E-Mail Opens New Door For Familiar Scam Tactic

April 29, 2002

He is a suburban Washington entrepreneur, middle-aged, prosperous -- and too humiliated to discuss how a businessman as smart as he could fall for such an obvious scam.

But later this year, the local entrepreneur, who spoke on condition of anonymity, may be in a Canadian courtroom to recount a disquieting tale of being duped out of $750,000 via an unsolicited fax. The get-rich-quick con, dubbed the "Nigerian Letter Scam" by authorities, was operated out of Toronto and Nigeria from 1994 to 2000 and swindled more than 300 people, including about 20 in the Washington area, out of approximately $20 million, according to law enforcement officials.

The businessman, authorities say, received the fax in June 1997. It purported to be from Nigerian National Petroleum Corp., and the writer, a total stranger, promised him a 25 percent cut of $25.3 million if he would allow Nigerian investors to deposit surplus government funds into his U.S. bank account. Soon, he was wiring payments for attorney fees, administrative costs and taxes. He never got a dime.

Similar scam communications, which have turned up worldwide, first surfaced in the 1980s in letters and faxes and are now arriving with increasing frequency in e-mails, many sent from Nigeria or neighboring West African nations. Last year, they constituted the third biggest consumer fraud on the Internet, trailing auctions and the sale of merchandise, according to the National Consumer League.

"I think it's becoming more popular [on the Internet] because it's cheaper for the con artist to get the information out," said Holly Anderson, spokeswoman for the Washington-based organization.

The Secret Service says it gets 13,000 complaints a month from people who have received the dubious solicitations, about 80 percent of which come by e-mail. In Montgomery County alone, detectives say they get up to 50 complaints a week about bogus financial offerings. One was sent to the fire chief.

In the past three years, U.S. residents have been swindled out of $100 million, according to the Secret Service, which investigates such cases because they are considered financial crimes.

In the Washington area, authorities say the losses have climbed into the millions, though it's hard to come up with an exact figure because many victims are too embarrassed to come forward.

"They've given money, and they've now accepted that it's a fraud, and they don't want to admit they were taken by something that initially should have been so obvious," said Brian Deck, a Secret Service agent in the Washington field office.

The con artists often get names of people and businesses from telephone books, Web sites, employee directories and various branches of the Chamber of Commerce.

In a new twist since Sept. 11, some e-mails have said that a person with millions of dollars in a Nigerian bank account died at the Pentagon, with no next of kin to claim the funds. The con artist, posing as a bank manager, suggests that the letter recipient pretend to be a relative -- and that the two share the money before his government seizes it.

To stem the problem, the Secret Service set up an office in Lagos, Nigeria, in 2000. Last year, agents assisted Nigerian authorities in 58 arrests, though few have been caught or prosecuted in the United States. The Washington field office is investigating several cases, but officials say it's a difficult crime to probe because many of the central players live overseas and use fake names.

In 1997, four Nigerians pleaded guilty in federal court in Greenbelt to posing as Nigerian banking officials and setting up accounts in the Laurel area and elsewhere, authorities said. They conned people from around the world, including California, France and China, out of at least $5 million, although none of the victims was from the Washington area. The four received prison sentences ranging from 30 to 48 months.

"Once [the con artists] realize you're willing to part with a substantial amount of money, they use that, and every month a new request will come," said Scott G. Wyne, a Montgomery County detective who works on a Secret Service fraud task force.

"It's, 'Oh, I forgot to tell you about the Lagos transfer tax. That's another $13,000,' " Wyne said. "They say the first of the month you're going to get your money, and then the 31st they call, 'Oh, the new attorney has transferred the debt to the reconciliation committee, and they've decided you have to pay another $32,500.' "

"And if you balk at it," he said, "they'll say, 'You're going to lose all the money.' "

In the Toronto case, authorities said that Washington area businessman received the fax at his firm in Maryland. The one-page letter read, "I am the group managing director [of] operations of the Nigerian National Petroleum Corporation and a member of an ad hoc committee set up . . . to review contracts awarded by the past military administration."

It explained that because of "grossly over invoiced contracts," there was excess money. "I have therefore been mandated as a matter of trust by the members of the committee to look for a foreign partner [to] whose account we could transfer the sum of $25 million" to begin an import business.

The letter offered the man a 25 percent cut. Later, he was told to wire about $10,000 to cover legal fees. Requests for more money followed.

Whenever the man called a bank supposedly involved in the transaction, the call was forwarded to a boiler-room operation in the Toronto area, staffed by accomplices in the scam, according to Sgt. Mark Van De Graff of the Royal Canadian Provincial Police fraud unit in Toronto. Eventually, the man hired a detective, who confirmed his suspicions.

"If there's a little bit of doubt in someone's mind, if they call these people, they're pretty convincing," said Edward Kolshorn, an agent with the Washington field office. "They'll show them official documents. They have official [sounding] people call them."

Wyne, of the task force, said some victims have asked him not to bust the con artists for fear "the whole deal is going to fall through." He tells them: "There's nothing to collapse. You're being bilked."

The Nigerian Embassy in Washington, concerned about its nation's image, posted a message on its Web site from the Central Bank of Nigeria: "Don't be fooled, many have lost money. If it sounds too good to be true, it is not true!!!"