Financial scams - Be Aware
SIFIU Michael Ha’apio, Financial Analyst
Overview
Introduction Advance Fee Frauds Lottery scams Sales Agent What to do Examples Further information
Introduction
Background Technically known as Advance Fee Frauds Dates back to 16th century Most well-known is the Nigerian Letter (or 419 fraud) but now generally called ‘West African 419 Fraud’ However spread around the world and not just from Nigeria e.g. Cote D’Ivoire, Hong Kong Nearly always sent by email now but sometimes by letter, fax or telephone
Introduction
Background US Secret Service estimated that between 1989 and 1999 US$5 billion stolen from victims In a four month period Australia Post in Sydney confiscated 4.5 tonnes of advance fee correspondence (1.8 million items) Over a two year period Australian Police collected over 250,000 letters Australian Customs intercepted a package from Nigeria containing 302 letters to be posted in Australia to NZ, the Pacific and SE Asia But now mainly by email
419 fraud
Claims to come from a person needing to transfer large sums of money out of the country Target told they are the beneficiary of an inheritance but also recently winner of lottery prize All ask for a relatively small sum of money to be transferred PRIOR to receipt of any money usually as a last minute hurdle “Scattergun” approach – most people ignore but some are gullible and greedy
Warning signs
These include: A promise to share or transfer millions of dollars to you for your help or participation The email is marked “urgent”, “top secret” or “highly confidential” and demands you act immediately The sender claims to be a Dignitary, Cabinet Member, High Ranking Army Officer, or lawyer acting on behalf of someone else to gain your confidence The proposal contains an unlikely situation i.e. overpaid millions of dollars on a contract, frozen assets by a foreign government, inheritance money, lottery winnings Name of a Central Bank (originally Nigeria) usually involved or some other foreign bank Requests personal information from you e.g. full name, bank account details, address, telephone numbers, passport details, official letterhead Requires you to advance money “up front” to secure your participation in the transaction – often a last minute hurdle Forged or fake documentation e.g. Anti-Money Laundering Certificate
If it sounds too good to be true it usually is…GREED
Documentation
Fake or forged documents:
– – – – – – – – – – – – – – – – – – – – – Fund Management Agreement Fund Remittance Voucher International Remittance Department, Approval Order Final Notification of Transfer, Fund Release Order Power of Attorney Form Project Development and Investment Agreement Sworn Affidavit of Truth / Claim, Transfer Authority Verdict of the Panel of Judges Affidavit of Fund Ownership Approval / Transfer of Payment Warrant Certificate of Incorporation Specimen Claims Application Form Drug Free Certificate Transfer Confirmation Slip Confirmation of Banking Particulars Foreign Exchange Control Approval Order Certificate of Registration Official Receipt Analysis of Fund Transfer of Fund Schedule Fund Release Order Form UNODC Anti-Money Laundering Certificate Anti-
Reasons for sending the money
Often last minute hurdles prior to sending the money:
– – – – – – – – Bribes for govt. officials Local lawyers fees VAT Insurance Bank fees Customs clearance Handling fees (1% or 2% usually) Etc.
How do they find you?
Any means possible:
– Telephone directories – Mailing lists – Internet, very easy
Recent findings
In the latest Australian FIU Annual Report mentions 100 suspicious transactions of payment fees related 419 frauds SIFIU came across 4 cases.-One reported sending undisclosed amount of money, to date yet receive any proceed.
What to do
If you receive such an offer then do not respond Do not pay any money Do not provide any personal information especially bank account details, residential address, passport details (risk of stolen identity) Never agree to meet in person Report to local police if appropriate and SIFIU Report to overseas authorities e.g. email documents to US Secret Service at 419.fcd@usss.treas.gov Contact email provider e.g. yahoo or hotmail
– abuse@yahoo.com – abuse@hotmail.com
Victims
Often not reported to authorities as victims are embarrassed and humiliated – some even known to have committed suicide Sometimes victims become part of the scam recruiting more victims to recover their own money Victims often borrow money from family and friends to pay the “fees”
Victims
Revealing personal information can often result in your details being used to:
– – – commit criminal offences in your name; access your bank account; or open lines of credit
Even if it were true you might be involved in a criminal offence and assisting laundering money…
Lottery
A new variant on the advance fee fraud and becoming increasingly common Do not believe you have won a prize in a lottery in which you have never participated Asked to maintain confidentiality for security or tax reasons Claim lottery operates under governmental or international control e.g. Spanish National Lottery Short time period to claim and must provide personal information (and usually copy documents) Asked to pay licensing, registration or lawyers fees in advance
Examples
[Kai Solo: Student in Australia , He won USD$1M]
Helpful tips
More information:
– US Secret Service (www.secretservice.gov/financial_crimes.shtml) – UK Metropolitan Police (www.met.police.uk/fraudalert/419.htm) – Nigerian Economic and Financial Crimes Commission (www.efccnigeria.org) – Interpol (www.interpol.org)
Warning note
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