Spam craigslist in every major city, begging people to click your (meaning his) ad-sense ad because his sister has leukemia and needs help paying for the chemotherapy treatment. And post a picture of a bald-headed and pathetic-looking little girl that will break the heart of everyone that reads the ad.
They will click his ads so frequently that Google will not be able to tell the difference between a legitimate click and one that is not, and will ban his account for this reason. Note the subtle difference here between a previous post that said that Google can tell the difference between a "real" click and a "fake" one. That might be true is there is a one-off spike in clicks, say for example a site that normally generates 30 suddenly generates 100. They might disallow most of the 70 fake clicks, but what if that same site got 10,000 clicks? Would Google disallow 90% of them, and pay for 1000 fake clicks, or would they ban the account?
I think they would ban the account. Otherwise, it would be a GREAT METHOD to create an ad-words account, fake 10,000 clicks and get paid for 1000 of them. 70 clicks might not be worth it, but 1000 would be worth it. Google cannot allow this kind of an opportunity for scammers, so they would HAVE to ban the account. Either that, or pick out which 30 of the 10,000 random, craigslist-generated clicks is legitimate, and which 9,970 clicks are not.
Meaning, ad-sense account banned.
Originally I thought to suggest that you just threaten him with this, but then decided that by doing this, you might be giving him information that would help him do the same thing to you. He might not be smart enough to think of something like this himself, and by giving him this idea you might be helping him to harm you. (= bad idea)
Instead, I think you should send him an email telling him that you have forwarded his threat to Google Ad-Words, and he might have his account banned as a result. Then do the method above, and get his account banned. He'll think Google did it.