Advanced Fee Scams: A Multibillion-Dollar Fraud

Advanced Fee Scams: A Multibillion-Dollar Fraud

Bruce Mandelblit
Wednesday, July 2, 2003

This longtime and highly successful swindle is known by many names -- the “advanced fee scheme,” the “Nigerian scam” or the “4-1-9 fraud” – but whatever it is called, the basic elements are often the same.

According to the United States Secret Service, here is how it works:

An individual or company receives a letter, fax or e-mail from an alleged “official” representing a foreign government or agency.

An offer is made to transfer millions of dollars in “over invoiced contract” funds into your personal bank account.

You are encouraged to travel overseas to complete the transaction.

You are requested to provide blank company letterhead forms, banking information and telephone/fax numbers.

You receive numerous documents with official-looking stamps, seals and logos testifying to the authenticity of the proposal.

Eventually you must provide up-front or advance fees for various taxes, attorney fees, transaction fees or bribes.

Other forms of the scam include c.o.d. of goods or services, real estate ventures, purchases of crude oil at reduced prices, beneficiary of a will, recipient of an award, and paper currency conversion.

Here is the customary scenario of this very creative and crafty sham:

The victim is enticed into believing he or she has been singled out from the masses to share in a multimillion-dollar windfall of profits for doing absolutely nothing.

In almost every case, there is a sense of urgency.

The victim is enticed to travel to Nigeria or a border country.

There are many forged official-looking documents.

Most of the correspondence is handled by fax, e-mail or though the mail.

Blank letterheads and invoices are requested from the victim, along with banking information.

Any number of Nigerian fees are requested for processing the transaction, with each fee purported to be the last required.

The confidential nature of the transaction is emphasized.

There are usually claims of strong ties to Nigerian officials.

A Nigerian residing in the United States, London or other foreign venue may claim to be a clearing house for the Central Bank of Nigeria.

Offices in legitimate government buildings appear to have been used by impostors posing as real occupants or officials.

Quick Security Tip: Although this swindle is generically called the “Nigerian scam,” the letters, faxes and e-mails could also originate from other countries – so please be on alert.

What can you do to help defend yourself against this hideous deception?

Here are some tips suggested by the National Fraud Information Center:

1. Beware of calls, letters, e-mails or faxes purporting to be from a government official in Nigeria or another country, asking for your help to place millions of dollars of overpayments in an overseas bank account.

2. Resist temptation. Despite the promise of generous compensation for your cooperation, the purpose of this scam is to take money out of your account, not put millions into it.

3. If you respond to the solicitation, you will be asked to pay a never-ending series of fees or expenses before the funds can be transferred to your account. Unfortunately, the millions never materialize.

4. Guard your bank account and other information carefully. Even if you don’t send money, all a crook needs is your bank account and routing numbers to withdraw funds from your account.

5. Do not consider traveling to meet the person and discuss the offer. Victims who have been lured to the foreign country or have gone to investigate what happened to their millions have been robbed, held for ransom, and even murdered!

6. Report these types of money scams to law enforcement authorities.

For more details about this sly hoax, check the United States Secret Service Web site at www.secretservice.gov and the National Fraud Information Center site at www.fraud.org.

My Final Thoughts: This deceitful deception is still a flourishing illicit scourge. These clever thugs are always coming up with new variations on this basic time-proven fraud. Recently, for example, some crooks have claimed to be former Iraqi government officials needing help to transfer millions of dollars out of Iraq.

On face value, it would seem that no one would ever enter into such a conspicuous scam – but unfortunately, nothing could be further from the truth. In fact, the United States Secret Service receives about 100 telephone calls from victims/potential victims, and 300-500 pieces of related correspondence, per day! Be alert and aware of these cunning criminals, and don’t fall for their crafty con.

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“Staying Safe” with Bruce Mandelblit is a regular column for the readers of NewsMax.com and NewsMax.com Magazine.

Bruce welcomes your thoughts. His e-mail address is CrimePrevention123@yahoo.com.

Bruce is a nationally known security journalist, as well as a recently retired, highly decorated reserve Law Enforcement Officer.

Bruce writes Staying Safe, a nationally syndicated weekly column covering the topics of security, safety and crime prevention.

Bruce was commissioned as a Kentucky Colonel – the state's highest honor – by Gov. Paul E. Patton for his public service.

This column is provided for general information purposes only. Please check with your local law enforcement agency and legal professional for information specific to you and your jurisdiction.

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