Fraud, Phishing and Financial Misdeeds: 2005-04-24

Saturday, April 30, 2005

Identity Theft

According to a Forbes article, Identity Theft cost U.S. citizens 52.6. billion last year. Quoting the FTC, the amount of occurences doubled last year. This probably doesn't take into account cases that were not reported and doesn't include the rest of the world.

http://www.forbes.com/technology/2005/04/29/cz_0429oxan_identitytheft.html?partner=rss

Halliburton Does Business in Nigeria

Although, the Nigerians aren't the only one's doing "Advance Fee" scams; they are generally known as the masters. I ran across something that's pretty scary. It seems that Halliburton (Dick Cheney used to be the CEO) feels that it is necessary to hire a law firm (used in the past by G. W. Bush) to investigate allegations that illegal payments were made to secure a Nigerian construction contract. In fact, as the article states, some of these payments were allegedly made during Dick Cheney's tenure as CEO.

Please note that Halliburton has recently had to agree to pay back sizeable amounts of money for overpayments and kickbacks done by their employees in Iraq. It seems that Halliburton has received all the lucrative contracts in Iraq and Afghanistan in the post 911 era.

Halliburton gets a lot of tax money and it is scandalous that they would be doing this in a country that openly victimizes most of the world. In fact, if there is any merit to these allegations, they fit right in the mix over there.

Note that in most Nigerian scams, the money is sent overseas and we rarely hear of any prosecutions.

For more on Halliburton and the Nigerians please go to http://www.corporatecrimereporter.com/02_17_04_pressrelease.html.

For more information on the most prevalent Nigerian scam going on presently (Auction Scams) please go to:
http://www.crimes-of-persuasion.com/Nigerian/Nigerian_auction_scams.htm

Although, the old Nigerian 419 letters promising to make you a millionaire are well known. Here is one of the latest twists, using religion as a hook.

http://scams.net/showthread.php?t=17

Friday, April 29, 2005

BCCI, The Beginning of the Globalization of Fraud?

The Godfather

Agha Hasan Abedi - founder, BCCI (Bank of Credit and Commerce) Pakistani National

The beginning of the globalization of fraud (largely attributed to the internet) might also have it's roots in a bank known as the Bank of Credit and Commerce (BCCI). Started in the late 70's in Pakistan, it essentially provided a "money laundering" operation for a wide range of criminals. There is evidence that several governments and world organizations turned a "blind eye" to what it was doing.

Of course in that era, we were fighting the good fight against the USSR in Afghanistan and supporting the Contras. Money for both of these causes filtered through the BCCI. Interestingly enough, in those days, Osama Bin Laden was on the same side of the fence as we were.

When the good fight was over in Afghanistan and with the subsequent fall of the "Evil Empire" (USSR), we essentially abandoned ship there. Subsequently, this lead to years of civil war, crimes against humanity and the rise of the Taliban. Given the ties to the Osama Bin Laden and the worldwide terrorist network that ensued, it makes one wonder if in a small part ignoring the massive fraud committed by the BCCI contributed to this.

Ironically, today, we have our young men and women in harm's way in Afghanistan, a country that has historically never been controlled by any outside force. Meanwhile, the former USSR has given birth to a worldwide fraud network.

Here is a transcript of the Congressional Investigation into BCCI, headed up by none other that John Kerry. It is very eye opening.

http://www.fas.org/irp/congress/1992_rpt/bcci/index.html

WorldCom CEO

There is no doubt that fraud exists at all levels. In fact, it goes all the way to the top and embraces people, who wouldn't seem to need the money.

Bernie Ebbers (Former CEO WorldCom) could spend 85 years in jail for it.

http://www.dailynugget.com/000884.php

http://www.forbes.com/2002/04/30/0430wcom.html

Thursday, April 28, 2005

Organized Identity Theft

Given the recent intrusions into major databases (such as Choice Point and others), passing laws and enabling resources to go after this type of activity is crucial. This activity bespeaks the invlovement of professional organized crime. One could also speculate that some of these organizations are tied to organized terrorist groups.

Why do you think the target of 911 was the World Trade Center? Part of the intent was to destabilize the economy, which in fact it did. With the rise of international ties to fraud and the attacks on personal data via the internet, we must begin to address the problem this creates to the economy.

The "Great Depression" was fueled by a public mistrust of the banking system. Today, Cashier's Checks and Government Postal Money Orders, which were once solid instruments are no more. This is due to the abundance of "Advance Fee" schemes circulating on the internet. Note that in most of these cases, the money is sent overseas and foreign nationals are involved. I seriously doubt if Choice Point's customers have a high level of trust in them right now.

On a personal level, identity theft is devasting to the individual. When done on a large scale it destroys the credibility of institutions, we are supposed to trust.

Dianne Feinstein, Demorcrat California and Patrick Leahy, Democrat, who routinely are champions of privacy rights, have called for an investigation and should be commended for doing so.

Ask anyone involved in investigating "White Collar Crime" and the resources allocated to it are minimal.

http://www.eweek.com/article2/0,1759,1770433,00.asp

The FBI Doesn't Notify People They Investigate

In the crazy world of today, one might assume someone passed a law requiring the FBI to warn people. A new variant of the "Soper K Worm" is being passed by bogus e-mails that claim to be warning people they are under investigation for visiting illegal web sites.

http://www.eweek.com/article2/0,1759,1769226,00.asp

Google Phishing Alert

Be careful when typing in "Google". Add a "K" in there and voila you may be misdirected to a site where you will encounter two "Pop Up" windows that will put a Trojan on your system.

Misdirection is nothing new, but beware!

http://www.eweek.com/article2/0,1759,1790348,00.asp

Wednesday, April 27, 2005

Victims, or ?

Many of us have seen innocent "Dupes" fall for the recent Advance Fee scams. Thanks to some hard work by the Postal Inspectors, we are now seeing what many of us suspected. All of them are not dupes! Some of them are "Double Agents":)

http://www.wilmingtonstar.com/apps/pbcs.dll/article?AID=/20050426/ZNYT05/504260360/1002/BUSINESS

Mortgage Fraud

With the interest rates beginning to go up, I've been getting a ton of solicitation regarding mortgage loans, or refinance opportunities. Here is a helpful guide to ensure anyone doing so is making a wise, informed decision.

Let's face it, the people on the selling end have been making six figure incomes in the past few years. The industry has attracted a lot of people to handle the flow. Whenever this happens, the potential for risk is inevitable.

This is an article that shows the warning signs of mortage fraud.

http://www.stopmortgagefraud.com/

TSUMANI FRAUD

It's a sad commentary on human nature that people can and will exploit other people's misfortune. This is a warning from the FBI on fraud related to the Tsunami disaster.

http://www.fbi.gov/page2/jan05/tsunamiscam010505.htm

Employee Backgrounds

MSNBC did an investigative report on the "Data Information" industry relevant to background checks. Additionally, I've seen where candidates manipulate their personal information to get past this.

Human Resouce Professionals should use numerous different sources, including reference checks to spot discrepancies. Trust me, it is possible. When these cases are uncovered, it is amazing how many clues existed pointing to deception.

After all, there are a lot of illegal immigrants who gain employment out there. Who is to say that criminals, intending to plant themselves in an organization, or merely gain employment aren't out there also.

http://www.msnbc.msn.com/id/6448213/did/7467732/?GT1=6428

Tuesday, April 26, 2005

Update on Qchex and EBay Fraud

Here is a link to a E-Bay forum discussing both QChex and E-Bay fraud. "Let the Seller Beware".

http://forums.ebay.com/db2/thread.jspa?threadID=410507167&tstart=160&mod=1112079749943

Employee Related Identity Theft

This is an interesting story on a Block Buster Employee, who was arrested for identity theft. Note that businesses, who establish recourse (for collection purposes) often have all the information at an employee's fingertips to do this.

Organizations can and are held liable for how they protect personal (private) information. This has become a hot topic in the workplace today.

http://www.nbc4.com/news/4414387/detail.html?rss=dc&psp=news

Huge Settlement for Corporate Fraud

Judgement against Accounting firm Deloitte & Touche LLP .

Wow....a $50,000,000 settlement for not establishing sound anti-fraud procedures. Ouch!

http://abcnews.go.com/Business/wireStory?id=705527

Headlines Page

Fraud on E-Bay

E-Bay has become a vehicle for Nigerian Fraud, although it is questionable, whether or not this is the only group involved now. The scam begins when a Seller is contacted (cars seem popular) by an alleged Buyer and the Seller is presented with a large check for more than the amount of the purchase. The seller is told to negotiate the check and wire the excess money overseas to countries, such as Nigeria, Canada, or just about anywhere in Europe. Eventually, the check is deemed counterfeit and the Seller is left holding the bag.

Initially, the checks were being negotiated at Banks and the seller's account was garnished once the instrument was found to be fraudulent. This hit the news and now the groups doing this are becoming more creative, they are instructing the Seller to go to a Check Cashing Store that also does wire transfer. Often, the Seller is also encouraged to keep the entire transaction confidential. This leaves the Seller open to arrest, however from a legal perspective, it is unlikely prosecution will take place since essentially the sellers intent isn't to defraud.

At first, the instruments were Cashier Checks and have mutated to Postal Money Orders and regular counterfeit items.

This scam is normally blamed on the Nigerians, however it is now being traced to Europe, the former USSR and more often than not, Canada.

Although, this scam is fairly easy to spot, it is happening daily across the country. Much of it isn't reported because the Seller is reluctant to do anything about it. Local Law Enforcement types (especially in large metro areas) are unsure how to go about investigating it, or are unwilling because it is out of their jurisdiction. The recommended venue to report this crime is with the Secret Service. A listing of their local field offices is located at http://www/secretservice.gov.

Monday, April 25, 2005

Qchex

Rumor on the streets has it that Auction Fraud, often done on E-Bay, Craig's List etc. has a new twist. Dupes, or Fraudsters pretending to be Dupes are taking advantage of a new service called "Qchex". Listed below is the "Qchex" security policy:

"Qchex provides one of the world's most popular ways for anyone to present checks and invoices over the Internet. The speed, economy and attractive features and capabilities benefit almost everybody, from personal users making an occasional transaction on an auction site, to large companies handling volumes of checking and invoicing transactions every day. As a convenient online finance manager and check/bill delivery service Qchex does not endorse, guarantee, verify or investigate transactions undertaken by its Members. "

Fraudulent items from Qchex are being passed at Banks and Check Cashing Stores throughout the United States.

Note the "Qchex" disclaimer, which states that they do not endorse, guarantee, verify or investigate transactions undertaken by its Members.

Of note, I was told by a person employed to investigate fraud that "Qchex" will not return his calls regarding certain items he is investigating.

I would recommend verifying everything before accepting one of these items, or depositing it into one of your accounts. You can view their website at http://www.qchex.com. Note the availability of "magnetic ink" cartidges intended for home use. In the past this was very difficult to accomplish and one of the key signals of a counterfeit was that the check didn't have it. Not anymore, I suppose.

Fraud, Phishing and Financial Misdeeds