Lottery Bandit Nabbed in California

While too good to be true lottery scams hit the news all the time, stories of crimes involving real lotteries happen less frequently.

Apparently, a 37-year-old Ceres, California man was arrested by local and state detectives after stealing thousands of lottery tickets in a series of burglaries stretching throughout California's Central Valley. I suppose this takes the gambling addiction warnings on the California lottery site to a new level?

The lottery addict in question, one Matthew Roberts, is a suspect in 30 burglaries from November to June that had one common denominator -- the theft of lottery tickets. During the arrest at a house in Ceres, several other people were arrested for drug and parole violations, also.

Investigators with the California Lottery’s Law Enforcement Division began to see a pattern in the lottery ticket thefts that were occurring, according to the press release on this matter. They began working with the local authorities in the area where the burglaries were occurring.

In May, alert SaveMart grocery store employees noted an individual attempting to cash in a on a winning lottery ticket reported stolen in the burglaries. They were able to get a license plate number and this led to Roberts being identified as the lottery ticket bandit.

Roberts has been charged in three of the burglaries and for auto theft. According to the authorities, there will be additional charges filed in the coming weeks as well as additional arrests. I guess this means that there might be additional lottery bandits still at large?

In this instance, we are probably dealing with a not so bright criminal. Given that lottery security is extremely tight and the inventory is tracked by computer -- stealing lottery tickets probably isn't the smartest way to win a lottery. It's pretty obvious that the alert employees at SaveMart were tipped off electronically that the ticket(s) being presented were "hot."

This isn't the first time in recent history, the California Lottery Police have made headlines. In May, it was announced that they were using undercover agents to catch dishonest retailers, who were cheating winners out of their prizes. Winning tickets of $500 to $25,000 were presented to retailers and several of them were caught pretending the prize was smaller and keeping the proceeds for themselves. Several arrests were made throughout California as a result of the sting.

California Lottery Nails Dishonest Retailers

When you cash in a small lottery prize at a lottery retailer, the amount might not exactly what you were were entitled to receive.

On 7/1/08, the California Lottery announced that they are using undercover agents to sting dishonest retailers, who cheat lottery winners out of their prizes. The press release on this matter pointed to a case in Morgan Hill, California where a dishonest retailer (and another individual) are being charged with grand theft of lottery tickets ranging in value from $500 to $25,000.

I decided to see if I could find any additional information on arrests and discovered another one that was reported by cbs13.com in Lodi, California. CBS 13 in Sacramento, with cameras rolling, approached Baljut Kang (one of the two arrested in Lodi), who refused to talk at first. Eventually, Kang stated to the reporter that the undercover agents found "some ticket in the garbage," which made them think she and her son were committing fraud (?).

According to the article, an undercover agent turned in one ticket worth $990 receiving only $24. Another ticket was presented at the retailer worth $25,000 and the agent was paid $10 for it. The article also states that this was the result of a statewide lottery sting. Other retailers were caught in Southern California.

The official press release indicates that this is the first enforcement effort of this kind anywhere in the country. This made me wonder if other States should run sting operations, also?

While dishonest retailers getting caught cheating customers is something new, lottery scams are big business for criminals. Spam e-mails, unsolicited telephone calls and even snail mails are used to dupe people into thinking they have won the lottery. Frequently, a person is then asked to negotiate a fraudulent instrument to cover tariffs and taxes and wire the money across an International border.

The California lottery has an interesting page, which can be seen on their website warning the public about this type of activity. In February, I did a post on the eve of a $270 Mega Million Lottery prize, about fraudsters attempting to impersonate the California lottery to trick unsuspecting people into cashing worthless checks.

Please note that scams -- where unsuspecting people are duped into cashing worthless checks and wiring the money before the financial institution catches on -- aren't limited to the lottery variety. Other varieties involving bogus financial instruments include work-at-home (job) scams, secret shopper, romance and auction scams. Known bogus items in circulation are Postal Money Orders, Travelers Express (MoneyGram) Money Orders, American Express Gift Cheques and Visa Travelers Cheques. A good site to learn more about scams involving fake checks is FakeChecks.org.

In California when you claim a ticket for a prize under $600, the retailer has to validate it in a machine, which prints a receipt showing exactly how much the prize was for. A good idea is to make sure you take a look at this receipt to ensure you are getting the right amount of money.

If you note suspicious activity, I'm sure that the dedicated law enforcement personnel at the California Lottery would like to hear from you. They can be reached at 1-800-LOTTERY.

80 year old man loses over $700,000 to advance fee (419) scammers

With spam e-mails offering too good to be true come-ons filling up our mailboxes, we often forget that there are some very real people who get victimized after falling for one of them.

Of course with the availability of botnets -- which command legions of spam spewing zombies (compromised computers)-- even if only a few people fall for the scheme, the scammers still make a tidy sum off of other people's misfortunes.

An example of this can be found on the Newport Beach Police website, where an elderly gentlemen lost a lot of money (probably his life savings) to one of these schemes:

Recently, an 80 year old resident of the city learned he was a victim of an international lottery scam. He originally received an email claiming he had won an overseas lottery which required him to pay a processing fee to have the funds released. This scam continued for a two year period and ended with the victim losing over $700,000.00.

Scam operators (often based in Canada) are using email, telephone and direct mail to entice U.S. consumers to buy chances in high-stakes foreign lotteries from as far away as Australia and Europe. These lottery solicitations violate U.S. law, which prohibits the cross-border sale or purchase of lottery tickets by phone or mail.

This type of scam is often referred to as an Advance Fee (419) scam.

Of course, the lottery scam isn't the only one out there. There are work-at-home (job) scams, secret shopper, romance, lottery and auction scams being sent out in millions (billions ?) of e-mails, also. And if you don't have your own financial resources, the scammers will gladly provide you with a wide array of counterfeit financial instruments to negotiate. They could care less if you get arrested and expect that you will wire them any proceeds if you successfully pass the bogus instrument.

Please note, that just because you initially are able to pass the instrument doesn't mean that someone won't come after you, later.

The news release from Newport Beach Police Department offers the following advice on how to report scams like this:

The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

They also point to a page on the FTC website about cross border scams, which can be seen here.

If you are a more "visual type," I recommend going to fakechecks.org, which has a series of video presentations on this subject.

Mega Millions Lottery spoofed in scam

The California Lottery announced that the Mega Millions lottery -- where $270 million was won last night -- is now being being used to trick people into cashing worthless checks.

The intent behind this is to get people to cash a bogus check and send the money back to them before your bank, or financial institution of choice, realizes the item is NO GOOD!

Most of the time they prefer you wire them the money so it has disappeared into thin air when the criminal aspect is discovered. Once the money is picked up -- especially via Western Union or MoneyGram -- the sender has little to no recourse.

The intended victim is lured into cashing the check and (normally) wiring the money with a promise that there is a LOT more MONEY (please) on it's way. Of course, more money never arrives and the person cashing the check ends up being held liable. Please note, there are stories circulating about people getting arrested for cashing countefeit financial instruments, also.

From the press release on the California Lottery site:

While eyes are watching to see if someone is lucky enough to capture the $270 million MEGA Millions jackpot tomorrow, California Lottery officials warn of a scam arriving in some mailboxes.

The letter from LOTTO LINE claims the recipient has won USA MEGA MILLIONS and includes a check to be cashed and used to pay administrative fees. The check may look authentic, California Lottery officials say, but beware that if it looks too good to be true, it probably is.

Apparently, this isn't the first (or probably the last) time the California Lottery has been impersonated. Here are the previous alerts, I found on the site about this:

CA Lottery Africa Scam

Lottery Logo Scam

Good Samaritan Lottery Scam

MEGA Millions Mail Scam Fradulent Check Scam

International Lottery Scheme Email Scam

Lottery scams are not the only scams involving bogus financial instruments. Counterfeit checks and other bogus financial instruments are sent to the "unwary" all the time. Known bogus items in circulation are Postal Money Orders, Travelers Express (MoneyGram) Money Orders, American Express Gift Cheques and Visa Travelers Cheques.

A great place to learn about these scams is FakeChecks.org.

The FraudAid people (Annie and team) have an excellent page on their site about lottery scams, also.

Full alert from the California lottery, here.

Are Internet Check Scam Artists staging a December Surge?

(Picture of counterfeit financial instruments recently intercepted in the mail by an International law enforcement task force)

In the past several days, I've noticed a surge in counterfeit check alerts from the FDIC (Federal Deposit Insurance Corporation). From December 19th to the 21st, the FDIC issued 26 alerts from various financial institutions throughout the United States reporting counterfeit activity using their information.

These checks are used in all the different varieties of overpayment scams. The basic MO (method of operation) in these scams is to trick someone into negotiating a bogus financial instrument and sending the money back to the person behind the scam. The victim is offered a small part of the money for doing this.

Of course, they are held liable for all of it when the item is discovered to be fraudulent.

Some of the known varieties of the overpayment scams are the lottery, auction, secret shopper, romance and work-at-home (job) scam(s). Please note you can search any of these "scam" terms at the top of this page for more information.

Spam e-mail is normally the vehicle in which these scams are presented, however they show up in more traditional print venues (including junk mail) from time to time, also.

One thing to bear in mind is that counterfeit checks (cheques) often appear to be legitimate in verification systems. The reason for this is simple, they use legitimate account numbers.

Victims have even asked employees at their financial institution of choice if the instrument was legitimate. Sadly, the items are often so good that the person is told that they are real. A financial institution employee verifying an item offers you no guarantee that the item is good. The person passing the instrument is the one who is liable for it.

Another tricky thing is that many financial institutions will also give their customers credit for these items in their accounts. This often gives the victim a false sense of security and causes them to send the money back to the scammer before realizing what is going on.

Federal rules dictate that banks can only put holds for a specified period of time depending on what type of check it is. The people behind the scams know about this and take advantage of it.

Although the money can be sent in a lot of different ways, most scammers prefer the use of Western Union, or MoneyGram wire transfer services. The reason for this is once the money is picked up (often within minutes), there is no recourse for the person who sent it.

Besides counterfeit checks, we've seen other instruments counterfeited on an industrial scale and sent to unsuspecting people, also. The known items in circulation are have included Postal Money Orders, Travelers Express (MoneyGram) Money Orders, American Express Gift Cheques and Visa Travelers Cheques.

The end result of these scams is that the person negotiating the item will be held financially liable. People are also getting arrested in certain circumstances for passing these items, also.

The National Consumers League recently set up a site (fakechecks.org), which is a great reference on Internet scams involving checks (complete with visual presentations), here.

Here is a post, I wrote with more information on how to verify one of these items:

Tools to verify those too good to be true financial instruments you got in the mail

Please note that if the deal you are being presented is too good to be true, or you are being asked to wire money it probably isn't worth going to the effort of trying to verify the item.

Also note that these scams have become so sophisticated that there is no guarantee that any amount of verification can guarantee the item is legitimate!

Counterfeit Visa Travelers Cheques in circulation!

Counterfeit financial instruments are circulated in a variety of Internet scams. The ploy is always to get someone to cash them and then wire the money back to the person behind the scam.

In the past couple of weeks, readers and other sources have brought to my attention that counterfeit Visa Travelers Cheques are in circulation.

Visa has provided resources to identify these instruments.

You can call them at 1-800-227-6811 to verify an item. This can also be done on-line, here.Visa also has a good interactive tool to identify the security features of the Visa Travelers Cheque, here.

The trick is to ALWAYS verify them before you negotiate them using your good name!

Some of the scams being used to trick people into cashing these items are known as work-at-home (job) scams, secret shopper, romance, lottery and auction scams.

A collective name for all of these scams that ask you to cash an item and send the money back to the scammer is called the advance fee (419) scam.

A lot of the sites dedicated to fighting scams are also seeing an alarming trend, which is that people are getting arrested for attempting to cash these items.

I recently had a conversation with the fine folks over at FraudAid about this trend.

A great (new) resource about all the counterfeit paper being circulated is FakeChecks.org.

People, who fall for these scams do so because they are lured with something that is too good to be true. The old saying is that if it is "too good to be true, it is NOT!"

Here are some other counterfeit instruments, I written about that are still in circulation:

Counterfeit MoneyGram Money Orders being passed via Internet Scams

Counterfeit Cashier's Checks Fuel Internet Crime

American Express Gift Cheques Being Circulated in Internet Scams

Counterfeit Postal Money Orders Showing Up in IScams Again

Here is a picture of counterfeit Visa Travelers Cheques that were sent to someone about a week ago. They were sent from the United Kingdom, however the scammer wanted the money wired to Nigeria.


(Photograph courtesy of Raleigh)

Internet crime victims report counterfeit American Express gift cheques being sent to them!

Scam (too good to be true) lure courtesy of miriyaparino at Flickr.

Counterfeit checks like all the ones recently discovered by an International law enforcement team being sent from Nigeria aren't the only bogus financial instruments being sent all over the world.

In this recent effort against this activity, over 15,000 counterfeit instruments were discovered in a months time.

For the past couple of weeks, I've received a lot of e-mail and blog comments from people receiving counterfeit American Express gift cheques in the mail with instructions to cash them and wire the proceeds (minus a paltry commission) back to the sender (scammer).

The reason for all the e-mails and comments are because of previous posts, I've written about these counterfeit financial instruments.

Other than having their financial world ruined, there are reports of people getting arrested after trying to pass some of these instruments. One victim recently wrote me after discovering she had been scammed -- and told me that when she tried to report her problems to the authorities, they advised her to seek legal advice before proceeding -- or she might be charged with money laundering.

The American Express gift cheques can be verified by calling 1-800-525-7641.

Counterfeit MoneyGram and U.S. Postal money orders are still also being sent to people as payment for goods, or in too good to be true lures that are nothing more than a scam.

A lot of these bogus financial instuments come from work-at-home scams, secret shopper, romance, lottery and auction scams. New varieties of these scams appear from time to time, but the common denominator in any advance fee (419) scam is that it is too good to be true and it makes little, to no sense.

Another common denominator in most of these scams is that they will try to get you to wire money. Here is what I wrote about this in a previous post:

The fraudsters want you to cash these counterfeit gift cheques and send (normally wire) the money back to them. When they are discovered to be fraudulent -- you end up taking the "rap" for the scammer and they disappear in an "electronic mist."

If you've received any of these items in the mail, I've compiled a lot of information on how to identify them and report them to the right people, here.

Another development being seen is that real scammers are getting their hands on these instruments, who have no intention of wiring any money, anywhere. In effect, they are scamming the scammers. This makes it a lot harder to figure out, whether or not, a person is a victim or a scammer. Maybe this is one of the reasons more people are getting arrested?

Of course, if the victim never wired the money, they are probably lining their own pockets (my opinion).

The bottom line is that falling, or getting involved in one of these scams can cause you a lot of financial pain and suffering and you might even get into worse trouble.

When sweepstakes scammers target the elderly should it be considered elder abuse?

Photo courtesy of speedwaystar at Flickr

Lottery and sweepstakes scams are on the rise and there seems to be little help for the victims, who fall for them. There also seems to be not very many consequences for the criminals, who are stealing people blind.

Paul Wenske of the Kansas City Star did a telling story in the Kansas City Star, which focuses on how senior citizens in the Midwest are being targeted and losing their entire life savings in the process.

From the Star article:

Canadian telemarketers spent two years bilking Walter Blevins of Arkansas City, Kan., out of $300,000 — his life savings.

The scammers initially told the 78-year-old former aircraft worker he’d won $2.2 million in a lottery. He just needed to wire cash to cover the taxes and other fees on his windfall.

The article also states that no one seems to be able to help these people once they've sent the money, but these crimes are now being classified as "cross border fraud."

The Missouri AG has tried to step in, but is limited in his jurisdictional powers to sending cease and desist letters to the scammers up North:

Seniors who make the mistake of responding to one mailing or phone call often end up on lists that are sold and resold, resulting in a flood of junk mail.

Late last year, Missouri Attorney General Jay Nixon launched “Senior Sting,” an ongoing operation in which 300 seniors were asked to save such solicitations. They collected 8,000 pieces of mail in the first month.

Don Burnett, of Louisiana, Mo., said at one time he was receiving eight mailings a day from foreign lotteries, sweepstakes and check schemes.

Interestingly enough, a lot of these solicitations are coming in junk mail and telemarketing calls and not from spam e-mails.

The article speculates that the fraudsters doing this are compiling telemarketing lists. While this is probably true, an information broker (InfoUSA) was recently accused of selling market segment targeted lists to some of these scammers.

Given the fact, most of these enterprises pose as legitimate businesses, I wonder how hard it is for them to simply purchase these lists?

The article also cites information from the Federal Trade Commission and the National Consumer League's Fraud Center.

The NCL site has an entire section on Elder Fraud, which can be reached by clicking, here.

Not to be outdone, the FTC also covers this subject in great detail on their site, here.

What's interesting to me is that I see elder abuse becoming a hot issue. The National Center for Elder Abuse is an organization that lobbies for stricter laws when senior citizens are abused.

While most of these telemarketing scams are considered fraud -- which many think of as a low priority crime, perhaps if when it involves senior citizens, we think of it as elder abuse -- the authorities on both sides of the border might begin to get more aggressive in prosecuting the criminals behind these schemes.

In my opinion -- stealing a senior citizen's entire life savings is nothing less and the criminals doing this deserve to be considered as what they truly are -- one of the lowest forms of life on the Planet!

Kansas City Star article, here.

Will counterfeit Visa Traveler Cheques be the latest bogus financial instrument spread in Internet Scams?

(Photo courtesy of Flickr)

Counterfeit Visa Travelers Cheques -- so far seen in $500.00 denominations -- are starting to appear in different parts of the United States.

In the past few years, counterfeit U.S. Postal Money Orders, MoneyGram Money Orders, and American Express Gift Cheques have all been circulated by Internet fraud activity.

If history repeats itself, we will see counterfeit Visa Travelers Cheques show up outside the United States, also.

These instruments have been passed in a lot of work-at-home (job) scams. They are also passed in secret shopper, romance, lottery and auction scams.

These advance fee (419) type scams all have a common theme. A lure (scam) -- which plays on greed is offered to entice someone into cashing these items -- and wiring the money back to the fraudster behind the scheme.

The lure (scam) is always too good to be true and makes no sense.

Since it is against the law to pass a counterfeit financial instrument, people are sometimes arrested when they present these items. Even if they aren't arrested, they are held liable, when the fraud is discovered.

Unfortunately, banks often give credit to their customers on these items. Tellers have even told their customers the items are legitimate, which doesn't make any difference (for the customer) when they return. Of course, the bank isn't liable for any of this.

These items are also being presented to merchants. Retail criminals use them to purchase items, get the balance in cash, then refund the merchandise. Of course, if they are unable to refund the items, they will probably try to get gift cards or fence the merchandise. There is a lot of stolen merchandise being fenced (pretty easily) on Internet auction sites.

Intelligence indicates these many of these items are being printed overseas, then distributed in bulk, worldwide. Once received in bulk, they are broken down and distributed to the criminals, who then use them in the manners listed above.

Visa recommends that you do the following to verify if one of the Travelers Cheques are real:

Can you see a watermark in the cheque?

Can you see the holographic thread embedded in the cheque?

Is the customer present?

Have the cheques been countersigned in your presence?

Does the original signature match the countersignature?

Has valid identification been presented and the details recorded along with the customer name on the back of the cheques?

If you are suspicious, you can call them at 1-800-227-6811 to verify an item. This can also be done on-line, here.Visa also has a good interactive tool to identify the security features of the Visa Travelers Cheque, here.

Here are some of my previous posts on counterfeit instruments circulating via the Internet:

Counterfeit MoneyGram Money Orders being passed via Internet Scams

Counterfeit Cashier's Checks Fuel Internet Crime

American Express Gift Cheques Being Circulated in Internet Scams

Counterfeit Postal Money Orders Showing Up in IScams Again

Secret shopping jobs are liable to cost you a lot of money!

The Secret (Mystery) Shopper scam is running full steam and victimizing people, daily. The last time, I addressed this problem was in a post, where I noticed I was getting a lot of hits from Google on this subject. Recently, a lot of people have been reading my previous posts about this scam.

Here is a basic description of the scam from my last 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 Money Gram services to Canada and report on the "customer service" aspects of their visits.

Once the money is wired and picked up (sometimes within minutes), there is very little that can be done to get your money back.

The letters soliciting victims (mystery shoppers) often are set up with fake telephone numbers that have fraudsters answering them.

The cardinal rule in Internet dealings is to independently verify any numbers provided, no matter how real they seem.

Please note that 800 type numbers are used, also. Sometimes the numbers are set up in the United States, but the shopper is normally instructed to wire the money to somewhere outside the country.

In several of the newer letters, which all contained high dollar counterfeit checks, the shopper is being instructed to cash the item, go and buy a nominal (low dollar) amount of merchandise, then (of course) wire most of the money back to the so-called service.

So far as what bank’s checks are being counterfeited, this seems to change daily.

Sometimes going to your own bank to verify an item isn't a good idea, either. Banks often give a customer credit for these items, and then hold their customer responsible when the item returns. Also, it's not unknown for people to get arrested when attempting to cash these items.

Numerous businesses are listed as places to shop on the recent letters I saw, but they all have one thing in common, which is they offer Money Gram or Western Union wire transfer services.

The most recent versions of the letter state to keep the nominal amount of merchandise they instruct you to purchase.

If you get one of these letters and checks, never cash it, or wire the money before making 100 percent sure the item is good. Of course, I’ve never seen one that did turn out to be good. Who would send a legitimate check worth thousands of dollars to someone they don’t know? Scams never make sense and prey on people looking to make a quick buck.

A good place to search for counterfeit cashier’s or official checks is the FDIC alerts on them, here.

If there is no alert, independently find the banking institution’s number and ask to speak with someone in their security department. Counterfeit checks often use legitimate account numbers and customer service people sometimes verify fraudulent items as legitimate.

This type of scam can be reported the Federal Trade Commission (U.S.) and to Phonebusters in Canada, although it is rare that any action will be taken to investigate an individual case.

I’m not saying not to report them, but the truth is that there is so much of this going on, no one has the resources to go after individual cases. The value in reporting them lies in providing intelligence to law enforcement, which does sometimes build cases, and goes after the culprits.

The best protection for the individual is to recognize these offers for what they are, or too good to be true.

All my previous posts mentioning this scam can be seen, here.

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 EdwardDickson@SBCGlobal.net.

Oprah's name spoofed in sweepstakes scam

At about the same time, Oprah did a show on Internet scams, the Illinois Attorney General (Lisa Madigan) issued (another) alert about scammers using Oprah's name to instill (trust) in the garbage they send.

Although, Oprah has run some sweepstakes recently, this one is a scam!

From Attorney General Madigan's press release:

According to Harpo Productions, Inc., which produces The Oprah Winfrey Show, several legitimate sweepstakes were held in the summer of 2006 through Oprah.com but all winners were previously notified. Harpo Productions, Inc. has not sent any letters in 2007 announcing additional winners for this sweepstakes. The sweepstakes letters being mailed to consumers have a check enclosed that is made payable to the letter recipient. The checks look real but are actually counterfeit. Consumers should disregard these letters and should not attempt to cash the checks.

The letters and checks are props in an especially devastating form of consumer fraud—conning check recipients into believing the checks are real, convincing recipients to deposit the checks into their banks, and even persuading the recipients to wire their own money to the con artists.

Full release, here.

Oprah covered this (and a lot of other scams) on her show yesterday, which can be seen on her site, here.

She also mentions this and another scam involving tickets to see her show on her site, here.

Tom Fragala (MyTruston) and I collaborated on a post about counterfeit checks being used in a variety of I-Scams a few months ago:

Counterfeit Cashier's Checks Fuel Internet Crime

Oprah's name is being used because of her immense popularity, which is a common theme in a lot of this activity. Popular brands, disasters and even government agencies are used in same manner, also!

Google name used in Internet deployed Lottery Scam

If it's too good to be true, it probably isn't (especially on the Internet). A spam e-mail, I received today informed me that I've won Google's lottery and 500,000 euros.

Trusted names are used to provide a false sense of legitimacy. Since I myself am a Google fan (user), I decided to comment on this one.

When the (eventually unfortunate) winner answers one of these, they are asked to send (wire transfer is preferred) money to cover taxes and tariffs to get their prize released.

Frequently, the scammer will send a counterfeit check (normally official, or cashier type) for their intended victim (winner) to cash. Eventually, the counterfeit check is discovered and the lottery winner is left hold the bag. Besides, financial consequences, (if I am to believe people reading this blog), cashing these items can cause someone to get arrested, also.

Unfortunately, the crooks behind these scams are normally safe in another country and rarely (if ever) get caught.

For a more detailed explanation on how these scams work (the lottery variety is one mutation of them), I did a post:

Counterfeit Cashier's Checks Fuel Internet Crime

A lot of the spam deploying these scams is facilitated using botnets (groups of zombie computers) that were taken over after another unfortunate Internet user opened an attachment in a spam e-mail, they probably shouldn't have.

Here is a post, I did at the beginning of the year describing this problem (getting worse all the time):

2006 was the Year of Internet Crime - 2007 is predicted to be even worse

Here is the e-mail I received (complete with all the bad grammar and spelling mistakes). Bad grammar and spelling mistakes are common in these e-mail lures.

Another clue is always the instruction not to tell anyone they are a winner.

From:nelson@nelsonbeilean.orangehome.co.uk
Subject:ISP Nomination/Email Award.
Date:Wed, 4 Apr 2007 17:53:07 +0200 (CEST)
To:FROM: LOTTERY COORDINATOR,INT. PROMOTIONS AND PRICE AWARD DEPARTMENTGOOGLE. Bolos Avenue 12900 kd .RESULTS FOR CATEGORY "A" DRAWS

Congratulations to you as we bring to your notice, the results of the First Category draws of E-MAIL LOTTERY organised by GOOGLE INT. We are happy to inform you that you have emerged a winner under the First Category, which is part of our promotional draws. The draws were held on 30th of March 2007 and results are being officially announced today 4th of April 2007. Participants were selected through a computer ballot system drawn from 5,500,000 email addresses of individuals and companies from Africa, America, Asia, Australia, Europe, Middle East, and Oceania as part of our International Promotions Program. Your e-mail address, attached to ticket number 675432890044/376, with serial number 2200-33 drew the lucky numbers 1-0-11-44-03-22 and consequently won in the First Category. You have therefore been awarded a lump sum pay out of One million (1,000,000.00) euros, which is the winning payout for Category A winners. This is from the total prize money from 1,500,000 euros shared among the 2 winners in this category. Your fund is now deposited with the paying Bank. In your best interest to avoid mix up of numbers and names of any kind, we request that you keep the entire details of your award strictly from public notice until the process of transferring your claims has been completed, and your funds remitted to your account. This is part of our security protocol to avoid double claiming or unscrupulous acts by participants / non participants of this program. Please contact your claims agent immediately for due processing and remittance of your prize money to a designated account of your choice:To file for your claim, please contact the CLAIMS agent.

Mr.Windy Smith.Cable Trust AgencyEmail: *(e-mail
addresses and telephone numbers removed) Academias53,11269 Athens
Greece.

You are advised to contact the agents by Email address.

NOTE: For easy reference and identification, find below your reference and Batch numbers.

Remember to quote these numbers in every one of your
correspondence with your claims agent.
REFERENCE NO:GPINT/7980/4376/06 BATCH
NO: 33/904/G3K. Congratulations once again from all our staff and thank you for
being part of our promotions program.

Sincerely Yours,

Dr.
Nelson Beilean.

PROMOTIONS COORDINATOR.

OCC is warning the public about counterfeit cashier's checks

I've written a lot about counterfeit cashier's checks, which have spread via the Internet in a number of different scams. Known scams include winning the lottery, secret shopping, overpayment for an item sold on an auction site, or assisting a romantic interest found in a chat-room.

The people who do this are creative and you never know what new "scam mutation" will be discovered tomorrow.

The OCC is warning:

However, cashier’s checks lately have become an attractive vehicle for fraud when used for payments to consumers. Although the amount of a cashier’s check quickly becomes “available” for withdrawal by the consumer after the consumer deposits the check, these funds do not belong to the consumer if the check proves to be fraudulent. It may take weeks to discover that a cashier’s check is fraudulent. In the meantime, the consumer may have irrevocably wired the funds to a scam artist or otherwise used the funds – only to find out later, when the fraud is detected – that the consumer owes the bank the full amount of the cashier’s check that had been deposited.

The OCC offers a lot of insight about the growing problem of counterfeit cashier's checks, here.

Also contained is a FDIC Bank locator, which is an excellent tool because in a lot of scams - the crooks set up phony telephone numbers and even addresses to make themselves appear legitimate.

In the case of cashier's checks, the issuing bank (not yours) is the best place to validate whether an item is legitimate, or not.

FDIC tool, here.

If you would like to see if a particular bank has been targeted with counterfeit cashier's checks - the FDIC issues alerts, here.

Another item to key on is the "scam behavior," which normally will always involve sending money to someone in anticipation of something that is too good to be true!

Does anyone know - whether or not - check fraud is on the rise?

I sometimes wonder - whether or not - anyone really knows how much check fraud is out there?

Law enforcement jurisdictions often have dollar amounts (some fairly high), which must be met before a case is actively investigated - causing it to be recorded as a statistic. And in the private sector - a lot of NOT very "clear reasons" are used to return checks, which might or (might not) mean fraud.

My two favorites reasons the banks use to return checks are "refer to maker" and "stop payment." This might mean someone was unhappy with a service that was performed, or it could mean the item is counterfeit and the owner of the account placed "stop payments" on the checks. It's even possible that items returned as NSF (non-sufficient funds) are forgeries, or counterfeits because the owner of the account has yet to discover their account has been compromised.

The same holds true with "fraud accounts" that banks open for crooks (new account fraud). New account fraud occurs when fraudster(s) open an account (often with fake information), write a series of checks for a lot more than what is in the account, and disappear (literally).

Often they do this over a weekend, and withdraw the amount they initially deposited, also.

New account fraud items normally return as (NSF) non-sufficient items until the bank closes the account. Once this occurs, they are classified as "account closed." Non-sufficient fund and account closed items are normally not considered a fraud classification.

The only thing that is certain is that the loser is going to be the party, who accepted the check, and not the banks. In fact -- some believe the banks are the winners in this process -- because they make a lot of money from "bounced check" fees.

In a lot of the recent Internet scams, customers have even gone to a bank employee to ask if an item is good. After trusting the employee's expertise, the check was deposited and the funds were made "available." A few days later, the item was returned as fraud and the customer's account was "garnished."

And in all the cases, I've heard where this happened, the bank didn't accept any liability. Here's a post, I wrote about this:

Don't Trust a Bank to Tell You Whether a Check is Good, or Not

The other day, I came upon an article by SmartPros, indicating that a "possibility exists" that check fraud will rise in the coming year.

According to SmartPros:

Identity theft trends in the next year may include an increase in check fraud, check synthesizing and check counterfeiting, according to The Identity Theft Resource Center, a nonprofit victim assistance center.

SmartPros story, here.

In case no one has been watching - check fraud appears to have been growing rapidly over the past several years. It's true that all the bogus "financial paper" circulating aren't only checks, we are seeing a lot of counterfeit money orders, also.

Counterfeit cashier's checks and other bogus paper financial instruments (money orders, travelers and gift cheques) have been showing up in secret shopper, romance, lottery, work-at-home and auction scams at ever increasing rates. The situation seems to be getting worse - as more and more people - become Internet users.

In fact, eBay recently announced they will no longer offer any protection for paper financial instruments on their site.

And so far as the amount of them out there, there is evidence that bogus paper financial instruments are being produced on an industrial level:

Are Counterfeit Documents being Mass-Produced in Nigeria?

The Federal Deposit Insurance Corporation sends out alerts on all the counterfeit cashier's checks, which are pretty hard to keep up with. If you want to see what I mean, link here.

We read a lot about "DIY" (do-it-yourself) kits being sold to commit phishing and eBay fraud in shady Internet crime forums -- but in the case of checks -- DIY kits are openly sold in stores, and available on e-commerce sites.

In fact, there are a lot of "legitimate companies" selling all sorts of software, printers and even magnetic ink, which are capable of turning out some pretty convincing counterfeits. Throw in a computer, and it's not very difficult to start making checks.

To show all the "DIY check technology" for sale on the Internet, I ran a Google search, here. Of course, a lot of this (including the paper) can be bought at your local office supply store, also.

As with a lot of fraud, technology seems to be enabling the problem.

Although check fraud might continue to grow, there is little doubt that it's already a huge problem. BankersOnline did an article in 2002 stating:

About five years ago, U S NEWS and WORLD REPORT did the most in-depth study on this that we've had, and I've used their figures ever since. They probably are low by now. They said the financial institutions in the United States lose about $12 Billion a year in check fraud, and the retail industry loses a like amount. The total loss being $24 Billion as a result of check fraud. I think identity theft is getting a lot of publicity now - but it's been around for a long time. We just never gave it the designation of identity theft.

Since this report is now 5 years old and it is using figures that were 5 years old -- no one probably knows how much check fraud is really going on.

I guess until everyone comes up with some uniform standards, it's going to be impossible to determine how much check fraud is really out there.

BankersOnline article by Barbara Hurst, here.

A great resource on check fraud is the National Check Fraud Center. Their site provides a lot of expert information on check fraud and how to protect yourself from it.

Is check fraud on the rise? Despite the lack of statistics - my best guess is that it is!

Tickets to the Oprah Show Smell a little Phishy

First gypsies impersonate Dr. Phil and now someone is selling tickets to the Oprah show that smell a little "phishy."

Illinois Attorney General, Lisa Madigan warned the public in a official statement:

In this case, e-mail recipients are asked to submit personal information and told they will receive tickets to The Oprah Winfrey Show after verification of certain financial information and/or the wiring of money to an unknown third party. However, according to Harpo Productions, Inc., The Oprah Winfrey Show does not sell tickets or ticket travel packages to fans. Consumers should disregard any e-mail that purportedly comes from The Oprah Winfrey Show offering show taping tickets for a fee.

No one is reporting any cases of identity theft yet, however one this is certain; wire money to anyone for Oprah tickets and you are going to lose out!

Tickets to watch a taping of the Oprah show are free!

Fraudsters and Phishermen love to have money wired to them - because once it's picked up - it belongs to them and there is nothing the sender can do about it.

Western Union has a warning about wire transfer scams, here.

Of course, the personal information harvested from this phishing attempt might be for sale in underground forums (chat-rooms). More on this, here.

Please note that "unsolicited" requests for personal and financial information via the Internet are scams, no matter how official they might seem. Fake "official looking" websites - including banking sites - are all "too" common in the "sometimes" murky waters of the Internet.

For more on this, you can read the release from Attorney General Madigan's office, here.

The press release mentions information on where to report this scam at the bottom of the release (link above).

If You've Really Won the Lottery - Why Are They Asking You to Send Money?

I've written a lot about the various Advance Fee scams out there - and judging from my inbox - the lottery variation of the scam is huge.

I sometimes get four or five notifications that I've won a lottery, or sweepstakes, daily.

Last evening, I read an article written by Linda Leatherdale of the Toronto Sun about a grandmother losing a lot of her hard-earned money as a result of falling for them.

Linda Leatherdale writes:

But more than anything, she wanted to pay for a university education for her three grandchildren. So she entered the sweepstakes.

Lo and behold, a few months later she received a letter that she had won. Ecstatic, she read what she believed to be an authentic lottery letter, which asked her to send
in $25 to collect her prize.

CASH MAILED OFF

Not trusting giving out personal financial information, via cheques or credit cards, she sent cash. Then other letters arrived -- from the U.S., Australia, New Zealand and other parts of the world. Some invited her to play a new lottery, others said she'd won and to send money to collect her prize.

Toronto Sun story, here.

I've seen the lottery scams, where a high-dollar financial instrument is mailed to the "intended victim," along with instructions to wire the money back - but mailing the smaller amounts ($25 to $50) was an activity that was new to me.

With Spam software that sends these "winner notifications" by the millions - I can see, where this could be a lucrative enterprise for the fraudsters behind this.

I guess the moral of the story is to look for the behavior. I've never won the lottery (I play Mega Millions sometimes) - but if I did - I doubt anyone would be asking me to send money.

It would probably be the other way around, or they would be sending me money!

Linda's article mentions "Phonebusters" as a good resource to educate people on Internet scams. I agree and you can link to them, here.

Down here in the U.S., another good resource is the FTC, link here.

Please note that these "lottery scams" cross borders with the click of a mouse.

You can also report these scams at both of these sites, which is something I highly recommend!

Doing so might save another grandmother out there!

For another post about lottery scams and the sheer amount of spam circulating "winner notifications," link here.

American Express Gift Cheques Being Circulated in Internet Scams

A couple of weeks ago, I updated an earlier post about counterfeit American Express Gift Cheques and asked my readers to help me discover exactly how these items were surfacing.

Prior to this, I knew they were showing up over a wide geographical area, but no one was "sharing" how they happened to get them.

One reader wrote in and said:

"I was almost duped into this. I responded to an ad on indeed.com. I was told that this person was an artist that needed a way of getting his money from clients in the US. This person was going to give me 10% of every artwork he sold. I bought in to this hook, line and sinker. However, when the payment came it was from Nigeria that made me suspicious. I checked online and verified these with American Express they asked me for all the information I had on the person I received these cheques from and had me write a series of numbers and letters on the back of the cheques and send them back to them. Thanks to your website I was able to prevent this from happening to me."

Several other readers wrote in and reported getting them as a result of being hired to process payments a.k.a. (also known as) a "job scam," or as an "overpayment scam" for something they were selling online. The goal in an "overpayment scam" is to have the amount "overpaid" wired to a far-away locale.

In every report, the reader had been asked to negotiate the items and wire the majority of it (minus a commission) to either Nigeria, or the United Kingdom. The return addresses (where they were being sent from) were from all over the United States and as stated above, Nigeria.

Interestingly enough, I haven't seen any warnings in the press, or from American Express about this.

The best way for someone to protect themselves is to verify them with American Express by calling their verification number at 1-800-221-7282. American Express claims that if you do this, they will either tell you the item is fraudulent, or reimburse you if they make a mistake.

If you spot any of this activity, I would report it to:

Internet Crime Complaint Center (FBI)

If it involves receiving these through the mail, you can also report it to the Postal Inspectors, here.

Besides counterfeit cashier's checks - which seem to change "affected financial institutions" daily - we have seen (mostly) counterfeit money orders (U.S. and Travelers MoneyGram) being used in Internet misdeeds in the past couple of years.

Here are some previous posts about similar, or the same activity:

Counterfeit American Express Gift Cheques

Counterfeit Cashier's Checks Fuel Internet Crime

Counterfeit Postal Money Orders Showing Up in IScams Again

Postal Money Order Romance Scam

Counterfeit Travelers Express (MoneyGram) Money Orders Showing Up ...

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.

Counterfeit Cashier's Checks Fuel Internet Crime

Tom Fragala - Truston Identity Theft Blog - and I were talking about how counterfeit cashier's checks have become a long-term problem in the world of Internet crime.

It's often difficult to verify that a check is counterfeit. They often use valid account numbers, which verify (easily) in the computerized telephone systems that most banks use today. Quite simply, unless the bank or the account owner is aware of that their account is being counterfeited - the item will appear to be legitimate.

Furthermore -- a lot of banks have taken the stance in recent years -- that they will not verify whether a check is good, or not. It's getting harder all the time to verify checks with banks.

The lottery, auction, work-at-home (check cashing), romance, advance fee (419) and secret shopper scams all have a common theme -- they often use counterfeit cashiers checks to lure victims into negotiating the item and wiring the money off to some far-away location.

The fraudsters often request that you use Western Union, or MoneyGram to wire money to them. They are also known to use wire transfers services offered by banks. Once the money is picked up (normally very quickly in scams), the sender has very little, or no recourse.

The golden rule is to never wire money to people you don't know, or only know from the Internet.

To understand why Internet fraudsters prefer counterfeiting these instruments, one can refer to the legal definition of a cashier's check (courtesy of Wikipedia):

Under Article 3 of the Uniform Commercial Code, a cashier's check is effective as a note of the bank. Also, according to Regulation CC (Reg CC) of the Federal Reserve, cashier's checks are recognized as "guaranteed funds" and amounts under $5000 are not subject to deposit holds, except under certain circumstances.

To the person receiving the item, they appear as if they are guaranteed by the bank and if the check is under $5,000.00 - there is no hold on the funds. The fraudsters know this and it will normally be 7-10 days before their victim discovers that anything is wrong.

There was a recent story circulating in the press about a "seemingly cautious gentleman," who decided to have his bank examine the item before he went forward with an auction deal. The bank told him the item was good (twice) and he deposited it. Several days later, while reviewing his online statement, he discovered that this wasn't the case and the bank had withdrawn the funds.

In the article, the bank blamed "Reg CC," because they are unable to hold the funds. Not completely true, an exception can be made if they have reason to believe the item can't be collected. The item may also be sent in as a collection versus depositing it in the account.

Nonetheless, in this instance, the bank had little to no liability because the item was counterfeit.

To illustrate, the amount of this activity, the FDIC sends out alerts on counterfeit cashier's checks. If you would like to see how many alerts -- they've issued recently (scary) -- link here.

Here are some things a person can do to see if a cashier's check is fraudulent:

If someone is asking you to wire money back to them - it's more than likely a scam.

Review the security features of a cashier's check. Despite the "booming" make your own check industry, some of the items out there are pretty amateur. Wikipedia has a good reference on the security features, here.

Review recent FDIC alerts - in a lot of cases, a warning has already been issued.

Verify the check with the issuing institution. Although this isn't 100 percent effective in the case of a counterfeit, they can normally verify certain items; like the ABA/account number, payee, check number, date of issuance, authorized signer and amount.

When you call the bank, never use the number printed on the check. Quite often - phony numbers with phony employees are set up to verify these items. Get the bank's number from a website, or telephone directory. Using 411 (information) might not be the best way to verify a number. Recently, there have been phony numbers set up that verify through - and reverse - through 411.

Since, there are also a lot of phony bank sites out there, if you use the Internet, TrustWatch is a good option for a search engine. TrustWatch will show you via a "coded coloring system," whether the site is verified to be legitimate, or not.

In some instances, good cashier's checks are copied, which defeats verifying the item by telephone. Once the counterfeit item is cashed, the fraudster negotiates the good item and the counterfeit is returned. This is also seen (occasionally) with counterfeit money orders.

If you are still uncomfortable after talking to the bank - ask to speak to a supervisor, or even better - someone in the fraud department. Ask if you can fax them a copy of the item for them to look at. A good way to do this - is to tell them you have a reason to suspect fraud.

Scams that involve, counterfeit cashier's checks, always represent something that is too good to be true. If this is the case, it probably is.