Nigerian Money Scams Thrive On The Internet

The arrival of Internet cafes in Nigeria a few years ago has given new life to an old scam that's been bleeding millions of dollars annually from gullible Americans and Europeans, experts say.

But some believe the Net may also help to drum the so-called "Nigerian 419" con artists out of business for good.

The fraud, which gained its name from the relevant section of Nigeria's penal code, has lately become a way of life for many people in cities such as Lagos, where economic opportunities are severely limited, according to the U.S. Secret Service.

"419's are such a popular thing in Nigeria right now," said one high-ranking member of the Secret Service task force charged with investigating the schemes. "On any given day, you may have a hundred people, ranging from amateur crooks to organized criminals, all using the same Internet cafe to send out '419' e-mails."

The unsolicited messages, which are usually sent from Web mail accounts at providers such as Yahoo, entice greedy recipients with the false promise of windfall profits in exchange for helping the sender recover millions of dollars in frozen or hidden assets.

Annual losses attributed to 419 scams are in the hundreds of millions of dollars, according to U.S. Treasury officials.

The e-mail-based scams have almost completely displaced the faxes and postal mailings used when Nigerian money frauds first appeared nearly 25 years ago. Credit the attractive economics of junk mailing or "spamming," as well as the anonymity of Internet messaging, experts said.

The e-mail typically arrives with a subject line such as "Business Relationship" or "Strictly Confidential" and appears to be written by a prominent Nigerian connected to the nation's government or banking system.

Authorities wouldn't disclose how many people have been victimized by the Nigerian money scams, but they report that some individuals have been bilked out of hundreds of thousands of dollars, mostly in the form of fraudulent fees, which the scammers claim are required to release the victim's take of the non-existent booty.

Last year, Nigerian 419 scams moved up from seventh place to become the third most common type of Internet fraud, and the scams resulted in the greatest financial losses for online fraud victims, according to the National Fraud Information Center.

The Secret Service has set up a special e-mail address for reporting Nigerian money fraud, 419.fcd@usss.treas.gov, which has generated a swelling database of such spams. But officials concede the e-mail messages provide little in the way of forensic fodder for their investigations.

The Internet protocol addresses in the message headers invariably lead to public computers at Net cafes where usage is not logged. And subpoenas to Yahoo, America Online, and other e-mail providers used by the scammers seldom produce solid leads, law enforcement officials said.

The Nigerian 419 spams are usually sent from fictitious account names derived from those of well-known Nigerian citizens. The scammers, like garden-variety spammers, harvest the e-mail addresses of their prospects from places including corporate and University Web sites as well as Usenet discussion groups and online message boards, according to Secret Service experts.

While the crimes may be based in cyberspace, much of the Secret Service's investigative headway occurs in Nigeria, where its task force maintains offices and collaborates with local police.

Teamwork between the parties has led to the shutdown of a number of 419 operations and even the recovery of some victims' money in recent years. But Nigeria remains a hospitable place for 419 scams because of inconsistent enforcement of the country's laws, Secret Service officials said.

What's more, the scammers' financial fleecing techniques have become increasingly sophisticated, and the con artists have morphed their messages to move with the times. Several recent 419 scam spams, for example, have preyed on sympathies for victims of the Sept. 11 terrorist attacks on America.

Disgusted with the intractability of the 419 problem on the Internet, some hackers have even contemplated retaliatory strikes against the scammers.

Because of the fraudsters' reliance on Web-based e-mail communications and potentially outdated software, they are seen as particularly exposed to exploits of security vulnerabilities in Microsoft's Internet Explorer (IE) browser.

"These guys are definitely hackable. It's just a matter of time," said one security expert, who noted that, for example, a remote-control Trojan horse program could be unloaded on the scammers using a recently discovered IE file download bug.

But others say the Net offers plenty of peaceful means to put the Nigerian money scammers out of business without hacking.

Charlie Pascale, operator of the 419 Coalition Web site, said that while the Internet may have invigorated the Nigerian scam, the medium can also serve as the antidote for the fraud.

"Education is one of the best ways available to fight 419. There is so much info available on 419 on the Web, and since such sites were up and readily available before the 419'ers started to use e-mail, we have been able to head them off at the pass," said Pascale.

The 419 Coalition site is at http://home.rica.net/alphae/419coal.

The Secret Service page on 419 fraud is at http://www.secretservice.gov/alert419.html.

Source: www.bizreport.com

Reported by Newsbytes

Posted by Reginald on 25-02-2002 in General