iYogi Scam Alerts: Beware of the Nigerian / 419 Scam
The Nigerian / 419 Fraud operates by taking a victim into confidence by presenting what appears to be an authentic opportunity to receive a large amount of money. This scam usually begins with an e-mail which appears to be written specifically for a single recipient, although it is actually sent out in bulk. The typical subject line of such e-mails can be “Your assistance is required”, “the Microsoft lottery”, “the MSN lottery” or something similar. The e-mail goes on to ask for personal information and documents such as bank account numbers, company letterheads and/or other confidential papers. Once you are hooked and revert with any documents, the game has started. The primary motive to ask for such documents is to convince you that the deal is on and is heading towards progress. Within a period of seven to ten days, perpetrators establish trust with the victim and eventually ask for more and more money giving vague but plausible reasons, like paying government fees or other issues. The more gullible the victim, the larger the sums of money that he or she will end up parting with.
What iYogi has to say:
“Nigerian / 419 scams have been duping people across the world out of their hard-earned money for over a decade and the scams continue to get more innovative with time,” said Vishal Dhar, President, Marketing and co-founder of iYogi. “Before making any financial transactions based on e-mail communications from an unknown overseas company or individual, it is imperative that people and companies alike take basic precautions such as verifying bank accounts and checking the contact’s background.”
What are the different forms of Advance Fee Fraud:
- Transfer of Money from Over-Invoiced Contracts:About 90 percent of Nigerian / 419 Frauds involve over-invoiced contracts. This scam involves an offer to transfer a large amount of money into an overseas bank owned by a foreign company. All the documents shared by the party tend to come through over-invoiced contracts from a Nigerian company or one of the Nigerian Government Ministries. Once victims are convinced that it is a legitimate deal, they end up paying several transaction fees over months or even years, before realizing that they’ve been had.
- Contract Fraud (C.O.D. of Goods and Services) :This type of fraud mainly targets small businesses with little or no export experience. Here, the target is not an individual but a firm. The targeted company may receive an order from what appears to be a Nigerian company with a bank draft, asking for items to be shipped. The targeted firm may also be fooled into sending a sample with an introductory price to Nigeria. They ask for all the logical registration, import and other fees. Once the company is convinced about the transaction, they receive a letter describing that the Nigerian company has been awarded a lucrative contract from the Nigerian Government and urgently requiret a larger shipment. It is only after this shipment is sent that the small business realizes that the bank draft was fraudulent, the shipment is non-recoverable and that the Nigerian company does not exist.
- Sale of Crude Oil at Below Market Prices:Here, the victim is offered special crude oil allocations at lower than market rate. Just like any other scam, this one also demands registration or licensing fees to acquire crude oil below market price. Once the payment is made, the sellers disappear with the money.
- Purchase of Real Estate:As the name suggests, this fraud involves an offer to purchase real estate using the services of a well established real estate broker. Once a home is finalized, the broker or person acting as the owner of the house asks for a certain amount of money to close the deal. Once the money is given, both the broker and owner vanish.
- Threat Scam (Extortion): This is a relatively uncommon scam and involves sending a letter, fax or e-mail to a recipient explicitly threatening his or her life unless a specified sum of money is deposited in a certain bank. The perpetrators leave no evidence that such a fraud has been carried out and once deposited, the money cannot be traced.