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The scam busters


ReligionNewsBlog.com • Thursday December 5, 2002

Budapest Business Journal, Dec. 2, 2002
http://www.bbj.hu/
by P�ter Ol�h

An intrepid writer and a team of consultants have probed the murky world of the ‘Nigerian’ e-mail scheme – and offer some crystal-clear advice

Your first instinct on receiving an unsolicited message from someone you have never heard of, promising large amounts of money in exchange for a little ‘assistance,’ might be to immediately destroy it.

But American investigative writer Brian Wizard, while recognizing such messages for the frauds that they are, decided to pursue the matter. The result is a book exposing the devious schemes in detail, entitled Nigerian 419 Scam “Game Over!”

“The 419 scams started out in the 1980s and primarily targeted the United States and Western Europe. Nowadays, they are shifting their target to new, so far less affected locations such as Central-Eastern Europe and Asia,” Wizard said last week while promoting his book in Hungary. “The scamsters are abusing basic human characteristics – greed and gullibility. It is easy to lose private and corporate funds as well as have one’s human relationships damaged.”

Wizard explained that the term 419 comes from the section of the Nigerian Criminal Code outlawing fraudulent activities, though not all 419 scams originate in Nigeria. He says that according to modest estimates, in excess of $5 billion has been stolen by 419 criminals worldwide so far.

“And still, there are people getting scammed every single day,” he said.

Charlie Patrick, partner responsible for forensic and litigation services in the Central-East European region at consulting powerhouse KPMG, concurred.

“Despite several years of warnings, there are still regular victims, even in sophisticated economies,” Patrick said. “Numerous such messages have been received by KPMG offices in the recent past and we see them becoming more common in Hungary. Most people routinely receive e-mails from strangers and generally delete them without reading. However, when they receive a message from the widow of a recently deceased African dictator, they start to take notice.”

KPMG recently prepared an information sheet about 419 fraud, outlining its typical characteristics and the way to avoid it.

Trick or treat

According to Wizard, regardless of the amount offered and the reason provided, all scam operators follow the same pattern for fooling the unsuspecting victims.

The white-collar criminals claim that they have supervision over large funds, which are currently held for various reasons. In order to collect the sum, the recipient is expected to pay a small and usually later a larger contribution, which, the fraudsters explain, is needed to put the transaction on track.

“They claim that the money is needed to open an account to release the funds, or to bribe local decision-makers,” Wizard said, adding that the swindlers are also ready to provide the victim with all kinds of real-looking fake documents about the existence of the money.

One of the existing scam scenarios, Wizard said, is a modernized version of a centuries-old West African con called the red mercury scam, in which it is claimed that a special chemical is needed to clean bank notes that have been defaced in order to make them unusable.

“The trick is that the bad guys are in need of cash to get new supplies of the chemical so that they can get the money transferred,” he said.

In other scenarios, people are told that foreign entities bequeathed them large amounts of money, or that the scamsters have the authority to transfer the exchange value of large contracts or have government funds to take out of the country. “In some cases they specifically target religious organizations by claiming that they represent a church whose funds are in danger, and that it needs help to get the money out of the country,” Wizard said.

According to KPMG’s fact sheet, the e-mails are normally sent from a free e-mail account, and the message may claim that the recipient’s name was found through a respected source, such as a local chamber of commerce directory. The message typically claims that a large sum of money, normally over $10 million, is not accessible for various reasons, and it also says that the recipient’s help is requested to unlock the funds, for which a substantial “commission,” typically 25%, is promised, the fact sheet says.

It also notes that it is frequently stated that 5% of the funds will be used to pay transaction costs and that the sender will retain the remaining 70%. It adds that the sender usually guarantees that the transaction is “risk free” and that the recipient is asked to treat the matter as strictly confidential.

Close encounters

KPMG’s Patrick said that many victims recognize the scam for what it is at this stage and stop their involvement, although their initial moneys will be lost.

“However, the really gullible even go as far as traveling to Africa, meet with the fraudsters and end up paying more fees,” he said.

So did Wizard, but for a different reason.

Wizard first received such an e-mail in the fall of 1999 and he decided to investigate the issue by pretending that he was game for the scam. “I was even ready to sacrifice some money to get as much information as I could,” he said.

Driven by his investigative instincts, Wizard soon got in touch with four different Nigerian fraudster groups, which operated independently from each other.

After communicating by e-mail, fax and telephone with various people in Nigeria, Spain and London, Wizard traveled overseas to meet the swindlers in early 2000. He met two different groups in London and in Amsterdam, both of which demanded hefty amounts of money from him. The London group needed money for ‘special chemicals,’ while the Amsterdam one requested him to join the exclusive ‘Secret Bank’ at a cost of $75,000, before the millions would be transferred. At the Amsterdam meeting, Wizard overheard a phone conversation between one of the criminals and a previous victim, who, having paid the bank admission, did not understand why the bank transfer was ‘delayed.’

Wizard, who finally left Amsterdam with a full picture about the scam, said the entire investigation, including phone bills and the trip to Western Europe, cost him about $4,000. “In exchange, I had them write one-third of my book,” he joked.

In order to spread information about the scams, Wizards posted his experiences on his own website (www.brianwizard.com), which he regularly updates with the latest information about the scams.

Don’t do it

Both Wizard and KPMG agree that victims of any 419 scam should not count on much assistance from the authorities, either locally or in Africa. Even if a complaint is made, there is very little chance that any funds will be recovered.

“‘I was helping foreign entities carry out an international money laundering scheme, when I found out that it was a scam and they fooled me,’ does not sound like a promising way to file a claim to the police,” Wizard said.

Citing unofficial statistics that claim 419 crimes to be the third to fifth largest revenue-generating activity in Nigeria, he said it is suspected that banks and top public administration officials are involved in the scam.

“Do not be scammed, be informed,” Wizard said, explaining that education about the 419 scam is the ultimate weapon against the fraudsters. He has been taking his information to people around the world: His stay in Hungary is part of a tour that also includes visits to Ukraine and the Czech Republic.

According to KPMG’s sheet, the best tactic is never to reply to such a message, because besides the possibility of being fooled, “any response could be used to steal your personal or company details.”

Wizard also suggests that recipients should use their common sense on acting upon such ‘business proposals.’

“The first question should be: ‘Why me?’ And then you should remember that if something seems too good to be true, it probably is,” he said.

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