JAMES M. DONCKELS, Senior Supervisory Resident Agent, FBI

Jim Donckels runs the Orange County office of the FBI from a nondescript Santa Ana building in an office decorated with golfing trinkets. A seemingly mild-mannered man with a slightly professorial mien, Donckels worked on some of the biggest local frauds of the 1980s, such as the ring that defrauded Bank of America and other banks out of half a billion dollars and the notorious $2.5-billion Lincoln Savings & Loan scandal. He talked recently with Times staff writer Michael Flagg about the FBI and white-collar crime.

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How many agents do you have in Orange County, and how has that changed over the years?

When I came here in 1975, we had 15 agents and one supervisor. Now we have 63 agents and five supervisors. A lot of that has to do with white-collar crime. In just the last few years, we went from one white-collar crime squad of 12 agents to two with 30 agents: one for bank and savings-and-loan fraud and one for other types of financial crimes. A lot of the expansion came in the mid- to late-1980s with the wave of failed savings and loans. At one time we had 14 separate failed financial institutions in Orange County, and we were involved in investigating all of them.

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Is Southern California really that much worse for white-collar crime than, say, New York or Florida?

Southern California is the fraud capital of the United States. There’s no question about it. And Orange County is right up there nationally as a popular place for people who commit frauds to live and do business. The Los Angeles division of the FBI has the largest complement of agents dedicated to white-collar crime in the country--156 altogether. That’s more than New York, which is our largest field office and has more than twice as many agents. White-collar fraud is the FBI’s top priority here.

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What’s so appealing to scam artists about Southern California?

The same thing that appeals to everybody else: It’s a nice place to live. You have the beaches, the good weather. And then there’s a lot of money in places like Orange County, and these guys go where the money is. They can establish themselves fairly easily and put up a legitimate front. They seem legitimate. I remember a fraud in the mid-1980s: Every company in it had a name similar to a well-known company. They’d have one called, say, Barclays Mortgage--playing on Barclays Bank in Britain, of course.

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So it’s hard, even for a relatively sophisticated business person, to sometimes spot a scam?

Any number of people involved in white-collar crime have been considered very respectable people in their community. It’s generally true that they live in nicer homes than you and I do, and drive nicer cars--they look successful. Normally, they haven’t been convicted of a crime. That’s what makes the crimes they commit so insidious: You believe in them and trust them.

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Someone once told me these guys are such good con artists that they can even con themselves into thinking they haven’t done anything wrong.

I once talked to a cooperating witness in the massive Bank of America fraud in the 1980s. And I asked, in his case, did he start his company with a clear idea of defrauding people? And I remember he said: “It’s kind of like driving a car and you’re not paying attention, and suddenly you’re slowly drifting over the yellow line. You don’t look up until you’re on the other side, and by then it’s too late. So you just keep on going.”

I never met a white-collar criminal who didn’t believe that if he hadn’t been stopped, he would have eventually replaced the money or whatever and everything would have turned out fine. Charles Keating of Lincoln Savings & Loan is the best example. We did that investigation out of this office. He still believes he’s done nothing wrong, even though it was the most incredible fraud I’ve seen in 25 years in the FBI: It was so vast and had so many tentacles. In just one aspect of it, he defrauded thousands of people. Just what do you say to people to get thousands of them to take $300 million of their life savings out of safe investments and buy your junk bonds?

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What kind of scams do you see most often here?

Everything. You name it--mortgage loan fraud, phony limited partnerships, pyramid schemes. The crooks are very innovative here. They’re coming up with new stuff all the time--commodities frauds, bogus insurance. Right now we’ve got investigations going into smuggling cigarettes, for instance, manipulation of stocks and bonds, phony lease transactions. . . .

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What kind of training do agents get in order to deal with these increasingly sophisticated frauds?

I would say 50% of our agents in the white-collar crime squads have accounting degrees, and another 25% have law degrees, and in some cases they have both. Once in the field, you specialize, you take in-service training courses. My specialty turned out to be white-collar crime, but I didn’t start out that way. Yes, in some cases the person we’re investigating will be a lot more sophisticated in a particular line of business than the agent investigating him. Then we bring in some help--a regulatory agency like the Securities and Exchange Commission, for instance, in cases of stock fraud.

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One hears that it is difficult keeping seasoned agents, since they can often make a lot more by practicing law or working for a private security firm. Is that a problem?

Turnover in the FBI nationwide is less than 2%, including retirements. So I’d say it’s not a problem. But we are in a hiring freeze. We won’t hire a new agent until October, 1994. And we’re going through a reduction too: We’ll probably lose 1,000 agents, out of 10,000 nationwide. I don’t know if we’ll lose any here. As it is, we can’t do all the major cases we’re referred. We simply have to pick and choose. We try to work bank cases if there’s $250,000 or more involved, but other types of frauds usually have to be in the millions of dollars before we get involved. We’re probably working 200 to 300 major cases out of here at any one time.

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On the mentality of white-collar criminals . . .

“I never met one who didn’t think he was better or smarter than us. They think we’ll never figure it out. It’s a good thing, too, because that’s why they end up going to jail.”

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On sentencing white-collar criminals . . .

“It used to be true that he might get a shorter sentence than the time you spent investigating him. But since the new sentencing guidelines in the 1980s, sentences are fairly substantial.”

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On how many of its white-collar cases the local FBI wins . . .

“I don’t keep track, but I’d estimate 75%. There are always frauds out there that just can’t be proved.”

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On white-collar criminals’ spending habits . . .

“They tend to be extravagant. They’ll do things like have a limousine wait for them. Their attitude is: ‘It’s not my money, so it doesn’t matter how fast I spend it.’ ”