By Mitch Lipka
Special to Consumer Reports WebWatch
A “banker” recently e-mailed Consumer Reports WebWatch asking for our help in claiming a deceased man’s bank account:
“I am Mr. Pui Cheung, Director of Operations of Hang Seng Bank Ltd… we discovered…that Mr. Richard Nault died from an automobile accident. On further investigation, I found out that he died without making a WILL, and all attempts to trace his next of kin was fruitless. … No one will ever come forward to claim it (his $30 million account). According to Laws of Hong Kong, at the expiration of 5(five) years, the money will revert to the ownership of the Hong Kong Government if nobody applies to claim the fund.”
The pitch had a familiar ring to it. In this spin on the old Nigerian letter scam, the purported banker – or, in some cases, attorney or individual – writes about desperately trying to reach next of kin to dispense a fortune. Finding no relatives, the e-mailer suggests you pretend to be family and split the fortune with him.
This scam hooked Stanley El of Woodbury, N.J., who responded to an e-mail supposedly from a Nigerian prince who said he needed a trustee to help him collect his inheritance. El, a business and personal development specialist who has published articles in some African publications and had relatives who worked on the continent, said the message seemed plausible to him.
Following an exchange of e-mails and phone calls, El said he spent $5,000 to fly to Spain to sign documents that supposedly would make him the trustee. He was offered a prince’s sum for his part, but El said he participated because he genuinely believed he could help. He had no idea he was participating in a scam.
The scammers sent a phony $50,000 check to El’s bank account, which cleared. El never got any of it, because the fraudsters quickly withdrew the cash before the bank realized the check was a fake. The bank then sued El. Although a judge determined that El should share the loss with the bank, he said a year later he hadn’t been asked to pay up.
Old Favorite Keeps Reinventing Itself
Nigerian letter fraud continues to rank high among online crimes, including the amount of money lost per incident – a median of about $3,000 per victim, according to the FBI’s Internet Fraud Complaint Center. About 8 percent of all complaints logged by the National Consumer League’s Internet Fraud Watch stem from the Nigerian letter scam, which has grown with the proliferation of e-mail.
Experts suggest the staying power of the 25-year-old scam – also known as “419 fraud” for its place in the Nigerian criminal code, and “advance fee fraud” – is related to the innumerable variants that can be developed, as WebWatch explored in an investigation last year. [See “The Check’s in the Mail”http://www.consumerwebwatch.org/dynamic/fraud-investigation-checks-in-mail.cfm]
In addition to the version outlined above involving so-called unclaimed wills, consumers should be wary of:
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- Suspicious e-mail messages, often from people overseas, seeking to pay for professional services or products via money order. Consumer Reports WebWatch reader Elizabeth Etienne says she was e-mailed by a couple supposedly en route to Holland seeking her photography services for their upcoming wedding. Etienne, who lives in Los Angeles, says she became concerned when the couple insisted on paying via a Western Union money order.
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- Requests for help transferring money following a disaster, such as a plane crash, or relating to another newsworthy event. For example, one fraudulent e-mail features a U.S. “soldier” serving in Iraq asking e-mail recipients to provide their phone and fax numbers to help him transfer $25 million in U.S. funds he claims once belonged to Saddam Hussein out of Iraq.
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- Responses to online personal ads requesting financial help once a rapport is established. Such requests might include money for a plane ticket via Western Union for someone traveling from overseas in order to meet you.
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- Messages purporting to be from a repentant sinner bent on giving away his money to finally do good. This variation often targets small charities and church groups.
- E-mails requesting money assistance from places other than Nigeria. Consumers are used to hearing about a scam from Nigeria and don’t consider money transfer requests from Sierra Leone or Afghanistan or another far-flung place to pose the same danger, said Barbara Mikkelson, co-founder of the urban legend debunking site snopes.com.
New Zealand’s Consumer Affairs Ministry lists more than 100 version of the scam on its official Web site. Nigeria’s Economic and Financial Crimes Commission, formed in recent years to prosecute 419 fraud offenders, also lists popular variations of the scam (http://www.efccnigeria.org/).
Prosecution Difficult
Another frustrating aspect to this type of fraud is thieves are rarely prosecuted. Nigerian authorities have taken a recent stab at cracking down on some of the top players in what has been said to be among the biggest industries in that country. Although there have been numerous arrests, none of the wealthy kingpins – some of whom are said to enjoy celebrity status there – have been convicted.
In the U.S., there have been a handful of successful prosecutions, with most resulting in sentences of probation or time served. Few victims of these scams have gone public.
“The nature of the crime makes it very difficult for many local law enforcement agencies to successfully investigate and prosecute,” says John Kane, research manager at the National White Collar Crime Center.
A consumer’s best line of defense? Common sense.
The U.S. Federal Trade Commission, in its bulletin “The ‘Nigerian’ Scam: Costly Compassion,” offers these words of wisdom that cut to the quick:
“If you’re tempted to respond to an offer…stop and ask yourself two important questions: Why would a perfect stranger pick you — also a perfect stranger — to share a fortune with, and why would you share your personal or business information, including your bank account numbers or your company letterhead, with someone you don’t know?”