How NOT to be a Millionaire

by the Financial Intelligence Unit 09.OCT.09

Many of us have seen or heard of the game show “Who Wants to be a Millionaire” and are fascinated by the apparent ease with which a person can earn $1,000,000 and often wish we could be as lucky. In a highly technological age when many of us access the Internet even if it is only to check our emails, we are often greeted by bright, blinking announcements of having been the millionth visitor to a site and we should click to claim our prize, or that we have won the lottery or that some other form of good fortune has been visited upon us.{{more}}

There are many who may be skeptical and those who outright ignore these turns in their luck, but there are many who fall prey to these scams and the possibility of doing so may be greater now, in a time when many claim to find it hard to make ends meet.

The announcements call us by name and may include other personal information that leads us to believe in their authenticity, when in fact they are the work of hackers and con artists.

If you have not bought a ticket, how could you have won a lottery that you never heard of, sometimes in a country you never even knew existed?

We often say that we probably have family ‘all over’ the world that we may not know of, but why would someone we have never heard of or met, leave us millions of dollars?

The main question we must ask ourselves is, why do these ‘gifts’ always require some payment in return?

Many of these schemes take the form of an “advance-fee fraud” in which the target is persuaded to advance sums of money in the hope of getting a significantly larger sum.

If we are to examine these claims closely we see that although many purport to come from reputable establishments, the spelling and grammar are poor. This is not something to be expected from an overseas business that should have trained and professional staff at their disposal. On the other hand, this may all be part of their game, depending on the type of scam, some may write in a clumsy and uneducated style which presents them as naive and capable of being easily cheated by a sophisticated person.

Additionally, they speak to us in a language we cannot understand; they fill their correspondence with technical words that are meant to confuse and make us believe that it is legitimate and when requests are made for clarification, they only confuse us further.

The schemes always set a deadline for the receipt of money and constantly remind you of such, telling you that whatever you are allegedly entitled to will no longer be available after the passage of a certain amount of time, continuously pressuring you to make a financial commitment.

Other scams include Lottery scams, Romance scams, Pyramid Schemes, Phone scams, alleged Government grants, Assistance to Businesses seeking funding, Finance scams, chain letters and emails, charity scams, credit repair, Diploma and Degree scams, Employment scams, Work-at-Home scams, Health scams, Investment Scams, Missing persons scams, Scholarship scams, Travel scams and scams using the names of reputable entities such as Amazon, eBay and Best Buy.

In the Nigerian Advance Fee Scheme (also known internationally as “4-1-9” fraud after the section of the Nigerian penal code which addresses fraud schemes) you receive an unsolicited letter purporting to come from someone who claims to work for the Nigerian Central Bank or from the Nigerian government. In the letter, a Nigerian claiming to be a senior civil servant informs the recipient that he is seeking a reputable foreign company into whose account he can deposit funds which the Nigerian government overpaid on some procurement contract.

The intended victim is reassured of the authenticity of the arrangement by forged or false documents. The scam artist may even arrange a meeting between the victim and “government officials” in real or fake government offices.

Once the victim becomes confident of the potential success of the deal, something goes wrong. The victim is then pressured or threatened to provide large sums of money to save the venture. Each fee paid is described as the very last fee required. The scheme may be stretched out over many months.

In Romance Scams, the victim may be approached on an online dating service, an instant messenger, or a social networking site. The con artist usually posts pictures of an attractive person (not themselves) and later claims to be interested in meeting the victim, but needs money for a plane ticket, hotel room, or other expenses. Others claim to be trapped in a foreign country and need assistance to return, to escape imprisonment by corrupt local officials or to pay for medical expenses. The scammer may also introduce some variant of the original Nigerian Letter scheme, such as saying they need to get money or valuables out of the country and offer to share the wealth, making the request for help in leaving the country even more attractive to the victim. In a newer version of the scam, the con artist claims to have ‘information’ about the fidelity of a person’s significant other, which they will share for a fee. This information is obtained through social networking sites by using search parameters such as ‘In a relationship’ or ‘Married’. Anonymous e-mails are first sent to attempt to verify receipt, and then a new web based e-mail account is sent along with directions on how to retrieve the information.

Another scheme takes advantage of businesses seeking funding by stating that they are interested in funding the project. They require the company to fly to their place of operation for a meeting and this cost is borne by the company itself. Afterward, they agree to fund but say that you have to pay for things such as due diligence and also assist with legal fees. The company sends this money to a special account “to get the process started” and of course after this is done, never receives any funding.

Diplomas and Degrees that state that you receive them based on your present knowledge and life experience, and there are no required classes, tests, books or interviews and that no one is turned down, should not be trusted. There is no way that such institutions are accredited, the only degrees conferred in any manner remotely close to that would be honorary degrees.

With regard to the use of reputable entities, requests that information be sent from customers through email should not be trusted since these entities do not engage in such practices.

We need to rethink the ease with which we believe everything contained in a piece of correspondence we may receive. When we get emails and letters that seem too good to be true, they usually are. There is no harm in doing a little research; many of these scams are described online in order to protect you from making the same mistake that many have made. We should all remember the adage, “A bird in the hand is worth two in the bush”, and here it means your $5,000. or however much it is you are asked to send is more real and more valuable that the prospect of gaining millions, especially when it is very likely you will never see that money. Do not risk losing what you have for something you don’t. This is reality; it is not a game show.

There are websites where you can learn more about these scams such as:

http://www.ccmostwanted.com/topics/sc/scams.htm

www.antiscam.net,

http://en.wikipedia.org/wiki/Advance_fee_fraud,

http://en.wikipedia.org/wiki/Romance_scam.