Advanced Fee Fraud Scams

Summary

The message begins with something like this, “I need your help. I have money tied up, if you just give me your banking information I will send you $1M, and you can keep $25,000 for yourself. If you’ll pay for the transfer fee…”

Advance Fee Frauds (AFF) use letters, emails, and faxes to operate a confidence scam that appears to be a business proposal from officials from a foreign government or an existing foreign business. The criminal uses stationery that appears to be legitimate and official, with appropriate governmental stamps and signatures. Hundreds of millions of dollars are fleeced from individuals around the world each year, with the United States and Great Britain receiving 50% of the AFF communications.

Though there are various types of AFF scams, they all have some common elements:

• The communication was unsolicited by the recipient;
• The "opportunity" is urgent and confidential; and
• The victim is required to pay various governmental and/or legal fees and taxes before the victim will receive the money, which turns out to be nonexistent.

Beneficiary Fund Scam – The scammers often present some type of story about needing your help to get money from a bank in another country. The story will usually involve someone who has died, and the perpetrator alleges that if they do not act quickly, the money will be turned over to the government.

Lottery Scam – Scam claims that you have won money in an overseas lottery. The letter or e-mail will usually ask for personal information to confirm your identity so you can collect your winnings.

Investment scam – An investment company contacts you and needs your assistance in investing money overseas. The letter or e-mail will look as though it is coming from a reputable investment firm or government official. The letter will ask you to contact the company, where you will be asked to pay some sort of fee upfront in return for a hefty profit that does not exist.

Romance Scam – Scammers pull at the heartstrings of those on internet dating websites and chat rooms by asking for money for sick relatives, or money for a plane ticket to meet you in person.

Baseline Practices

• If it sounds too good to be true, it probably is.
• You should know who are dealing with. If you have not heard of a person or company that you intend to do business with, learn more about them.
• Ensure you fully understand any business agreement that you enter into, and if the terms are very complex, have them reviewed by an attorney.
• Does the business not have a physical address but operate out of post office boxes or mail drops? Does the business not have a direct telephone line or is never in when you call, but always returns your call later?
• Does the business require you to sign a nondisclosure or non-circumvention agreement, which would prevent you from independently verifying the people and business?

Article provided by: The Financial Services Information Share and Analysi