Everyone seems to be rushing to get a piece of the booming economy. But few people are chasing money like Joseph Fasceski and David Prater.
The two longtime buddies, who met almost 40 years ago while serving in the Marine Corps, formed a private investigative firm in 1998 to help organizations victimized by financial fraud or similar schemes. Prater, Fasceski & Associates works to recover lost assets or cash--or at least find out what happened to them.
In this hospitable economic climate, Fasceski and Prater believe that their services will increasingly be in demand as fast-growing young companies become targets for con artists, disgruntled employees and even senior company officers who find ample opportunity to make money at the expense of entrepreneurs.
People running start-ups are often "so busy doing so many things," Prater said, that they do not realize when money is being siphoned from their business until checks start bouncing or a big investor starts asking questions. By then, the culprit and the cash are usually long gone, Prater said.
That's when he and Fasceski come in. "I find the pieces of the thread, and then he comes in and starts weaving it all together," Prater said, with an appreciative glance toward Fasceski. (Although Fasceski occasionally interjects a word or two during conversation, Prater often leaves little room for interruption.)
They were explaining the business over lunch at the Lebanese Taverna, Prater's favorite restaurant in Arlington. Fasceski isn't crazy about Middle Eastern cuisine but endures it for Prater's sake.
The two men, both 57, were on a hunting trip in Colorado a few years ago when they decided to go into business together. Fasceski told Prater, who was living in Colorado and doing investigative work on his own, to call if he ever needed help.
Prater, who said his expertise stops short of the "nickel-and-dime" intricacies of accounting, saw an opportunity for a full-time partnership, and the two had several more discussions. Finally, Prater moved to Arlington, and they set up shop in Fasceski's home in Sterling, where they are beginning to market to the scores of high-tech start-ups in the region. Many of them, Prater said, will be "easy prey" for financial scams.
Often, people who think they have great ideas are "desperate" for financing and too trusting when they pick their associates, Prater said.
Take, for example, the Denver wireless communications firm that paid a consultant thousands of dollars when he promised to help the company secure funding from European banking and investment groups. When the chairman of the communications company didn't hear back from the consultant, he called Prater, who found the consultant living comfortably in Spain on the substantial advance fees he had collected from the wireless firm and others.
High-tech companies are vulnerable to any unscrupulous operators among the "independent financial consultants" who circle such firms, Prater said. But more often than not, he added, company owners who get swindled are victims of the people closest to them: employees and partners.
"Pretty much everyone has a price," Fasceski said.
Companies that are lax with internal financial controls--in other words, those that do not have a handle on the flow of money through the organization--leave themselves open to theft. Employees, partners, anyone close to the money could eventually see "an opportunity to make it worth the risk," Fasceski said.
What strikes the two partners as strange is that when longtime, apparently faithful employees and partners take from their employer, they often rationalize it as simply taking what they deserve or as not taking at all--what Prater calls the "wages-in-kind mentality."
They cite an employee who indirectly stole hundreds of dollars a month from his employer, who eventually hired Prater to find out why he seemed to be losing money. Prater showed up at the employer's office one day about lunch time--he never tells a client exactly when he'll arrive--and noticed that there was only one employee there, quietly eating his lunch. The employee soon got up, walked over to the copier and began photocopying a newsletter for his church group--10,000 copies. It turned out he did that every month.
"He never thought for a moment he was stealing," Prater said.
That was a simple case. There have been others in which Prater and Fasceski could not determine where the missing money had gone--or worse, discovered where it had gone but could not recover it.
"And that is a problem, isn't it Joe?" Prater said, adding that he feels like a failure each time he must tell a client that the missing money is beyond reach. Fasceski, the number cruncher by training, has focused increasingly on working with companies before an incident occurs to put financial controls and systems in place.
Fasceski and Prater said their plan to focus on Northern Virginia hasn't gone exactly as expected. Because Prater already had a client base outside Virginia, he and Fasceski have spent a lot of time working with referrals from out of state while they establish a client base here. Toward that end, they have begun networking with local lawyers who work with small and mid-size businesses.
Meanwhile, they aren't finding much money of their own--because, they said, they have only just begun to do serious marketing. "We're struggling by," Prater said.
But they're having a good time. "That's why we do it; it's fun," Fasceski said, putting on his Lifetime Member of the NRA baseball cap as he leaves the restaurant. Although both have guns, neither man carries one during work. This is not "Magnum, P.I.," after all.
"We're boardroom guys," Prater said with a smile.
CAPTION: Joseph Fasceski, above, and David Prater specialize in helping firms root out--and, increasingly, prevent--financial fraud.