Alves dos Reis – Portugal’s greatest fraud ever

Yes, meet the man whose entire life was dependent on forgery and other frauds, Alves dos Reis had some audacity that was not seen before.

It’s easy to look at recent history and think that this is the only time there’s been a spate of financial crises like the ones involving Enron, Bernie Madoff, and Countrywide Financial. Nonetheless, Artur Virgilio Alves dos Reis’s boldness was unparalleled in terms of its scope (1898-1955). He abandoned his engineering studies, moved to Angola, and forged an Oxford University degree in order to get employment. In Portugal, he was quickly arrested for check fraud and sent to jail, where he plotted his next heist.

What did Alves dos Reis plot?

After Alves dos Reis’ release from jail, his history didn’t stop him from orchestrating a financial scam so massive that it helped bring down the Portuguese Republic in 1926 and pave the way for Salazar’s fascist rule. Alves dos Reis may be a worst-case scenario at a time when many question whether or not the financial system is effectively controlled.

Alves dos Reis

The brilliance of Alves dos Reis, as outlined by M. Teigh Bloom in The Man Who Stole Portugal, was that he did not counterfeit Portuguese cash. Instead, his group convinced the British firm responsible for printing Portuguese currency that they were the legitimate government. The business wanted proof of this, but instead of asking the authorities, they went to the conspirators and asked for paperwork. Waterlows, the firm that Alves dos Reis’s gang defrauded, paid out 100 million escudos, or around 1% of Portugal’s GDP, after the group submitted fake documents. Alves dos Reis stole a fourth of the notes and used the money to invest in a taxi company, some farms, and some jewellery.

In order to facilitate the laundering of these cash, he also established his own bank. He was so confident in his scheme that he even tried to use the money to buy out the Bank of Portugal, the one financial institution he was worried about being exposed. Once in power, he planned to hide any proof of wrongdoing. He put a lot of money into buying shares, but it wasn’t enough.

How exactly did he continue the forgery?

Instead, the scam was exposed due to reporting done by O Seculo, a Portuguese daily, investigating his bank, which prompted authorities in that country to begin recording the operations of the conspiracy, which ultimately led to its downfall. Even with no counterfeit bills to look out for, the scam proved difficult to uncover.

However, the serial numbers on the new notes matched those on the old ones, prompting the government to return all 500 escudo bills and sparking widespread fear. Aboard the 6th of December, 1925, Alves dos Reis was detained on the ship “Adolph Woerman” in route to the Portuguese territory of Angola.

Was Alves caught?

Even though he was young, Alves dos Reis had masterminded and carried out the whole deception. When he was arrested, he was just 28 years old. A German spy and a Dutch banker, among others, said they were also fooled by Alves dos Reis, who they say convinced them he was working covertly for the Portuguese government. Many outsiders believed this because of Alves dos Reis’s talents. In other cases, those responsible for the conspiracy were never brought to court. Even after the controversy, some individuals were able to go on with their lives.

Former English printing firm leader and then London mayor Sir William Waterlow was fired from his position as corporation head. Alves dos Reis, however, was not so lucky. As he was being held, he attempted to forge evidence linking the Banco do Portugal to the scam. He then attempted suicide but was successful in escaping death. Since his arrest, he has been incarcerated. He was living in extreme poverty when he passed away in 1955.

The gravity of his transgression was astounding. In 1926, a military coup overthrew the government and terminated the First Republic. It would be exaggerated things to argue that the coup was made possible because of people losing faith in the Portuguese monetary system, but this deception certainly helped create the atmosphere of crisis that led to the revolt.

But can you believe that in India, a man started printing Government Stamp Paper that was even sold in government offices before he was arrested?

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