"Crupt Practice" Member Takes the Rap for Fraud

(Crupt Practice from MySpace)

Melvin Slaughter of the Seattle Rap Group "Crupt Practice" will probably be "rappin" from the big house soon.

The Seattle PI is reporting:

A Secret Service agent arrested a local rap performer Friday on charges that he conned or bribed people to give up ATM cards, flooded the victims' accounts with counterfeit check deposits, then withdrew cash.

Seattle PI story, here.

It appears that Mr. Slaughter used social methods (conning people) to take over their accounts.

Taking over credit card accounts, or opening accounts with other people's information (identity theft) - then inflating their "open to buy" has been around for awhile. Most institutions don't allow payments for more than the "balance owed" for this very reason.

Debit cards are a different story since they are tied to a bank account, or are prepaid - and inflating their balances with bogus payments might be a future fraud trend.

It's hard to limit how much is deposited into an account, or loaded on a card.

This activity seems to be growing - eBay, PayPal, debit, credit and online brokerage accounts have been targeted in recent history. Account takeovers will probably continue to be a problem - and there are indications that keyloggers and crimeware (used to steal online information) are making the problem worse.

Of course, more social methods continued to be used, also.

If you would like to learn about other "crupt practices" involving counterfeit checks, here is a post I did on all the counterfeit cashier's checks that circulate via the electronic world:

Counterfeit Cashier's Checks Fuel Internet Crime

Crupt Practice has a MySpace page, here.

Since there are a lot of "rap" versions of classic rock, perhaps the fellas might consider doing an updated version of "Jailhouse Rock."

Mr. Slaughter should have plenty of "time" to work out the details.

Counterfeit American Express Gift Cheques (Update)

A couple of weeks ago, readers and other sources started reporting counterfeit American Express Gift Cheques. At the time - this was something new - but more and more seem to be showing up over a wide geographical area.

The best way to protect yourself if you receive one of these items is to call the verification number at 1-800-221-7282.

I've even heard that if you verify them and they turn out to be fraudulent - American Express will make good on them. Please note, I can't personally guarantee this, but I was told by an Amercian Express Representative that it was standard procedure.

Here is my previous post on this subject:

Counterfeit American Express Gift Cheques

If you have any specific details on how these are being circulated, please leave a comment, or drop me a line at edwarddickson@sbcglobal.net.

Cyber Crooks Targeting Online Brokerages

According to the SEC (Securities and Exchange commission) - reports of fraud involving online brokerages are on the rise.

MSNBC reports:

The Securities and Exchange Commission said it had received a surge in the number of complaints about online account break-ins by hackers "in the last few months".

John Stark, chief of the regulator's office of internal enforcement in existence since 1998 said: "We have had more investigations in this area than we've ever had before."

Asked why the phenomenon had grown, he told the Financial Times: "It's easier with all the spyware and keystroke logging programmes have become easier to use, and more ubiquitous. More and more people are doing things online as well."

MSNBC story, here.

Of course, account takeovers are nothing new, criminals have done this for years with credit card, banking and more recently eBay and PayPal accounts.

And keyloggers (which in my opinion should be illegal) continue to be sold (unregulated) on the Internet, see here. Interestingly enough, they are often "touted" as a "do it yourself" investigative tool.

Besides being the inspiration for criminal acts - a lot of people's privacy is probably being violated with some of these technologies. The recent HP scandal is a good example, where corporate executives and private investigators used similiar technology.

Sadly enough - there is too much (currently legal) technology out there that is being abused - despite the growing number of people being victimized by it.

Internet Crime Forums Pose a Serious Threat to All of Us

Hacker (Internet Crime Forums) are fueling the identity theft business. These forums facilitate (for a price), selling personal financial information and even (whole) identities.

TopTechNews did an interesting story on this problem, where they say:

The cybercrime forums gird a criminal economy that robs U.S. businesses of $67.2 billion a year, according to an FBI projection.

According to the article - the sites are now being hosted in rogue countries like Iran - which the crooks consider beyond the reach of the authorities.

Here is what the TopTechNews article reported:

At USA TODAY's request, CardCops traced CardersMarket's point of origin and confirmed that it is registered to a computer server in Iran.

If Iceman succeeds in establishing CardersMarket as the Wal-Mart of forums, its routing through an Iranian server will make an already complex law enforcement challenge that much more difficult, security experts say.

"Chasing these carding fraudsters is like chasing terrorists in Afghanistan," says RSA Security's Einav. "You know they are somewhere out there, but finding their caves, their underground bunkers, is almost impossible."

TopTechNews story, here.

The article highlights that there is action being taken against these "criminals," but it also points out that experts say with the amount of compromised information being "bought and sold" on these sites, identity theft could multiply by a factor of twenty.

Since these groups seem to do business with rogue countries that support terrorism (Iran). Maybe we should start considering them as "enemies of the people" and "supporters of terrorism."

Perhaps this "label" would facilitate more effort into putting them where they belong, or "where the sun don't shine."

Barret Service Solutions - A Cover for the Secret Shopper Scam?

There are a lot of people getting taken in secret shopper scams. The name Barret Service Solutions keeps popping up as a cover company for this brand of "misdeed" on the Internet.

Here is a recent comment about Barret Service Solutions:

I fell into the scam for a company called Barret Service Solutions. I am now $3600 in the hole and will soon lose everything, possibly my car!!! I am in tears writing this because I know there is almost no recovery for me. Stupid kid trying to make some extra money on the side of having a full time job and going to school full time too!! Hopefully I won't go to jail, but the chances are now very likely due to my lack of funds!!!

In case you don't know how the secret shopper scam works, here is a description from an earlier post:

In the secret shopper scam, people are solicited to become "secret shoppers" - sometimes known as "mystery shoppers" - and go into (normally) Walmart to negotiate a bogus check (Walmart recently got into the business of cashing checks). They are then asked to wire the money using Walmart's MoneyGram services to Canada and report on the "customer service" aspects of their visits.

The checks - in almost all these cases - are counterfeit and the person cashing them will be the one held responsible. This will mean a "financial hardship" and (possibly) criminal charges for the unfortunate "soul" tricked into doing this.

Once the money is wired - it's normally picked up immediately - and can't be recovered.

Full post (with comments and other links), here.

I've also been told that secret shopper scams are appearing in the classified sections of newspapers.

If you get an offer like this - take a deep breath - and do not respond.

In the United States - you can report these scams to:

Internet Crime Complaint Center (FBI)

In Canada - you can report them to:

Phonebusters

The Federal Trade Commission (FTC) has an informative page on mystery (secret) shopping, here.

The Hackers from China are at it AGAIN!

I've done several posts about Chinese Hackers going after U.S. Government systems. Today, I read about another example of this on Michael Hoffman's DailyTech blog:

The US BIS has been forced to overhaul its PCs by replacing hundreds of the infected systems.

Chinese hackers allegedly targeted computer systems at the Bureau of Industry and Security, a specialized department within the department of commerce dealing with the export of software and technology designed for military and commercial uses. The online thieves were aiming to access computer accounts of federal employees over a span of time that ranges at least several weeks. Even though several accounts were compromised during the attacks, no sensitive data has been stolen.

Post from Michael Hoffman's blog, here.

Hackers from China seems to be a serious issue, here are some previous posts, I've written on this matter:

Rogue Governments, Terrorists and Organized Criminals Raise the ...

How Dangerous is China

Identity Thieves Pose as Career Center Employees on College Campus

Two men posing as Career Center employees are suspected of gathering the information for "identity theft" purposes.

Ashley Evans of Sacramento State University's Hornet reports:

Two unidentified men entered at least five classrooms, during the course of a week, posing as career center employees, said Sgt. Kelly Clark of the University Police Department.

Career Center Director Beth Merritt Miller said the two men entered the classrooms stating they were there to recruit for an internship but didn't state with whom. She added that the center acted quickly upon finding out about this situation.

Hornet story, here.

Identities are often harvested by criminals on a lot of the job sites, such as Monster.com.

If you want to learn how to protect yourself from this growing problem involving finding a job, the World Privacy Forum has some excellent advice, here.

Internet Criminals Love to Have Money Wired to Them

Channel3000.com (Wisconsin) did an excellent article about a woman - who after looking for a roommate on roommates.com - was defrauded out of $1400.00 when she wired a "deposit" for an apartment to Canada.

Wire Transfer fraud is becoming a "huge" problem on all sorts of Internet sites, especially those of the auction and job variety.

Some detailed research was put into this article, which revealed the following (sad) statistics:

"A recent survey of seven states found that one-third of all Western Union transfers to Canada were fraud-induced."

"After complaints and threats of lawsuits, Western Union agreed last year to spend $8.1 million on a consumer awareness program to alert consumers to the potential of wire fraud."

Good read from Channel3000.com, here.

BUT Canada isn't the only place the money is sent. There are a lot of sad stories of victims wiring money to West Africa, Europe -- and even within the United States.

If you have been a victim of a fraudulent wire transfer, the right place to report it in the United States is the Federal Trade Commission, here.

In Canada, Phonebusters might be able to help (they have a toll-free U.S. number), here.

To learn more about these types of scams, the Channel3000.com has a link to the FTC page regarding this problem, or Craigslist has a pretty informative page, here.

A New (More Sophisticated) Fraud Approach Involving Call Centers

This didn't make much of a splash in the U.S. press, but is being reported in India. Three men (two of Indian origin) defrauded three U.S. companies for more than $19 million dollars in financing for call center operations.

The Press Trust of India is reporting:

Three men, including two of Indian origin, have been indicted by a US court on charges of fraud and money laundering.

Dinesh Dalmia, a key accused in the 2001 stock market scam, and New Jersey-based Ashish Paul were handed down a 16-charge indictment which alleges conspiracy to defraud three lenders - GE Capital Finance, CitiCapital Technology Finance and a leasing company.

The third man, William Dowling, faces ten charges for allegedly conspiring with them to launder money.

It is alleged that Dalmia controlled three New Jersey companies and using the alias Nick Mittal and approached the lenders from 2003 through 2005 seeking multi-million dollar financing through lease-financing contracts for computer equipment and telephone lists for call centers purported to be engaged in debt collection and telemarketing.

Press Trust of India article, here.

The article doesn't stipulate - whether or not - the "alleged" call centers were in India, but it makes one wonder?

Entire Mexican Police Force Under Investigation in Border Town

The BBC (British Broadcasting Corporation) is reporting that the entire Tijuana Police Force is being investigated for drug trafficking.

The BBC reports:

In a move unprecedented in Mexico, the entire Tijuana police force is under investigation on suspicion of being involved in organized crime and drug trafficking. There are more than 2,300 police officers attached to various departments in Tijuana.

Tijuana Mayor Jorge Hank Rhon told the press " everyone from the policeman on the beat to the state police superintendent will be subject to this investigation."

Mr. Rhon says the majority of officers in his city are, in some way, involved with illegal drug trafficking or organized crime.

BBC story, here.

Recently, I did a post on problems on similar problems on the U.S. side of the border:

Insiders are a Threat to Securing our Borders

President Bush recently signed a bill to tighten up the border, which allocates $34.8 billion for 700 miles of fencing, 1500 new border agents and new detention facilities.

Fencing, more people to corrupt and new facilities will likely do little good unless the "greed" factor is addressed.

If we ever want to solve the problem of "border insecurity," we need to go after the money. As long as corrupt people (law enforcement officers are a small percentage) are making billions, people will be easily bought. And while law enforcement personnel going to the "dark side" makes a good story, there are a lot of other people getting rich off of illegal border activities.

Maybe the solution is to go after the people profiting the most from our "insecure borders" and work our way down?

Story about recent legislation from SignonSanDiego.com, here.