Wire Transers

A recent article about scams and wire transfers caught my eye the other day.  Here are time facts from the article . . .

Rules governing wire transfers place a larger burden on account holders than laws on credit cards or debit card . . . . {the} bank says {the victim} may not have met required security requirements on his computer system — even though he has secured wireless, firewalls, anti-virus software and other protection — and so, the bank may not be liable to pay him back.

I get really frustrated when I see things like this.  Why is it that the banks can sit back and do nothing, and put all of the blame on the customer!?!?!  When do the banks have to stand up and say "There are things we could have done to stop this, so we are liable also."

MoneyGram and Nigeria

On June 8th, 2010 MoneyGram released the following information. Because I feel so strongly about this topic, I would like to share the entire press release with you, along with my personal thoughts on it.

MINNEAPOLIS, Jun 08, 2010 (BUSINESS WIRE) --MoneyGram International (NYSE:MGI), a leading global money transfer company, announced today that First Bank of Nigeria Plc has selected MoneyGram to provide money transfer services in its more than 500 locations across the nation. First Bank, established in 1894, is Nigeria's oldest bank and one of the largest in terms of network size. First Bank has locations in all key cities including Abuja, Benin, Lagos, Iabdan, Port Harcourt, and Warri as well as a significant presence in rural Nigeria, some operating 24 hours a day, seven days a week, making MoneyGram services even more convenient for Nigerians.

Is this really what we need?  for Money Gram services to be even more convenient for Nigerians?  I feel that it is pretty convenient for them just as it is.  Actually it is way TOO convenient for them to pick up money that people receive from counterfeit cashier's checks, or for fake Secret Shopper jobs or that people believe that they are sending to someone within the United States.

"MoneyGram, which has operated in Nigeria since 1998, saw significant growth between 2006 and 2008 when it tripled its network in the country," said Vicky Johnston, MoneyGram's senior regional director for Anglo Africa and Middle East. "We are excited about partnering with First Bank as it is MoneyGram's most recent and significant expansion which will allow us to provide a service to so many more people through the bank's large number of branches."

Ironically, during the same time period that MoneyGram increased it's network in the country, the number of money lost to scams and fraud also increased.  You can see the increase on the chart below which is from the Annual Report put out by the Internet Crime Complaint Center (IC3.gov)

To commemorate the agreement with First Bank Plc, MoneyGram's Chairman and CEO, Pamela H. Patsley is in Nigeria and will attend the official launch event scheduled for today. During her visit, Patsley will address the media as well as CEOs of MoneyGram's agent banks in Nigeria, discussing the common goal of bringing needed financial services to the people of Nigeria and the growth opportunities there.

I have a better idea . . . what about discussing the common goal of fighting all of the scams and fraud that pass through MoneyGram every day, and how they can do more to save those customers from becoming victims.  Before we start looking at the financial needs of the people of Nigeria, I think we need to protect the financial needs of the people right here in the United States. 

"MoneyGram is pleased to partner with First Bank," said Patsley. "Our partnership will help to ensure that our services are accessible and convenient for the people of Nigeria and that we can continue to meet the growing demand of consumers in this important remittance market."

And why are their demands growing?  Because there are more and more scams going undetected or people just turning a blind eye to them. 

Nigeria, Africa's most populous nation, is ranked in the top 10 receive countries for money transfers. The World Bank estimates that $10 billion USD in remittances was sent to Nigeria in 2009 - with the United States being the primary send country. Other top send countries include Canada, Germany, Israel, Italy, Liberia, Libya, Malaysia, Spain, South Africa and the United Kingdom.

That is because Nigeria is also ranked in the top 3 countries for money wire transfer scams.  The other countries would be Canada and the United Kingdom, who are also ironically on the list above.  I wonder hom much of the $559.7 million dollars from the chart above that went out of this country in scams is directly a part of the $10 billion reported to be going into Nigeria in 2009? 

With the First Bank agreement, MoneyGram now has a total of eight bank relationships, thus further proving that MoneyGram is dedicated to providing reliable and safe money transfer services to Nigerians - wherever they may reside. Furthermore, agent banks in Nigeria have brought a positive experience to the remittance business with their individual pedigree in banking, service quality delivery and branch network, which provides a sense of ease for those receiving funds from family members working in other countries.

So we are going over and above to make sure that Nigerians have a reliable and safe money transfer service, but we are doing very little to offer that same kind of safety to the MoneyGram customers in the United States.  The last sentence in the above paragraph really gets me . . . . which provides a sense of ease for those receiving funds.  Why is it that we seem to care more about the people in another country, who are one of the main sources of these scams, than the people here in the United States that they are scamming? 


Shawn Mosch
Co-Founder of ScamVictimsUnited.com
 
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Counterfeit checks and MoneyGram

I am currently working with a lawyer who is interested in speaking to victims of counterfeit cashier's check scams who wired money using MoneyGram.  Please contact me if you would be willing to speak with this lawyer.  If this turns into a case, it could be a huge break for victims of these scams.

Do not post your contact info here . . . if you do not already have my contact information, you can find me through http://www.retaggr.com/page/ShawnMosch

 

Connection between scams and terrorists

I have thought for a LONG time that there was a connection between scams and terrorists, but because I did not want to be seen as a conspiracy theory person I did not talk about it a lot. Well, now there is an FBI press release that supports that theory.

Al Qaeda Supporter Pleads Guilty to Supporting Terrorist Organization
Kansas City Man Also Admits to Bank Fraud, Overseas Money Laundering

KANSAS CITY, MO—Beth Phillips, United States Attorney for the Western District of Missouri, announced today that a Kansas City, Mo., man pleaded guilty in federal court today to his role in a conspiracy to provide material support to the terrorist organization al Qaeda. He also pleaded guilty to bank fraud and money laundering.

“National security is the highest priority of the Department of Justice,” Phillips said. “I applaud the diligent work of our law enforcement partners from local, state and federal agencies that serve on the Heart of America Joint Terrorism Task Force. These agencies have made significant investments of manpower and resources to the task force, and I appreciate their commitment to defeating terrorism. Much of their work is done behind the scenes, investigating and gathering information, but they play a crucial role in preventing terrorist activities.”

Khalid Ouazzani, 32, of Kansas City, waived his right to a grand jury and pleaded guilty before U.S. District Judge Howard F. Sachs to a federal information that charges him with conspiracy to provide material support to a terrorist organization. Ouazzani also pleaded guilty to charges contained in an indictment that was returned under seal by a federal grand jury in Kansas City on Feb. 3, 2010.

Ouazzani, a native of Morocco and a naturalized citizen of the United States, swore an oath of allegiance to al Qaeda in June 2008. Ouazzani admitted that, from August 2007 to February 2010, he participated in a conspiracy to provide material support or resources to al Qaeda.

Ouazzani also admitted that he personally provided more than $23,000 to al Qaeda and performed other tasks at the request of and for the benefit of al Qaeda. Ouazzani had conversations with others about various ways to support al Qaeda, including plans for them to fight in Afghanistan, Iraq, or Somalia.

“Citizens here in the heartland should be alert to suspicious activity and never hesitate to report their concerns to law enforcement. This case serves as a reminder that terrorist-related activities can occur anywhere,” said Special Agent in Charge Brian A. Truchon of the Federal Bureau of Investigation’s Kansas City field office.

Ouazzani agreed to contribute $6,500 to al Qaeda in August 2007. A co-conspirator, who is not identified in court documents, made that payment on Ouazzani’s behalf. Ouazzani repaid the co-conspirator in November 2007 through a wire transfer to the co-conspirator’s bank account in the United Arab Emirates. Those funds came from Ouazzani’s sale of his business, Hafssa LLC, doing business as Truman Used Auto Parts, a retail operation that bought and sold used auto parts and used motor vehicles.

In June or July 2008, Ouazzani also agreed to pay al Qaeda $17,000, which represented his profit from the sale of an apartment in the United Arab Emirates that was owned by Ouazzani and a co-conspirator (who is not identified in court documents).

Bank Fraud Scheme

Ouazzani obtained a $175,000 line of credit commercial loan from Union Bank in April 2007 for Hafssa LLC (Truman Used Auto Parts). Under the terms of the loan, the funds were to be used as working capital for his business. Ouazzani admitted that he submitted false financial information about himself and the company to obtain the loan, and used substantial amounts of the loan proceeds for various personal purposes.

Ouazzani made only approximately $13,000 in payments on this loan. In September 2008 Union Bank wrote off the loan (then in the amount of $174,028) as uncollectible. On Feb. 11, 2009, Union Bank obtained a civil default judgment against Ouazzani and Hafssa LLC in the amount of $177,001.

Money Laundering

Ouazzani admitted that he used part of the proceeds of the Union Bank loan to purchase an apartment in the United Arab Emirates with a co-conspirator.

On May 23, 2007, Ouazzani caused a wire transfer of $112,830 to be sent to a bank account in the United Arab Emirates. The funds for this wire transfer included funds obtained from the $175,000 Union Bank loan and involved a series of transactions designed to make it more difficult to trace the funds.

Ouazzani used the wire-transferred funds to purchase an apartment in the United Arab Emirates, which he later sold for a profit of approximately $17,000. Ouazzani requested a co-conspirator to pay this $17,000 to al Qaeda.

“The criminal justice system is a valuable tool for disrupting terrorist plots and bringing terrorists to justice,” Phillips said. “We must use every means—criminal prosecutions as well as intelligence and military operations—to protect the American people. Federal prosecutions not only result in long prison sentences, but yield valuable intelligence that can be used in the fight against al Qaeda and other terrorist organizations.”

Under federal statutes, Ouazzani is subject to a sentence of up to 65 years in federal prison without parole, plus a fine up to $1 million and an order of restitution. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

This case is being prosecuted by Assistant U.S. Attorneys J. Daniel Stewart, David M. Ketchmark and Brian P. Casey and Special Assistant U.S. Attorney Alex Menzel of the U.S. Attorney’s Office for the Western District of Missouri, with assistance from attorneys at the Justice Department’s National Security Division, including the Counterterrorism Section. It was investigated by the Heart of America Joint Terrorism Task Force, led by the Federal Bureau of Investigation, with the assistance of the Missouri Department of Social Services - Division of Legal Services Investigation Section.

Heart of America Joint Terrorism Task Force
Federal Bureau of Investigation
Bureau of Alcohol, Tobacco, and Firearms
Defense Criminal Investigative Service
Federal Air Marshals Service
IRS-Criminal Investigation
Kansas City, Kan., Police Department
Kansas City, Mo., Police Department
Kansas Highway Patrol
Missouri State Highway Patrol
Overland Park, Kan., Police Department
U.S. Attorney’s Offices for the Western District of Missouri and the District of Kansas
U.S. Immigration and Customs Enforcement
U.S. Marshals Service
U.S. Postal Inspection Service
U.S. Secret Service

More on MoneyGram

I read a press release stating that MoneyGram is now available in over 6,000 Candada Post Locations.

I sure hope that they do some better training of their staff at these locations, and monitor them more closely than they did their other Canadian locations.  What am I talking about?

The FTC charged that between 2004 and 2008, MoneyGram agents helped fraudulent telemarketers and other con artists who tricked U.S. consumers into wiring more than $84 million within the United States and to Canada – after these consumers were falsely told they had won a lottery, were hired for a secret shopper program, or were guaranteed loans. The $84 million in losses is based on consumer complaints to MoneyGram – actual consumer losses likely are much higher.

The FTC charged that MoneyGram knew that its system was being used to defraud people but did very little about it, and that in some cases its agents in Canada actually participated in these schemes. According to the FTC’s complaint, MoneyGram knew, or avoided knowing, that about 131 of its more than 1,200 agents accounted for more than 95 percent of the fraud complaints it received in 2008 regarding money transfers to Canada; a similarly small number of agents was responsible for more than 96 percent of all fraud complaints to the company in 2006.

You can read the entire press release here.  

Wire Transfers and scams

So many of the online scams involve the scammer sending a counterfeit cashier’s check or money order, asking the victim to wait for it to “clear” and then wire a portion of the money on to someone. The scammers make up all kinds of stories to make the reason for having to wire money to someone else make sense, and of course since the bank has already told you that the check is “clear” you feel like there is nothing to worry about.

Did you know this . . . when you wire money to someone, even if you write on the documentation that the wire transfer is to be picked up in Detroit, Michigan if the scammer has the test/security question and answer along with the wire transfer information then they can pick up the money at any location in the world . . . like Lagos, Nigeria.

These test or security questions are a feature put in place for emergency situations, when the person picking up the money has lost their photo id, which is normally needed to pick up a wire transfer. But if you give the scammer the test/security question information that is how they bypass the need for a picture id when picking up the money. This happens every day on sites like Craigslist. The scammer will pretend to be within the United States so as to not raise any red flags with the potential victim by mentioning that they are really in Nigeria.

With so many scams using wire transfering services like Western Union and MoneyGram we at Scam Victims United would like to see these companies increase their security by making it mandatory that the money must be picked up in the destination zone. If the documentation filled out by the customer says that the money is going to Detroit, Michigan, then the money should not be able to be picked up outside of the state of Michigan, no matter what information the person picking the money up has. This would help to reduce the number of scams going on because the scammers would then have to tell the victims to wire the money to Nigeria for them to be able to pick it up, and with so many people this would be a red flag because of the information about Nigerian scams.

In addition, wire transfering services could have a Fraud Alert posted in their store locations, and when anyone does fill out a wire transfer form and indicates Nigeria as the destination for the money to be picked up they could point out the Fraud Alert or have the customer sign a secondary document saying that they are aware that there are many internet scams coming out of the country of Nigeria which involve receiving a cashier’s check or money order and then wiring money.

I would like to propose laws that would require wire transfer services to implement and follow such security measures.  Since we cannot go to other countries and arrest the people running these scams we must do as much as we can to provide the correct information to the American public to educate them about these scams. This means that everyone must do their part, including the wire transfering services that the scammers use as a part of their business.

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Money Transfers

http://www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt034.shtm

Money Transfers Can Be Risky Business

You’ve won a prize!
I’m in a foreign country, and I need cash.
We’re temporarily unable to accept credit cards.
Your dream apartment is available immediately at an incredible price!

Scam artists use a number of elaborate schemes to get your money, and many involve money transfers through companies like Western Union and MoneyGram. According to the Federal Trade Commission (FTC), the nation’s consumer protection agency, money transfers may be useful when you want to send funds to someone you know and trust — but they’re completely inappropriate when you’re dealing with a stranger.

Why do scammers pressure people to use money transfers? So they can get their hands on the money before their victims realize they’ve been cheated. Typically, there is no way you can reverse the transaction or trace the money. Another reason: When you wire money to another country, the recipient can pick it up at multiple locations, making it nearly impossible to identify them or track them down. In some cases, the receiving agents of the money transfer company might be complicit in the fraud. Money transfers are virtually the same as sending cash — there are no protections for the sender.

Many money transfer scams involve dramatic or convincing stories that play on your optimistic nature, your altruism or your thriftiness. But no matter how you parse it, they always cost you money. Here are some scams involving money transfers that you may recognize:

Counterfeit Check Scams

Someone sends you a check with instructions to deposit it and wire some or all the money back. By law, banks must make the funds from deposited checks available within days, but uncovering a fake check can take weeks. You are responsible for the checks you deposit, so if a check turns out to be fraudulent, you will owe the bank any money you withdrew.

Counterfeit check scams have many variations:

Lotteries and Sweepstakes: You just won a foreign lottery! The letter says so, and a cashier’s check is included. All you have to do is deposit the check and wire money to pay for taxes and fees. Oops: The check is no good. Although it looks like a legitimate cashier’s check, the bank eventually will determine that it is a fake. The lottery angle is a trick to get you to wire money to someone you don’t know. If you deposit the check and wire the money, the check will bounce — and you’ll be responsible for the money you sent.

Overpayment Scams: Someone responds to your posting or ad, and offers to use a cashier’s check, personal check or corporate check to pay for the item you’re selling. At the last minute, the so-called buyer (or the buyer’s “agent”) comes up with a reason to write the check for more than the purchase price, and asks you to wire back the difference. The checks are counterfeit, but very often, good enough to fool bank tellers. Acting in good faith, you deposit the check and wire the funds back to the “buyers.” Oops: the check bounces. You are liable for the amount you wired.

Mystery Shopper Scams: You are hired to be a mystery shopper and asked to evaluate the customer service of a money transfer company. You’re given a check to deposit in your personal bank account. Then, you’re told to withdraw the amount in cash and wire the money using a certain money transfer service. Often, the instructions say to send the transfer to a person in Canada or another foreign country. You’re then asked to evaluate your experience — but no one collects the evaluation. Oops: the check you deposited bounces. You are responsible for the money you withdrew.

Don’t wire money to: a stranger — in this country or anywhere else someone claiming to be a relative in a crisis — and who wants to keep their request for money a secret someone who says a money transfer is the only form of payment that’s acceptable someone who asks you to deposit a check and send some of the money back

Other Money Transfer Scams

Online Purchase Scams: If you are buying something online and the seller insists on a money transfer as the only form of payment, consider it a red flag: ask to use a credit card, an escrow service or another way to pay. No matter what story the seller tells you, insisting on a money transfer is a signal that you won’t get the item — or your money back. Find another seller.

Advance Fee Loans: Ads and websites that guarantee loans or credit cards regardless of your credit history may be tempting. The oops moment is when you apply for the loan or credit card and find out you have to pay a fee in advance. If you have to wire money for the promise of a loan or credit card, it’s likely you’re dealing with a scam artist.

Family Emergency Scams: You get a call out of the blue from someone who claims to be a member of your family and needs cash to get out of a jam — to fix a car, get out of jail or leave a foreign country. He begs you to wire money right away and to keep the request confidential. Check it out with your family. It’s likely they know nothing about it. If you absolutely, positively cannot ignore the request, try to verify the caller’s identity by asking very personal questions a stranger couldn’t possibly answer. And keep trying to reach the family to check out the story.

Apartment Rental Scams: Some scammers hijack bona fide rental or real estate listings by changing the email address or other contact information, and placing the altered ads on other sites. Other rip-off artists make up listings for places that aren’t for rent or don’t exist, and try to pique your interest with the promise of below-market rent. But once they have your attention, a skilled scammer asks you to wire an application fee, a security deposit or the first month’s rent. It’s never a good idea to send money to someone you’ve never met for an apartment you haven’t seen. If you can’t meet in person, see the apartment or sign a lease before you pay, keep looking.

If you’ve wired money to a scam artist, call the money transfer company immediately to report the fraud and file a complaint. You can reach the complaint department of MoneyGram at 1-800-MONEYGRAM (1-800-666-3947) or Western Union at 1-800-448-1492. Ask for the money transfer to be reversed. It’s unlikely to happen, but it’s important to ask. Then, file a complaint with the FTC. Visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.

The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint or to get free information on consumer issues, visit ftc.govor call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The FTC enters consumer complaints into the Consumer Sentinel Network, a secure online database and investigative tool used by hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.

MoneyGram class action

Last week I wrote about MoneyGram and the FTC, and how the FTC has found that MoneyGram knew that it's money transfer system was being used to defraud and scam people out of their money, and did very little about it.

Since then I have been contacted by a consumer rights attorney in California and he would like to bring a claim against MoneyGram to get money back to scammed consumers.

If you know of anyone in California that was scammed by MoneyGram, please have them contact me so that I can get them in touch with this attorney. He is willing to help the victims and work on contingency.

Shawn Mosch
Co-Founder of ScamVictimsUnited.com
There is strength in numbers!

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Consumer Education

The FTC has a new Consumer Alert, available on its Web site at http://ftc.gov/bcp/edu/pubs/consumer/alerts/alt034.shtm, titled “Money Transfers Can Be Risky Business.” It includes useful information on how consumers can avoid telemarketing and money transfer fraud, including the following tips. Don’t wire money to:

· someone you don’t know, in the U.S. or in a foreign country;

· someone claiming to be a relative in the midst of a crisis and who wants to keep the
request for money a secret;

· someone who says a money transfer is the only form of payment that’s acceptable; or

· someone who asks you to deposit a check and send some of the money back.

Consumers interested in the process of redress administration should call 202-326-3755.

The FTC’s case was investigated with the assistance of the Toronto Strategic Partnership, Project Colt, Project Emptor, and the U.S. Postal Inspection Service. Additional assistance was provided by the Durham Regional Police Service, Ontario, Canada, and the Canadian Anti-Fraud Call Centre (PhoneBusters).

The Toronto Strategic Partnership includes the FTC, the U.S. Postal Inspection Service, Competition Bureau Canada, the Toronto Police Service Fraud Squad – Mass Marketing Section, the Ontario Provincial Police Anti-Rackets Section, the Ontario Ministry of Consumer Services, the Royal Canadian Mounted Police, and the United Kingdom's Office of Fair Trading. Project Colt includes the FTC, the Royal Canadian Mounted Police, Surete du Quebec, City of Montreal Police Service, Canada Border Services Agency, Competition Bureau Canada, U.S. Homeland Security, U.S. Postal Inspection Service, and the Federal Bureau of Investigation. Project Emptor includes the FTC, the Business Practices and Consumer Protection Authority of British Columbia, the Royal Canadian Mounted Police, Competition Bureau Canada, the Federal Bureau of Investigation, and the U.S. Postal Inspection Service.

The Commission vote approving the complaint and proposed consent order was 3-0, with Commissioner Pamela Jones Harbour recused. The complaint and order were filed on October 19, 2009, in the U.S. District Court for the Northern District of Illinois, Eastern Division.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the law has or is being violated, and it appears to the Commission that a proceeding is in the public interest. A complaint is not a finding or ruling that the defendants have actually violated the law. A stipulated court order is for settlement purposes only and does not necessarily constitute an admission by the defendants of a law violation. Stipulated orders have the force of law when signed by the judge.

Copies of the complaint and stipulated order are available from the FTC’s Web site at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,700 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

MoneyGram and FTC

This information can be found at

http://www.ftc.gov/opa/2009/10/moneygram.shtm

MoneyGram International, Inc., the second-largest money transfer service in the United States, will pay $18 million in consumer redress to settle FTC charges that the company allowed its money transfer system to be used by fraudulent telemarketers to bilk U.S. consumers out of tens of millions of dollars. MoneyGram also will be required to implement a comprehensive anti-fraud and agent-monitoring program.

The FTC charged that between 2004 and 2008, MoneyGram agents helped fraudulent telemarketers and other con artists who tricked U.S. consumers into wiring more than $84 million within the United States and to Canada – after these consumers were falsely told they had won a lottery, were hired for a secret shopper program, or were guaranteed loans. The $84 million in losses is based on consumer complaints to MoneyGram – actual consumer losses likely are much higher.

The FTC charged that MoneyGram knew that its system was being used to defraud people but did very little about it, and that in some cases its agents in Canada actually participated in these schemes. According to the FTC’s complaint, MoneyGram knew, or avoided knowing, that about 131 of its more than 1,200 agents accounted for more than 95 percent of the fraud complaints it received in 2008 regarding money transfers to Canada; a similarly small number of agents was responsible for more than 96 percent of all fraud complaints to the company in 2006.

“Money transfer services have a responsibility to make sure their systems don’t become conduits to rip people off,” said David C. Vladeck, Director of the FTC’s Bureau of Consumer Protection. “In this case, MoneyGram not only ducked this responsibility, but also looked the other way while its agents took part in the scams.”

Minneapolis, Minnesota-based MoneyGram operates through a worldwide network of approximately 180,000 agent locations in 190 countries and territories. In its complaint, the FTC charged that in recent years this network has increasingly been used by telemarketing scammers to prey on U.S. consumers. Con artists prefer to use money transfer services because they can pick up transferred money immediately, the payments are often untraceable, and victimized consumers have no chargeback rights or other recourse.

In 2007, 72 percent of all complaints received by the FTC involving Canadian-based fraud reported using money transfer services to make payments. According to a recent FTC survey cited in the complaint, at least 79 percent of all MoneyGram transfers of $1,000 or more from the United States to Canada over a four-month period in 2007 were fraud-induced. The Commission’s complaint further stated that based on the more than 20,600 fraud complaints MoneyGram itself received, U.S. consumers lost more than $44 million to cross-border money-transfer frauds between 2004 and 2008 alone. When combined with losses reported by U.S. consumers on money transfers within the United States, that number grows to $84 million.

In many of the scams that used MoneyGram’s money transfer system, the con artists used counterfeit checks to induce consumers to send money back by wire transfer. The most prevalent of these scams were lottery or prize schemes in which consumers were told they had won thousands of dollars and just had to pay a fee for “taxes,” “customs,” or “insurance” to a third-party to collect their winnings. Consumers paid the fee using MoneyGram, but received nothing. In another scheme, telemarketers told consumers they were guaranteed loans, regardless of their credit score. All they had to do was pay “insurance,” “paperwork,” or “processing” fees to complete the transaction. Consumers who sent funds using a money transfer service got nothing in return.

In mystery shopping scams, the con artists called U.S. consumers or sent them a piece of direct mail in which they claimed to be hiring consumers to visit stores such as Wal-Mart to evaluate MoneyGram money transfer operations. The con artists sent consumers a cashier’s check, telling them to deposit it in their checking account and then send most of the money back using a money transfer at Wal-Mart. When the counterfeit checks bounced, consumers realized they had lost the money they transferred. By this time, however, the money transfer agents had already received and paid out the money, often either without checking IDs or by using fake drivers license information.

The FTC’s complaint alleges that MoneyGram ignored warnings from law enforcement officials and even its own employees that widespread fraud was being conducted over its network, claiming that proposals to deal with the problem were too costly and were not the company’s responsibility. The company even discouraged its employees from enforcing its own fraud prevention policies or taking action against suspicious or corrupt agents. Some employees who raised concerns were disciplined or fired, the FTC charged.

In addition, at least 65 of MoneyGram’s Canadian agents have been charged by Canadian or U.S. law enforcers with, or are currently being investigated for, colluding in fraud schemes that used the MoneyGram system.

The complaint charges MoneyGram with violating both the FTC Act and the FTC’s Telemarketing Sales Rule by helping sellers or telemarketers who it knew – or consciously avoided knowing – were violating federal law, and for not taking adequate steps to prevent fraud.

The agreed-upon court order settling the FTC’s charges bars MoneyGram from knowingly providing substantial help or support to any sellers or telemarketers that are violating the Telemarketing Sales Rule and requires it to implement a comprehensive anti-fraud program. Under the anti-fraud program, MoneyGram must conduct background checks on prospective agents; educate and train its employees about consumer fraud; institute agent monitoring; and discipline agents who don’t comply with the rules. The order also requires MoneyGram to provide a clear and conspicuous fraud warning on the front of all its money transfer forms. The order’s conduct provisions apply to all MoneyGram money transfers sent worldwide from either the United States or Canada.

The order contains monitoring and discipline provisions that will ensure MoneyGram is properly training, monitoring, and taking actions to address problems related to its agents. To do this, the order requires MoneyGram to develop and maintain a system for receiving consumer complaints and data, and to provide that information to the FTC upon request. MoneyGram also must take all reasonable steps to identify agents that are involved in fraud. It must review its transaction data to identify any unusual or suspicious activity by its agents and fire any agent who it believes may be participating in fraudulent activities. It also must fire or suspend any agent who has not taken appropriate steps to stop fraudulent money transfers.

Finally, MoneyGram will pay the Commission $18 million, which will be used to provide redress to consumers.

Scams and the Holidays

Thanksgiving is just over a week away, and it is time to start thinking about the Holiday Season. We at Scam Victims United usually see an increase in the number of scam victims during this time of year. Many people are looking for a way to make some extra money to pay for the gifts that they want to give to family and friends, so they may sell something they own at an online classified ad site, like Craigslist, or they may look for an extra part-time job. It is because of this need for the extra money to get through the Holidays that some people may let their guard down and become more vulnerable to online scams.

Common online scams include the overpayment scams, in the form of counterfeit cashier's checks and money orders, or work at home job offers such as the Secret Shopper Scam. Let's review the signs of both.

Counterfeit Cashier's check or Money Order Scam
You are selling an item over the Internet - it could be a used car or motorcycle, jewelry or even bred animals. You receive an email offer to purchase your item and the buyer says he'll send a bank cashier's check. The buyer is from Nigeria or "West Africa", but has a business associate in the United States who will send you the cashier's check. Then you are told that for some reason the check was already made out to you for an amount larger than your asking price. The buyer asks you to please deposit the check, wait for it to clear, and then send him the difference -- "but only after the cashier's check clears, of course."

You are skeptical - but, sure enough, the bank cashier's check arrives by Fed Ex, it looks real, your bank accepts the check, and the bank assures you the funds are in fact available. So you wait the time the bank recommends to verify that the check is clear and then you wire the difference to your buyer in Nigeria and prepare to ship your item.

A week later your bank calls: "We're very sorry, but the cashier's check was counterfeit" -- a superb copy, but worthless. Your account is frozen. You must pay the bank back the entire amount of the cashier's check. You may even be considered a fraud suspect yourself.

Secret Shopper Scam
The scammer will either place an ad in a legitimate classified listing, online or in print, or they will collect their victim’s names and email addresses off of resumes posted online. Some of them are even making “copy cat” websites of legitimate Secret Shopper companies to use in their scam to help convince the victim that this is all legitimate. For a listing of legitimate Secret Shopper companies, go to http://www.mysteryshop.org/

The victim will be told that they have been hired as a Secret Shopper and will be sent a cashier’s check or money order to cash and use on their assignments. One of the assignments is to review the service at a Western Union or Money Gram location. They are given a name and address to wire money to, from the check that was sent to them, and told to fill out an evaluation form on the service received and email or fax that back to the company they are working for.

Everything seems fine, and some victims may even complete a few “assignments” before the check is discovered to be counterfeit. On average, it takes about 10 business days for the bank to realize that the check is counterfeit, but we have seen some cases where it has taken over 6 months. Once the bank dose find that the check is counterfeit, they will contact you demanding the return of the money and deduct the full amount of the check from your bank account. This sometimes leaves the victims with negative bank accounts.

For more information on the check clearing process and the banking terms, please read
http://scamvictimsunited.blogspot.com/2009/08/banking-terms-not-as-clear-as-they.html


Shawn Mosch
Co-Founder of ScamVictimsUnited.com
There is strength in numbers!

Find us on Twitter, Facebook and more through
http://www.retaggr.com/page/ShawnMosch

Support Scam Victims United by shopping at
http://shopittous.blogspot.com/

Another story of a scam victim arrested

A while back I told you about a scam victim who was arrested. Stories like these always frustrate me because as a former scam victim I know the hurt and pain that you go through when you find out that you have been scammed, but these victims have that feeling plus more because they now have been arrested. They do not just face the financial recovery process that people like myself went through, but they also have to hire a lawyer to prove that they are the victim in the case and not the criminal. What happened to innocent until proven guilty?

This victim was also responding to a Secret Shopper ad.

Here is the story of this latest scam victim in her own words . . .

I responded with all the requested information the next day. Shortly after I responded to this email I was asked by a local company to come into their office for an interview. I did and became very hopeful that I would get the job. I totally forgot about even responding to the Mystery Shopper email and wasn't really expecting to hear anything from them. I few days later I received 2 Money Gram money orders @ $998.00 each sent to me via Fed Ex overnight mail. No other documents were inside. I couldn't figure out where these came from and was not even thinking about that one email response I sent for the Mystery Shopper position. I had read an email in my AOL inbox a week or two before that I was a part of a class action lawsuit against AOL for some "footer" issue. I assumed these checks may have been a result of the class action suit since I had 2 screen names with AOL. I attempted to call Money Gram and went online and could not get any information regarding the tracking numbers on them. NO ONE EVER EVEN MENTIONED POSSIBLE FRAUD. When I went to the Money Gram station at the local Lucky store (in the town I have lived for 34 years and am now raising my 13 year old son) to cash these money orders I was arrested immediately. I was frisked, my car searched my purse emptied all in front of the Lucky store here in the quaint little community where most people know everyone. The 3 responding officers were absolutely sure that I was some check fraud "ring leader!" They would ask me where the money orders came from, I would answer telling them that they were sent via UPS next day air but I was unsure by who. Then I was told to shut up and stop lying. One officer told me "you and I both know no one sent these to you. You made these yourself" I was then "escorted" to Alameda County Jail where I remained for the next 10 hours until my $10,000.00 bail bond (for check fraud) was processed.

Once released from jail I made it my mission to catch this dirty rotten scum bag who was responsible for what I had been through. So.....I responded to an email that he had sent to me (which I didn't even open until about 2 days after I was released from jail) indicating that he sent the package and instructions and he needs me to follow through with this task immediately (of sending his payment via Western Union) I played along with this guy to try to obtain as much information as I could. I advised him that the money orders were cashed and to please call me as I was a bit confused about something regarding his instructions. He called, about every other minute from that moment through the next 4 days. Once even forgetting to *67 therefore I was able to obtain his NIGERIAN telephone number. He even went so far as to send me text messages!!! He thought I had his money and he wanted it. I recorded our phone conversation on my MAC I MOVIE. I tracked down the gentleman whose email address they had hacked and were using to send the initial correspondence. He lived in S. Africa and was the administrator of a fishing forum. I explained to him my situation and advised him to contact the FBI before they contacted him as I had already given them his email information on my FBI report of this incident. He was grateful that I had taken so much of my time to track him down and explain this situation to him so that he could cancel his email address they were using before they had sent any further damaging money orders out to innocent people. I thought that since the local police didn't really care about catching these losers that I would!!

I have since retained a very good lawyer. We have met with the DA who still is unsure whether he plans to file charges against me or not. I appeared in court last week and at that time there were no charges filed yet BUT THE CASE WAS NOT DROPPED EITHER!!! I go back to court November 5th.

Ever since this happened I cannot STOP talking about it. It helps for me to get past the anger. Initially, I was consumed by researching scammers, trying to catch this guy and others like him. Then I realized that law enforcement officials are inexperienced and unequipped to handle situations like mine. They are not interested in catching the people responsible and therefore I needed to direct my ager somewhere else and for that reason, I would love to tell my story in hopes to make people aware of these scammers.

MoneyGram International Reaches Agreement with FTC

This press release can be found at http://www.moneygram.com/MGICorp/InvestorRelations/News/index.htm

MINNEAPOLIS--(BUSINESS WIRE)--Oct. 20, 2009-- MoneyGram International (NYSE:MGI), a global leader in the payment services industry, today entered into an agreement with the Federal Trade Commission (FTC) to make certain enhancements to its consumer anti-fraud program to further combat consumer fraud perpetrated by criminals who use MoneyGram’s services illegally.

“At MoneyGram, we take the issue of consumer fraud very seriously. Our ability to provide safe and reliable money transfer services for our consumers is critically important,” said Pamela H. Patsley, MoneyGram chairman and CEO. “MoneyGram has committed extraordinary resources to building a state-of-the-art consumer anti-fraud program.”

The company has begun implementing new systems and processes to further bolster consumer protection, which have been effective at stopping millions of dollars in fraudulent transactions every year.

“While we don’t agree with the FTC’s allegations regarding our fraud prevention in the past, we can agree on fraud prevention today and in the future,” said Patsley. “We don’t want our customers being victimized by third-party fraud. What we are announcing today with the FTC is our commitment to enhance our already comprehensive efforts to combat fraud and ensure our customers can continue to rely on MoneyGram for safe, reliable money transfer services.”

MoneyGram provides consumer warnings about the latest scams on its website and money transfer send-forms, and through its 24-hour customer service center. The company also works closely with local, state, federal and international law enforcement to combat this global criminal activity.

“We are committed to be vigilant in our efforts in protecting our customers from fraudulent activity,” said Patsley. “Ensuring safe and reliable money transfers for our customers all over the world is at the forefront of all we do.”

As part of its agreement with the FTC, the company has also agreed to pay $18 million into an FTC-administered fund to refund consumers who have been victimized through third-party fraud.

There is also an article about this topic at
http://www.examiner.com/x-1893-News-You-Can-Use-Examiner~y2009m10d20-A-medium-for-fraud-MoneyGram-to-pay-millions

Brought to you by www.ScamVictimsUnited.com

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Support Scam Victims United by shopping at
http://shopittous.blogspot.com/

Why do scammers love Craigslist?

Many websites have become infested with scammers, but Craigslist seems to be one of the places that the scammers really love to hang out. Why is that?

Variety of categories - In the past, when a scammer wanted to find a victim for their overpayment scams they had to go to a website were people were selling items, usually of large value. If they wanted to find a victim for an employment scam, they had to go to a site where people were posting their resumes. If they wanted to find a victim for a romance or dating scam, they would have to go to a dating website. If you wanted to find a victim for renter or roommate scam, you had to go to a site where people were posting housing information. With Craigslist, you can find all of those people in the different categories on the same site.

Includes the entire country - There are other classified ad sites that would have the same variety of categories that Craigslist has, but they are usually for a certain geographic location. If the scammer wants to try and find more victims, they would have to go to another classified ad site that is targeted towards another geographic location. With Craigslist all the scammer has to do is click on a new city and state for their search location and they have a entirely different group of victims to try and bring into their scam.

It's free - Not only is Craigslist free for people to post or creating listings, but it is also free to people looking at those listings. This
works to the scammer's advantage. If the scammer is the one placing the listing, for a Secret Shopper job for example, they do not have to pay anything to place that advertisement. Many of the sites that require you to pay to post have a lower number of scams posted simply due to the fact that the scammer is there to make money, and not to spend it. It works the other way too . . . if the scammer is the one searching the posted ads for their next victim, they do not have to pay anything to have access to those listings.

Craigslist does have warning information on their site, and I think that some of their warnings should hold true if you are using their site or another classified ad site.

Deal with local buyers and sellers. If you sell your item and you need to have it shipped someplace you are taking a greater risk. If you deal locally, you can arrange to meet the person face to face to exchange money and the item for sale.

Never wire funds to someone you only know via email conversations. Scammers use services like Western Union and MoneyGram in their scams because they know that once the money is wired off and picked up on the other end there is no way to recover the money. Also, since they are overseas, our law enforcement in the United States cannot just go and pick them up for taking your money. It becomes an issue for the government and law enforcement in the country that they live in. This all goes back to jurisdiction, which we talked about in the past, and you can review here.

One thing that I think that Craigslist could add to their posted warning is that a cashier's check could take 10 business days or more to go through the clearing process. Just because you take the check to the bank and they tell you that it has cleared, or that it will be verified as good in 24 hours does not mean that the bank knows for sure that this check was written on a good account and has the funds in that account to cover the check. This is the information that is missing from so many of the current internet scam warnings, but is also the piece of information that could save so many scam victims. So why don't the places that post the warnings understand this and include this information? Personally, I feel it is because they are thinking as a "business" and not as a scam victims, and that is one thing that I can do since I have been there myself.

Had we known back in October of 2002 that the check could take up to 10 business days to go through the entire clearing process and that until that happened we would be liable for the entire amount of the check, then there is no way we would have wired any money off any sooner than 10 business days . . . actually, my husband and I had promised each other that what ever amount of time the bank said to wait to be safe we were going to double to be extra safe, so like I said, if they would have been honest with us there is no way we would have become scam victims.

More on Secret Shopper Scams

For a listing of legitimate Secret Shopper companies, go to http://www.mysteryshop.org/

We have spoken with representatives at both Western Union and Money Gram. Money Gram does NOT use Secret Shoppers as a normal business practice. Western Union does use Secret Shoppers, but the shoppers are NEVER paid by cashier’s check or money order. If you have been contacted to shop Western Union or Money Gram, and it involves you receiving a cashier’s check or money order, IT IS A SCAM.

Often, the email address used by the representative of the company “hiring” you will be coming from a generic email address, and not one associated with that company. For further assurance, search out that company on your own and contact them for verification.

Shawn Mosch
Co-Founder of ScamVictimsUnited.com
There is strength in numbers!

Find us on Twitter, Facebook and more through
http://www.retaggr.com/page/ShawnMosch

Scam Victim Arrested

What started out as excitement about a new job quickly turned into a financial and emotional roller coaster for one Texas woman. In July of 2009, Nicole Ball, a stay-at-home mother from Pasadena, Texas was offered a job by someone claiming to be with a company called Formations House processing paperwork for their clients. Nicole was ecstatic, and in this economy who would not be when they found not only a source of income but a way to do so and continue to stay at home with her young child.

She began to receive packages in the mail with instructions to process the checks in the package. She was instructed to keep a portion of the checks, for her payment, and then to forward the rest of the money along with some paperwork on to a man using the name of Stanley Clarkes.
On July 23rd she entered the bank to bring in another check that she had received, and when she brought them to the teller her whole world turn upside down . . . the bank employees brought her into an office, called the police and pressed charges against her for forgery. She was devastated. To add to this, her young daughter was with her at the time and she had to witness her mother being told that the check was a fraud, the job she thought she had was a scam, and that now she was going to be arrested and have to spend time in jail.

It is cases like this that show how significant the need for Scam Education and Awareness is, not only for the average American, but for bank employees and law enforcement. With the right questions, not only could the bank employees have seen the warning signs of a scam and warned Nicole, but they would have also realized that she was not the one that needed to be behind bars or prosecuted. With the right questions or a search warrant, the police could have seen that Nicole was not the one manufacturing these counterfeit checks that were good enough to fool bank employees. They could have reviewed the information on her computer and in her home to see that she is a victim of this scam and not the perpetrator.

Nicole’s story is far from over. She will now have to endure court proceedings and pay for legal fees all to prove that she is innocent. I hope that the law enforcement and government officials in Pasadena, Texas will step in on this matter in order to assist Nicole Ball and her young daughter. Beyond that we ask for your support and partnership in a Scam Education and Awareness Program across the country so that stories like Nicole’s will not happen to others.

Shawn Mosch
Co-Founder of ScamVictimsUnited.com
There is strength in numbers!

Find us on Twitter, Facebook and more through
http://www.retaggr.com/page/ShawnMosch

Consumer Alert - Renters Scam

In this consumer alert by the FBI, they look at what we refer to as Roommate or Renter Scams.



We have been reporting stories of Roommate/Renter Scams since 2005. Many victims are sent cashier's checks as a deposit on a room/space they are renting, and it will either be for more than the agreed upon amount, or the renter will later back out of the deal completely and ask for the money to be wired back to them.

Remember, it takes an average of 7 to 10 business days for the bank to find out that the check is counterfeit, and in some cases we have seen it take months. No matter how long it takes, once it comes back as counterfeit the bank will hold you liable for the entire amount of the check, even if they had already told you that it was "clear" or "verified". Never wire money to someone that sent you a cashier's check or money order. That is a clear sign of a scam.



http://www.fbi.gov/page2/july09/housingscam_072909.html






Shawn Mosch

Co-Founder of ScamVictimsUnited.com

There is strength in numbers!



Find us on Twitter, Facebook and more through

http://www.retaggr.com/page/ShawnMosch

Work-at-home scams join on-line cons - News - The Charleston Gazette - West Virginia News and Sports

It so sad that just about every day I could do a google search on scams and find another story like this one . . .

Work-at-home scams join on-line cons - News - The Charleston Gazette - West Virginia News and Sports

The scammers got to websites where people who are really looking for work post their resume, and they then contact these people offering them a job. Many of them are called account managers or billing department managers, and they are basically funneling the counterfeit checks that the scammers make off to the victims. They are using the fact that so many Americans are looking for work to fuel their scam business.

I wish I could take out a full page ad in every newspaper across the country and post something on every employment and resume site on the internet about these scams to help warn people.


Shawn Mosch
Co-Founder of ScamVictimsUnited.com
There is strength in numbers!

Find us on Twitter, Facebook and more through
http://www.retaggr.com/page/ShawnMosch

Cosmetics Sales Rep Victimized by Check Scam | wltx.com

As we have talked about, there are a lot of work at home offers that are scams, but some of the ones that are NOT are working for a Home Party Plan type company, like Avon . . . but this story shows that just because you are working for a company like this does not make you protected from scams. In the article, Cosmetics Sales Rep Victimized by Check Scam wltx.com , they talk to an Avon Lady who took a couple of orders from people and accepted cashier's checks from them as payment. The checks later turned out to be counterfeit.



Shawn Mosch
Co-Founder of ScamVictimsUnited.com
There is strength in numbers!

Find us on Twitter, Facebook and more through
http://www.retaggr.com/page/ShawnMosch

Scams and the bank's part

I would like to share with you a problem in our banking system that needs to be addressed in order to protect all banking customers.

It starts when people from overseas posing as potential buyers of large items for sale on the internet, such as cars, ask the seller of the item if they can have an associate of theirs in the United States mail them a cashier’s check for the amount of the item plus transportation overseas in order to expedite the process. They ask that once the check has cleared the bank, the seller withdraw the amount that is for transportation, and wire it to the buyer so he can schedule the shipment of the item.

When these cashier’s checks are deposited into the accounts of the sellers and they ask their banks to verify for them when the check will be clear and good, so that they can safely remove the funds needed, they are not given accurate information by the banks. Some are told that the check will be good in 24 hours, and some are told that the check is guaranteed good, so they should have no worries about the using the funds. Feeling safely assured the bank customer goes through with the transaction. Then, days later, when the checks are found to be counterfeit the banks are holding their customer responsible for the entire amount of the check, even though the bank had already assured them that the funds were good.

This is exactly what happened to my husband and myself in October 2002. We found out quickly that there was very little information that could help victims of these scams, so we decided to begin our own website, ScamVictimsUnited.com, in order to spread the word about this scam and help to save others from going through what we went through. While our efforts have helped stop over $2 million in the first two years of operation, so much more could be done if the banking industry would take more responsibility for actually verifying these cashier’s checks before the money is released to the customers.

It has been our dream and our mission to find a way to compel our government and legal system to take measures to help protect banking customers from this type of unfair and deceptive business practice. The banking system is failing to verify these checks and allowing counterfeit cashier’s checks to pass into the system which impedes the national interest of the United States because it finances crime, undermines the integrity of the international financial system, impedes the international fight against corruption and drug trafficking, terrorism and distorts economics. United States banks are frequently used by other countries to receive large funds from unsuspecting Americans because the banks often fail to screen, monitor and check the transactions for their customers.

We are asking that the customer protection laws governing banks and the check clearance/settlement system include the following:

- Assure full disclosure of the true time period for check clearance to the customer
- Prohibit the use of funds until a check been verified against the ledger at the issuing bank and the check has been honored
- Hold financial institutions liable for any monetary loss due to the customers reliance on false of misleading statements by financial institutions
- Mandatory holding periods on all checks of a substantial amount
- If a customer would like to access the money before the time that the bank has verified and honored the check, requiring them to sign an agreement that makes it clear that they are liable for the money of the check comes back as counterfeit.




These items will help to ensure good business practices, customer financial safety, and reduce the use of counterfeit checks as a means of fraud. If financial institutions understand that they will be help totally liable for any monetary losses due to false or misleading statements or neglect to follow the above described check clearing and verification process the financial institutions will take measures to protect themselves from this type of loss, thus protecting the customer, the financial system, and reducing the criminal activity of producing counterfeit cashier’s checks. Our financial institutions are our last defense against this type of fraud, so it is important that these customer protection laws be created to ensure that they are working with and for their customers in order to reduce such activity.

We hope that you will agree with us that the banking industry is misleading it’s customers when they do not fully disclose the time that it will take for a cashier’s check to be verified as legitimate, or when the assure a customer that a check has cleared only to hold that same customer liable when they find out later that they were wrong. We hope that you can assist us, and all other victims of theses scams, by launching the legal battle to change the way the banking industry handles the verification process of cashier’s checks.

Shawn Mosch
Co-Founder of ScamVictimsUnited.com
There is strength in numbers!

Find us on Twitter, Facebook and more through
http://www.retaggr.com/page/ShawnMosch