Phil Kitzer and the G Men | 166

Phil Kitzer was a globe-trotting scammer who spent more than a decade creating fake banks and insurance companies, ripping off customers to pay for his lavish lifestyle. By the late 70s, Phil’s scam is so prolific that the FBI authorizes the first-ever white collar undercover sting operation. Two young agents join Phil’s entourage and quickly get in way over their heads. With no undercover training, these two newbies scramble to keep up with one of the best con-men in the world without blowing their cover, and hopefully get enough evidence to put Phil away for good. Be the first to know about Wondery’s newest podcasts, curated recommendations, and more! Sign up now at https://wondery.fm/wonderynewsletter Listen to Scamfluencers on the Wondery App or wherever you get your podcasts. You can listen early and ad-free on Wondery+. Join Wondery+ in the Wondery App, Apple Podcasts or Spotify. Start your free trial by visiting wondery.com/links/scamfluencers/ http://wondery.com/links/scamfluencers/ now. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Sarah Hagi?

  Audible subscribers can listen to all our episodes of Scamfluencers ad-free right now. Join Audible today by downloading the Audible app.

• 0:14Scaachi Koul?

  Sarah, have you ever hung out with newish friends and gossiped a little too hard and then you realized that you weren't really in the right company for the kind of gossip you just told?

• 0:24Sarah Hagi?

  You know what? That is so close to being my worst nightmare. I've been close where I've tested the waters, where I've been like, "Yeah, you know that girl?" And then people are like, "Oh, yeah, I love her." And I'm like, "Gotcha."

• 0:37Sarah Hagi?

  But usually, I try and dip my toes in to see what the vibe is. But yeah, I mean, it happens to everyone. I'm sure it's happened to me and I've just erased a memory.

• 0:45Scaachi Koul?

  Well, this has never happened to me because I do not gossip and I do not start every single Scamfluencers recording session with, "Do you have any gossip?"

• 0:53Sarah Hagi?

  Oh, my God, you actually do that?

• 0:56Sarah Hagi?

  And when I don't have anything to offer you, I'm like, "I failed."

• 0:58Scaachi Koul?

  Yeah, and I feel that you have failed. Well, I ask because today's scammer got caught doing a version of just this: trusting the wrong people with the intricate details of his scam. God, Sarah, it's like you can't trust anyone to keep a little secret about fraud.

• 1:17Scaachi Koul?

  It's an early morning in March 1977, and Jack Brennan is sitting by the window in a hotel room in Honolulu, Hawaii. Jack's in his early 30s with boyish round cheeks, sandy hair, and a southern drawl. He's about to spend the next few days at this luxe resort, but he's not on vacation. Jack is an FBI agent, and he's here working undercover. Jack and his partner, JJ Weddick, are trying to gather enough evidence to bust a scammer they've been following for months: a guy named Phil Kitzer. Phil has been running a fake bank con for almost a decade. He offers people phony loans that never come through, and right now, he's targeting a new mark: Hawaii's lieutenant governor.

• 2:00Scaachi Koul?

  But this isn't a typical FBI assignment for Jack. Because this time, Jack and JJ are along for the ride. Phil thinks they're scammers too, and he's brought them into his entourage of rowdy, hard-drinking con men. Over the past few months, Phil has taken them all over the world to meet other ne'er-do-wells and cook up schemes. But he also has them out dancing all night while he picks up women. To keep from blowing their cover, the agents have to stay up late too, drinking all the booze they can't discreetly pour out into potted plants. While they're out partying, Jack and JJ have to try to memorize everything Phil says until they can sneak off to write it down and send their notes back to the FBI.

• 2:41Sarah Hagi?

  I don't really believe in being sneaky this way, but I understand it's necessary sometimes, and I feel like it'd be so much fun.

• 2:49Scaachi Koul?

  It is kind of zany. Well, staying at this beautiful tropical resort has posed all kinds of new problems.

• 2:57Scaachi Koul?

  Phil is taking all his meetings poolside, and the agents can't hide their recording devices when they're in bathing suits. On top of this, Phil has gotten so familiar with the guys that he tends to barge into their rooms and rifle through their stuff. It's making it extremely hard to gather evidence. But today, Jack has a plan. He uses a pair of scissors to cut a small hole in the hem of his hotel room curtains, and then he slips a tiny tape recorder inside. Jack adjusts the cloth around the recorder and probably says a silent prayer that they catch Phil saying something incriminating on tape.

• 3:33Scaachi Koul?

  He feels a rush of adrenaline and fear, because he and JJ are flying by the seats of their pants. These young FBI agents have had zero undercover training, and they're working under their real names. JJ is single, but Jack is married, with two young children and a new baby on the way. So there's a lot at risk if he gets caught. As Jack gears up for another long day of partying with Phil, he can't help but worry. They need to put this con man behind bars before Phil figures out that they're the ones conning him.

• 4:13Speaker 02

  In New Orleans, truckers kept getting sideswiped the exact same way. When a man is found murdered under questionable circumstances related to these accidents, the rubber hits the road. Listen to Over My Dead Body: Operation Sideswipe wherever you get your podcasts.

• 4:31Speaker 03

  I'm Lauren Malloy, the host of the podcast My Mom's Murder. For 30 years, I thought my mom died of natural causes. That's what everyone told me. That's what I believed. Until one day, I got a phone call that changed everything. A woman claiming to be my mom's best friend told me my mother was murdered and that no one had ever investigated it. So I did what the detectives wouldn't: pulled the threads, knocked on doors, and confronted the contradictions. And what I found, it's worse than I imagined. Something happened to my mom. Someone killed her. And I won't stop until I find out who.

• 5:14Speaker 03

  The system may have given up on my mom, but I never will. Listen to My Mom's Murder wherever you get your podcasts. Audible subscribers can binge all 10 episodes early and ad-free right now. Join Audible in the Audible app or by subscribing on Apple Podcasts.

• 5:35Scaachi Koul?

  From Wondery, I'm Sachi Cole. And I'm Sarah Hagee. And this is Scamfluencers.

• 5:48Scaachi Koul?

  Phil Kitzer was a world-class scammer who spent more than a decade creating banks and insurance companies, only to loot them for millions of dollars by selling worthless policies that offered no real coverage. By the late 70s, Phil's scam is so prolific that the FBI takes an unprecedented step to take him down. They authorize the first-ever white-collar undercover sting operation. Two young agents join Phil's entourage and quickly get in way over their heads. With no undercover training, these two newbies will have to scramble to keep up with one of the best con men in the biz without blowing their cover. And hopefully, get enough evidence to put Phil away for good. This is Phil Kitzer and the G-Men.

• 6:35Scaachi Koul?

  It's 1950 in Chicago. Phil Kitzer is just a teenager, but he's already ditched school. He dropped out after 10th grade to start working for his dad's bail bonds business. He's a strong sense of hustle that he inherited from his dad, Phil Senior, who emigrated from Hungary to the US and worked his way up from bricklayer to bondsman.

• 6:57Scaachi Koul?

  It's clear that Phil Junior is a natural-born salesman. He's charming as hell and relentless about getting what he wants. For example, one day, he meets his friend's girlfriend Helen. And even though she's dating his friend, Phil asks her out. Helen says no, she already has a boyfriend. But Phil doesn't take no for an answer. He keeps calling, and eventually, she agrees to go out with him. They start going steady, and a few years later, he asks her to marry him. Helen again says no, but this is Phil we're talking about. So naturally, he keeps asking, and ultimately, she comes around.

• 7:34Sarah Hagi?

  This happens to me all the time, and it just sucks. And you know, I've never, I've never given in.

• 7:40Scaachi Koul?

  Yeah, men are always proposing to us. It's really frustrating.

• 7:44Scaachi Koul?

  Well, by the late 1950s, Phil's family bond business is booming. A bail bond is an agreement that allows a criminal defendant to stay out of jail until they go on trial, without having to pay the full bail amount set by a judge. Instead, they pay a percentage of the bail to a bondsman, like the Kitzers, who guarantee that the defendant will show up in court. By this time, the Kitzers are writing more than half of the bail bonds in Chicago's federal court. One of their clients is the notorious mobster Jimmy Hoffa. And eventually, their work catches the government's attention. At one point, the Kitzers are investigated by a federal grand jury. They're suspected of giving kickbacks to cops in exchange for sending people they arrest straight to the Kitzers to write their bail bonds.

• 8:27Scaachi Koul?

  And in 1959, Phil, his dad, and his brother Joe are questioned by the FBI as part of another courthouse corruption probe. Phil Senior is accused of giving bribes, but he brushes the allegations off as malicious rumors. Ultimately, the FBI drops the investigation. And just like that, it's back to business as usual.

• 8:48Sarah Hagi?

  You know what? Nothing happens to them. So that tells me they're gonna learn an amazing lesson from this and never do anything bad.

• 8:55Scaachi Koul?

  Yes, exactly. Well, by 1961, the Kitzers are looking to diversify. Phil Jr. has been running his own insurance business as a side hustle for a few years. Since he already has a foot in the door, his dad and his brother decide to join him, and they start a car insurance company together. But when Phil goes to the bank for a business loan, he gets a rude awakening. The bank officer wants a kickback in order to approve the line of credit. Phil is not happy, but he needs the loan. So he pays up. His early experiences in Chicago have taught him that sometimes you gotta pay to play. But Phil's no chump. So he's gonna take what he's learned and figure out how to give himself the better side of every deal from now on.

• 9:40Scaachi Koul?

  Phil, his dad, and his brother name their insurance company Adequate Mutual.

• 9:46Sarah Hagi?

  That would inspire belief in a company. Adequate, thank you.

• 9:51Scaachi Koul?

  Truth in advertising. While his dad is focused on the bail bonds, Phil runs the family's insurance business, and he quickly turns it into an empire. Over the next few years, the Kitzers take over and start more than a dozen insurance companies that, in total, employ more than 25,000 brokers in Illinois, Minnesota, and London. Adequate Mutual pulls in millions of dollars in premiums. While Phil has been growing the family's insurance business, he's also become a responsible family man. By now, he and Helen have a rapidly growing family. He takes care of the kids and does chores whenever Helen suffers from migraines, which is fairly often. But this changes around 1963. The business is doing gangbusters, and Phil has more cash than he knows what to do with. He's also traveling a lot

• 10:36Scaachi Koul?

  and only home about once a month. This does not go over well with Helen, who has just given birth to their fourth child. Phil assures Helen that he's taking care of business and that she doesn't have to worry. But he doesn't tell her where the money's really coming from, because Phil's insurance empire is built on lies, and he's using his companies as a personal ATM.

• 10:57Sarah Hagi?

  I mean, insurance, already a scam we have to buy into. So why not just add another layer, right?

• 11:03Scaachi Koul?

  Well, Phil learned early on that the system is broken. And if you don't take advantage of it, you're a sucker. So he started running a scam that is so complicated, it's almost undetectable. First, he starts a real estate holding company to invest profits from his insurance companies. But instead of filling the portfolio with real investment properties, he buys pieces of property nobody wants for next to nothing. Then he finds an assessor who will claim the property is worth much more in exchange for cold, hard cash. Once that overvalued asset is part of his real estate company, Phil is able to pull out an equivalent amount from the company in cash. It looks fine on paper because he's withdrawing cash against an existing asset. But because the value of the asset is fake,

• 11:47Scaachi Koul?

  Phil is really robbing his own company blind.

• 11:52Sarah Hagi?

  Clearly, this is working right now, but it will catch up to him, and he just doesn't care at all.

• 11:58Scaachi Koul?

  Yes, exactly. This will not serve him in the long term, but that's not the point. He's not trying to build a sustainable business. It's more like a pyramid scheme, where each new asset props up the ones Phil has already looted. He's just looking for a quick buck now, and he doesn't care what happens later. Phil is also looting from his other companies. By 1965, Phil, his dad, and his brother have siphoned nearly $4 million from their string of fake insurance companies, the equivalent of over $40 million today. That money should stay in the company coffers to pay out claims. But since it's gone, when a customer, say, gets in a car accident and needs to replace their vehicle, they get almost nothing in exchange for all the premiums they've paid.

• 12:43Scaachi Koul?

  Phil's first insurance company, Adequate Mutual, is insolvent within a year of opening, and the others meet similar fates. Meanwhile, Phil is living it up, spending his stolen millions on lake houses, speedboats, gambling trips to Vegas, and travel to warm tropical locales. So while Helen's at home with the kids in a pounding migraine, Phil is hanging out with beautiful women, even on Mother's Day.

• 13:08Sarah Hagi?

  It seems pretty crazy that he's doing all that considering he basically begged Helen to marry him.

• 13:13Scaachi Koul?

  That's usually how it goes. Well, Phil meets many of these young women in nightclubs and offers them plane tickets to keep the party going in Miami, San Francisco, Puerto Rico, and Acapulco. Some guys can't pull off this playboy lifestyle without seeming creepy, but Phil is charismatic and fun to be around. He puts a lot of this travel on the company tab. At one point, he runs up a $9,000 bill while staying at the famous Fontainebleau Hotel in Miami, which is more than 90 grand in today's money. Phil is loving his new playboy lifestyle, and the thought of going back to Helen, her migraines, and their four kids becomes less and less appealing.

• 13:55Scaachi Koul?

  So in 1966, he walks out on his family for good. But while Phil is partying it up and conning his customers, federal prosecutors are starting to catch on to the Kidster's growing scampire. Soon, Phil will need to leverage one of the only real assets he actually has: his persuasive personality. It's a chilly spring day in April 1967 in Bismarck, North Dakota. The usually sleepy courthouse is swarming with reporters, and everyone in town is talking about the Kidster case. Government prosecutors are charging Phil and a dozen other people with conspiracy to defraud thousands of auto insurance policyholders. They claim Phil and his dad siphoned $3 million from their customers.

• 14:40Scaachi Koul?

  The trial is centered on victims in Minnesota, where six of their insurance companies are based. But the Kidster family successfully argued that they wouldn't be able to get a fair trial there, so the proceedings have been moved to Bismarck. And it is a scene. Several women take the stand to testify that Phil took them on fancy free trips. And don't worry, the reporters covering the trial make sure to emphasize how young and attractive the women are. The prosecution alleges that they were all partying on the company dime. And they say that Phil is a bad person who abused the, quote, "great concept of social justice that is insurance."

• 15:18Sarah Hagi?

  I guess like in theory, these people think that insurance is a concept of social justice, but he's taking the scam of insurance one step further because there are things he's not covering at all, and he's using these people's money to go to Miami. So they also only realize they've been scammed once something bad has already happened to them because they try and use insurance, realize they weren't covered, and by then their money's gone, right?

• 15:43Scaachi Koul?

  Yeah, Phil is the worst of the worst. But the government has to explain Phil's scam to the jury, and it's complicated and confusing. The jury, which The New York Times describes as, quote, "Six North Dakota housewives, three nurses, and three laboring men, struggle to keep up with the intentionally Byzantine scheme." But Phil is a salesman with a gift for storytelling. So when he takes the stand, he's a breath of fresh air. He explains his side of the story as a narrative, and the jury is able to follow along. He grandstands with lengthy explanations, and at one point, he claims that, quote, "The American way of life is to borrow money and start a business."

• 16:24Scaachi Koul?

  In the end, the jury comes to a unanimous verdict. Phil, his father, and his brother are all not guilty. When Phil hears the news, he bursts into tears. Then, he pulls himself together and walks out of the courtroom wearing a winner's smile.

• 16:41Sarah Hagi?

  Well, I do feel like this is the kind of thing that literally will just push him to keep going and just going even harder.

• 16:49Scaachi Koul?

  Yes, that's exactly right. The only thing he's learned is that when people hear his version of the truth, they believe it. Phil has one other takeaway from his brush with the law. The more complicated the scam, the more likely it is that he'll get away with it. With this in mind, he ups the ante on his previous insurance scams. This time, he's not just running fake companies, he's running fake banks. Over the next decade, Phil jets around the world, setting up a series of fake financial institutions, several headquartered in the Caribbean. He lures in customers by promising investors tax-free returns offshore. He masters the art of forging documents, and he finds clever loopholes,

• 17:29Scaachi Koul?

  like naming a company Corp instead of Corporation, so he doesn't have to legally incorporate it.

• 17:36Sarah Hagi?

  My favorite thing is when a scammer finds a loophole that is so cartoonishly stupid. Corp instead of corporation, that's Lionel Hutt's.

• 17:45Scaachi Koul?

  I know. It's like a Looney Tunes fake doorway drawn on a wall, basically. Phil's fake banks often have names that sound very similar to legitimate banks, which further confuses customers. For example, he creates the First National Citibank and Trust of Grenada, a play on the very real First National Citibank of New York. And Phil makes sure that he almost never meets his victims. He builds a layer in between, a person called a broker. The brokers use Phil's fake documents to con Marx into giving them money in exchange for access to credit. And then they give Phil a cut of the profits. Without Phil's fake banks, the brokers can't run their con. It's a win-win situation for everyone, except the customers.

• 18:29Scaachi Koul?

  Though it's obviously risky, Phil stays out of legal trouble by moving around a lot, shutting down fake banks that attract attention and opening up new ones. Apparently, all it takes to open a bank is a little bit of paperwork. By the mid-'70s, Phil has a team of more than 50 brokers working across four continents. He's the go-to guy for nefarious types who want to fleece vulnerable customers looking for credit. And as Phil refines his system for scamming and gets bigger and bigger partners in crime, their marks get a lot bigger, too.

• 19:02Scaachi Koul?

  In June 1976, Fred Pro, one of Phil's protégés, calls his boss with some big news. Fred is in his early 50s. He's tall and stocky and wears a salt and pepper toupee. He's eager to talk to Phil, but the connection is spotty, because Fred's calling from an air-to-ground phone in Elvis Presley's private jet. Fred is pumped. He tells Phil that he just closed a big deal on this plane, which Elvis no longer needs. Elvis might be the king of rock and roll, but he's just become the most famous pawn in their scheme. The details are a little complicated, but what you need to know is that Fred arranged for Elvis's dad, Vernon Presley, to pony up more than $300,000 to upgrade the plane so that it can handle commercial charter flights.

• 19:47Scaachi Koul?

  Fred would get a third party to buy the plane and pay off its mortgage. This new owner will then lease the plane back to Elvis's dad, Vernon, who will lease it back to Fred. If this sounds insane to you, you're not alone. It's a really weird deal. But the bottom line is that it'll earn Elvis $1,000 a month in easy profits. And Fred assures Vernon that he can buy the plane back for a dollar after the lease is up if he wants.

• 20:14Sarah Hagi?

  It is such a crazy deal. And also, whenever our scammers get close to like a truly famous person, it always blows my mind how small the world is. There's just not that many people.

• 20:29Scaachi Koul?

  Yeah. Well, to win Vernon's trust and make this convoluted deal, Fred draws on his reputation as a legit businessman. Before getting into the con game, he was a vice president at a major manufacturer of railroad cars. But then he was scammed out of $160,000. The loss left him reeling, and he was willing to do anything to feel good about himself again. So naturally, he turned to a life of crime. Fred has another explanation for this walk on the wild side, Sarah. He claims that he received a life-changing blowjob on the Eiffel Tower that made it impossible to imagine going back to an honest living. Who amongst us?

• 21:07Sarah Hagi?

  That is disgusting. Honestly, it's disgusting and it's probably a lie.

• 21:13Scaachi Koul?

  Yeah, no one's that good. Well, Phil is helping Fred pull off the scam behind the scenes. He creates fake documents to assure Vernon that Fred's got enough money in the bank to lease the plane at the agreed price, which he does not. Of course, Fred's checks for the lease payments immediately bounce. He pockets the money Vernon gave him to make upgrades and divides it between himself, Phil, and the other con men who are in on the deal. Of course, he never does any work on the plane, but he does fly it around to look fancy while making other scammy deals. About eight months later, Vernon finally speaks with the FBI about what happened. As Fred, Phil, and their cronies keep pulling audacious scams, it's only a matter of time before more of their victims start talking.

• 22:02Speaker 02

  A trucker merges onto the I-10 in New Orleans. He checks his mirrors. The lane is clear. And then, boom. Impact. A pickup truck, seemingly out of nowhere, scrapes down the side of his 18-wheeler. Multiple passengers inside. One man flees the scene. And the driver of the pickup? He doesn't seem all that upset. It didn't feel like a regular accident, because it wasn't. Across the city, truckers are getting sideswiped, all on the same stretch of the same freeway. And behind many of the cases is one person, a Hollywood stunt woman turned personal injury lawyer named Vanessa Moda. This podcast is a story about fake accidents that lead to real consequences and a scheme that ends in betrayal and murder.

• 22:47Speaker 02

  Listen to Over My Dead Body: Operation Sideswipe wherever you get your podcasts. Audible subscribers can binge all episodes early and ad-free right now. Join Audible in the Audible app or by subscribing on Apple Podcasts or Spotify.

• 23:03Speaker 04

  You stepped out for your morning jog. Except it's not your usual morning jog. You started listening to an epic sci-fi book on Audible. 30 chapters later, you've accidentally run a half marathon. You've lost track of how far you've run, somewhere just past the city limits. You can't stop. You have to find out what happens next. Then it's over. The universe seems bigger. You feel different. You feel like you have no idea where you are. Audible: Stories That Speak to You.

• 23:35Speaker 05

  I feel like a legend.

• 23:40Scaachi Koul?

  It's October 1976, and Jack Brennan is at his desk at the FBI Bureau in Gary, Indiana, when the phone rings. It's one of his informants, a cop-turned-conman-turned-pizza-shop-owner named Norman. After Jack caught him writing illegal bail bonds last year, Norman made a deal with the FBI. Lately, Norman's been telling Jack about a shadowy network of fraudsters who've been using fake banks to cheat people and even governments out of millions of dollars. Today, Norman has a hot new tip for Jack. He tells him that if he really wants to take down this racket, he needs to look into their leader, a man named Phil Kitzer.

• 24:18Sarah Hagi?

  Well, well, well. It's crazy because also it's like he is truly leader status.

• 24:24Scaachi Koul?

  Yeah. Well, Jack's ears perk up right away. His work focuses on organized crime, but he's interested in financial fraud, too. He worked as a commodities trader before joining the FBI. So unlike all the people who are confused by Phil's scams, Jack can actually wrap his head around them and why they're so dangerous to consumers. The very next day, Jack opens The Wall Street Journal to see a story about a fraudulent bank in the British West Indies. And Phil Kitzer is named as one of the bank's officers. Jack realizes the FBI has actually tried to indict Phil before, but with no informants to prove Phil is purposefully defrauding people, the case went nowhere. Jack's excited to finally bring this guy down.

• 25:08Scaachi Koul?

  And with Norman on board, he thinks he has a pretty good shot. But he'll have to convince his bosses that going after Phil is worth the resources. At this time, the FBI isn't doing very much about white collar crime, and the local bureau chief is more concerned with the high number of murders in town. But there's someone in the office who Jack thinks would be down to help with the case, a fellow agent named J.J. Weddick. At 26, J.J. is a few years younger than Jack. He's tall and skinny with dark brown hair and a thick 70s mustache that could rival Tom Selleck's. He's a fast-talking New Yorker who started with the FBI three years ago. While Jack is trying to balance work and a family, J.J. is an unmarried workaholic who grinds out 16-hour days.

• 25:51Scaachi Koul?

  He's got a reputation for being ballsy and hot-headed. He loves the adrenaline rush of chasing thieves and bank robbers. And once, he even pulled his gun on two people trying to mug him.

• 26:02Sarah Hagi?

  You know what? People like this in my mind either end up in law enforcement or being like daredevils.

• 26:08Scaachi Koul?

  Yeah.

• 26:08Sarah Hagi?

  Like, he would be walking on a tightrope between buildings or doing this.

• 26:13Scaachi Koul?

  He's in the right place, maybe. Well, Jack corners JJ by the office coffee machine and pitches the case to him. At first, JJ turns down Jack's offer. Financial fraud sounds slow and boring, but he respects Jack, so they keep talking. And it doesn't take long for JJ to realize that going after Phil could be a chance to do something he's always dreamed of: going undercover. At the time, the FBI's undercover work and training is limited, so it could be a while before JJ gets his turn. He decides that this case might be an opportunity to jump to the front of the line. So he comes back to Jack and tells him he's in. Norman helps them arrange a meeting between Phil and an undercover specialist at the

• 26:55Scaachi Koul?

  FBI, who pretends to be a failed restaurateur looking for a loan. And Norman attends, too, pretending to be in on the deal while wearing a wire. It goes off without a hitch. Phil accepts cash in exchange for a fake letter of credit, and it's all caught on Norman's wire. JJ is psyched about the big fish they've got on the line, and he's ready for more. It's a frigid day in February 1977 in suburban Minneapolis, and JJ is wired up with a clunky audio recorder. As he walks towards the Thunderbird Motel, he's sweating through his three-piece suit because he's about to meet Phil for the very first time. After desperately angling for his first undercover assignment, it's finally here, and the role

• 27:39Scaachi Koul?

  is a doozy. He and Jack are posing as young con men in training who want Phil to show them the ropes. JJ had to get clearance from an entire chain of FBI higher-ups to even go to this meeting, so he's eager to prove himself. But he's anxious. He'll have to pretend that they have connections to the insurance industry as their way in with Phil. But unlike Jack, he doesn't know anything about finance. JJ and Jack have had basically no undercover training. They've been approved to do this meeting as a one-time undercover thing, but since they haven't been trained by the FBI, the Bureau won't create fake names for them. So they're using their real names and their very own credit cards.

• 28:21Sarah Hagi?

  It's so risky, but also it's 1977. It's not like you're gonna go off and be Googling these guys. Also, this does sound like a movie.

• 28:31Scaachi Koul?

  It's so lousy.

• 28:32Sarah Hagi?

  This is like 21 Jump Street levels of undercover hijinks.

• 28:37Scaachi Koul?

  Looney Tunes. Well, JJ spots Phil waiting for them at the hotel bar, which is a Native American-themed spot called the Powwow Lounge, Sarah. By now, Phil is in his mid-40s and his face is creased from years of hard partying. He's wearing a suit and tie and sipping a highball of Scotch. And he's puffing on a cigarette, which he lit with a gold-plated lighter. JJ puts on his game face and tries his best to look like a scammer. But when Phil sees JJ and Jack, the first thing he tells them is that they look like a couple of feds.

• 29:11Sarah Hagi?

  Oh, my god. Again, this is straight from a movie. And then, you know, one of them's like, "Yeah, we get that all the time."

• 29:19Scaachi Koul?

  Well, for a moment, JJ holds his breath, wondering if they're about to be exposed. But then, Phil starts laughing. He says that if they were really feds, it wouldn't have been so hard to set up this meeting. Phil buys their cover story, that they want to buy stolen bonds for Jack's grandpa's insurance agency. He even invites them to come along on one of his business trips to Cleveland the very next day. Phil thinks he's helping a couple of upstart criminals learn the ropes, but this masterclass in con artistry will be the start of his undoing.

• 29:54Scaachi Koul?

  It's a crisp evening in New York, a few months after JJ and Jack first met Phil. The three of them are sitting in a restaurant, surrounded by women Phil invited. It's a fancy place, and even though Phil's picking up the tab, the women keep gawking at the prices and struggling with what to order. Phil's getting annoyed, so he asks the waiter to bring them one of everything on the menu. JJ tries to keep a straight face, but he's embarrassed by Phil's big show of opulence. When the food arrives, there's nowhere to put all the plates. Everyone in the place is staring at them, but Phil doesn't care. When the desserts come out, Phil tells the waiter he forgot the spumoni. Just when JJ feels this spectacle can't get any worse, Phil spots a couple in the restaurant giving them the stink eye.

• 30:39Scaachi Koul?

  And then, Phil tells the woman that JJ thinks she's ugly.

• 30:44Sarah Hagi?

  I mean, that is crazy, but it also, in a way, feels like a test to see maybe how uncomfortable they're going to be around him. Like, he thinks they look like feds, and now he's putting them through the wringer, you know?

• 30:58Scaachi Koul?

  Yeah, you could be right. Or he could just be an asshole. Or both. JJ wants to sink into his chair, but he can't break cover. He knows Phil can be cruel and capricious, but since their first business trip to Cleveland, Phil seems to have taken a liking to him and Jack. He calls them the junior G-men, slang for a government man, and makes fun of their clean-cut appearances. Phil probably likes that about them. If they really were con men, their spotless records and Boy Scout good looks could be useful for pulling off scams. And he's enjoying showing these promising young con men how it's done. The two men spend the next few months traveling around the world with Phil on a series of business trips that takes them as far away as the Bahamas,

• 31:42Scaachi Koul?

  Frankfurt, Hong Kong, and Tokyo. It's a blur of boozy nights as Phil and his gang of fraudsters port new marks and beautiful women in each new city. They make time to party at Studio 54 and run up crazy hotel bar tabs around the world. JJ and Jack document everything they can about Phil's scams, gathering the evidence they need to put him away. But Phil doesn't make it easy, so they have to get creative. Like the time Jack chopped up the hotel room curtain in Hawaii to hide a secret recording device. JJ and Jack keep having to come up with excuses to peel off from the group so they can talk to their FBI colleagues and report back on what they found. At one point, Jack sneaks away by pretending to have a nasty case of dysentery. Other times, they pretend to pick up women at bars

• 32:27Scaachi Koul?

  and go home with them, but the women are actually fellow FBI agents.

• 32:33Sarah Hagi?

  This sounds insane to experience, and it's mind-blowing that they are engaging in these activities for the sake of a bigger get. And it kind of simplifies all the ways something like this could go wrong as far as abuse on the FBI's end. You know what I mean? It's like, there are still people engaging in these crazy activities, even if they are cops.

• 32:53Scaachi Koul?

  Mm-hmm.

• 32:54Sarah Hagi?

  It's just so weird seeing it laid out this way.

• 32:56Scaachi Koul?

  Yeah, the line between doing crime as part of your cover and just doing crime could get confusing. And it also seems like they're having a hard time parsing how they feel about Phil personally. Like, while they're collecting evidence on Phil, they're also forming a bond with him. They buy him Tums for his chronic stomach problems. Phil even lends JJ some of his clothes and buys Jack his own gold-plated lighter. But the agents try to never lose sight of who their travel buddy really is: A scammer who's hurting people. While JJ and Jack are on the ground with Phil, their colleagues in the FBI are busy setting up wiretaps on members of Phil's entourage and collecting other evidence. Finally, after spending 23 straight days traveling the world with Phil,

• 33:42Scaachi Koul?

  Jack and JJ say goodbye to him.

• 33:46Scaachi Koul?

  Phil is off to his farmhouse in Minnesota to dry out, and the agents return to brief their bosses. After laying out all of the leads Jack and JJ have identified through their work, the FBI decides that they've got what they need to wind the investigation down and make arrests. JJ and Jack are finally free. In September 1977, Jack calls Phil, who says the FBI just shut up at his door with a search warrant. Jack lies and says that he and JJ were searched. Phil reassures Jack and JJ that everything will be okay, but he also warns that they might be called before a grand jury to testify. Phil's not thrilled, but he doesn't seem too worried. He tells JJ the FBI doesn't care about white-collar cases. They're too complicated and confusing to win,

• 34:30Scaachi Koul?

  so now would actually be a great time to pull off even more scams. JJ is floored by Phil's logic. According to Phil, it would be a logistical nightmare to add new charges on top of an existing indictment, so they may as well go nuts. He seems to be trying to insulate JJ and Jack from the impact of the investigation, while also making sure they don't give him up. But Phil's efforts are coming too late, because he's about to get hit with a shocking truth about his two favorite proteges.

• 35:03Scaachi Koul?

  It's a balmy day in October 1977, and Phil is in the middle of trying to con a bank in Panama when he gets some bad news. The FBI has indicted him on fraud charges. He's not surprised, and he gets on the plane without incident. But when Phil lands in Miami, he is shocked by one thing. The FBI agent waiting for him at the airport is Phil Hanlon. Hanlon is a senior FBI agent from LA, and even Phil's gang never wanted to mess with him. But now, he's putting Phil in handcuffs, and Phil knows that if Hanlon is here, this case is a bigger deal than he thought. Hanlon tells Phil that he's being charged for his role in the Elvis plane deal and another fraud case, and that there will be more indictments down the road.

• 35:47Scaachi Koul?

  Phil asks to call his lawyer. He also makes sure to tell Hanlon that JJ and Jack had nothing to do with this. Maybe these two agents are surrogates for the sons Phil abandoned and is now estranged from. Maybe he wants to pass his scamming skills on to the next generation, just like his father did for him. But whatever the reason, Phil wants to protect JJ and Jack.

• 36:10Sarah Hagi?

  This was like something in my mind that was kind of bound to happen. Like, despite them being cops, they've spent so much time together that how could they not be forming some type of bond?

• 36:21Scaachi Koul?

  Yeah, they're buddies. When Jack and JJ show up to visit Phil in FBI custody, he's confused. At first, Phil thinks they've been picked up too, and he warns them not to talk to the FBI. Finally, JJ rips off the Band-Aid. He flashes his badge and explains that they're here because they are FBI agents, and they've been gathering evidence on him this entire time. Phil demands to see their badges again up close. He feels queasy and looks so rough that Jack offers him a Tums. Finally, after a long silence, Phil starts to smile. He probably feels a begrudging sense of respect for these agents. He has to hand it to these guys. They ran a really good con.

• 37:06Scaachi Koul?

  Maybe, in a weird way, he taught them well after all.

• 37:11Sarah Hagi?

  I know it's really common now to think about undercover assignments and that people go deep undercover, but considering this is the first ever for white collar crime and how deep it went and how many layers there were, it is so crazy to me that nothing went wrong and that Phil didn't figure it out at all. Which, I mean, I guess it does make sense because he doesn't know that this concept exists, but it is just crazy to me that it worked at all.

• 37:37Scaachi Koul?

  I know. And meanwhile, Phil was convinced he could wriggle out of legal trouble yet again. But now, the government has so much evidence on him. Plus, he's broke and isolated. His former entourage of promoters are all furious that he brought a pair of feds into their group. And now, thanks to him, they're all in hot water, too. JJ and Jack tell Phil that they want to make a deal, but they've been lying to him for the last nine months. Phil has to decide if he can trust these guys, or if he'd rather face them in court.

• 38:16Speaker 06

  Dr. Seuss's Cat in the Hat and Fish are back for a whole lot of wonderfully whimsical fun. What happens when you switch bodies with your best friend? Discover a caveman frozen in ice? Or make an alien so angry, he threatens to destroy the planet? Find out in season two of the Cat in the Hat podcast. The Cat and Fish are traveling the world in the great catastrophic cacophony cruiser, meeting genies, clown professors, cave trolls, and extraordinary characters along the way. With clever wordplay, imaginative rhymes, original songs, and stories celebrating curiosity, empathy, and creative problem-solving,

• 38:55Speaker 06

  every adventure brings something new to discover. It's a world of wonderful words, big imaginations, and plenty of heart for the whole family. Listen to the Cat in the Hat podcast wherever you get your podcasts. Audible subscribers can binge all 20 episodes early and ad-free right now.

• 39:16Speaker 07

  Hi, I'm Kenya Paris.

• 39:17Speaker 08

  And I'm Malcolm Gladwell. We're back for season two of our Audible original podcast, The Unusual Suspects.

• 39:23Speaker 07

  We'll sit down with extraordinary guests from the worlds of art, film, literature, comedy, and wellness to hear from their unexpected stories of success.

• 39:30Speaker 08

  And who do we have this season? Well, we'll talk with Grammy-winning artist Anderson Paak, athlete Rich Roll, portrait artist Amy Sherald, Oscar-winning director Ron Howard, legendary writer David Sedaris, and many more. These conversations are more intimate than last season, wouldn't you say?

• 39:47Speaker 07

  I would. Listen to season one of The Unusual Suspects wherever you get your podcasts and sign up for a free trial Audible to listen to season two in the Audible app or by subscribing to Apple Podcasts.

• 40:11Scaachi Koul?

  It's March 1978, and Phil is standing before a federal jury in Louisville, Kentucky. He has a lot to say, and he starts by telling them, quote, "I don't know where I would be today were it not for J.J. Weddick and Jack Brennan, but I do know I sure would not be in this damned courtroom." To save his own skin, Phil makes a deal to cooperate with the FBI and rat on his old friends. The experience is a rude awakening. He flies around the country to testify in all the different trials, but instead of staying in hotels, he's constantly moved between local jails. And unlike his usual luxe treatment on business trips, the guards sometimes deny him his medication and even beat him. J.J. and Jack try to intervene and take care of him,

• 40:53Scaachi Koul?

  but the witness protection program at this time is pretty bare bones. There's not much they can do. While Phil receives harsh treatment in custody, he becomes something of a media darling. He doesn't speak to the press, but tons of newspapers cover his court appearances. They marvel at his skills as a con man, nicknaming him "the king of scam."

• 41:14Sarah Hagi?

  We've had a lot of scammers. Has anyone been nicknamed "the king of scam" yet? I don't think so.

• 41:22Scaachi Koul?

  This might be our first.

• 41:25Scaachi Koul?

  Well, Phil is ultimately sentenced to 10 years in prison, but he only serves two in exchange for cooperating with the FBI. He won't be able to go back to the crazy life he had before, but he'll turn being a rat into a more successful career than any of his previous scams.

• 41:45Scaachi Koul?

  It's December 1985, and Phil has been out of jail for five years. He's sitting with JJ in the dining area at a tiny municipal airport in Mobile, Alabama. They're joined by two guys Phil knows from prison, who are looking to start up a major drug-dealing operation. They want Phil's help and underworld connections to get it up and running. JJ is wired up again, pretending to be a big-time gambler with access to chemicals for cooking meth. But this time, he and Phil are partners.

• 42:14Sarah Hagi?

  Oh, really?

• 42:15Scaachi Koul?

  Yes, Sarah. It's Catch Me If You Can.

• 42:17Sarah Hagi?

  I feel like he could also be going undercover because he knows how it works.

• 42:21Scaachi Koul?

  He really does know how it works. Phil understands the assignment. While JJ's tape recorder rolls, he coaxes the two men into admitting their criminal intent. And minutes later, a massive team of armed agents show up to arrest them. Phil's not doing this as a favor. It's his job now. The government is paying him $36,000 a year, a little over $100,000 in today's money, to work with Jack as an informant. He reels in con men and corrupt politicians, and Jack and the FBI take them down. This time, he's more than happy to share what he's learned in all those years that he ran cons. He even serves as an expert witness in fraud cases and gets paid to give lectures to FBI agents and the IRS about how his scams worked.

• 43:05Sarah Hagi?

  Well, yes, I understand this is a very smart thing for him to do. It must be so crazy, him being like a former criminal now being like truly a rat.

• 43:18Scaachi Koul?

  He leaned in. Well, after they took Phil down, both Jack and JJ went on to have accomplished careers with the FBI. By 2004, they'd both retired. Their crime-fighting careers outlived Phil, who died in 2001. After spending a lifetime bending the rules as the king of scammers, Phil used his expertise to go after anyone who might come for his crown by putting people like himself behind bars.

• 43:45Scaachi Koul?

  Sarah, what did you learn? What I learned is that you can have a second career in life if you just become a rat.

• 43:53Sarah Hagi?

  I know. It opens up this whole can of worms of also like the kind of people who are allowed to do that, you know? But yeah, it's pretty insane to have someone ask, "What's your job?" And then you'd be like, "Oh, I'm an FBI educator because I once was the target of a major investigation. So now I'm using that expertise as my job."

• 44:15Scaachi Koul?

  Well, it's so interesting too, because it's like his scam worked because it was so complicated, but he understood it. And so, of course, why wouldn't you hire someone who created this like insurance snare that so few people could understand? Like, the only reason he got busted is because they just like gave him friends. His downfall was that he wanted friends too much.

• 44:36Sarah Hagi?

  Yeah, I mean, also, it's like, it probably is pretty hard finding friends when you're a criminal mastermind, you know? Like, do they just want to be around you for your money? Do they actually like you? It's probably very similar to being like a celebrity, you know?

• 44:51Scaachi Koul?

  Sarah, do you think you would make a good undercover agent?

• 44:54Sarah Hagi?

  You know, sometimes I feel like I'd be a good undercover agent because when I'm around people that like are crazy, I'm very, very good at just like letting them speak at me without trying to add too much. Like, to be honest, I do like being around a certain type of chatterbox because I could just like take the backseat and have them keep talking. But also, no one would ever assume I'm like a mastermind of manipulation and deceit. I'm kind of too clumsy, I don't know.

• 45:24Scaachi Koul?

  I think what this taught me is that if it looks like a fed and sounds like a fed and smells like a fed, might be a fed.

• 45:29Sarah Hagi?

  You know, I do agree, and I also, it would take so much to think like I am important enough for people to go this deep undercover for me.

• 45:40Scaachi Koul?

  Yeah. The thing about Phil too is like he got a lot of clemency because they liked him. They liked him, so they cracked him a deal so he didn't spend that much time in jail. They wanted to take care of him while they're like moving him around at all these weird prisons while he's testifying. You know, they start working with him. Like, being a good hang can help you get away with a lot.

• 45:57Sarah Hagi?

  It can. It really, truly can. That is why there are personality hires, you know what I mean?

• 46:02Scaachi Koul?

  There's two of them right here.

• 46:03Sarah Hagi?

  Yep.

• 46:09Scaachi Koul?

  Follow Scamfluencers on the Audible app or wherever you get your podcasts. You can listen to all episodes of Scamfluencers ad-free by joining Audible.

• 46:20Sarah Hagi?

  This is Phil Kitzer and the G-Men.

• 46:22Scaachi Koul?

  I'm Saatchi Cole.

• 46:23Sarah Hagi?

  And I'm Sarah Haggy. If you have a tip for us on a story that you think we should cover, please email us at [email protected]. We use many sources in our research. A few that were particularly helpful were the book Chasing Phil by David Howard, and articles from the 1960s, 70s, and 80s in The Charlotte Observer, The Honolulu Star Advertiser, The Los Angeles Times, The Bismarck Tribune, The Morning Pioneer, and other newspapers.

• 46:48Scaachi Koul?

  Susie Armitage wrote this episode. Additional writing by us, Saatchi Cole and Sarah Haggy. Olivia Brierley is our story editor. Fact checking by Meredith Clark. Sound design by James Morgan. Additional audio assistance provided by Augustine Lim. Our music supervisor is Scott Velazquez for Frieze on Sing. Our managing producer is Desi Blalock. Our senior managing producer is Callum Pluse. Janine Cornolo and Stephanie Jens are our development producers. Our associate producer is Charlotte Miller. Our producer is Julie McGruder. Our senior producers are Sarah Enney and Ginny Bloom. Our executive producers are Jenny Lauer Beckman, Marshall Louis, and Erin O'Flaherty. For Wondery.

• 47:34Speaker 09

  Journalist Tristan Redmond goes where no son-in-law should ever go. Deep into his wife's family history, digging up the cold case of who murdered her great-grandmother. Because, I should mention, he thinks the murderer might actually be the beloved family patriarch. For the best binge-watch series like Ghost Story, listen to the Audible True Crime Podcast wherever you get your podcasts.