OBSERVANCE OF THE LAW
Sometime in 1926, a tall, dapperly dressed man paid a visit to Al Capone,
the most feared gangster of his time. Speaking with an elegant Continental
accent, the man introduced hirnself as Count Victor Lustig. He promised
that if Capone gave hirn $50,000 he could double it. Capone had more
than enough funds to cover the "investment," but he wasn't in the habit of
entrusting large sums to total strangers. He looked the count over: Something about the man was different-his classy style, his manner-and so
Capone decided to play along. He counted out the bills personally and
handed them to Lustig.
"Okay, Count," said Capone. "Double it in sixty
days like you said." Lustig left with the money, put it in a safe-deposit box
in Chicago, then headed to New York, where he had several other moneymaking schemes in progress.
The $50,000 remained in the bank box untouched. Lustig made no effort to double it. Two months later he retumed to Chicago, took the money
from the box, and paid Capone another visit. He looked at the gangster's
stony-faced bodyguards, smiled apologetically, and said, "Please accept my
profound regrets, Mr. Capone. l'm sorry to report that the plan failed ... 1
failed."
Capone slowly stood up. He glowered at Lustig, debating which part
of the river to throw hirn in. But the count reached into his coat pocket,
withdrew the $50,000, and placed it on the desk. "Here, sir, is your money,
to the penny. Again, my sincere apologies. This is most embarrassing.
Things didn't work out the way 1 thought they would. 1 would have loved
to have doubled your money for you and for myself-Lord knows 1 need
it-but the plan just didn't materialize."
Capone sagged back into his chair, confused. "I know you're a con
man, Count," said Capone. "I knew it the moment you walked in here. 1
expected either one hundred thousand dollars or nothing. But this . .. getting my money back ... well." "Again my apologies, Mr. Capone," said
Lustig, as he picked up his hat and began to leave. "My God! You're honest!" yelled Capone. "If you're on the spot, here's five to help you along."
He counted out five one-thousand-dollar bills out of the $50,000. The
count seemed stunned, bowed deeply, mumbled his thanks, and left, taking the money.
The $5,000 was what Lustig had been after all along.
Interpretation
Count Victor Lustig, a man who spoke several languages and prided himself on his refinement and culture, was one of the great con artists of modem times.
He was known for his audacity, his fearlessness, and, most
important, his knowledge of human psychology. He could size up a man in
minutes, discovering his weaknesses, and he had radar for suckers. Lustig
knew that most men build up defenses against crooks and other troublemakers. The con artist's job is to bring those defenses down.
One sure way to do this is through an act of apparent sincerity and
honesty. Who will distrust a person literally caught in the act of being hon-
est? Lustig used selective honesty many times, but with Capone he went a
step further. No normal con man would have dared such a con; he would
have chosen his suckers for their meekness, for that look about them that
says they will take their medicine without complaint. Con Capone and you
would spend the rest of your life (whatever remained of it) afraid.
But
Lustig understood that a man like Capone spends his life rrlistrusting others. No one around hirn is honest or generous, and being so much in the
company of wolves is exhausting, even depressing. A man like Capone
yearns to be the recipient of an honest or generous gesture, to feel that not
everyone has an angle or is out to rob hirn.
Lustig's act of selective honesty disarmed Capone because it was so
unexpected. A con artist loves conflicting emotions like these, since the
person caught up in them is so easily distracted and deceived.
Do not shy away from practicing this law on the Capones of the world.
With a well-timed gesture of honesty or generosity, you will have the most
brutal and cynical beast in the kingdom eating out of your hand.
Ever ything turns gray when I don 't have at least one mark on the horizon.
Life then seems empty and depressing. I cannot understand honest men.
They lead desperate lives, full of boredom.
CO/IIII " ir/or j,nl/ig, /891J-/'N7
KEYS TO POWER
The essence of deception is distraction. Distracting the people you want to
deceive gives you the time and space to do something they won't notice,
An act of kindness, generosity, or honesty is often the most powerful form
of distraction because it disarms other people's suspicions, It turns them
into children, eagerly lapping up any kind of affectionate gesture.
In ancient China this was called "giving before you take"-the giving
makes it hard for the other person to notice the taking. It is a device with
infinite practical uses. Brazenly taking something from someone is dangerous, even for the powerful. The victim will plot revenge, It is also dangerous simply to ask for what you need, no matter how politely: Unless the
other person sees some gain for themselves, they may come to resent your
neediness. Learn to give before you take. It softens the ground, takes the
bite out of a future request, or simply creates a distraction. And the giving
can take many forms: an actual gift, a generous act, a kind favor, an "honest" admission-whatever it takes,
Selective honesty is best employed on your first encounter with someone. We are all creatures of habit, and our first impressions last a long time.
If someone believes you are honest at the start of your relationship it takes
a lot to convince them otherwise. This gives you room to maneuver.
Jay Gould, like Al Capone, was a man who distrusted everyone.
By the time he was thirty-three he was already a multimillionaire,
mostly through deception and strong-arming. In the late 1860s, Gould invested heavily in the Erle Railroad, then discovered that the market had
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92 LAW 12
been flooded with a vast amount of phony stock certificates for the company. He stood to lose a fortune and to suff er a lot of embarrassment.
In the midst of this crlsis, a man named LordJohn Gordon-Gordon offered to help. Gordon-Gordon, a Scottish lord, had apparendy made a
small fortune investing in railroads.
By hirlng some handwriting experts · Gordon-Gordon was able to
prove to Gould that the culprlts for the phony stock certificates were actually several top executives with the Erle Railroad itself. Gould was grateful.
Gordon-Gordon then proposed that he and Gould join forces to buy up a
controlling interest in Erle. Gould agreed. For a while the venture appeared to prosper. The two men were now good friends, and every time
Gordon-Gordon came to Gould asking for money to buy more stock,
Gould gave it to him. In 1873, however, Gordon-Gordon suddenly
dumped all of his stock, making a fortune but drastically lowering the value
of Gould's own holdings. Then he disappeared from sight.
Upon investigation, Gould found out that Gordon-Gordon's real name
was John Crowningsfield, and that he was the bastard son of a merchant
seaman and a London barmaid. There had been many clues before then
that Gordon-Gordon was a con man, but his initial act of honesty and support had so blinded Gould that it took the loss of millions for hirn to see
through the scheme.
A single act of honesty is often not enough.
What is required is a reputation for honesty, built on a serles of acts--but these can be quite inconsequential. Once this reputation is established, as with first impressions, it is
hard to shake.
In ancient China, Duke Wu of CMng decided it was time to take over
the increasingly powerful kingdom of Hu. Telling no one of his plan, he
married his daughter to Hu' s roler. He then called a council and asked his
ministers, "I am considering a military campaign. Which country should
we invade?" As he had expected, one of his ministers replied, "Hu should
be invaded." The duke seemed angry, and said, "Hu is a sister state now.
Why do you suggest invading her?" He had the minister executed for his
impolitic remark. The ruler of Hu heard about this, and considerlng other
tokens of Wu's honesty and the marriage with his daughter, he took no precautions to defend hirnself from Cheng. A few weeks later, Cheng forces
swept through Hu and took the country, never to relinquish it.
Honesty is one of the best ways to disarm the wary, but it is not the
only one. Any kind of noble, apparendy selfless act will serve. Perhaps the
best such act, though, is one of generosity. Few people can resist a gUt, even
from the most hardened enemy, which is why it is often the perfect way to
disarm people. A gift brings out the child in us, instandy lowerlng our defenses. Although we often view other people's actions in the most cynical
light, we rarely see the Machiavellian element of a gift, which quite often
hides ulterlor motives. A gift is the perfect object in which to hide a deceptive move.
Over three thousand years ago the ancient Greeks traveled across the
sea to recapture the beautiful Helen, stolen away from them by Paris, and
to destroy Paris's city, Troy. The siege lasted ten years, many heroes died,
yet neither side had come elose to victory. One day, the prophet Calchas
assembled the Greeks.
"Stop battering away at these walls!" he told them.
"You must find
some other way, some ruse. We cannot take
Troy by force alone. We I mag e: T h e must find some cunning
stratagern." The cun- Troj an Horse. ning Greek leader
Odysseus then came up Y 0 u r g u i l e i s with the idea of building
a giant wooden horse, hidden inside hiding soldiers inside it,
then offering it to the a magnificent Tr oj a ns as a gift.
Neoptolemus, son of gift that proves Achilles, was disgusted
with this idea; it was irresi stible to unmanly. Better fo r
thousands to die on the YOUf opponent. battlefield than to gain
victory so deceitfully. The walls open. But the soldiers, faced
with a choice between Once insi de, another ten years of
manliness, honor, and wreak havoc. death, on the one hand
and a quick victory on the other, chose the
horse, which was promptly built. The trick was successful and Troy fell.
One gift did more for the Greek cause than ten years of fighting.
Selective kindness should also be part of your arsenal of deception. For
years the ancient Romans had besieged the city of the Faliscans, always unsuccessfully. One day, however, when the Roman general Camillus was
encamped outside the city, he suddenly saw a man leading some children
toward hirn. The man was a Faliscan teacher, and the children, it turned
out, were the sons and daughters of the noblest and wealthiest citizens of
the town. On the pretense of taking these children out for a walk, he had
led them straight to the Romans, offering them as hostages in hopes of ingratiating hirnself with Camillus, the city's enemy.
Camillus did not take the children hostage. He stripped the teacher,
tied his hands behind his back, gave each child a rod, and let them whip
him all the way back to the city. The gesture had an immediate effect on
the Faliscans. Had Camillus used the children as hostages, some in the city
would have voted to surrender. And even if the Faliscans had gone on
fighting, their resistance would have been halfhearted. Camillus's refusal to
take advantage of the situation broke down the Faliscans' resistance, and
they surrendered. The general had calculated correctly. And in any case he
had had nothing to lose: He knew that the ho stage ploy would not have
ended the war, at least not right away. By tuming the situation around, he
earned his enemy's trust and respect, disarming them. Selective kindness
will often break down even the most stubborn foe: Aiming right for the
heart, it corrodes the will to fight back.
Remember: By playing on people's emotions, calculated acts of kindness can turn a Capone into a gullible child. As with any emotional approach, the tactic must be practiced with caution: If people see through it,
their disappointed feelings of gratitude and warmth will become the most
violent hatred and distrust. Unless you can make the gesture seem sincere
and heartfelt, do not play with fire.
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94 LAW 12
REVERSAL
Authority: When Duke Hsien
of Chin was about to raid Yü,
he presented to them a jade
and a team of horses. When
Earl Chih was about to raid
Ch'ou-yu, he presented to
them grand chariots. Hence
the saying: "When you are
about to take, you should
give." (Han-fei-tzu, Chinese
philosopher, third century B.C.)
When you have a history of deceit behind you, no amount of honesty, generosity
, or kindness will fool people. In fact it will only call attention to itself. Once people have come to see you as deceitful, to act honest all of a
sudden is simply suspicious. In these cases it is better to play the rogue.
Count Lustig, pulling the biggest con of his career, was about to sell
the Eiffel Tower to an unsuspecting industrialist who believed the government was auctioning it off for scrap metal. The industrialist was prepared
to hand over a huge sum of money to Lustig, who had successfully impersonated a government official. At the last minute, however, the mark was
suspicious. Something about Lustig bothered hirn. At the meeting in which
he was to hand over the money, Lustig sensed his sudden distrust.
Leaning over to the industrialist, Lustig explained, in a low whisper,
how low his salary was, how difficult his finances were, on and on. After a
few minutes of this, the industrialist realized that Lustig was asking for a
bribe. For the first time he relaxed. Now he knew he could trust Lustig:
Since all government officials were dishonest, Lustig had to be real. The
man forked over the money. By acting dishonest, Lustig seemed the real
McCoy.
In this case selective honesty would have had the opposite effect.
As the French diplomat Talleyrand grew older, his reputation as a master liar and deceiver spread. At the Congress of Vienna (1814-1815), he
would spin fabulous stories and make impossible remarks to people who
knew he had to be lying. His dishonesty had no purpose except to cloak
the moments when he really was deceiving them. One day, for example,
among friends, Talleyrand said with apparent sincerity, "In business one
ought to show one's hand." No one who heard him could believe their
ears: A man who never once in his life had shown his cards was telling
other people to show theirs. Tactics like this made it impossible to distinguish Talleyrand's real deceptions from his fake ones. By embracing his
reputation for dishonesty, he preserved his ability to deceive.
Nothing in the realm of power is set in stone. Overt deceptiveness will
sometimes cover YOUf tracks, even making you admired for the honesty of
your dishonesty
