What is the 419 Scam?
The 419 advance fee scam is a particular type of Advance Fee Fraud that emanates from Nigeria. The ‘419’ refers to the article of the Nigerian Criminal Code which deals with fraud. Unsurprisingly, the UK and USA are amongst the countries with a high incidence of such a fraud. The internet has, no doubt, allowed such frauds to grow in number.
So, how do 419 scams work? Typically, an email will arrive in your inbox from someone in Nigeria, claiming to have financial difficulties, and appealing for your help. They may ask to transfer money to your bank account, promising some of the proceeds to you, later using your bank details to steal your money. Alternatively, the scammer may ask for your help to pay fees to transfer their money through your bank account. Although these fees might start small, they get larger and larger.
Warning signs to look out for:
- Unsolicited contact from someone claiming to be a foreign dignitary or executive
- A promise of a multimillion-dollar fortune in exchange for a cash transfer
- A sad story about why they can’t transfer the funds themselves to manipulate you into helping
How to protect yourself from 419 scams:
- Never send money or share credit card details, online account details or copies of personal documents with strangers
- Never send a stranger an up-front payment via money order, wire transfer, international funds transfer, pre-loaded card or electronic currency, like Bitcoin which can be difficult to recover
- Do not agree to transfer money on behalf of someone else. This falls under the crime of money laundering.
- Do some research. Enter the names, contact details or exact wording of the letter/email into a search engine to check for any references to a scam.
- If you suspect it might be a scam, don’t fall into the trap of getting into ongoing correspondence. It’s better to ignore the message than being manipulated by the scammer.
419 Advance Fee Scam
The scammers use mass emails promising potential victims romance or huge riches. Latterly, scammers have used fake, but plausible accounts on social networks to make contact with potential victims. The victim is told a story which varies wildly but the common theme is that the fraudster pretends to be an official of some kind who needs to transfer a large sum out of Nigeria for whatever reason and the victim will be paid a percentage for assisting them in that task. Often false and plausible documents are sent which persuade the victim to participate.
Once the victim’s trust has been gained, there will be an obstacle to prevent the transfer of some kind, which requires the victim to make a payment of admin fee or something similar. Sometimes they say that the victim needs to deposit a minimum sum to be able to participate and profit from the scheme. The transfer will often be a wire transfer, which is untraceable and irreversible.
The fraudsters will often use ‘tests’ to gauge the victims’ gullibility, by asking them for their bank details for example. The bank account won’t necessarily be drained of resources by the scammer, but may well be drained later by the person that the scammer has sold those details on to. The elderly are particularly susceptible to such frauds, given they are generally far more trusting than the younger generation and the scammers use letters in the post as well as the internet.
It has been difficult for authorities to truly quantify the cost of this type of fraud to the world, given that many victims may be too embarrassed to come forward and report it once they realise what has happened.
In 2006, the United States government reported that American people lost $198.4 million to internet fraud, with an average of $5,100 per incident [San Francisco Chronicle]. In the same year, the United Kingdom claimed such scams lost the economy £150 million per year, with the average loss per victim at £31,000. There can be a much higher price paid by victims. A man from Cambridgeshire committed suicide by lighting himself on fire when he realised the $1.2 Million “internet lottery” he had won was, in fact, a scam. In 2007, a Chinese student at the University of Nottingham killed herself after she discovered she had fallen for a lottery scam [BBC News].
In rare instances, the scams can lead to extremely serious crimes, such a kidnap and murder. In 2008, Osamai Hitomi, a Japanese businessman, who had been lured to Johannesburg in South Africa, was kidnapped. They demanded $5 million ransom. People were ultimately arrested for the kidnap. In 2001, Joseph Raca, a former Mayor of Northampton, was kidnapped in South Africa. They demanded a £20,000 ransom and then released him when they got nervous [News 24 and BBC News].
One of the major problems is that the crime spans continents and countries and is a truly international crime. Often the victim has bought into some kind of illegal activity, such as agreeing to transfer money which has been taken from someone else. Corruption is present it seems within the Nigerian government and so tightening regulation and asking them to intervene may serve little purpose ultimately.
Sometimes, however, the authorities do catch up with the fraudsters. In 2004 a large gang (fifty-two in all) were arrested in Amsterdam.
For advice and assistance if you are being investgated for an alleged fraud contact us.