(Continued from last week)
Examples of Advance Fee Scams (part 2)
Here is an actual example of such scam as reported on 914Legal.org.
“Last month, hundreds of internet users from places right across the US were done in by a scam perpetrated by a company calling itself The Fairway Lending Group. The company gave a false address and claimed to be operating out of 1699, Wall St., Mt. Prospect. It was careful to leave out local residents. The scam would have blown apart if any of the locals had found out that it was not occupying the said premises.
The company was especially targeting those with a poor credit rating. It offered a loan that was actually a scam molded on the advance fee type of scams.
The scam started when people responded to mails from the company that promised them easy loans. They were then asked for their bank account details presumably for processing of the loan request. The victims were next asked to make a payment as collateral for the loan. They were asked to make the payments through Western Union money transfer. The amount people paid ranged from $900 to $5000.
Users should have been warned when asked to pay any amount upfront before receiving a loan. Such loan schemes are actually banned in the US and in Canada. Any such loan offer would be illegal if offered in the first place.
Apart from money lost, the victims in this case, might also be exposed to identity theft, having revealed their bank account details to the fraudsters. The thing for them to do would be to either close the account or to give instruction to the bank if possible to temporarily suspend it.
As of now, there is no trace of the company. Local authorities claim to have no clue about their whereabouts. Being an Internet based scam, the fraudsters found it easy to hoodwink the police by covering their tracks.
Seeing an increase in scams, the Federal Deposit Insurance Corporation provides warning signs that may indicate a loan offer is not legitimate:
The loan approval is "guaranteed." Lenders do not typically guarantee loans before analyzing the applicant's financial condition, credit history and ability to repay.
The loan applicant is required to pay upfront fees to a third party or individual. Loan fees are normally paid to a business after the loan has been approved.
The lender or loan processor may be located outside of the United States.
Fees are requested using a retail wire transfer system. A password is sometimes used by the overseas receiver to pick up the funds in an attempt to hide the true identity of the criminals and make funds more difficult to trace.
Occasionally you have no idea you are paying anything. Ads may include phone numbers that generate telephone fees added to your phone bill. Some online sites require downloads that include a virus. It switches your Internet Service provider from what you are using to theirs, usually located overseas with huge fees.
Growing in popularity are death threat reports. Someone has hired a “hit” on you and the person who accepted the contract will not follow through if you pay him.
People outside the United States have to be aware of scams stating that the company can get people into this country. They provide employment offers in the US, targeted to people specifically living in India, although other places may be involved. These jobs have come from a variety of sources, but are usually traced or linked to a company based in the United States, that are information technology consultants, contractors or simply a specialist employment agency. These companies have clearly stated that they will "assist" or even outright claimed that they will "obtain" the necessary working permit visas on behalf of the proposed employee. Of cause, upfront fees are needed.
In some cases, the scammers ask that the person come to the foreign country directly to handle the transaction in person. The US Department of States warns: Over the past 3 years, 15 foreign businessmen (one American) have been murdered in Nigeria in AFF scams. Since September 1995, at least eight Americans have been held against their will by these criminals in Lagos that have come to the attention of the U.S. Embassy. In 1996 the U.S. Embassy helped repatriate ten Americans who came to Lagos looking for their “pot of gold.”
Tuesday, May 26, 2009
Saturday, May 9, 2009
Consumer Safety & Awareness Part 19
Examples of Advance Fee Scams
In order to recognize the many varieties and ever changing advance fee scams, one needs to study many examples. Con artists spend considerable time creating new, innovative schemes to trick us. They mask their techniques and hide their intent carefully.
In the previous section we looked at the typical Nigerian 419 scams that included promising something for a fee paid in advance, an inheritance, found money, stolen goods, ATM cards, and traveler checks. Other 419 scams, all requiring you to pay for something in advance and usually involve a wealthy investor who wants to invest in a large sum of money in a foreign country, but can't attend to the business personally. Wouldn't you care to do them the favor of overseeing the investment?
A fortunate person has gotten a large quantity of a commodity, oil, gold, or diamonds for example, but cannot move them from their storage facility without the help of a foreign investor. If you would only pay some fee, bribes, or other expense, he will let you keep a very generous percentage of the commodities' market value once they have been sold.
A business places a relatively small legitimate order from your company, usually under $1,000 worth of goods. Thereafter, another order is placed, for a slightly larger amount, again, paid in full. Suddenly, an urgent order and much larger is placed, but this one needs to be air freighted on the double! Your trade partner has just received a lucrative contract, and if this shipment arrives on time, it means many more large orders in the near future. Don't worry about waiting until the bank draft clears, after all, the order is from a trustworthy company that has always made payments before.
You receive an e-mail from a U.S. Special Forces commando who has found millions in drug money while conducting a covert mission against the Taliban. The "commando" says he has stashed the cash in luggage, but wants to keep it in someone else's bank account "for safekeeping."
The National Fraud Information Center reports a scam artist who used dating websites, including sites for gays. She pretended to be the daughter of a slain African gold mine executive seeking a long-term relationship with a special someone. Phony Web sites, which look quite realistic, may contain plenty of investor information, often copied from the sites of legitimate regulators. The sites are one of the many ploys used in advance fee scams that try to get investors to send money in advance of any service rendered. These fake sites often use "cookies" to track visitors and gather information.
Taking advantage of recent health scares, one advance fee ploy involves the discovery of a vaccine or other preventatives that can not only save millions of lives but will also generate considerable money. The inventor needs financial support to distribute, market, or manufacture his cure. A twist on this one is the sale of stock in such a company. Stock is not sold by e-mail. If you are actively advertising real estate for sale, you may receive an offer to purchase your property from a foreign concern. The catch: You are required to pay up-front fees to a “special broker.” Once paid, you cannot locate this special broker to consummate the purchase.
Almost all of these schemes have five common features – something of great value exists, there is a pressing time issue, it comes from out of the country, assistance is needed, you can not tell anyone else, and advanced payment is required to free up the item of value. Until 2007, more than 50% of these originated in Nigeria, but now they can come from anywhere. In many cases similar versions even have local, United States or Canada, origins.
Many domestic advance fee scams are financial in nature and prey on people with poor credit history or current money flow problems such as late payment of mortgages or loans. They promise low cost loans, debt consolidation, improved credit scores, or other solutions to financial problems. All of them require a fee for processing, credit evaluation, good faith, or other improbable reason.
Occasionally, yet growing more common, the scammers do not ask for any money at all, but need information to verify your credibility. These are identity theft scams. Never send anyone your bank or investment numbers, or even let others know where you invest. Your social security number must be sacred – only medical and valid insurance people need this. If you have an investment that produces dividends or interest, the company needs your social security number for their IRS reports, but deal only with such institutions in person.
(To be continued next week)
In order to recognize the many varieties and ever changing advance fee scams, one needs to study many examples. Con artists spend considerable time creating new, innovative schemes to trick us. They mask their techniques and hide their intent carefully.
In the previous section we looked at the typical Nigerian 419 scams that included promising something for a fee paid in advance, an inheritance, found money, stolen goods, ATM cards, and traveler checks. Other 419 scams, all requiring you to pay for something in advance and usually involve a wealthy investor who wants to invest in a large sum of money in a foreign country, but can't attend to the business personally. Wouldn't you care to do them the favor of overseeing the investment?
A fortunate person has gotten a large quantity of a commodity, oil, gold, or diamonds for example, but cannot move them from their storage facility without the help of a foreign investor. If you would only pay some fee, bribes, or other expense, he will let you keep a very generous percentage of the commodities' market value once they have been sold.
A business places a relatively small legitimate order from your company, usually under $1,000 worth of goods. Thereafter, another order is placed, for a slightly larger amount, again, paid in full. Suddenly, an urgent order and much larger is placed, but this one needs to be air freighted on the double! Your trade partner has just received a lucrative contract, and if this shipment arrives on time, it means many more large orders in the near future. Don't worry about waiting until the bank draft clears, after all, the order is from a trustworthy company that has always made payments before.
You receive an e-mail from a U.S. Special Forces commando who has found millions in drug money while conducting a covert mission against the Taliban. The "commando" says he has stashed the cash in luggage, but wants to keep it in someone else's bank account "for safekeeping."
The National Fraud Information Center reports a scam artist who used dating websites, including sites for gays. She pretended to be the daughter of a slain African gold mine executive seeking a long-term relationship with a special someone. Phony Web sites, which look quite realistic, may contain plenty of investor information, often copied from the sites of legitimate regulators. The sites are one of the many ploys used in advance fee scams that try to get investors to send money in advance of any service rendered. These fake sites often use "cookies" to track visitors and gather information.
Taking advantage of recent health scares, one advance fee ploy involves the discovery of a vaccine or other preventatives that can not only save millions of lives but will also generate considerable money. The inventor needs financial support to distribute, market, or manufacture his cure. A twist on this one is the sale of stock in such a company. Stock is not sold by e-mail. If you are actively advertising real estate for sale, you may receive an offer to purchase your property from a foreign concern. The catch: You are required to pay up-front fees to a “special broker.” Once paid, you cannot locate this special broker to consummate the purchase.
Almost all of these schemes have five common features – something of great value exists, there is a pressing time issue, it comes from out of the country, assistance is needed, you can not tell anyone else, and advanced payment is required to free up the item of value. Until 2007, more than 50% of these originated in Nigeria, but now they can come from anywhere. In many cases similar versions even have local, United States or Canada, origins.
Many domestic advance fee scams are financial in nature and prey on people with poor credit history or current money flow problems such as late payment of mortgages or loans. They promise low cost loans, debt consolidation, improved credit scores, or other solutions to financial problems. All of them require a fee for processing, credit evaluation, good faith, or other improbable reason.
Occasionally, yet growing more common, the scammers do not ask for any money at all, but need information to verify your credibility. These are identity theft scams. Never send anyone your bank or investment numbers, or even let others know where you invest. Your social security number must be sacred – only medical and valid insurance people need this. If you have an investment that produces dividends or interest, the company needs your social security number for their IRS reports, but deal only with such institutions in person.
(To be continued next week)
Friday, May 1, 2009
Consumer Safety & Awareness Part 18
How Advance Fee Scams Operate
Poor Nigeria. It seems that this country frequently gets blamed as being the center of Internet scams. That’s because the Advance Fee fraud originated, or at least was perfected there. In addition, the Nigerian government seems to protect fraudulent activities and does not prosecute scammers when they are discovered. Now-a-days these types of scams can originate anywhere, including the United States and Canada.
According to UltraScan, a global investigations group, the Nigerian Advance fee scam, also called the 419 scam, is the world’s must successful fraud, costing people worldwide over $32 billion. More than 300,000 people have fallen for this, with more buying in every day.
Since it is so widely publicized, why does it continue to be so successful? Because people want to believe, and because people are greedy. There are more than 100 variations on this scam, so they may be hard to spot at first, but all of them call for the mark to pay upfront before getting the thing of value.
NextWeb Security has a huge list of such scams – here is a sample:
In the original scam, of which new variations are generated daily, the 419 scammer has or can gain access to a large sum of money by some means and he needs the financial and personal help of the target, in return for a percentage of the funds, to get the necessary transactions processed and get monies out of the country. As in all advance fee frauds, the mark has to send money prior to obtaining any benefit. Once the funds are transferred, either you do not hear from the scammer again or he has excuses to ask for additional sums.
The ATM Card Payment Scam is used in conjunction with other scams, such as a fake Lottery Scam. The victim is promised an ATM card with which the victim can withdraw millions of dollars (up to a large limit per day) at any location that accepts ATM cards. However, the victim must pay a fee to receive the card. If it ever is received, it will not work. A "Replacement card" will then be offered, again for a fee.
In the Black Currency scam the 419er has a large amount of currency available to share with the target, but the currency has been defaced. However, the currency can be cleaned if the target will purchase enough of the correct cleaning solution. Guess who has it for sale?
In one of the original 419 frauds, the scammer has Cashier's Checks or money orders he needs cashed, and the target can keep a percentage of the check as his commission for cashing it and forwarding the remaining proceeds to the 419er. The original check or money order sent to the target eventually bounces. The target is out both the money advanced to the 419er and the amount owed to the bank. The target must also pay any overdrafts and any relevant fees. On occasion the victim lands up in jail for bank fraud.
Charities are not safe. The 419er approaches a charitable organization with a request for help, usually about getting a large sum of money transferred out of a country in which the charitable organization operates. A percentage of the proceeds are often offered to the charitable organization for their assistance. The 419er needs the charity’s money for fees in order to get the monies freed up.
In a job scam, the 419er "employs" the target to process financial transactions for a commission and has the target advance the net proceeds of these transactions to the scammer before the checks sent to the target bounce.
If you run a business, beware of the scam in which goods or services are ordered in advance, on credit. Then the scammer does not pay or pays with a bad check.
In the romance scam, the 419 meets the target online in a chat room or through a dating or instant messenger online service, befriends the target, and gets the target to advance him money for various reasons.
Greedy people often fall for the inheritance scam. Someone has died with no relatives to claim the large cash bequest left by the deceased. Often, the 419er says that if someone does not claim the money it will revert to the Government and no one will get it. The target is asked to "stand in" as a relative to claim the money, with the 419er taking care of all the details, and then they can split the proceeds. The scammer needs up-front money for fees to get the target declared the rightful inheritor.
In another action that can get the victim in legal trouble, the 419er will obtain stolen merchandise for personal use or to sell. Because many companies will not send merchandise to Nigeria or Eastern Europe due to warnings about stolen credit card purchases, the scammer must find an in-country person to receive then reship the goods.
Scammers all around the world use similar techniques. We frequently hear of “gypsy-type” contractors offering to do repairs on a home at low cost. They may be willing to resurface or blacktop your driveway for half the expected price. Once you agree, they unload some supplies from their truck, and then ask for advanced payment to get additional supplies. Since they have material set out, you agree, perhaps giving $120 for five buckets of blacktopping. They drive off to get it and you never see them again. You are left with useless garbage on your lawn.
This type of scam also applies to roofing, carpentry, and other odd jobs. Some contractors ask for money up front, then do a shoddy job, or start and never finish. It may take years and lots of legal fees to get back even part of what you paid them.
Online auctions use advance fee techniques, purchasing items and never paying for them or selling items and never sending them once they receive the money. In some cases you do get poor quality or out-of-date products.
Monday, April 20, 2009
Consumer Safety & Awareness Part 17
Advance Fee Scams: Introduction
One of the most common illegal schemes is called the “advanced-fee” scam. It involves getting payment or a product before giving anything of value, then disappearing. There are two main formats, the simple get-the-fee-and-run technique, and the counterfeit rebate scheme. The second, originally a “Nigerian 419” scheme, revolves around receiving a check, depositing it, and sending part of the amount to the scammer. The check is stolen or counterfeit. We will look at this in depth later.
Advanced fee schemes can arrive in the mail, by e-mail, through phone solicitations, personal visits, in newspaper and magazine ads, and even through paid television and radio commercials. They can earn the scammers enough to quickly pay for their upfront fees, generate a nice profit, and provide them with get-away cash. They know how to cover their tracks well.
All such scams are uninvited. You do not contact them, they contact you. The mass mailing available to Internet spammers provides a perfect venue. Let’s start off by analyzing an actual e-mail that people have received.
AWARD NOTIFICATION: FINAL NOTICE
Attn: Winner,
We are pleased to inform you of the lottery result winners of Australian International Lottery Programmes held on the 30th of July 2007 from the Australian International Lottery programme. Which is fully based on an electronic selection of winners using their e-mail addresses. Your name was attached to ticket number; 675061725 9356460902 Serial Number 67749137002. This batch draws the lucky numbers as follows 2-9-23-35-46 bonus number 14, which consequently won the lottery in the second category. You are here by having been approved a lump sum pay of US$400,000.00 in cash credit file ref: ILP/HW 46704/03 from the total cash prize shared amongst eight lucky winners in this category.
Due to mix up of some numbers and names, you are advised to keep your winning information confidential until your claims has been processed and your money remitted to your nominated bank. This is part of our security protocol to avoid double claims and unwarranted abuse of this programme by some participants. All participants where selected through a computer/mail balloting system drawn from Nine hundred thousand E-mail addresses from Canada, Australia, United States, Asia, Europe, Middle East, Africa and Oceania as part of our international promotions program which is conducted annually. This Lottery was promoted and sponsored by a conglomerate of some multinational companies and also the Australian Government as part of their social responsibility to the citizens in the communities where they have operational base. Further more your details (e-mail address) falls within our European representative office in Amsterdam, Holland, as indicated in your play coupon and your prize of US$400,000.00 will be released to you from our regional branch office. We hope with part of your prize, you will participate in our end of year high stakes for US$2.3 Million international draw.
HOW TO CLAIM YOUR PRIZE: Contact our Claims Office under the African Payment Centre, where your winnings fell.
Contact Person: Mr. Alexzander Evans(RCA) Phone_+234_80 666 70849
Email: agentalex.australianlotto@yahoo.com
TO FILE FOR CLAIM: Please quote your Date of draw, Reference Number, Batch Number and Winning Number, which can be found on the top-left corner of this message. Also, you should give in your telephone number to help locate your file easily. For security reasons, we advice all winners to keep this information confidential from the public until your claim is processed and your prize has been released to you and also to the public. This is part of our security protocol to avoid double claiming and unwarranted taking advantage of this programme by non-participant or unofficial personnel.
Note: All winnings MUST be claimed before the 30th of August 2007: otherwise all funds will be forfeited. Congratulations once again on your winning!
BEST REGARDS,
MR.DANIEL ROMAN
(LOTTERY COORDINATOR)
PLEASE DO NOT REPLY TO THIS EMAIL. CONTACT YOUR CLAIMS AGENT AT:
agentalex.australianlotto@yahoo.com
ANY BREACH OF CONFIDENTIALITY ON THE PART OF WINNERS WILL RESULT TO DISQUALIFICATION.
The catch is that when you call up or write to submit your claim, they ask you to pay a fee or to submit your credit card or bank account number to cover some expenses. It could be taxes, verification of identity, promotional costs, or some seemingly reasonable cause. Payment is usually through a money order, Western Union, or similar method that is not traceable to the actual scammers. They may not ask for gigantic sums. Occasionally, especially if they hope to con thousands, the fees may be a few hundred. They have been known to ask for thousands of dollars at a time.
Let’s analyze this letter.
1. It is called the “Australian International Lottery Programmes.” Google that phrase and you get around 200,000 hits. The first one may say “Congratulations, you have won, this is real.” All the others say that this is a scam. In fact, Goggling the phrase with “scam” after it leads to such sites as Fraud Aid, which contains a list of thousands of names used in scams.
2. “Your name was attached to ticket number; 675061725 9356460902 Serial Number 67749137002. This batch draws the lucky numbers as follows 2-9-23-35-46 bonus number 14” Too much detail. That is a technique scammers use. They believe that people will fall for official-sounding gibberish.
3. “US$400,000.00 in cash credit…from the total cash prize shared amongst eight lucky winners” Multiply that amount by the 8 winners and you get $3.2 million. Are you going to believe that the second place prize was that much?
4. “Due to mix up of some numbers and names, you are advised to keep your winning information confidential until your claims has been processed and your money remitted to your nominated bank.” Three things in this sentence. Any prize that asks you to maintain confidentiality is a scam. No questions about it. Secondly, this is a conglomerate of major corporations and the government. Would they get numbers and names mixed up? Last, they are already leading up to needing your bank account number. You give it to them and they can drain your entire savings.
5. “This is part of our security protocol to avoid double claims and unwarranted abuse of this programme by some participants” There are eight winners. Even if you include the first place and a few hundred minor winners, what are the chances their organization, especially since it was “promoted and sponsored by a conglomerate of some multinational companies and also the Australian Government” will be so disorganized that they cannot keep track of a few names?
6. “Drawn from Nine hundred thousand E-mail addresses from Canada, Australia, United States, Asia, Europe, Middle East, Africa and Oceania.” Why not Mexico and South America?
7. “Further more your details (e-mail address) falls within our European representative office in Amsterdam,” No North American representative? Seems unlikely.
8. “We hope with part of your prize, you will participate in our end of year high stakes for US$2.3 Million international draw.” Heads up! They are going to ask you to send money to play in this drawing before you get your prize. Interesting that their grand annual prize is $2.3 million, yet second place was $3.2 million.
9. “Contact our Claims Office under the African Payment Centre, where your winnings fell. Contact Person: Mr. Alexzander Evans(RCA) Phone_+234_80 666 70849
Email: agentalex.australianlotto@yahoo.com” Wow, there’s a bunch of give-away signs here. Why would someone in the United States, who has a “European representative” have to contact someone in Africa? Let’s Google that phone number. There are only a few results and the first screams “scam.” The second is written in Cyrillic letters, meaning the scam may have originated in a former Soviet Union country. International calling code “234” is Nigeria. Remember what we said earlier about this being a favorite of the “Nigerian 419” scams?
10. “Also, you should give in your telephone number to help locate your file easily.” How can they cross-reference to your telephone number when this was a random drawing using e-mail addresses? They do not have your phone number, but giving it to them will make it easier for them to scam you, or to sell the information to others who can try to trick you.
11. “We advice all winners to keep this information confidential from the public” A second such warning. They know if you tell anyone you will be informed it is a scam.
12. “PLEASE DO NOT REPLY TO THIS EMAIL” Because if you do, you will get a no-such e-mail return. They love using throw-away e-mail addresses. Use it once and then delete it. The same is true for using a “Yahoo,” “G-Mail,” “Hot-Mail,” or any other form of free e-mail service. Your contact is agentalex.australianlotto@yahoo.com. Agent X? And a Yahoo account? You would think that a bona fide lottery would have its own domain.
13. “ANY BREACH OF CONFIDENTIALITY ON THE PART OF WINNERS WILL RESULT TO DISQUALIFICATION” In case you did not catch it the first three times.
This is just an example. There are many other types of advanced-fee scams.
One of the most common illegal schemes is called the “advanced-fee” scam. It involves getting payment or a product before giving anything of value, then disappearing. There are two main formats, the simple get-the-fee-and-run technique, and the counterfeit rebate scheme. The second, originally a “Nigerian 419” scheme, revolves around receiving a check, depositing it, and sending part of the amount to the scammer. The check is stolen or counterfeit. We will look at this in depth later.
Advanced fee schemes can arrive in the mail, by e-mail, through phone solicitations, personal visits, in newspaper and magazine ads, and even through paid television and radio commercials. They can earn the scammers enough to quickly pay for their upfront fees, generate a nice profit, and provide them with get-away cash. They know how to cover their tracks well.
All such scams are uninvited. You do not contact them, they contact you. The mass mailing available to Internet spammers provides a perfect venue. Let’s start off by analyzing an actual e-mail that people have received.
AWARD NOTIFICATION: FINAL NOTICE
Attn: Winner,
We are pleased to inform you of the lottery result winners of Australian International Lottery Programmes held on the 30th of July 2007 from the Australian International Lottery programme. Which is fully based on an electronic selection of winners using their e-mail addresses. Your name was attached to ticket number; 675061725 9356460902 Serial Number 67749137002. This batch draws the lucky numbers as follows 2-9-23-35-46 bonus number 14, which consequently won the lottery in the second category. You are here by having been approved a lump sum pay of US$400,000.00 in cash credit file ref: ILP/HW 46704/03 from the total cash prize shared amongst eight lucky winners in this category.
Due to mix up of some numbers and names, you are advised to keep your winning information confidential until your claims has been processed and your money remitted to your nominated bank. This is part of our security protocol to avoid double claims and unwarranted abuse of this programme by some participants. All participants where selected through a computer/mail balloting system drawn from Nine hundred thousand E-mail addresses from Canada, Australia, United States, Asia, Europe, Middle East, Africa and Oceania as part of our international promotions program which is conducted annually. This Lottery was promoted and sponsored by a conglomerate of some multinational companies and also the Australian Government as part of their social responsibility to the citizens in the communities where they have operational base. Further more your details (e-mail address) falls within our European representative office in Amsterdam, Holland, as indicated in your play coupon and your prize of US$400,000.00 will be released to you from our regional branch office. We hope with part of your prize, you will participate in our end of year high stakes for US$2.3 Million international draw.
HOW TO CLAIM YOUR PRIZE: Contact our Claims Office under the African Payment Centre, where your winnings fell.
Contact Person: Mr. Alexzander Evans(RCA) Phone_+234_80 666 70849
Email: agentalex.australianlotto@yahoo.com
TO FILE FOR CLAIM: Please quote your Date of draw, Reference Number, Batch Number and Winning Number, which can be found on the top-left corner of this message. Also, you should give in your telephone number to help locate your file easily. For security reasons, we advice all winners to keep this information confidential from the public until your claim is processed and your prize has been released to you and also to the public. This is part of our security protocol to avoid double claiming and unwarranted taking advantage of this programme by non-participant or unofficial personnel.
Note: All winnings MUST be claimed before the 30th of August 2007: otherwise all funds will be forfeited. Congratulations once again on your winning!
BEST REGARDS,
MR.DANIEL ROMAN
(LOTTERY COORDINATOR)
PLEASE DO NOT REPLY TO THIS EMAIL. CONTACT YOUR CLAIMS AGENT AT:
agentalex.australianlotto@yahoo.com
ANY BREACH OF CONFIDENTIALITY ON THE PART OF WINNERS WILL RESULT TO DISQUALIFICATION.
The catch is that when you call up or write to submit your claim, they ask you to pay a fee or to submit your credit card or bank account number to cover some expenses. It could be taxes, verification of identity, promotional costs, or some seemingly reasonable cause. Payment is usually through a money order, Western Union, or similar method that is not traceable to the actual scammers. They may not ask for gigantic sums. Occasionally, especially if they hope to con thousands, the fees may be a few hundred. They have been known to ask for thousands of dollars at a time.
Let’s analyze this letter.
1. It is called the “Australian International Lottery Programmes.” Google that phrase and you get around 200,000 hits. The first one may say “Congratulations, you have won, this is real.” All the others say that this is a scam. In fact, Goggling the phrase with “scam” after it leads to such sites as Fraud Aid, which contains a list of thousands of names used in scams.
2. “Your name was attached to ticket number; 675061725 9356460902 Serial Number 67749137002. This batch draws the lucky numbers as follows 2-9-23-35-46 bonus number 14” Too much detail. That is a technique scammers use. They believe that people will fall for official-sounding gibberish.
3. “US$400,000.00 in cash credit…from the total cash prize shared amongst eight lucky winners” Multiply that amount by the 8 winners and you get $3.2 million. Are you going to believe that the second place prize was that much?
4. “Due to mix up of some numbers and names, you are advised to keep your winning information confidential until your claims has been processed and your money remitted to your nominated bank.” Three things in this sentence. Any prize that asks you to maintain confidentiality is a scam. No questions about it. Secondly, this is a conglomerate of major corporations and the government. Would they get numbers and names mixed up? Last, they are already leading up to needing your bank account number. You give it to them and they can drain your entire savings.
5. “This is part of our security protocol to avoid double claims and unwarranted abuse of this programme by some participants” There are eight winners. Even if you include the first place and a few hundred minor winners, what are the chances their organization, especially since it was “promoted and sponsored by a conglomerate of some multinational companies and also the Australian Government” will be so disorganized that they cannot keep track of a few names?
6. “Drawn from Nine hundred thousand E-mail addresses from Canada, Australia, United States, Asia, Europe, Middle East, Africa and Oceania.” Why not Mexico and South America?
7. “Further more your details (e-mail address) falls within our European representative office in Amsterdam,” No North American representative? Seems unlikely.
8. “We hope with part of your prize, you will participate in our end of year high stakes for US$2.3 Million international draw.” Heads up! They are going to ask you to send money to play in this drawing before you get your prize. Interesting that their grand annual prize is $2.3 million, yet second place was $3.2 million.
9. “Contact our Claims Office under the African Payment Centre, where your winnings fell. Contact Person: Mr. Alexzander Evans(RCA) Phone_+234_80 666 70849
Email: agentalex.australianlotto@yahoo.com” Wow, there’s a bunch of give-away signs here. Why would someone in the United States, who has a “European representative” have to contact someone in Africa? Let’s Google that phone number. There are only a few results and the first screams “scam.” The second is written in Cyrillic letters, meaning the scam may have originated in a former Soviet Union country. International calling code “234” is Nigeria. Remember what we said earlier about this being a favorite of the “Nigerian 419” scams?
10. “Also, you should give in your telephone number to help locate your file easily.” How can they cross-reference to your telephone number when this was a random drawing using e-mail addresses? They do not have your phone number, but giving it to them will make it easier for them to scam you, or to sell the information to others who can try to trick you.
11. “We advice all winners to keep this information confidential from the public” A second such warning. They know if you tell anyone you will be informed it is a scam.
12. “PLEASE DO NOT REPLY TO THIS EMAIL” Because if you do, you will get a no-such e-mail return. They love using throw-away e-mail addresses. Use it once and then delete it. The same is true for using a “Yahoo,” “G-Mail,” “Hot-Mail,” or any other form of free e-mail service. Your contact is agentalex.australianlotto@yahoo.com. Agent X? And a Yahoo account? You would think that a bona fide lottery would have its own domain.
13. “ANY BREACH OF CONFIDENTIALITY ON THE PART OF WINNERS WILL RESULT TO DISQUALIFICATION” In case you did not catch it the first three times.
This is just an example. There are many other types of advanced-fee scams.
Monday, April 13, 2009
Consumer Safety & Awareness Part 16
Multi-Level Marketing and the Law -- Part 2
In 2007 a class action lawsuit was brought against both Amway and Quiztar. Amway refused to cooperate because all their distributors have to sign an agreement not to sue them, but rather to submit to binding arbitration. They get to pick the moderator and set the rules. The judgment went against them.
The suit is based on the same charges that the FTC brought against Equinox, SkyBiz and other MLMs that regulators shut down. It states that the Quixtar program – based upon selling products to recruits "for personal use", then authorizing them to recruit others to do the same while requiring them to maintain quota levels of monthly purchases, and then rewarding them in a multi-level compensation system – is a fraud. The suit also attacks Quixtar's infamous "tools" business as a second pyramid scheme perpetrated on new recruits.
Equinox International Corporation, and its founder, William Gouldd, operated a multi-level marketing company that encouraged consumers to become distributors for products including water filters, vitamins, nutritional supplements and skin care items. Equinox distributors ran classified ads in the "help wanted" sections of newspapers, which implied that a salaried position was being offered. Those who responded to the ads were instead given a sales presentation designed to recruit new distributors.
The suit claims that Equinox told potential distributors that they could earn money by selling products or recruiting additional participants but emphasized that the real way to make money is through recruiting, not through sales. New recruits were encouraged to purchase $5,000 worth of products to become a manager, rent desk space for $300 to $500 a month, obtain their own telephone line and attend training seminars that cost between $300 and $1,000. Participants were told that "financial gains were dependent upon the continued successive recruitment of other participants" and that retail sales are not required to make money.
Investigations determined that a very small percentage of distributors actually recoup their expenses. In reality, the majority of participants drop out of the program with little or no earnings despite the defendants' claims that everyone who participates in the program will receive substantial income. The courts closed down the business and ordered over $40 million in restitution.
The United States Postal Inspector made this statement:
Multi-level marketing is a system of selling in which you sign up other people to assist you, and they, in turn, recruit others to help them. Some entrepreneurs have built successful companies on this concept because the main focus of their activities is their product and product sales. However, there are many multi-level distributorship schemes that are nothing more than sophisticated chain letters. They operate as a "pyramid," claiming participants can earn lots of money by concentrating most, if not all, of their efforts on recruiting distributors rather than selling a product.
The success of a pyramid distributorship for each and every distributor depends on continuously getting additional people to join the pyramid. However, there is a practical limit to how many distributors can be found and to how many product units they can sell or use. To protect yourself against falling victim to a multi-level marketing scheme, note whether the basis of the promotion is the sale of a product at the retail level, as opposed to an emphasis on recruiting more and more distributors to help you increase your income.
There is no easy way to wealth. A multi-level marketing scheme is no exception, other than perhaps for the promoter who originates it and receives the large fees from unsuspecting victims.
Before you get involved in any business where you have to sell products to your friends, take the time to read the information at mlmwatch.org. They list governmental legal action against several dozen multi-level marketing companies including Amway, Herbalife, Nu Skin, Nature’s Sunshine, and Oxyfresh. Even Scientology has been classified as an MLM as members get paid for every new recruit they bring in.
The truth is that there are many legal companies that fall into this type of business, and it is possible, with a few of them, to become financially successful, but not without work. More important, from a consumer’s point of view, is that the value of the products they sell tend to be exaggerated or misrepresented.
As we have recommended before, when offered a product from anyone or any company, you should initially turn it down so that you can research it. If the product claims to be a cure, whether called natural, herbal, or scientifically proven, at very least have your doctor check for compatibility with any medication you are already taking. Copy the ingredients from the bottle or jar. If you feel you have a medical need for such a product, have your physician do a blood test to discover if there is a systemic cause for the problem. Often doctors can find inexpensive remedies as opposed to the month-after-month of using an unproven and possibly expensive product.
Before you purchase a perfume, skin cream, nail softener, or other cosmetic product, compare its price to both name brands and store brand products that have similar claims. MLM state their products are less expensive because of no middleman, but they do indeed have a multiple of middlemen, all of whom grab a profit. A truly honest salesperson will let you take the product in to your pharmacist so that you can seek advice.
In 2007 a class action lawsuit was brought against both Amway and Quiztar. Amway refused to cooperate because all their distributors have to sign an agreement not to sue them, but rather to submit to binding arbitration. They get to pick the moderator and set the rules. The judgment went against them.
The suit is based on the same charges that the FTC brought against Equinox, SkyBiz and other MLMs that regulators shut down. It states that the Quixtar program – based upon selling products to recruits "for personal use", then authorizing them to recruit others to do the same while requiring them to maintain quota levels of monthly purchases, and then rewarding them in a multi-level compensation system – is a fraud. The suit also attacks Quixtar's infamous "tools" business as a second pyramid scheme perpetrated on new recruits.
Equinox International Corporation, and its founder, William Gouldd, operated a multi-level marketing company that encouraged consumers to become distributors for products including water filters, vitamins, nutritional supplements and skin care items. Equinox distributors ran classified ads in the "help wanted" sections of newspapers, which implied that a salaried position was being offered. Those who responded to the ads were instead given a sales presentation designed to recruit new distributors.
The suit claims that Equinox told potential distributors that they could earn money by selling products or recruiting additional participants but emphasized that the real way to make money is through recruiting, not through sales. New recruits were encouraged to purchase $5,000 worth of products to become a manager, rent desk space for $300 to $500 a month, obtain their own telephone line and attend training seminars that cost between $300 and $1,000. Participants were told that "financial gains were dependent upon the continued successive recruitment of other participants" and that retail sales are not required to make money.
Investigations determined that a very small percentage of distributors actually recoup their expenses. In reality, the majority of participants drop out of the program with little or no earnings despite the defendants' claims that everyone who participates in the program will receive substantial income. The courts closed down the business and ordered over $40 million in restitution.
The United States Postal Inspector made this statement:
Multi-level marketing is a system of selling in which you sign up other people to assist you, and they, in turn, recruit others to help them. Some entrepreneurs have built successful companies on this concept because the main focus of their activities is their product and product sales. However, there are many multi-level distributorship schemes that are nothing more than sophisticated chain letters. They operate as a "pyramid," claiming participants can earn lots of money by concentrating most, if not all, of their efforts on recruiting distributors rather than selling a product.
The success of a pyramid distributorship for each and every distributor depends on continuously getting additional people to join the pyramid. However, there is a practical limit to how many distributors can be found and to how many product units they can sell or use. To protect yourself against falling victim to a multi-level marketing scheme, note whether the basis of the promotion is the sale of a product at the retail level, as opposed to an emphasis on recruiting more and more distributors to help you increase your income.
There is no easy way to wealth. A multi-level marketing scheme is no exception, other than perhaps for the promoter who originates it and receives the large fees from unsuspecting victims.
Before you get involved in any business where you have to sell products to your friends, take the time to read the information at mlmwatch.org. They list governmental legal action against several dozen multi-level marketing companies including Amway, Herbalife, Nu Skin, Nature’s Sunshine, and Oxyfresh. Even Scientology has been classified as an MLM as members get paid for every new recruit they bring in.
The truth is that there are many legal companies that fall into this type of business, and it is possible, with a few of them, to become financially successful, but not without work. More important, from a consumer’s point of view, is that the value of the products they sell tend to be exaggerated or misrepresented.
As we have recommended before, when offered a product from anyone or any company, you should initially turn it down so that you can research it. If the product claims to be a cure, whether called natural, herbal, or scientifically proven, at very least have your doctor check for compatibility with any medication you are already taking. Copy the ingredients from the bottle or jar. If you feel you have a medical need for such a product, have your physician do a blood test to discover if there is a systemic cause for the problem. Often doctors can find inexpensive remedies as opposed to the month-after-month of using an unproven and possibly expensive product.
Before you purchase a perfume, skin cream, nail softener, or other cosmetic product, compare its price to both name brands and store brand products that have similar claims. MLM state their products are less expensive because of no middleman, but they do indeed have a multiple of middlemen, all of whom grab a profit. A truly honest salesperson will let you take the product in to your pharmacist so that you can seek advice.
Subscribe to:
Posts (Atom)