Saturday, May 07, 2005

Keyloggers, Newest Threat in Identity Theft

Keyloggers are used by programmers to develop software. In the wrong hands, they are used by identity thieves to steal information. It is estimated that in February and March there were about one hundred malicious sites hosting keyloggers. These sites often look like popular e-commerce sites.

If you do a search for "keyloggers" on the internet, you will find dozens of ads selling them. Here is an amusing one:

Entitled "PC Police", it claims to be totally covert and give you the ability to spy on cheating spouses, misguided children etc. Although, the ads try to make them sound legitimate, in the hands of criminals they obviously are being used for a lot more. We live in a scary world.

To protect yourself, it is recommended to keep your virus and malware software updated and be wary of unsolicited e-mails with attachments. You should also be careful about not downloading from suspicious websites. Here is a story with more information.

Unfortunately, a lot of internet crime goes unreported. Not reporting it makes it more lucative for the criminals and harder for law enforcement to resolve. If you suspect crime on the internet, here is a website where you can file a complaint online.

43 Million Fraud by Student at NYU

A Turkish Student at NYU set up a check/cheque scam by depositing counterfeit "certified" checks in two banks, one in the United States and another in Switzerland. Interestingly enough, he made a $21 million donation to NYU. NYU has agreed to pay back the $1.25 million already given to them in this scam.

Undoubtedly, he will continue his education, but it will probably be behind bars!

Thursday, May 05, 2005

A New Twist on Insurance Fraud

The FBI is looking into corporate fraud schemes in the insurance industry. Recently problems were uncovered at AIG, one of the largest companies. Apparently at AIG, they will be "restating" financial reports over a four year period by 2.7 billion dollars. The overstatement appears to have mislead investors.

In the recent past, ten executives in the industry have plead guilty to fraud charges and have been ordered to pay a billion dollars in restitution.

Most of us pay a hefty price for insurance. In addition to this, we are often told the reason it is so expensive is all the fraudulent claims they have to pay. Perhaps, it possible that these external fraud claims aren't the only reason?

Here is a link to an article with more information on this subject.

More Possible Fraud in Iraq

Recent polls show support for the war in Iraq is declining. According to a recent report, about $100 million has simply, disappeared. It is controversial exactly where the money went, or how much of it might have been stolen. According to this article, they have found indications of fraud in a recent audit.

I recently wrote of a former FBI Agent, who is charging that another contractor is defrauding the government in Iraq.

Revelations, such as this, take away from the sacrifices of the military people serving there. It will also do little to win the "hearts and minds" of the local population.

In my opinion, anyone doing this in a war zone, should be subjected to the severest criminal penalties possible.

Tuesday, May 03, 2005

Insider Identity Theft

There is no doubt (Identity Theft) can stem from employee theft of information. In this story, it is alleged that a banker in Philadelphia used fake identities to commit about $6.7 million in fraud. It has been well documented that fraud gangs plant people in organizations to facilitate fraud and steal identities. In this instance, it proves that even people in the higher echelon, can and will commit fraud.

What amazes me, is that according to the article, the bank has only taken civil action, thus far.

Here are some recommended practices to ensure your identity is protected at a bank.

Individual banks maintain various safeguards against identity theft. Here are some points to consider:

Does the bank have a procedure in place for verifying signatures?

Are bank employees subject to a background check?

What kind of identity verification is required when applying for a loan?

Does the online banking system provide encryption, firewalls, timed log off, virus protection, and a secure log-in process?


Centralize. Keep credit cards, mortgages and bank accounts in one place.

Ask your bank or credit organization about its policy for selling customer data.

Request your information not be sold to brokers.

Reconcile bank statements, credit card statements and other accounts monthly.

Check your credit report at least once a year. Contact one of the three major credit bureaus:

Equifax - (800) 525-6285 or
TransUnion - (800) 680-7289 or
Experian - (888) 397-3742 or

Fraud in Prison

This story hit the news when a package with numerous fraudulent tax returns was sent to the wrong address. A local Television Station did an investigation and discovered a inmate, who told them that in his prison alone, he estimated that 500 of these forms had been filled out. This would have cost the government about (his estimate) $2.5 million. He also indicated that this goes on all over.

This was accomplished by filling out forms easily available at any Office Supply Store. They use the identities of prisoners and business addresses that do not exist. If this is going on all over, as he states, I'm sure fake identities are also used.

No one wants to reveal the informant's identity for his own protection. Could be his motive, but the informant is hoping he will get his case reheard. Of course, he is personally innocent.

No wonder we have a DEFICIT!

If you suspect any type of tax fraud, you're asked to call IRS investigators at (800) 829-0433.

Monday, May 02, 2005

Identity Theft Convicts Tell All

Here is a link to an article interviewing two criminals involved in identity theft. In my opinion, they aren't very sophisticated, or even very good at it. Pretty low tech stuff compared to what is around these days.

On the other hand, it shows how easy it is to do for people who don't seem to be very sophisticated.

I'm sure there is more talent behind bars than these two.

Phishing on the Rise

Phishing seems to be on the rise. Traditionally, "Phishing" is where a victim is duped into going to a fraudulent website and entering information that is used to make them a victim of identity theft. This is normally accomplished with SPAM e-mail, which lures a victim to what they believe is a legitimate site. New toolbars are identifying a lot of these phoney sites. This article states the the origin of a lot of it is Taiwan, South Korea and China.

More sophisticated techniques are also discussed, such as using worms to implant key loggers so that the scam artists don't have to rely on duping the victim to do it manually. E-Mail is being used less and less in favor of more sophisticated hacking techniques.

Here is a link to "APWG" (Anti Phishing Working Group) Contained in it is a lot of good information, including how the various scams work and how to avoid becoming a victim.

Former FBI Agent in Iraq Makes Fraud/Abuse Allegations

A former FBI agent working in Iraq was allegedly forced out of the country for refusing to defraud the government on contracts. He is also making allegations of rampant abuse towards Iraqi citizens.

Looks like the goverment is investigating and there might be merit to his claims.

Sunday, May 01, 2005

419 Scam, Not only for Nigerians

Although, not a very new article, it illustrates that sometimes what we call Nigerian 419 scams are being copied by fraudsters from all over the world. I would imagine this is also true of the Lottery Scams and the E-Bay Scams so prevalent on the internet.,1367,53115,00.html?tw=wn_ascii

I got this off a website that is run by either a certified nut case, or likes his own unique blend of commentary. I read it for amusment from time to time, but he did put together an interesting page on Nigerian Fraud.

High Level Arrests in Nigeria

A wave of high level arrests in Nigeria for graft and fraud. As the article states, they are famous for claiming to be cleaning up over there and then it's back to business as usual. We can only hope this will impact the multitude of victims that continue to be bilked.

Russian 419 (Advance Fee Scams)

Although, it is not being reported in North America, or Europe yet, it's probably only a matter of time. Australians are being targeted from the former U.S.S.R. with e-mails from a family devastated by the Tsunami, a Russian Tycoon who wants to hide money and a legless Iraqi boy.

They are also being solicited to launder money through the personal accounts.

It is suspected that this activity is highly organized and the work of Eastern Bloc crime syndicates. Anyone foolish to give out their banking information normally has all their money wired to Russia.

Live from India

Since a lot of organizations have been outsourcing to India, I'm sure those of us who need a lot of technical help are developing relationships over there. Here is a warning about "Blue Tooth" enabled cell phones direct from the "Hindu Times".