This isn’t something recent, but I only now dug it up.  This guy has been mentioned in passing a few times in the Museum of Hoaxes, but seems to not have had any thorough coverage.  And so:

http://home.nycap.rr.com/useless/lustig/index.html

When it comes to deception and trickery, there was no man better at it than Victor Lustig.  He really was the king of the confidence men.  With forty-five known aliases, the mastery of five different languages, and nearly fifty arrests in the United States alone, Lustig could swindle even the brightest of marks.

Lustig was born back in 1890 in Czechoslovakia to your basic middle class background.  At the age of nineteen, a man slashed Lustig for paying just a wee bit too much attention to his girlfriend.  This left Lustig with a scar that ran from the tip of his left eye to the lobe of his left ear.  He was an excellent study in the promising fields of billiards, poker, and bridge and turned to the life of crime for which he would become infamous.

As a gambler, Lustig took to the seas.  The cruises that constantly crossed that Atlantic were loaded with the rich.  And, if rich people abound, then you can be sure that the crooks are not far behind.  It was on one of these cruises at the beginning of the twentieth century that Lustig met up with professional gamblers like Nicky Arnstein (who later gained fame for marrying Ziegfeld Follies star Fanny Brice) and learned the ropes.

World War I put a quick end to all Trans-Atlantic pleasure cruises and Lustig’s career was brought to an instant halt.  He then decided to head for the United States just as the roaring 20’s was about to unfold.  This was the time of the height of Prohibition and the ever-growing Stock Market.  It seemed as if everyone was getting rich and Lustig was there to take advantage of it.

Con #1

In 1922, Lustig went to Missouri and expressed great interest in a dilapidated old farm that a bank had repossessed.  No one wanted this farm, but Lustig did.  Lustig assumed his most famous of aliases.  As “Count” Victor Lustig, he was able to give some sob story of how his life of nobility in Austria was destroyed when the country was overthrown as a result of the First World War.  He claimed to have come to America to rebuild his life with what was left of the family fortune and chose a life of farming.

He offered the bankers $22,000 in Liberty bonds to buy the farm and they gladly took it.  Lustig also convinced them to exchange an additional $10,000 of bonds for cash so that he would have some operating capital until the farm became productive.  The bankers gladly obliged.  They were so excited to be rid of this worthless farm that they had no idea that the Count had switched envelopes and made off with both the bonds and the cash.

Lustig made no attempt to hide his escape.  The bankers hired a private detective who captured him in a New York City hotel room.  During the long train ride home, Lustig convinced his captors that if they actually did press charges against him, there would be a run on the bank by its depositors and the bank would go belly up.  And, Lustig insisted that they should give him $1000 for the inconvenience that the arrest has caused him.  Somehow, Lustig had twisted the whole story and walked away to freedom with their $1000 in his pocket. (Now that is one smooth operator

Con #3

Ah!  The con that would live in infamy.

In May of 1925, Lustig traveled to Paris with Dapper Dan Collins, another confidence man.  While reading the newspaper one afternoon, Lustig noticed a small article in the paper that claimed that the Eiffel Tower was in great need of repair.  The cost of the repair job was very prohibitive and there was a brief comment that the government was actually exploring the idea that it might be cheaper to rip it down than to repair it.

Ding!

A bell went off in Lustig’s head.  He decided that he would be the one to sell the rights to tear down the tower.  First, he had a counterfeiter create official government stationary and personally “appointed” himself to the official position of Deputy Director General of the Minist

Cons #4 and 5

Lustig is well known for one other interesting con.  Lustig did not originate the idea, but he perfected it.  Known as the Rumanian Box, Lustig had a cabinetmaker in New York City make a handsome mahogany box on an as need basis.  Each box measured approximately 12 inches square with a narrow slot cut in either end.  One side of the box featured a series of highly polished brass knobs and dials.

In 1926, Lustig headed for Palm Beach, Florida and spotted a man named Herman Loller.  Loller had earned his fortune making transmission flywheels for the automobile industry, but his business had started to decline as the big car manufacturers forced the little guys out.  Loller was looking for a quick way to sustain his fortune and he stepped right into Lustig’s trap.

The Count did his usual royalty-to-poverty routine and hinted that he had come up with a great way to get rich.  Of course, Loller was now hooked and inquired as to how Lustig did it.  Lustig then pulled out his mahogany box and said that it was a money-duplicating machine.  Lustig assured him that this was not counterfeiting and that all banks would accept them.

Lustig inserted a $1,000 bill in one end and piece of high-rag-content white paper in the other.  He then turned the cranks and knobs and both the bill and paper were sucked in.  Lustig explained that the bill had to soak in the secret chemical bath for exactly six hours for all of the images to transfer properly. Exactly, six hours later, the two men returned and Lustig turned the knobs to have the box spit out two identical bills.  Lustig had Loller take both bills to a local bank and it was confirmed that they were both real.  And they were real.  Lustig had previously concealed a second bill in the box with the serial numbers carefully altered so that they matched.

Loller paid the Count $25,000 (about $240,000 in today’s money) for the machine, which was supposedly the only one in existence (yeah, right!).  Lustig figured that he had exactly six hours to get out of town before his scam was unfolded, but when Loller failed to produce a bill on the first try, he kept trying for weeks on the assumption that he was doing wrong.

Later on, Lustig made his way to Oklahoma where he was arrested on non-related fraud charges.  Once again, he pulled out his magic box and convinced the sheriff (and county treasurer) that he could have the machine in exchange for $10,000 and his freedom (claiming that Lustig had escaped).  It was a deal that the sheriff couldn’t refuse.  Approximately eight months later, the sheriff caught up with Lustig in Chicago and pointed a gun at the Count’s face.  Once again, Lustig talked his way out of this predicament by explaining that the sheriff did not follow the proper sequence of turning the knobs.  Lustig then returned the $10,000.  The sheriff was later arrested down on Bourbon Street for passing counterfeit $100 bills and sentenced to federal prison in Lewisburg, Pennsylvania.

The End of a Career

Now, I am sure that you have realized that I could go on and on.  Lustig pulled many other amazing cons during his lifetime.  But all lives of crime eventually come to an end, and Lustig was no exception.

In 1934, the Secret Service put together a special squad to find out who was flooding the United States with counterfeit bills.  They believed that the counterfeiter was a man named William Watts.  Watts, a former pharmacist, started counterfeiting whisky labels during prohibition and later dabbled in the production of currency.  But the government had no clue where to find Watts.  His only known contact was a man named, you guessed it, Count Victor Lustig.

After a lengthy stakeout, Lustig was arrested and confirmed that Watts had made the plates, but claimed that he had absolutely nothing to do with it.  Yet, Lustig had a key on him that opened a locker in Times Square.  In the locker, the agents found a set of plates and $51,000 in phony currency.  Lustig was arraigned and sent to the Federal House of Detention in New York City.  Almost immediately, the supply of counterfeit notes began to dry up.

The police finally nailed the Count.  Or, at least they thought that they had.

Lustig escaped from prison the day before his trial.  This was not an easy thing to do, since the prison was considered basically escape-proof.  (Lustig quickly proved them wrong.)

His escape was actually quite ingenious.  When first placed in the prison, Lustig noticed that when the attendants brought clean bed sheets to the cells, they would simply ask how many beds were occupied and hand over the required number.  When they came around to collect the soiled linens, they never counted how many were returned.  This set Lustig’s plan into motion.  A couple of weeks before his escape, Lustig simply added one to the number of occupied cots and accumulated nine sheets that he stored in a slit in his mattress.  At night, while all of the other prisoners were listening to a radio show, Lustig tore the sheets into long strips and fashioned a crude rope.

As part of their daily routine, the prisoners were taken to the prison roof at noon for exercise.  On the day of his escape, Lustig claimed that he was ill and stayed behind.  When he was confident that all eyes were off of him, he went down the hall to the washroom and cut through the wire screening with a pair of wire cutters.  (It’s amazing what prisoners can get their hands on in jail.)  He then securely fastened his rope to the third floor window and stepped outside on to a six inch ledge.  Lustig then proceeded to vigorously clean the windows with his white cloth.  Suddenly, in the blink of an eye, the cleaning rag extended out into a long rope and Lustig rapidly lowered himself to the street below.  Many thought that the Count had fallen from the ledge, but he quickly bounced to his feet, took a bow, and then disappeared into the city.

The Count was recaptured twenty-seven days later in the city of Pittsburgh, Pennsylvania.  On December 5, 1935, he stood trial for his crimes.  The star witness for the prosecution was the recently captured William Watts, who recounted every detail of the counterfeiting scheme.  In the middle of the trial, Lustig interrupted the proceedings and mumbled a guilty plea.  Both Lustig and Watts were sentenced to fifteen years in prison.  Lustig, however, received and additional five years for his escape and was sent to Alcatraz to serve out his sentence.  On March 9, 1947, Lustig contracted pneumonia and died thirty-six hours later at the age of fifty-seven years.  His death certificate listed his occupation as a salesman.

And more information on him:  http://en.wikipedia.org/wiki/Victor_Lustig.