The Cellar - Brilliant Scam

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So, you think governments are necessarily loss-making, inefficient bureaucracies, right?
Mostly, but not always, as demonstrated by this wonderful bit of private sector/public sector entrepreneurialism:

Quote:

A fake government office has been discovered in northern India that collected taxes, provided civic services and even handed out birth and death certificates, a report says.

An office was set up outside Jhansi town in Uttar Pradesh state and 20 people were employed to carry out jobs such as street sweeping.

Officials believe the operation originally started as a scam to collect fees from residents in return for one municipal janitor.

But the leader of the operation, named as Shyam Valmiki, allegedly branched out, opening a functioning office that employed a team of janitors.

"He later seems to have decided to carry on with the office as it did not appear to be a loss-making proposition," an unnamed police officer was quoted by Times of India as saying.

The scam only came to light after some employees complained about salary problems to superiors in the actual government department, the report said.

"We were shocked to hear this as we ourselves were not aware that our department had a branch office," R Kulkshreshtra, an official with the Jhansi Municipal Corporation, told the newspaper.

It is not known how long the office had been running before being uncovered.

"It would have been difficult for me to believe that a racket like this could exist had we not actually stumbled upon this," Jhansi district official Rajeev Agarwal told the newspaper.

Anirudh Singh Yadav, employed by the office as head supervisor of street cleaners, said he had no way of knowing the branch was fake when he got his job.

"There was hardly any scope for suspicion," he said.

"After submitting the papers we went for a medical examination and were provided certificates."

Valmiki, who was said to be an employee of Jhansi Municipal Corporation, was not at the office when police went to search it, the paper said.

The office was located seven kilometres outside the city and used a signboard of the Jhansi Municipal Corporation.

- AFP

I love a good scam! What's your favourite?

Ahhh human ingenuity is a wonderful thing - gotta give 'em credit. Its pretty ballsy

i think the important point here is being missed. this guy started providing a service that people thought the government should be providing. he hired people and apparently ran it in a semi-legit manner - although it seems not everyone was happy with their pay. but the point is that he was actually able to provide government services for a reasonable fee AND turn a profit.
Why can't anyone that really works for the government figure out how to do the same? if the agency he was impersonating didn't turn the same type of profit he was, the director should be fired and he should step into the position.

He probably wasn't paying into an employee pension fund or passing over taxes he had deducted from employees.

Quote:

Originally Posted by lookout123 (Post 415044)

Why can't anyone that really works for the government figure out how to do the same? if the agency he was impersonating didn't turn the same type of profit he was, the director should be fired and he should step into the position.

Well, government shouldn't turn a profit. It is for things that either aren't profitable, or things in which the profit motive harms the mission.

The latter seems likely here, as privatized birth and death certificates don't seem like a good idea, but if he was able to turn a profit there should be no excuse for the government not opening a legit branch in that location.

I think the US Postal Service is required to be profitable.

They're supposed to break even, not make a profit. And they are more in the "profit harms the mission" camp.