longtime State Farm manager and alcoholic, died inside Cox's bid. On the one visit he made alone, after the 26 years looked final, he told his son he was not proud of where he had ended up, but he was proud of him. His mother came every two weeks for 13 years, wheelchair and all. He got out in time to take her to dinner, walk beside the chair, and hold her hand at the last stroke. "If I have to be called a snitch for the rest of my life, I don't care," he says. "I didn't deserve more. She did."

His son, three when Cox ran, was adopted and will not speak to him. Cox says the argument is airtight. He has never smoked, drunk, or used drugs because he refused to become his father; his son, looking at him, drew the same line. Asked if he would change any of it, he would scrap the whole thing. The man he is now, he says, is a 54-year-old felon starting over broke, with two dead parents and a child who looks through him. He would rather be a CPA. He never should have whited out that 30-day late. At his richest he was crying. Leaving prison with nothing, he missed his friends. He met his wife in the halfway house. Their date night is alligator hunting on Lake Okeechobee.