Saturday, April 21, 2007

How much of our Social Security money is benefiting former illegal aliens in Mexico?

With predictions that Social Security might be bankrupt before many of us ever receive any benefits, money potentially being given to people not entitled to it, bothers some people.

Dr. Jerome R. Corsi ( just did a very eye-opening analysis of the problem, where he states:

Amid the U.S. government's acknowledgment of rampant document and benefit fraud, the Federal Reserve is wiring 26,000 Social Security payments every month to Mexicans south of the border.

Officials with the Federal Reserve and Social Security Administration insist payments are not going to illegal aliens but admit they cannot be certain. Meanwhile, the Department of Homeland Security has launched a new task force to address the "growing" problem of benefit fraud, including in the Social Security Administration.

I like the official statement that no payments are going to illegal aliens, but they can't be certain?It seems to me that if they were certain, they might HAVE do SOMETHING about it.

I sometimes like to examine the money trail, which is what anyone wanting to determine fraud should follow, and according to the article:

According to the Federal Reserve, in 2005 the amount of funds transferred to Mexico reached more than $30 billion, up from $16.6 billion in 2004. The remittance market to Mexico has experienced double-digit growth in recent years.

Even scarier, was what is termed a totalization agreement with Mexico, that Social Security refused to release until forced to by an advocate group for senior citizens:

As WND previously reported, after refusing to release the document for three and a half years, the Social Security Administration in January finally made public a totalization agreement that "would allow millions of illegal Mexican workers to draw billions of dollars from the U.S. Social Security Trust Fund."

The disclosure was forced by a Freedom of Information Act request filed by the TREA Senior Citizens League, a non-partisan seniors advocacy group.

This hasn't been signed into effect by President Bush, but it could be done without congressional approval.

Dr. Corsi sums up this analysis using factual data from the GAO:

In September 2003, the U.S. General Accounting Office estimated a Social Security totalization agreement with Mexico would cost $78 million in the first year and would grow to $650 billion (in constant 2002 dollars) in 2050.

The GAO admitted even this estimate was low given that the totalization agreement provides an additional incentive for millions more Mexicans to enter and work in the United States.

Dr. Corsi's highly interesting analysis (I highly recommend reading the entire article), here.

So far as the officials, who aren't certain if fraud is occurring, they might want to consider the amount of benefits fraud, recently uncovered in the Katrina and Rita hurricanes. Initially, officials seemed to be in denial (not certain) about how much of it happened there, also. After the GAO did a little digging, they seemed to find quite a bit of it - and rumor has it - they aren't finished finding all of it.

Benefit fraud is a huge problem, and it costs us all in the form of higher taxes. It also takes away from the funds available to pay honest people, who are entitled to receive them.

Here is another post, I wrote about the scope of this problem in a limited area (Southern California):

Los Angeles Grand Jury Calls Child Care Program an ATM for Thieves

The official ICE press release about the government task force looking into this problem can be seen, here.

Friday, April 20, 2007

While a nation mourns, cyber criminals are on the attack

Earlier in the week, I blogged about how cyber criminals (ghouls) would likely use the Virginia Tech disaster to line their pockets.

According to Jeremy Kirk, IDG News Service, this prediction is becoming true -- and according to experts -- fake domains are being set up at a faster rate than after the Katrina hurricane.

Even malicious software a.k.a (crimeware) is being circulated via spam e-mails, claiming to have a link to cam phone footage of the incident.

Clicking on this filth can turn your computer into a zombie (normally used in a botnet to send more spam) -- or even log your personal and financial details -- which might be later sold in a carder forum (used for identity theft).

Very interesting and sad commentary on how cyber criminals are on the attack, while a lot of people are in mourning, here.

One place, I recommend to send any of this (trash) you spot on this is to Castlecop's:

Phishing Incident Reporting and Termination Squad (PIRT)

They make sure this garbage gets reported to all the appropriate parties!

The case of an alleged $2 billion government contract fraud/abuse in Iraq/Afghanistan

A company providing services to our troops in Iraq and Afghanistan has allegedly committed $2 billion in fraud and abuse. Until recently, it was part of Halliburton (spun off after a stock swap)?

Donna Borak, of the AP (courtesy of SignOn San Diego) reports:

U.S. lawmakers on Thursday railed against defense contractor KBR Inc. for a string of fraud and contract abuses on a multibillion-dollar contract that provides food and shelter to U.S. troops in Iraq.

“I think profiteering during wartime is inexcusable,” said Sen. Byron Dorgan, D-N.D., during a Senate Armed Services Committee hearing. “We've got a very serious problem. This is the most significant waste, fraud and abuse we have ever seen in this country.”
Here are more specifics as to what occurred, quoting Senator Levin, chairman of the Senate Armed Services Committee:

Sen. Carl Levin, D-Mich., chairman of the committee, cited several examples of contract abuse, including KBR billing the federal government for millions of meals that were never delivered, overstating labor costs by 51 percent, or $30 million and wasting between $40 million and $113 million by purchasing unnecessary vehicles.

Full story from the AP, here.

The thought of a company being made independent (via a stock swap) and charges of wrongdoing being brought forth, shortly afterwards, bothered me. I decided to look a little further to see what I could find about how this occurred.

I found a site called Halliburton Watch, which did an article entitled, Halliburton bails out of Iraq, KBR and now America. The article (which alleges a lot of other wrongdoing by Halliburton) links to the press release from Halliburton about the KBR spin-off, here.

The stock swap was announced in February. Since it would be hard to skim $2 billion from a $20 billion contract (granted over 5 years) in two months, I decided to see what else I could find.

Going to Senator Levin's site, I found a press release, clearly indicating that the alleged fraudulent activity occurred well before February.

After stating that KBR (formerly Halliburton) should be considered innocent until proven guilty, there seems to be a lot of substance to these charges, researched by government auditors. It will be interesting to see how this plays out, and fraud in time of war (if proven), should be dealt with severely!

Thursday, April 19, 2007

Not answering a Privacy Notice gives the sender permission to sell your personal/financial information

Recently, I did a post on the difficulties a blogger had after receiving a privacy notice from one of his financial institutions (American Express) and trying to "opt-out" (let them know he didn't want his personal and financial information sold).

In reality, most of the privacy notices, we receive are saying "if you don't respond to me, you are giving us permission to sell your personal and financial information."

These privacy notices (hard to distinguish from junk mail) come about from a law passed in 2001 to protect consumers from having their information sold (just about anywhere). This personal information is often put at risk because it wasn't protected, properly.

The Privacy Rights Clearinghouse has a lot of information on this subject and why the version of the law that was passed isn't as consumer friendly as it sounds. Here is what they had to say:

When this law was debated in Congress, consumer advocates argued unsuccessfully for an "opt-in" provision. This stronger standard would have prevented the sharing or sale of your customer data unless you affirmatively consented. Unfortunately, the opt-in standard did not prevail. That is why we emphasize in Fact Sheet 24 that the burden is on you to protect your financial privacy.

They do have an EXTREMELY informative page on the site, which gives a lot of information on the law and how you can protect your information, here.

They also have another page with a lot of information on how to opt-out from having a lot of different companies sell your personal details.

If you are like me and have a "time challenged" life style, there is one place everyone should opt-out from having their information sold, or the credit bureaus. Credit bureaus, collect and gather all our personal and financial information, and make a LOT of money, selling it.

In a lot of instances, they were the ones, who sold it in the first place.

You can do this, by going, here.

The Federal Trade Commission also offers information to consumers on this subject.

Since most of these laws were passed by Congress prior to data breaches being tracked, perhaps the time is right to make a few changes to the law.

In case any of them are interested, the Privacy Rights Clearinghouse, has also been maintaining a very telling chronology of why something should be done, here.

As of this post, 153,558,451 voters and potential voters have been compromised, according to the chronology (which freely admits it isn't 100 percent accurate). The stated reason that it is impossible to be accurate is because in many instances, the total number of people compromised couldn't be determined.

It's normally pretty hard to get the data thieves to comment on how much information they got in any particular breach!

Wednesday, April 18, 2007

Are Charity Fraudsters (Phishermen and Pharmers) preparing to exploit the Virginia Tech Disaster?

Internet criminals use disasters to get nice people to donate their hard-earned money to them, personally. Recent examples where this occurred have been the Katrina hurricane, Tsunami disaster and London bombings.

According to the Sans Internet Storm Center, we can probably expect the same activity to occur in the wake of the Virginia Tech Disaster.

Here is what they are reporting in their Handler's Diary:
There has been a flurry of domain registrations related to the Virginia Tech tragedy, as reported by GoDaddy and other registrars. While some of these are undoubtedly well-intentioned organizations joining in the outpouring of support for the friends and family of the victims, others are likely to be opportunists who want to cash in on the suffering of others.

Be on the lookout for a rash of spam & phishing coming from these leeches. If you receive a plea for donations, check the organization out closely before opening up your e-gold, Paypal, Visa or other account or providing any personal information. In some cases the phishers may use voice, fax, email and websites to dupe generous and thoughtful victims into disclosing valuable information.
Full diary post (with potential domains being grabbed), here.

As the SANS post aptly points out, giving out any personal, or financial information to one of these fraudsters (leeches) can have more consequences than giving your money away to the wrong place (identity theft).

Here are some investigative (due diligence) resources someone might take advantage of to make sure they are donating their money to a worthy cause:

Better Business Bureau Wise Giving Alliance

Charity Navigator

American Institute for Philanthropy

The Federal Trade Commission (FTC) has some information on how to make sure your money goes to the cause you intend it for, here. Also contained on this page is where you can report fraudulent activity to them, which is highly recommended.

Tuesday, April 17, 2007

Counterfeit MoneyGram Money Orders being passed via Internet Scams

Recently, MoneyGram removed the Travelers Express name from their money order product. The new version is branded simply as MoneyGram, printed in Spanish (Espanol) in addition to English.

The old version with the Travelers Express name have been counterfeited and circulated via Internet scams for a couple of years. A lot of them had Walmart's logo printed on them. We've seen similar counterfeit American Express Gift Cheques and Postal Money Orders in recent years, also. Some of these items are still in circulation, including the older Travelers Express version.

The newer version (MoneyGram) printed in both Spanish and English are now being counterfeited and being circulated via Internet scams. The one I saw was accompanied by a letter from Walmart Financial Services.

Like other counterfeit financial instruments, we'll probably see these circulated via romance, auction, job, secret shopper and lottery scams. The common theme is that the scammer will always request that you send a portion of the money back to them (wire transfer is the preferred method).

In the case of auction scams, they may be used to buy expensive merchandise.

Cashing these items will leave you at a minimum, financially liable. I've also been told by readers that people are sometimes getting arrested for passing them!

The new version (recently seen) have receipts attached to them. Money Order companies often attach receipts to their products as a security feature. These receipts are used to obtain refunds, if a money order is lost, or stolen.

The counterfeiters have probably added this feature to instill a false sense of security.

Like their predecessors, these counterfeit Money Orders are (normally) easy identified by calling in and verifying their authenticity.

MoneyGram has an automated system to do this, which can be accessed by calling 1-800-542-3590. Live customer service help is available during normal business hours.

MoneyGram also has a page with a lot of relevant information on how to SAFELY negotiate these items, here.

Since this is something new, if anyone would like to help get the word out, please leave a comment on this post, or drop me a line at

Monday, April 16, 2007

Social Security employee causing $2.5 million in credit card fraud reveals how easily information is stolen from within

Recently, I blogged about a former IRS employee, who committed $330,000 of retail refund fraud (basically shoplifting) in nine states. This morning, I read about a former Social Security Administration employee, who caused an alleged $2.5 million in credit card fraud by providing detailed information on victims to an external identity thief.

Sharon Gaudin at Information Week writes:

The indictment alleges that Batiste conspired with her cohort Craig Harris and others by agreeing to access the Social Security Administration's computer system to run search queries for Harris.

Harris, a 50-year-old Los Angeles resident, pleaded guilty in September to conspiracy and unlawful possession of a means of identification. Harris, who faces a maximum sentence of 10 years in prison, is scheduled to be sentenced on July 17.

The government contends that Harris would give Batiste some identifying piece of information about someone -- either a name or Social Security number -- and Batiste would then query the government system to pull up enough other identifying information to put the person's identity at risk.

Information Week article, here.

According to the article, the arrest was the result of the work of the Economic Crimes Task Force, which includes both federal and local assets in Southern California.

Last October, I wrote about a task force in Southern California responsible for catching a lot of insider related (employee) identity theft. My post is still up, but the link to the LA Times article is now down and nothing else can be found about it on Google.

I suppose insider problems aren't as newsworthy as large scale data-breaches, involving highly skilled hackers. The reason for this might be that they are embarrassing to the organization involved, and they don't help sell expensive (computer related) security fixes.

In fact, a trusted insider, can normally get past all the above referenced security fixes, simply because they have access.

And if you think about it, retail, restaurant and clerical employees have access to a lot of information. It's a lot easier to bribe, or even place a person inside an organization to steal information than hack it from the outside.

Trust me, it's going on in the business (and it appears) civil service worlds, daily.

Perhaps, all the experts, should take a closer look at this problem and how to control it.

Here's a previous post, I wrote on this subject, where the Secret Service is doing this:

Secret Service is Studying the Problem from Within

LA County has a hot line to report government employees committing fraud. The information to contact it can be found, here.

The FBI has also set up a place, where anyone can report public corruption, here.

A lot of large companies have a dedicated hot line to report internal problems, or you can ask to speak to someone in their security department. Smaller businesses normally don't have these resources, but most owners would be highly interested if someone working for them was stealing.

It's not good for business!

In some instances (not all), there are financial incentives for reporting insider dishonesty.

If you are worried about safety issues, I always recommending doing this, anonymously.

Sunday, April 15, 2007

Mexican Drug gangs post execution videos on YouTube

It used to be that organized drug gangs wanted to keep a low profile. No more, like their jihadist role models, they are using the Internet to spread their twisted message of death and destruction.

Manuel Roig-Franzia did an extremely informative article about this for the Washington Post, where he wrote:

Bloody bodies -- slumped at steering wheels, stacked in pickup trucks, crumpled on sidewalks -- clog nearly every frame of the music video that shook Mexico's criminal underworld.

Posted on YouTube and countless Mexican Web sites last year, the video opens with blaring horns and accordions. Valentín Elizalde, a singer known as the "Golden Rooster," croons over images of an open-mouthed shooting victim. "I'm singing this song to all my enemies," he belts out.
Washington Post story, here.

Recently, these drug gangsters posted a video on YouTube of one of their rivals being decapitated.

Of course, the money to do all of this is obtained by sending their wares (narcotics) across our Southern border.

While everyone debates the illegal immigration issue, we have something (far more sinister) to worry about. In fact, the sheer number of illegal people crossing (perceived by many of us to be harmless) probably enables a lot of (not so harmless) people to cross, also.

There is no doubt, many of the illegal immigrants are innocent souls -- but as long as we allow criminals to control our borders -- we aren't doing a very good job of protecting our own citizens.

The step daughter of one of the gang leaders (Jefes) producing counterfeit documents, Suad Leija, has a message about this to all of us, which can be read, here.

Counterfeit documents are one of the factors that enable this problem (not very secure borders) to pose a danger to us all.