The 419 scam is going global and hi-tech. What originally began as a lark among students left jobless by Nigeria's 1980s oil bust has become the world’s most pervasive financial fraud run by organised mafias.
The 419 scam is best known for the ubiquitous spam offering jobs or money in return for small advance payments that crowd everyone’s cellphones and computers. India is becoming increasingly entangled in this network. Besides becoming a target for 419 conmen, India is becoming a hub for 419 fraud activity in two other ways.
First, India is home to an increasing number of rings that operate the fraud in other countries. Frank Engelsman, an expert with the Netherlands-based Ultrascan Global Investigations Unit, says 419 scam rings “try to keep one jurisdiction between the scammer and victim”. So rings set up in India will work to dupe people in other countries. Indian victims will be targeted by rings in Thailand or elsewhere.
This year’s Ultrascan survey of 419 fraud estimates there were at least seven rings based in India last year, up from three in 2005. The seven rings probably had a little over 100 individual operatives. Engelsman says, “Our view is that these are Nigerian-run operations.” The rings are often interlocking, sharing their earnings with each other.
There are a few cases of Indians being duped by a ring based in another part of the country: Kolkatans and small-town Maharashtrians lured to Mumbai to pay for packets of “blackened money” and “chemicals” to clean them.
Second, some small Indian call centres are being used to handle the information gathering that victims are often asked to provide to collect their supposed reward. For example, a call centre will be hired to ask the victim for his name, fax and phone number to lull him into believing these are from a legitimate organization. Engelsman recommends: “Call centres should check if their client and his company really exist. Google the names of both together with the word ‘scam’.”
The growing Indian nexus reflects a pattern developing in all emerging economies. Governments neglect the issue at their peril. Canada ignored the problem for decades and has now emerged as a major 419 scam hub. The US Secret Service’s Michael Sameremetis says, “A large part of the scamming in the US is coming out of Canada.” His service is the lead US agency handling 419 fraud. Engelsman adds, “One ring in Canada has been there for five years and is now the biggest in the world outside Nigeria.”
One of the signs of the crime's evolution is how adept scammers have become at duplicating official documents and entire websites. At one point, 419 fraudsters had 10 copies of the Royal Bank of Canada website in the Internet to induce payments from victims.
Police agencies are not immune. A fake Interpol site pops up regularly every year around November, says one fraud expert. The Secret Service has warned that 419 scammers are sending emails claiming to be from the agency. Victims have been known to call fake police sites and been told by “policemen” that the fraud offer is genuine. One such fake site, of the Filipino equivalent of the FBI, www.nbigov.com , is still on the Internet.
A post-9/11 twist: 419 victim are told their payments are being held up for “terrorism clearance certificates” and fees should be paid to a fictitious government anti-terrorism agency.