Baker Fraud Report

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Interpol leads crackdown in Africa against scammers; 1209 arrested across Africa; $97.4 million seized; from crypto mining investment scams to inheritance frauds

New fraud technique called “Ghost-tapping:” crooks put stolen credit cards onto burner phones; link to Google Pay and Apple pay; can have mules buy goods at a physical location and just tap the card

FCC bars 1200 voice service providers from the US phone system in crackdown on illegal robocalls

CBS Interview with Apple Cofounder Steve Wozniak on online scams; how he sued Youtube for using clip of him to further bitcoin scam

Full report here

FBI warns the scams are now impersonating major law firms, producing fake legal documents, and falsely claim to be lawyers to further crypto romance frauds or claim that they can get lost money back

All 51 State Attorney Generals form group to combat robocalls

Let us know when scammers caught in the US are from other countries.  I have noticed that many people arrested in the US for fraud are really from other countries (such as Nigeria, India, Romania, or China) and may well be in the country illegally.  Many times press releases do not reveal these facts, even though they are is reported in their home country news media, such as in Nigeria or India. At times the origin of the person is revealed in the indictment or other legal papers.  These are just facts tying them to foreign gangs, and disguising their origins helps no one.

Full report here

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Man from Costa Rica gets 15 years prison for sweepstakes fraud; calls from Costa Rica claimed to be from government agencies; no one had won; collected over $4 million; operated more than 15 years

New FTC Data Spotlight that looks at business and government impersonation frauds that want you to turn over funds to keep them “safe”

• Reports by older adults losing $10,000 or more quadrupled since 2020
• Those who lost $100,000 or more increased sevenfold
• One third of the money lost was sent in crypto
• These scams also begin as tech support frauds
• $690 million reported lost to this type of scam last  year

Boston: Thirteen charged in grandparent scam that operated from a call center in the Dominican Republic; took in $5 millionForeign gangs operating in the US: Foreign fraud gangs have at least thousands of people physically in the US who help operate the frauds. Some make calls directly; others send mail or email and may help set up websites. And of course these US based helpers launder money, open bank accounts, recruit money mules or go to the homes of victims to pick up money (or hire Uber driver or other couriers).  Thus well over a hundred people from India have been convicted over this type of work.  And Romanians fly in, set up ATM skimmers, and fly out.  Many of these criminals are here illegally, either having crossed the border or overstaying tourist or student visas.  When caught taking part in frauds couldn’t/shouldn’t they be deported?

Full report here

Man from Costa Rica gets 15 years prison for sweepstakes fraud; calls from Costa Rica claimed to be from government agencies; no one had won; collected over $4 million; operated more than 15 years

New FTC Data Spotlight that looks at business and government impersonation frauds that want you to turn over funds to keep them “safe”

• Reports by older adults losing $10,000 or more quadrupled since 2020
• Those who lost $100,000 or more increased sevenfold
• One third of the money lost was sent in crypto
• These scams also begin as tech support frauds
• $690 million reported lost to this type of scam last  year

Part Nine on Fraud gangs:  We know that China has organized crime groups, despite its totalitarian ways.   Fentanyl precursors are made in China and then sold to Mexican drug cartels, for example.  And most of the counterfeit goods sold around the world come from China, and are massively sold on the internet.  In fact, the largest pool of fraud complaints to the BBB are about counterfeit or nonexistent goods sold this way.  China, or Chinese gangs, are mainly responsible for the massive scam compounds in Thailand, Cambodia, and the Philippines that kidnap young people and force them to scam. These compounds grew out of Chinese-led online gambling “casinos.”   Finally, there has been a noticeable trend in the use of Chinese couriers being used to pick up victims money for India-based tech support frauds.  Chinese people also are actively involved in gift card fraud.  And note that China seems to have devised ways to take and process credit cards (for sales of counterfeit goods online and for online gambling) despite efforts by MasterCard and Visa to fight this illegal use of their cards.

Full report here

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UK and Romania bust ATM skimming gang; 18 searches, 2 arrested to date

Amnesty International visits 53 scam compounds in Cambodia; issues report; kidnappings, beating

Part Nine on Fraud gangs:  Nigerian Black Axe.  This “confraternatity” seems to have emerged from Nigerian college campuses.  It goes not appear to be the only one that did.  And now Black Axe operates worldwide. For example, Black Axe has partnered with the Italian mafia to control prostitution in Italy.  The Black Axe has even had Facebook pages for chapters in major cities in (at least) North America, including Toronto, Houston, Atlanta and Washington DC.  Though we do not tend to think of violent crime being involved in frauds, Police agencies investigating the organization state that it does engage in violence.

And in addition to its work with a wide variety of fraud around the world, it is also engaged in international drug dealing, sometimes using romance scam victims, for example, to carry seriously illegal drugs from country to country.

Scammers operate as a network.  For example, just one Western Union location in London had thousands of complaints from victims who had been instructed to send their money to that location for a variety of scams. But how did the scammers know who was behind each transaction so that the proper fraudster could get paid?  And what if that location were stealing part of that money?  Of course there are scammers that rob each other. But since frauds cannot go to the police to enforce their agreements, it seems likely that Black Axe and other organized crime groups serve this function.    

Next up:  China

Full report here

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Wired: Social media influencer teaches Nigerian Yahoo boys their trade

Part eight on Fraud gangs:  Nigeria

Nigerian scammers seem responsible for a larger share of consumer fraud than any other group.   Nigeria is a former British colony, fairly well educated, and largely English-speaking.  It has a large population of 227 million and thus is quite a bit larger than Russia with 143 million.  Despite huge oil reserves, many people are relatively poor.  Thus there has been a huge Nigerian Diaspora around the world; very large numbers have emigrated to the US, Canada, Europe, Ireland, and Asia. The main law enforcement body in Nigerian, the Economic and Financial Crimes Commission (the EFCC) has told me that they believe there may be 250,000 Nigerians living in mainland China.

     Scammers from Nigeria, often known as Yahoo boys, are the primary operators of romance scams, but also operate a large number of other frauds, such as Sextortion scams targeting teenage boys, business email compromise fraud,  inheritance and lottery fraud, and the theft of government benefits, such as unemployment and PPP fraud.

     Often groups operate several different frauds simultaneously with partners around the world.  There is a strong fraud support network that they employ to provide internet support, move money, fake web sites; fake passports, etc.  These are just facts. There is no more reason to believe that all Nigerians are scammers than it would be to believe all Italians are part of the Mafia. 

Next week: The Black Axe

Full report here

GAO report finds organized fraud groups are targeting federal programs, and half of prosecution have been of fraud gangs

Man from Costa Rica gets more than 15 years prison for running lottery scams from call centers there that impersonated US government officials; made over $4 million

Part Seven on Fraud Gangs: Canada

At one point there were thousands of people in Canada operating fraud telemarketing operations against the US.  Due to great joint work between Canadian and US law enforcement much of this is now gone.  Note that it is very difficult to extradite from Canada.   But much fraud remains.    The main fraud coming out of Canada is grandparent fraud, traditionally centered in Quebec.  The head of a major group behind this fraud was recently arrested.  Police estimate that they took in $30 million.  The SQ in Quebec believe organized crime groups are also involved in grandparent fraud, though it not clear if  this is the Italian Mafia or the Nigerian Black Axe. The Toronto Police Service and the RCMP have also done great work on tracking the activities of the Black Axe across Canada.

Full report here

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UK: Sim Swapping events were up 1000% in 2024

Part 6 on Gangs: Cameroon.  Another large source of fraud is Cameroon, a large country in Africa that shares a border with Nigeria.  It is a former French colony.  Perhaps the most familiar fraud is sale of pets online that don’t exist. Petscams.com tracks much of this activity.  The hallmark of their scams are online sales and collecting money for products that don’t exist and are never sent.  In addition to pets Cameroon-based scammers “sell” guns, ammunition, illegal drugs and other goods.  I’ve never seen enforcement there. And there is a large private industry that creates web sites for the use of frauds, including copycats versions of real bank websites. 

Full report here

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Canada: Profile of Gareth West, believed to be the Montreal mastermind behind grandparent scams; he has now fled

Interpol announces sharp rise in cybercrime in Africa; issues new Threat Report here

Part 5 on Gangs:  Mexico/Peru.  I’ve always been surprised at how little consumer fraud seems to come from Mexico.  But many from the US and Canada have bought timeshares in Mexico, and people that can not longer visit (or afford them) have long been subject to frauds claiming to have a buyer. Of course fees must be paid in advance, and sellers are assured that those will be returned to them at closing. But of course there is no closing.  The Jalisco drug cartel seems to be involved in this fraud, and some had been kidnapped – and later killed – at call centers doing this fraud. 

Peru also has been a home to several different frauds concentrating on Spanish-speaking people in the US.  Several have been sued by the FTC or prosecuted in the US.

 I would be quite surprised if there are not also fraud gangs operating from places like Brazil or Argentina, but I’ve not seen or heard of those. Possibly they are simply in Spanish Language press, and thus they are not on our radar. But one would think that someone would report on them.

Full report here

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UN reports that China run scam compounds are relocating from Southeast Asia to Africa, especially to Nigeria; UN study itself here

Texas: Six (Nigerians?) sentenced to prison for romance fraud, BEC fraud and theft of unemployment benefits; got $17 million

Washington: DOJ files to forfeit $225 million in crypto, apparently from crypto romance frauds

Part 4 on Gangs:  India.   Though tech support scams seem to have begun in the US, it now comes almost wholly from India.  And after the crooks have remote access to computers, they can easily find log in information for financial accounts.  And India also is the main home for scams that call impersonating bank security officials or federal agents.  Victims are threatened with arrest and told they move their funds to the caller in a “safe” account to preserve them.    But of course those funds are simply stolen.  India also has a raft of scams offering small business and personal loans; fees are required to get the loans, which never material.  In the last year or two scammers from India have been arriving at victim’s homes to pick up money, often requesting actual gold.  Well over 100 from India have been prosecuted in the US handling the money for these frauds.  Notably the Indians seem to be working with Chinese, at least to pick up funds.

India has busted a number of large call centers, and made many arrests, though I’ve yet to see them actually prosecute anyone.  I’ve seen no evidence that they have ever extradited anyone to another country either.

Obviously India is a huge English-speaking, but poor, country with many people who have experience in call centers.

Be careful when going a Google search for a customer service number!  A growing numbers of scammers post their own numbers high in search results (they pay for this) and use them to scam people. This has long been  a favorite tactic of tech support scammers, but now it is spreading

Need an expert witness for consumer protection or fraud issues?  Let me know.

Full report here