Offshore Scams

The Nigerian Advance
Fee Scheme

The Nigerian Advance Fee Scam has been around for quite awhile, but
despite many warnings, continues to draw in many victims. In fact,
the Financial Crimes Division of the Secret Service receives
approximately 100 telephone calls from victims/ potential victims and
300-500 pieces of related correspondence per day about this scam!

Indications are that the advance fee fraud grosses hundreds of
millions of dollars annually and the losses are continuing to
escalate.

The Nigerian Advance Fee Scheme (also known internationally as
"4-1-9" fraud after the section of the Nigerian penal code which
addresses fraud schemes) is generally targeted at small and medium
sized businesses, as well as charities. This global scam (recently
seen in Russia, Southeast Asia, Australia, and New Zealand, as well
as the US) involves the receipt of an unsolicited letter purporting
to come from someone who claims to work for the Nigerian Central Bank
or from the Nigerian government. (The Central Bank of Nigeria denies
all connection to those who promote this scheme.)

In the letter, a Nigerian claiming to be a senior civil servant will
inform the recipient that he is seeking a reputable foreign company
into whose account he can deposit funds ranging from $10-$60 million
which the Nigerian government overpaid on some procurement contract.

The goal of the scam artist is to delude the victim into thinking
that he or she has been singled out to participate in a very
lucrative - although questionable - arrangement. The intended victim
is reassured of the authenticity of the arrangement by forged or
false documents bearing apparently official Nigerian government
letterhead, seals, as well as false letters of credit, payment
schedules and bank drafts. The scam artist may even establish the
credibility of his contacts, and thereby his influence, by arranging
a meeting between the victim and "government officials" in real or
fake government offices.

Once the victim becomes confident of the potential success of the
deal, something goes wrong. The victim is then pressured or
threatened to provide one or more large sums of money to save the
venture. For example, an official will demand an up-front bribe or
an unforeseen tax or fee to the Nigerian government will have to be
paid before the money can be transferred. Each fee paid is described
as the very last fee required. The scheme may be stretched out over
many months.

Here is a sample of a letter a victim may receive:
(Note: The letter that is sent is all in capital letters.)

----------------------------------------------------------------
Lagos, Nigeria.
Attention: The President/CEO

Dear Sir,

Confidential Business Proposal

Having consulted with my colleagues and based on the information
gathered from the Nigerian Chambers Of Commerce And Industry, I have
the privilege to request for your assistance to transfer the sum of
$47,500,000.00 (forty seven million, five hundred thousand United
States dollars) into your accounts. The above sum resulted from an
over-invoiced contract, executed commissioned and paid for about five
years (5) ago by a foreign contractor. This action was however
intentional and since then the fund has been in a suspense account at
The Central Bank Of Nigeria Apex Bank.

We are now ready to transfer the fund overseas and that is where you
come in. It is important to inform you that as civil servants, we
are forbidden to operate a foreign account; that is why we require
your assistance. The total sum will be shared as follows: 70% for
us, 25% for you and 5% for local and international expenses incident
to the transfer.

The transfer is risk free on both sides. I am an accountant with the
Nigerian National Petroleum Corporation (NNPC). If you find this
proposal acceptable, we shall require the following documents:

(a) your banker's name, telephone, account and fax numbers.
(b) your private telephone and fax numbers - for confidentiality
and easy communication.
(c) your letter-headed paper stamped and signed.

Alternatively we will furnish you with the text of what to type into
your letter-headed paper, along with a breakdown explaining,
comprehensively what we require of you. The business will take us
thirty (30) working days to accomplish.

Please reply urgently

Best regards

----------------------------------------------------------------

What should you do if you receive a letter like this?

The U.S. Secret Service has instructed anyone in the US who receives
a letter similar to this one to send it to:

U.S. Secret Service
Financial Crimes Division
1800 G St., NW,
Room 942,
Washington, DC 20223.
(202) 435-5490

If you are outside the United States, you should to report it to your
local authorities.

Be careful. This scam can be physically dangerous as well as
dangerous to your finances. Victims are almost always requested to
travel to Nigeria or a border country to complete a transaction.
Victims are often told that a visa will not be necessary to enter the
country. The Nigerian scam artists may then bribe airport officials
to pass the victims through Immigration and Customs. Because it is a
serious offense in Nigeria to enter without a valid visa, the
victim's illegal entry may be used by the scam artists as leverage to
coerce the victims into releasing funds. Violence and threats of
physical harm may be employed to further pressure victims. In June of
1995, an American was murdered in Lagos, Nigeria, while pursuing a
4-1-9 scam, and numerous other foreign nationals have been reported
as missing.

Recommendation:
Avoid these scams like the plague! Don't let promises of large
amounts of money impair your judgment.

[Reprinted from The Offshore Journal - Nov., 1996]

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