Every Auditor on Wall Street Vouched for This Felon

He was a respected drug-company president — a Heidelberg-trained doctor, a self-made millionaire, a man some in his own party wanted to run for President. Every bank, the New York Stock Exchange, and the most respected auditors on Wall Street signed off on his numbers, year after year. None of it was real. "Dr. F. Donald Coster" did not exist, and roughly twenty million dollars of his company's assets — a whole division — existed only on paper, invented and run by his own brothers under false names. This is the story of the McKesson & Robbins scandal: how a twice-convicted felon named Philip Musica bought a real, 105-year-old American corporation and inflated it with a fortune that was never there — until one treasurer asked the most boring question in business, and the police took the tycoon's fingerprints. It's the securities-fraud case that forced the world to invent modern auditing, and the rare con where the company outlived the con man: McKesson is a Fortune-500 giant to this day. A study in manufactured legitimacy, accounting fraud, and the gap between the paperwork and the thing behind it. CHAPTERS 0:00 The Ovation for a Doctor Who Didn't Exist 0:54 The 20 Million Dollars That Never Existed 3:28 A Grocer's Son in Little Italy 4:32 The Hair That Sank a Bank 7:30 How to Erase a Name 9:53 A Fake Doctor Buys a Real Company 11:02 The Phantom Drug Division 13:03 The Family Forgery Firm 16:41 The Auditors Who Vouched for Him 19:08 The Uninsured Warehouse 20:28 "These Reports Are Forgeries" 22:41 The Week Wall Street Suspended the Stock 24:08 The One Thing He Couldn't Forge 28:20 The Fraud That Rewrote the Rules of Auditing 30:23 The Company That Outlived the Man Sources & further reading: the SEC's 1940 report In the Matter of McKesson & Robbins, Inc.; Charles Keats, Magnificent Masquerade (1964); contemporary New York Times coverage, December 1938.