Stanley Mark Rifkin, a mild-mannered computer wizard, used his skills to pull off the largest bank robbery in the history
of the United States. Adding insult to injury, the bank was unaware
that it had been victimized until federal officials informed them of
Rifkin’s scam.
An artful schmoozer
In 1978, Rifkin operated a computer consulting firm out of his apartment in the San Fernando Valley in southern California. The balding thirty-two-year-old had numerous clients, including a company that serviced the computers of the Security Pacific National Bank, headquartered in Los Angeles,
California. Located in a room on the bank’s D-level was Operations Unit
One—a wire transfer room. A nationwide electronic wire network allows
banks—including Security Pacific—to transfer money from one bank to
another. Operated by the Federal Reserve Board, a government agency,
the network allows banks to transfer funds throughout the United States
and abroad. Like other banks, Security Pacific guarded against wire
theft by using a numerical code to authorize transactions. The code
changed on a daily basis.
Rifkin used his position as a consultant at the bank—and his
knowledge of computers and bank practices—to rob the institution. In
October 1978, he visited Security Pacific, where bank employees easily
recognized him as a computer worker. He took an elevator to the
D-level, where the bank’s wire transfer room was located. A pleasant
and friendly young man, he managed to talk his way into the room where
the bank’s secret code-of-the-day was posted on the wall. Rifkin
memorized the code and left without arousing suspicion.
Soon, bank employees in the transfer room received a phone call from
a man who identified himself as Mike Hansen, an employee of the bank’s
international division. The man ordered a routine transfer of funds
into an account at the Irving Trust Company in New York—and he provided
the secret code numbers to authorize the transaction. Nothing about the
transfer appeared to be out of the ordinary, and Security Pacific
transferred the money to the New York bank. What bank officials did not
know was that the man who called himself Mike Hansen was in fact
Stanley Rifkin, and he had used the bank’s security code to rob the
bank of $10.2 million.
Diamonds: an untraceable commodity
Officials at Security Pacific were not aware of the theft until Federal Bureau of Investigation
(FBI) agents informed them of the robbery. The heist went through
without a problem—until the second part of Rifkin’s plan came into
play. Rifkin had actually begun preparations for the robbery in the
summer of 1978, when he asked attorney Gary Goodgame for advice in
finding an untraceable commodity. Goodgame suggested that Rifkin should
speak to Lon Stein, a well-respected diamond dealer in Los Angeles.
In early October, Rifkin laid the groundwork to convert stolen funds
into diamonds. Claiming to be a representative of a reputable
firm—Coast Diamond Distributors—he contacted Stein. He claimed to be
interested in placing a multi-million dollar order for diamonds.
Suspecting nothing, Stein ordered diamonds through a Soviet government
trading firm called Russalmaz.
On October 14, the Russalmaz office in Geneva,
Switzerland, received a phone call from a man who claimed to be an
employee of the Security Pacific National Bank.
The man, who called himself Mr. Nelson, informed the Russalmaz firm
that Stein was acting as a representative of Coast Diamond
Distributors. Further, he confirmed that Security Pacific had the funds
to finance
the multi-million dollar transaction. The man who called himself Mr.
Nelson called again, to say that Stein would stop by Russalmaz’s Geneva
office on October 26 in order to look over the diamonds.
On the rocks
On October 26, Stein arrived at the Geneva office of Russalmaz. He
spent that day inspecting diamonds and returned the following day with
another man. (The identity of the second man is unknown. According to
physical descriptions of the man, he did not resemble Rifkin.) Stein
agreed to pay the Soviet firm $8.145 million in exchange for 43,200
carats of diamonds. (Diamonds are weighed by a basic unit called a
carat, which is two hundred milligrams. A well-cut round diamond of one
carat measures almost exactly one-quarter inch in diameter.)
Somehow Rifkin managed to smuggle the diamonds into the United
States. Five days after he robbed Security Pacific, he began to sell
the Soviet diamonds. First, he sold twelve diamonds to a jeweler in
Beverly Hills—an exclusive suburb of Los Angeles, California—for
$12,000. Next, he traveled to Rochester, New York, where he attempted
to sell more of the diamonds. There Rifkin’s plot hit a snag.
On November 1, he visited Paul O’Brien, a former business associate.
He informed O’Brien that he had received diamonds as payment for a West
German real estate deal—and that he wanted to exchange the diamonds for
cash. Before he had a chance to act on Rifkin’s request, O’Brien saw a
news item on television describing a multimillion-dollar bank heist in
Los Angeles. The story named Rifkin as the thief. O’Brien wasted no
time in contacting the FBI.
Convicted of wire fraud
Rifkin flew to San Diego, California, to spend a weekend with Daniel
Wolfson, an old friend. He informed Wolfson that he planned to
surrender. But he never had the opportunity to give himself up. O’Brien
had given the FBI permission to record calls from Rifkin. On November
5, Rifkin called O’Brien. The conversation contained information that
allowed FBI agents to track Rifkin to Wolfson’s Carslbad, California,
address.
Around midnight on Sunday, November 5, FBI agents Robin Brown and
Norman Wight appeared at Wolfson’s apartment. At first, Wolfson barred
their entry with outstretched arms. When the agents informed him that
they would force their way inside if necessary, he allowed them to
enter. Rifkin surrendered without a struggle. He also turned over
evidence to the federal agents: a suitcase containing the $12,000 from
the Beverly Hills diamond sale and several dozen packets of diamonds
that had been hidden in a plastic shirt cover.
Rifkin was taken to the Metropolitan Correctional Center in San
Diego. Soon after he was released on bail, he got into more trouble
with the FBI. He had begun to target the Union Bank of Los
Angeles—using the same scheme that had worked at the Security Pacific
National Bank. What he did not know was that someone involved in the
scheme was a government informant who had set him up. Rifkin was
arrested again on February 13, 1979. Federal agents also arrested
Patricia Ferguson, who was helping Rifkin set-up the bank. Tried on two
counts of wire fraud, Rifkin faced the possibility of ten years
imprisonment. He pleaded guilty, and on March 26, 1979, was sentenced
to eight years in federal prison. In June 1979, Ferguson was convicted
of three counts of conspiracy.
Supplementary Material
Recovered funds
Officials at the Security Pacific National Bankin Los Angeles
had no idea that Rifkin had stolen $10.2 million from the bank—until
FBI agents informed them of the theft. After Rifkin’s capture, federal
agents recovered about $2 million of the stolen money—and a large cache
(supply) of diamonds. The bank later sold the diamonds.
An incredible problem
People who knew Rifkin found it hard to believe that the pleasant computer whiz was the mastermind of a multi-million dollar bank robbery. Gerald Smith, a professor of management science at California State University
at Northridge told reporters, “The guy is not a bank robber, he’s a
problem solver. I have a feeling Stan viewed the thing as an incredible
problem. He’s always five years ahead of anything else going on.”
A picture worth a thousand words
Rifkin was picked up by FBI agents at the home of Daniel Wolfson.
Wolfson, a photographer, shot pictures of his old school pal as federal
agents escorted him into custody. He sold the photographs the following
day for $250. One of the photographs was purchased by UPI (United Press
International). The picture included the caption: “Stanley Mark Rifkin,
32, smiles in this picture, taken minutes after his arrest, by Dan
Wolfson, who rented the apartment where Rifkin was arrested. Rifkin, a
computer wizard, is charged with defrauding a Los Angeles bank of $10.2
million. Wolfson was also arrested … during the telephone interview
with UPI.” Wolfson was later charged with harboring a criminal.
Sources for Further Reading
Nash, Jay Robert. The Encyclopedia of World Crime. Wilmette, IL: Crime Books, 1990, pp. 2582–2583.
“The Ultimate Heist.” Time (November 20, 1978), p. 48.
This is the complete article, containing 1,389 words
(approx. 5 pages at 300 words per page).
