Arcis Fraud Discovery & Exposure Centre

Preparation and Patience Go a Long Way: Interviewing a Scamster

2009-08-18T20:48:00.001+12:00

Scamsters, victimize businesses, private individuals, government agencies with their small to very large scale schemes. They run the loan scams, fraudulent investment schemes, the pyramids and ponzi schemes, the telemarketing frauds and fraudulent insurance schemes causing billions in damages every year. Contrary to "traditional" criminals who may commit their crimes triggered by a perceived pressure (for instance to finance an addiction, out of economic distress) scamsters are more often than not of an opportunistic nature. In many handbooks and articles on fraud and fraudsters you will find some reference to the subject matter of "NEED OR GREED".
I think I can confidently say that the swindler, con artist, scamster or whatever you want to call them will fall into the category "greed". They run their schemes because they make a lot of money and it is easier than working to make a living. Marks are easy to find as their are plenty of gullible people around. (Mark is jargon for a potential victim). Just look at Madoff, there were people actually begging to have their money invested through him.

At one point or another, victims of these scams get a feeling that something is wrong and start asking questions.They find out that they have been scammed and try to confront the scamster. If they are as lucky to get in touch find they con artist (many flee the scene before that), they will see their persistence often met with feigned bewilderment, amazement about the size of the 'misunderstanding' or even aggressive responses as to daring to even suggest that the con artist involved is anything but professional and highly ethical.

Good at what they do; manipulate, many of these scamsters find a way to convince their victims that nothing is wrong, that no harm was done or that no loss suffered or that any loss suffered is not the result of fraudulent or negligent misrepresentations. Some of them almost seem to believe genuinely that they did not do anything wrong. Others eventually blame it on the victim themselves for being so gullible.

Throughout a conversation with the French-born con artist, which was taped from a British Columbia jail cell where he awaited trial for participation in a B.C. business scam, Christopher Rocancourt argued that reneging on a loan is not a crime. Rocancourt is also wanted in Europe and the U.S. for fraud and theft involving millions of dollars. Mr. Rocancourt does all he can in the interview to convince viewers he is a far cry from the heartless criminal police have portrayed him to be. In fact, if anyone is to blame for the victims' losses, he says it is the victims themselves. After all, they were gullible enough to believe him. (Source http://www.subtleny.150m.com/Chris/National%20Post%204-13-02.htm)

Scamsters have an ability to be charming, manipulative, persuasive and authoritative. That's how they win your trust, that why they are successful at what they do. They are master liars, with no empathy for their victims whatsoever. That same persuasiveness is what makes the scamsters a more challenging subject of an investigative interview and criminal investigative agencies or prosecutors are more than once discouraged from (further) investigation or prosecution. Having to prove criminal intent is seen as a considerable barrier and challenge.

What makes things easier is that scamster are often so confident in their own ability to manipulate others that they will be happy to agree to an interview. During the interview, you will be measured to see what your level of expertise is. Expect to be bombarded with jargon and figures. This helps the scamster in his or her attempts to convince you that things are all a misunderstanding. What has helped is that as a private sector service provider you can come from a position of interest or trying to get the facts together and understanding the situation as opposed to a law enforcement interrogator.

Over time two key factors have proven to be of key importance in relation to these type of interviews:

thorough preparation; and
patience.

The problem or I should say challenge with scam artists is that contrary to for instance internal fraudsters or employee thieves it is more difficult to bring them back to the point where they crossed an internal moral barrier. Employee thieves or internal fraudsters are more easily brought back to that point where - driven by some perceived need - they crossed the line knowing fully well that what they were doing was illegal. This causes a certain anxiety that is subsequently rationalized away so as to ease that anxiety. This is different for the scamster who simply does not think anything of ripping others of their money or even life savings. They have no need to rationalize and bringing them back to that point of anxiety is not even possible: there is none!

The ideal outcome of the interview (after you have convinced yourself that the facts gathered so far indeed constitute a scam) would of course be a signed confession as that would speed things up nicely. However, going into the interview with a confession in mind only is not recommended. Confessions are rare and the exception sooner than the rule. Even without a confession though an interview can still be very valuable as it offers an opportunity to further built a case, gather additional evidence to get more clarity for the prosecutor or litigator to formulate charges or claims or obtain evidence that could prove intent.

Especially in criminal cases the challenge is in proving "criminal intent". Witnesses other than the scamster can hardly assist in proving the intent. Usually you are confined to documents and statements as circumstantial evidence to prove intent and the statements of the scam artist him or herself can make a valuable contribution thereto. His or her admissions, false explanations, excuses or denials of intentional misrepresentations may end up being one of your more valuable assets in building a case. This does not just concern their representations but also, and equally important, their attempts to cover up their misdeeds.

THOROUGH PREPARATION
Before interviewing a scamster you will need to be thoroughly prepared especially when confrontation is to be expected. This means that you will need to:

debrief witnesses as thoroughly as possible;
obtain and analyse the documentary evidence;
internalize all the ins and outs of the scheme including the relevant associated legitimate financial or business concepts on which the scam is based, the relevant laws and regulations and industry best practices and standards;
where possible anticipate what excuses may be expected so as to be prepared for them and being able upfront to debunk them. Whether you will or will not during the interview is not the key question at this point;
A review of the background of the scamster and his business activities (business documentation, financial information, credit reports, educational backgrounds, involvement in other schemes or business ventures, court reports, complaints etc);

It has helped me tremendously in the past, as part of the preparation to collect and document verbal and written representations made to victims (telephone notes, meeting notes, emails, letters, taped telephone recordings and promotional materials). It makes it easier to ask the scamster about these representations and where certain excuses are brought up they may well add to proving intent. Prepare an interview schedule either on paper or get it in your head, that covers all relevant facts and elements of the scheme as well as potential escapes.

Where a law enforcement officer you may well obtain a lot of documentary evidence from the suspect upfront, prior to the interview those in the private sector may not have that possibility. There is a wealth of information available via all kinds of open and paid sources online as well as off line, if you are in a position to do so obtain as much of the business documentation and financial information as is legally allowed in preparation or, in conjunction with other evidence to obtain a pre-trial court order for further evidence from the interviewee. In these cases the deep understanding of the scheme and following the the money trail as far as possible is often the key to success; to your interview and in building a solid case.

THE INTERVIEW
Initially you try to schedule an interview with the scamster, which is sometimes a challenge in itself where some of them make it a habit to disappear on a regular basis, claim unavailability or cancel appointments. An option is to visit the scamster unannounced, which has a risk of being sent away to come back another time.

At the interview itself, introduce yourself properly and explain the reason for the interview. Also explain to the interviewee that he is not obliged to cooperate or being interviewed. Usually the reason or the interview is that complaints have been received and that you would like to discuss the matters raised. It is my experience that scam artists do not mind sitting down with you even if that is for an extended period of time. Where the scam artist is not perpared to cooperate with an interview it is up to the investigator to convince the scam artist of the importance of cooperation and how this is not in your but his or her best interest.

Regardless of the issues involved stay professional and polite at all times and prevent coming across as accusative. Good manners go a long way in building rapport and trust and helps in getting the best out of the interview.

Throughout the interview, patience is your biggest ally. Allow the scamster to explain the ins and outs of the scheme he or she has been promoting and the representations made to victims, be a listener not a talker. The scamster will try and find out what you know in any event so make sure that what you give away is as little as necessary. Confidence and underestimating the level of knowledge of the interviewer will likely make the scamster give away more than he should have as a result of overconfidence in his own abilities to manipulate. Furthermore, as part of their ways, these scamsters have a habit of wandering off and give long winded answers lacking coherence to initially straightforward questions. Keep on listening while guiding the subject back to the matters at hand subtly. Avoid to stand up against what you know to be pokey stories, keep your cards to yourself and let the scamster do the talking. Confrontation can come at a later stage.

Over the years I have made it a habit to accept all initial answers to my questions and keep any confrontation with inconsistencies for a later stage of the interview. In some instances it has been necessary to split the interview in two separate interviews, although I consider that not to be ideal. Letting the scamster do all the talking helps in that you can close doors (areas that offer a way out) while doing the interview and when you do arrive at the inconsistencies in previous statements and confrontational aspects of the interview it will be harder for the scamster to explain his prior statements. Focus on extracting, detailing and documenting the scamsters descriptions of relevant facts and contacts with victims. It is advised sometimes to leave questions about the scamster's background to a later stage of the interview. I would have to say that at least part of these questions, such as business background and education may well be used as part of building rapport with the scamster by creating an air of genuine interest not just in the transactions that got you to interview the scamsters but also the scamster as a person. It may serve as a tool to hide your level of knowledge in the initial stages. I guess this is a matter of how you present the questions and intuition. Do make sure however you get a clear view of the scamster's business and educational background especially in areas related to the scam at hand.

After extracting the complete story of the scamster, the confrontational part of the interview can follow. The scamster is now queried about inconsistencies and discrepancies. To prevent the scamster from closing up, start with smaller ones and build up the pressure. Again, don't make accusations, instead ask for explanations because it seems that prior statements are inconsistent with what you understand to be the facts. Where required or helpful, confront the scamster with evidence. It is in this stage where questions tend to become of a more closed nature. For instance:

"You told some of the parties involved as an investor in this opportunity that building could start as soon as the investment sums were received. Correct? You also told the parties that this was the second round of investments and that the development was already well underway. Correct?" You then confront the scamster with a very recent photo of a bare piece of land where a building project in progress should be happening and the fact that no building consents were granted on the basis of which building could have started.

You could for instance follow up with the question: "You used this money to buy that new Porsche, the boat and making a down payment on the mortgage of that new mansion you are building for yourself didn't you? (This information can depending on the jurisdiction be derived from open or publicly available sources.) Or... " You used that money to pay to keep the investors in the other venture <specify> quiet, am I correct?" Where possible support this with documentary evidence. You will either get an admission or an even more ludicrous bs story.

Keep in mind that confessions by scamsters are rare but not impossible. If you end up getting a scamster to make admissions or confessions on specific elements, make sure you try to obtain the broader confession or admission that would go towards closing the case. For instance:

"When you designed the investment program for development MACS, you were aware of the false or untrue nature of the representations, promises and claims made to investors and in the investors documentation were you not? You knew that making false representations was the only way to get people to invest money in the scheme and that they would not invest in this development if they knew the truth about the development and your intended use of the money. Am I correct?

Should you be as lucky to get to the point of admissions like this, thoroughly question the scamster about all the relevant details of the scam. (Keep in mind the elements of any relevant criminal offenses or civil legal matters that need to be proven). At the same time however; confessions like the ones above are the exception and not the rule with scamsters. Some, depending on their level of confidence or arrogance, may see the overwhelming case against them and out of personal interest cooperate with the interviewer. Others will still refuse to admit to intentionally causing damages to their victims. The documented false explanations and excuses will still serve as evidence for intent and enhance the chances of success in prosecution or litigation.

FINALLY
Probably the hardest part of any fraud or scam investigation is proving the legally required criminal intent. It is exactly this element that causes many cases to end up on the shell or being rejected for prosecution. The burden of proof is already high in criminal cases where guilt needs to be proven beyond a reasonable doubt. Whilst civil procedures are based on the balance of evidence, a sufficient amount of negligence or intent will usually still need to be proven. Allowing the scamster room to express his or her false explanations, misrepresentations and excuses assists in documenting intent or negligence. Whether a confession follows or not, at the least it paints a picture of witness that cannot be trusted. More importantly, although it requires a lot of preparation; the thorough and patient approach enhances the chances of a confession. Success!

Dutch Opta Gets Tough on Spammer

2009-07-28T12:03:00.001+12:00

We all get sick and tired of it: spam, cluttering out mailboxes with useless and more than once even dangerous emails. Worldwide, legislative initiatives are being taken to combat this abuse of internet facilities, which includes fines or even jail terms.

ANP newsservice in the Netherlands reported that a man had been fined EURO 250,000 for by telecom watchdog OPTA upon finding out his firm had been sending out at least 21 million spam messages which resulted in almost 400 complaints via the Dutch spam complaint site Spamklacht (http://www.spamklacht.nl).

The man who has not been named by OPTA, had received a previous warning 4 years ago and now faces an additional EURO 5,000 fine for every day that his company sends out spam. From other news sources it transpired that the owner of Serinco Benelux (http://www.serincobenelux.nl) an Alphen aan de Rijn based software and "internet promo" company, been first warned in 2004 about violating the anti-spamlaws. In 2007 the Dutch regulator had confiscated evidence during a raid on the man's house and is understood to have received more information about spamming activities more recently.

In an interview with the German Press Agency dpa, the man, understood to be Reinier Schenkhuizen, denied that his company had sent 21 million spam emails and would appeal the decision. Allegedly the OPTA has not understood that emails sent by his clients automatically contained some information about his company because it is integrated in the software.

It is great seeing that a tough stace is being takem against spam. According to some statistics spam is making up around 80% of all the worlds email traffic and wasting about 33 billion kwh of energy a year, enough to power 2.1 million US homes. Other reports claim a well over $800 loss per employee per year as a result of spam. Time to get really tough I would imagine.

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Robbery Captured on Google Streetview

2009-06-20T23:38:00.001+12:00

Karin Sitalsing of "De Volkskrant" a Dutch newspaper, reported how the Dutch Police was able to arrest to men in relation to a street robbery.
The two men, 24 year old twin brothers without a permanent residential address were recognized on a picture in Google Streetview. The Police admitted it was one very lucky shot.

A 14 year old boy filed a criminal complaint in relation to a street robbery of which he was a victim. He had been pulled of his bike by a man ater which another man sat on top of him after which the two men took his mobile phone and 165 Euro. Half a year later the victim found a picture of himself and the two robbers in Google Streetview and cntacted the police immediately.

Tge Dutch Police contacted Google because the faces on the picture had been made unrecognizable. When the original pictures came in from Google, the men were recognized. The brother reciognized themselves on the pictures but denied having committed the robbery. Other denials and admissions make it at this stage unclear if and on what basis the men will be prosecuted.

Source: de Volkskrant

False Sense of Security and Surprise as a Tactic

2009-05-01T12:44:00.001+12:00

Fraud is of all ages and cannot be banned out completely. This may seem like the obvious but not so long ago another company found out that fraud prevention and detection is something that requires continuous attention.

Some years ago already the company had invested in fraud prevention and detection by implementing procedures, new systems and security equipment. While the company had very modern systems to generate relevant information, the information that was produced was hardly looked at after some time let alone analyzed.

Fraudsters know the who, what, how, where, when of internal controls and fraud detection and will know how to avoid or circumvent these. One of the tactics you could consider is surprise. Go out in the middle of the day to do a surprise audit of one or more cash registers. Every now and then pick up the time registrations to see what is actually happening also when you are not there. Why, taking into consideration the workload are some of your employees 'working' in the weekend? Could that maybe explain your shrink or leakage? It would not be the first time that is happening. Check the status of different financial accounts especially those where funds appear to be parked temporarily.

While it cannot be denied that investment in policies, procedures, systems, equipment and people is of paramount importance it should not lead to a false sense of security. The investment in fraud prevention and detection is not something you do to sit back and wait. No fraud prevention and detection system is 100% fault proof and fraud is a fact of life. At all times it is important to stay alert. And where a serious suspicion arises, consider calling a professional (organization) instead of trying to do you own investigations. Discretion and safeguarding the relevant evidence are of utmost importance. Employment law, in many jurisdictions is a minefield, but besides that securing and safeguarding evidence is becoming more and more a specialized affair and mistakes may turn out to be very costly and detrimental even for the outcomes of your case.

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Swine Flu Scams

2009-04-30T11:48:00.001+12:00

It could of course be expected, but with may in the world concerned about the outbreak of swine flu, there will always be scam artists trying to cash in on that, preying on the fears and anxieties of people. The public is turning to the net for information about the swine flu but so are these scam artists.

According to F-Secure people are registering domains related to "swine flu" (see more info here http://www.f-secure.com/weblog/archives/00001668.html) an whilst there are no cases of malware sites registered yet F-secure warns that that will only be a matter of time. (The list of domains is located here: http://www.f-secure.com/weblog/archives/swineflu_domains.txt).

The Better Business Bureau is already urging consumers to reliable information regarding the outbreak from the website of the Centers for Disease control and Prevention (http://www.cdc.gov/swineflu/) and warns that scammers are creating their own epidemic of spam.The BBB advises:

Avoid opening emails frm an unknown source and do not click on any links, instead delete or report the email to the Federal Trade Commission;
Don't believe any offers for vaccinations because there is no such vaccine (yet);
Keep your computer security updated.

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Security NL Encryption surpassed by awareness

2009-04-28T01:53:00.000+12:00

Security.nl a Dutch website focused on computer and internet security conducted a poll from which - according to their latest newsletter - it transpired that currently awareness education/training is considered the most popular solution to prevent leaking of sensitive information. Last year 34% of the readers considered encryption the most suitable prevention tool, this year 44% of the respondents considered awareness training the most preferable solution. This is claimed to be a remarkable move upwards from 27% last year with encryption chosen by only 30% of the respondents. Consistent was the 8% of respondents that opted for storing less data.This according to the latest newsletter.

(Pleasantly) Surprised by that outcome I checked the respective poll on the site to find that this report was based on 679 votes which seems hardly adequate to draw any general conclusions from this poll. At the same time however daily reality can not come to any other conclusion than that awareness is your first key step, despite the importance that encryption may or may not have.

It cannot be denied that in many nowadays situations, encryption is only part of the solution. Especially the social web and social engineering have become important "weapons" in the arsenal of those that do want to get their hands on sensitive information. Years ago, Kevin Mitnick, already predicted that the human factor would be the one most important in the information security area, and that advice, in my view, still remains as current as when it was made.

Reading the reactions to the poll, I see a substantial divide between those that opt for encryption and those that opt for awareness training. Imho there is nothing wrong with an approach that incorporates both. At the same time I would have to maintain that those that are committed to get their hands on your valuable data probably will find a way.

Talking about that I need to mention that at the moment data theft by employees is considered the largest threat. While this may come as news or at least it is presented as such, it has been my experience that the "insider threat" has always been the most important one. What has changed however is that more of your insiders may have an incentive to actually make the threat into an incident. Anxious about lay-offs or upon actual lay-offs employees may be more tempted to take along your valuable information, either because they are considering setting up shop for themselves or because the competition may be keen to re-employ them, or just because, well, you never know where it may come in handy.

AVG Offers LinkScanner

2009-04-21T11:07:00.001+12:00

AVG will begin offering a free version of its LinkScanner software, which offers real-time scanning of Web pages while surfing or doing Web searches.LinkScanner, which is currently part of the AVG Free Edition suite, scans a Web page before a surfer visits the page and warns if the page appears to be unsafe.

Read the full article at CNet here >>>

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Social Media as an Investigative Tool

2009-04-20T20:32:00.001+12:00

HOW THE DIVIDE BETWEEN PRIVATE AND PUBLIC, COMMERCIAL AND PUBLIC IS GETTING MORE AND MORE VAGUE.

The rise in numbers and users of social networking sites was bound always bound to bring new developments. Some years ago headlines were made with a story of a woman that fired after blogging about her employer and more case have followed. More recently I have seen the rise of articles explaining how employers, lawyers and investigators are using the social web in their arsenal of tools: for background checks on job candidates, jury members, and even clients.

In Australia we saw the emergence 8 months ago of a country's first company promoting it actively monitors social networking sites on behalf of companies." The company, SR7, specializes in what they call "online risk and reputation management."

Whilst there may be some doubts raised by the director of the UNSW's Cyberspace Law and Policy Centre, I think we can safely assume that this kind of development will be seen more and more in the future and in my view this is the logical expansion of already existing media monitoring. More and more companies are allowing their employees to make use of these sites during work time as part of their efforts to get a social media strategy going. The divide between public, commercial and private is not always as clear anymore. At the same time what employees publish may have reptational effects on your business. In legal terms it is often not clear as to what is allowed and what not: where it concerns employees' use of these facilities and publishing about workd as well as how the information is being used.

Recently some KFC workers were fired for publishing shots of them bathing in a KFC basin on MySpace.
Telstra has been disciplining an employee for Twitter comments.

Domino Pizza employees have seen what happens if you post video's about your abuse. And while the videos were taken of Youtube they can all still be seen here >>> Their video lead to a "manhunt" by users of Consumerist.org and through using google the store in which these employees were working was located. The employees in question are fired, charged with criminal offences and a civil claim is expected.

About two years ago I was involved myself in an insurance fraud case where a video posted on Google video by "friends" of the claimed led to declining the claim and besides that prosecution for filing a false, fraudulent claim.

A 27-year-old Australian woman, who did not want to be named, said about six months ago her employer - a large online technology company - started disciplinary action against her over a "generic" comment she wrote on the Facebook wall of a friend, who did not work at the company, outside of work hours. In this case it was not even the boss itself but a fellow employee that had seen her remarks and passed it on to her employer.

It cannot be denied that social networking sites are offering a wealth of information on people and businesses.
It can also not be denied that by now users of these sites, regardless off an expectation of privacy, should keep in mind that once things are out there they are and that there is at all times a risk of others seeing what you put out on the internet. There is at this stage unclarity about whether and how the information may be used. At the same time however, it has become a reality that employers more and more make social media research part of their employment screeing processes. I guess we can say that the days are gone when die diligence, or even a litigation backgrond check amounted to reviewing a resume and some public records or even just "googling a person." Besides employers more and more lawyers are using the 'new' options for their practice, to do a background check on witnnesses, to locate experts or get a picture of an expert hired by the other side, check the backgrounds of jurors.

More and more I get requests that also include a check of the most used social networking sites sich as Linkedin, Facebook, MySpace, Bebo and a few others. And in all honesty, social networking activity may at times be revealing and provide information that adds to getting a more complete, indepth picture of potential hires or jury members. It is less formal and therefore more than once pribides additional insight into a person. The self-generated content, along with comments can provide inisght in a person's character, values, current and past activities, prejudices, political preferrences, relationship information and self-image and if not more often than not it provides good leads for additional research and/or investigations.

I have been active in the field of social networking for the past 8 years. Initially to get to know new people and for business purposes. I guess it was when I found out how linkedin works in terms of search capabilities I realized that there could be a case for being more active in this field. I remember the days well where fellow colleagues were somewhat resistent and virtually not present on these sites, that has changed quickly over the past years. I have iused social networking sites to get my hands on a range of types of information, including but not limited to:

developing a profile on witnesses and prospective employees as well as potential business partners and investors/investments;
tracing people that had moved, for insurance companies, civil procedures, to locate heirs and missing persons;
to obtain more insight in the actual state of a marital status;
reviewing pictures and movies to get a more clear insight in family members, friends and others;
to perform a network analysis and to identify potential conflicts of interest.

In many countries facebook and myspace are amongst the most popular networks, in New Zealand Bebo has a strong following and in the Netherlands, hyves is a good place to start despite the fact that facebook is growing in importance. More and more I find people active on Twitter. Linkedin is a great site that is actively being used by a wide variety of professionals. Ecademy, whilst missing the critical mass of some of the other networks, is growing still and has a lot of professionals united. Many people tend to have a profile on more than one social or business networking site. I have found it particualrly useful to not just browse around profile pages of the siubjects involved but also on pages, blogs etc where these subjects left comments. More than once it is there that they reveal more than they would on their own site which may very well offer not much more than a nicely groomed profile.

More and more those sites are incorporating better privacy controls and under circumstances that may mean that specific profile pages are not as easily accessible. At the same time once you get a hold of email addresses and other information (some of which is often already provided by the client) it is relatively easy to get a way more complete picture. The next question, and that is the one lawyers are discussing is how you use that information, whilst the question of social networking pretexts may also come in question.

Personally I think it would be a good thing if employers especially started to accept the reality of social networking and ensure that a policy is incorporated in the staff handbook as well as in (new) employment contracts. This does not just refer to using these sites but also ownership of a network and profile. At the same time, I think that it is somewhat difficult that just say that employers are running risks when they use the information in hiring decisions and for reasons of discipline and even to dismiss certain employees. But there is another side of this coin of course. Social networking content is often referred to as self generated content. Whilst I do not deny that there is a good reason to consider human rights, at the same time it could be argued that whatever you put out there as a prospect or employee is relatively public and at the same time it could seriously affect the business /corporate image and reputation of your employer. Where employers would be wise to take legal advice in relation to social media, employees would be wise to consider the potential effect of their publications an at times even rants since you are also a face for the company that pays your check every month. There is however a large gray area where one should be able to express oneself without having to fear for repercussions.

There is however a double edged sword that appears to be going through all of this. Employers are held to be more and more careful in whom they are hiring and at the same time are not allowed to "discriminate" on certain grounds. Besides that it is argued that as an employee you should be able to let off steam, and while some do that in the pub others do that on the net.

I guess that is where the real legal battlefields will end up being. In the meantime, and for those that have an interest, on the ARCIS Fraud Discovery & Exposure Centre website you can find a listing of around a hundred popular social and business networking sites to give you an idea. The number of these sites are growing by the day and probably and I see invites for new ones pass by at least a few times a month.

In the next part I will go into more detail with some case examples and in part 3 we will look at some legal issues so hang in there.

Fraud "A Claims Handlers Guide" 2nd Edition

2009-04-18T03:01:00.001+12:00

Fraud "A Claims Handlers Guide" 2nd Edition

View more documents from CounterFraud.

Romance Scams

2009-04-13T15:30:00.001+12:00

After the pyramid scams, ponzi schemes, work from home scams and vanity scams, today I stumbled across a website called "Romance Scams" at http://www.romancescams.org. As we are all aware, it is very easy to assume an identity on the internet. Law enforcement agencies as well as some news agencies have used this tactic in the past to track down people involved in child pornography and the distribution thereof, scammers have used it on for instance facebook and even linkedin to attract a large number of connections.

In recent years, the internet has seen an ever increasing number of sites that individuals use to meet that love of their lives. whilst it opens up the opportunities and gets rid of geographical boundaries it also increases the risk of "meeting" someone that is actually not what he or she is purporting to be. In the not so far away future I have bee dealing with people that ended up being defrauded and even blackmailed by so called mail order brides for exotic destinations such as Russia and other Eastern European countries as well as some Asian and african countries. A good friend of mine tried his luck and I remember it well:

After months of chatting and calling, he was finally going to meet this lady that was going to be everything he ever looke for in a woman, she was cute, she was sexy, she was witty and at the same time of a soft character and vey caring. she did not have any children yet and seemed not to bring too much baggage from previous relationships. Knowing how much he was looking forward to it we waved him away when he went en route for a romantic diner with his newly found love. Within less than one and a half hour we saw him come back down the street again, to park his car and pop in at our place. He looked completely pale and shattered. Bu no means the girl loked anywhere near what he was made to belief and her pictures, according to the story, must have been at least ten years old. She was twice his size and covered with tatoes. She looked nothing like the pictures she's been sending him and most of all she had seemed a completely different personality all together when they finally met. "I was so shocked at what saw and i was actually sorta afraid of her. I still took her into the car but when we were halfway, I thought this is not fair, so turned the car and dropped her off at her place again." It was not long after that that he started receiving first apologetic text messages, when not answered they became abusive and even cntained threats. He almost lost his job because she had started to flood his phone at work and his cell phone with abusive messages, started spreading false rumours on the internet and the list goes on. It took police interference to make this woman stop.

No this is only an example and the range of romance scams is almosty as endless as the human imagination allows. Romance scams have been used to defraud victims, to obtain a working permit or visa, to blackmail victims. That is where Romance Scams aims to come in.

According to their Who We Are page:

"The mission of RomanceScams.org, a non-profit information and advocacy organization, is to create public awareness, provide accurate information and expertise to assist in the successful demise of online romance scams and help people learn, heal, and experience a safe on-line environment.

Romance Scams.org came into existence on June 6, 2005 with the hopes that we could help one or two people who might find us. Our beginning was with a Yahoo Group, set up as a place to talk about these scams. Since then over 30,000 people have sought and found assistance within the Yahoo Group. Over time we have gathered an extensive collection of information and resources for assistance of the victims of these scams.

Support, education and healing are what our group is all about. We support the victims of these crimes, either in a group setting or one on one, until they are ready to move forward from their experience. We spend a lot of time educating the victims so they do not fall victim of these sorts of scams again. We also work with the media in an effort to educate the general public about these scams."

The Site claims to have well over 12,000 members with over 10,000 reported scammers. I had a look around the site and it seems like a great initiative with good infirmation about romance scams. I suggest you check it out before your next internet dating activities.

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David Alexander on ATM Urban Legend

2009-04-13T02:17:00.001+12:00

http://ping.fm/4B3jO Don't fall for this urban legend

Conficker

2009-04-13T02:16:00.001+12:00

http://ping.fm/pqQw4 Conficker rears its ugly head finally

Is it me or .... what's really up here?

2009-04-05T19:55:00.001+12:00

Keeping track of fraud related media on a daily basis I cannot help but noticing that one after the other investigation is being picked up by authorities all over the place. The Madoff case appears to have been a trigger for a widespread flood of investigations against all kinds of well established names in business.

The FBI reports one ofter the other investigation, the SEC is going double speed, Australia's market watchdog is suing the country's third largest iron ore mining company Fortescue Metals, Elizabeth Baldwin is being investigated. In fact I could fill a page with all kinds of ongoing investigations and newly started investigations.

What strikes me a bit is that these all seem tpo come so all of a sudden and that all of sidden these parties are being identified as having scammed investors for years. I am wondering how this suden explosion of 'discoveries' all seem to be coming about at the same time?

Could it maybe be that instead of a spike in these schemes, the public is starting to wonder whether these agencies, those watchdogs, admittedly usually underfunded, have been getting somewhat complacent, somewhat less vigilant than they should have been considering that it were our tax dollars that have funded these organizations? Don't get me wrong. Bad apples need to be removed if only so as not to spoil the rest of the lot. Don't get me wrong. Bad apples need to be removed if only so as not to spoil the rest of the lot. But what is it with this sudden dioscovery of so many bad apples?

Could it maybe be that this current tsunami of fresjhly detected fraud cases is actually nothing more than window dressing? Could it maybe be that we have been aware that our business and lives were determined by a otten to the bone financial system and with authorities not intervening they have actually been instrumental in keeping these players alive? I know that allegations have been made about Amway in the past (see www.merchantsofdeception.com or www.pyramidschemealert.org) and how political influence has been instrumental in not being prosecuted, and that is either Amway or the large distributors. Really, I can't help thinking: what is really up here?

I'd be keen to hear your views.

IC3 (Internet Crime Complaints Center) 2008 Annual Report now available

2009-04-03T15:19:00.001+13:00

For Immediate Release
March 31, 2008

IC3 2008 Annual Report on Internet Crime Released

The Internet Crime Complaint Center (IC3),a partnership between the FBI and the National White Collar Crime Center (NW3C), released the 2008 Annual Report on the number of Internet crime complaints received.

The 2008 Annual Report states that complaints of online crime hit a record high in 2008. IC3 received a total of 275,284 complaints, a 33.1% increase over the previous year. The total dollar loss linked to online fraud was $265 million, about $25 million more than in 2007. The average individual loss amounted to $931.

While the complaints consisted of a variety of fraud types, non-delivery of merchandise and/or payment ranked number one (32.9%). Internet auction fraud was the second most reported offense (25.5%) followed by credit/debit card fraud (9.0%).

The report details information related to the volume and scope of complaints, complainant and perpetrator characteristics, geographical data, most frequently reported scams, and results of IC3 referrals.

FBI Cyber Division Assistant
Director Shawn Henry said, “"This report illustrates that sophisticated computer fraud schemes continue to flourish as financial data migrates to the Internet. It also underscores the need for continued vigilance on the part of law enforcement, businesses, and the home computer user to be aware of these schemes and employ sound
security procedures."”

Director Don Brackman of NW3C stated, “"The report demonstrates that in a technology driven global market, the inability of consumers to distinguish between legitimate and fraudulent activities poses a serious threat to our economy. The financial losses that result have an impact on each and every one of us."”

The report is posted in its entirety on the IC3 website.

Source: http://www.ic3.gov/media/2009/090331.aspx

Welcome David Alexander

2009-04-01T03:28:00.001+13:00

We are pleased, proud and honored to advise you that David Alexander has joined us to become a blogger here at the ARCIS Fraud Discovery & Exposure Centre blog.

In the past times David has time and time proven how he has some unique and authentic insights where it comes to fraud and over time we have established an alliance with David which has been quite valuable. David brings in unique insights.

More about David

If you want to know more about David I suggest you go here >>>

In addition to that David is the founder of Scam Stop which has its official website (as opposed to the previous link to the blog) here>>>

More about Daviod personally can be found here >>>

Why not all say hello to David.

You are Gagged

2009-04-01T03:06:00.001+13:00

I just received legal opinions in relation to an idea I had in mind for a long time: exposure of those that abuse out trust with their shonky dealings. More recently I have been involved in looking into the affairs of a member of one of the popular social and business networks who allegedly ripped of a lot of investors. Regular requests for assistance come from people that feel that they have been scammed or defrauded by businesses throughout the world.

It would have been a great idea I imagine if, upon investigating, at least the facts could be published online so as to let other readers make up their own mind. "NO" the lawyers said, "unless you want to spend most of your time in the courts, defending defamation claims." As it turns out, a fact is of course not simply a fact but most of all it is so easy to stop such actions in New Zealand or at least make the publisher of these facts life's miserable by aggressively pursuing anyone that does publish.

A recent article by Rosemary McLeod in the Sunday Star Times appears to strengthen the advice of the lawyers. McLeod reports:

"What the public doesn't know is how often the threat of legal action silences the media. Libel trials are costly, outcomes uncertain and juries more likely to side with a single complainant than a big media company.

If a newspaper or broadcaster sticks to their guns, believing themselves to be right - and even if they are right - they can pay heavily for it. If they repeat their allegation that adds to the so-called damage they cause, which equates to money, so a lawyer's letter is a brilliant way of shutting them up indefinitely.

If you wonder why certain stories aren't told, that's why. There's a hidden network of manoeuvres operating behind the scenes constantly and pay-offs made to avoid the courts, and there's great potential there for a kind of blackmail of media if you put your mind to it.

Being paid to go away could be lucrative and enforcing silence on the matter at the same time would be doubly rewarding. I'd like to believe this doesn't happen, but I didn't come down in the last shower...

... It's not just people in the news who are affected by this country's suffocation of freedom of speech."

So, where does that leave me? Even if I decide to set things up differently, I will still be running a risk of seeing myself attending court attendance after court attendance, regardless of whether I can rightfully bring up a defense of a truthful or honest opinion. So what this comes down to is that people are basically made quiet by the laws of defamation especially where you may want to use your website to post warnings. For the time being that may mean referring people to websites like http://www.ripoffreport.com and http://www.complaintsboard.com, while I am back to the drawing board looking at more viable options.

It is not the fear of being sued necessarily but it is the time consuming nature of such activities that make it less attractive. Regardless of whether you are legally right or wrong, court dates tend to take longer than expected, require preparation and where things are really dragged out to actual court and jury hearings.... you may very well be in for a tombola where juries can be manipulated.

Give me some more time please so can work this out.Letting you post your complaints yourself is at this time and day no option for you and for me. Does this, maybe explain why the list of scams and associated businesses has vanished form the website of the Consumer Organisation here in NZ?

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Chain letters and Pyramids

2009-03-29T13:14:00.002+13:00

Earlier this week I talked to a professor an friend, a true smart cookie you could say. He showed me a letter and asked me what I thought of it. I guess the recent scandals like Madoff has made us all a bit more careful about promises that sound too good to be true. Pumping lots of money in some of these great investment schemes is being approached with utmost care.

But scam artists understand all this all too well. I guess with spamming laws tightening up all over the place, they apparently are giving snail mail a second go. The letter spoke of a business opportunity and was apparently aimed at those that would not mind giving a small investment a go. For an "investment" of only $199 you were promised to make around $250,000 in a matter of weeks and around $750,000 or even more in a matter months.

All you needed to do was sending money to a list of strangers on a list and add your name at the bottom of the list: the all too familiar chain letter concept. By adding your name to the list other strangers would start sending you money! That sounds all to easy and familiar doesn't it.

Well here is the issue, it is an illegal chain letter and pyramid scheme. Moreover it is ILLEGAL and regardless of that, the only ones that will be making money are the ones that started it. The way for you to make money from it is to send that lame business opportunity pitch to all your contacts, friends and family to get them to send you $199.

RING!!!!!!!!! REALITY CHECK!

Send your money and you will lose it. In addition to that consider that while most of your contacts will probably just delete the message, some are a bit more vigilant about spam and may very well report you and ultimately your internet access could be suspended or even revoked. You will look like a fool to all your contacts and some may even consider you to be a scam artist yourself. And for what, because you thought in all foolishness that this was going to work. At the very worst you may be prosecuted as in many jurisdictions chain letters and pyramid schemes are defined as an illegal, criminal practice.

It would be great to think that you will not fall for such an obvious scam but the sad truth is that thousands of people lose millions of dollars on these schemes every year. Yo make sure you are not one of them.

This does not just sound too good to be true: it is!

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Today I Retire

2009-03-25T21:36:00.001+13:00

Going over last days mail, I am sure I can retire now.

I won two lotteries, prize money totaling around 18 million NZ (I used XE.com to convert) and that is on top of the lotteries I won last week. Besides that I am going to make another few million on helping a lawyer, a widower, a religious person that saw me appear in her vision when doing her praying for a solution to get, money out of some African country to reinvest it in New Zealand.

And here comes the next part, as if all this money was not enough to retire straight away I saw that I have at least three get rich quick pyramids and ponzi invitations: an amazing investment opportunity in some fund that is going to bring big big big results, some shares that nobody knows are going to be worth a fortune soon, a cash gifting scheme which is completely legal because well, it is ok to make gifts according to the IRS and while I give away of coiurse no strings attached, the money is going to come in amazing quantities as soon as I give. I furthermore open 20 business cetres with 6 different new pyramids Ooops MLM's and if necessary I will buy myself new recruits to keep the commission checks coming in (got millions to spend anyway).

So here am an overnight millionaire that is in a position to make these millions into billions.

And now comes the best part: I see that there are around 30 gorgeous looking ladies that would like to date me, and hey they don't even know that I am filthy ruch and getting richer by the minute using all these automated cash generating "systems". So they must like me for who am and not for the money. In fact I will open my own new Playboy Mansion and enjoy my days well you can probably guess what I am hinting at. And even that is no problem and these ladies will all be so pleased with me after I had my order in for penis enlargers. As the advert goes: "big is beautiful." No need to worry about keeping up with all thes ladies cause I ordered all these viagra type of endurance stuff.

Enough said, time to start enjoying life!!!!

Bye now.

New Missing People Initiative

2009-03-25T12:27:00.001+13:00

Today I received an email from a connection through a no longer existing social networking site iYomu.

You are receiving this one email because of your connections with the iYomu
site which you once joined. I promise that you will receive no more contact
from us after this email. I am now seeking your help.

I was asked last year by my mum to help find her son and my eldest brother
Paul Rooney who we have not seen since 1999. My mum is 78 now and not in
great health.

I looked at all ways of finding him and I recognized that the way we look
for missing people is expensive and lacks any proper use of technology. I
think that most people who have had someone go missing are completely
isolated and without much hope. I decided to do something about it.

It seems pretty basic, but I realized that the only way to find Paul and
others like him who have gone missing was to create a really unique and
simple website that could get the global internet community involved. The
website that we have built is called www.findpeoplemissing.com.
We have launched this website today.

There will be no fanfare, no big party and no big marketing drive with this
website. There will be just a few emails that I hope get passed on from one
person to another. I believe that a great website will always sell itself.
In the end we will leave it up to those from the internet and missing
community to see what they think about what we have built.

Paul's photo is the first on the website, but I believe that he will be soon
joined by many others as there are over 2 million registered missing people
out there.

I hope that you do have a look at the website and as it is free join up to
Help Find Missing Persons - please pass the web link onto anyone who you
think it could be really relevant to.

Thanks

David

I think this is a beautiful initiative an I suggest that you go have a look.

For those that are in search of someone that has gone missing: you can register such a person as missing there. And those that are missing and do not want to be found: you can register yourself there as such as well. On top of all that, for those that are in for a reward: check out the first two persons listed there and perhaps you end up with the reward.

Go have a look for yourself at http://www.findpeoplemissing.com.

David, All the success with this site!

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Securities Commission (NZ) reviewing corporate governance disclosure

2009-03-23T13:33:00.001+13:00

23 March 2009

News release

Commission reviewing corporate governance disclosure

The Securities Commission is now reviewing reporting by issuers on their corporate governance as part of its ongoing financial reporting surveillance programme.

"Given the current financial climate investors need greater assurance that issuers have robust corporate governance arrangements in place. Investors can only have confidence in the market if such arrangements are fully disclosed," Securities Commission Chairman, Jane Diplock, says.

"Good governance is the key to a successful, well managed corporate," Ms Diplock says.

"The Commission's review of corporate governance reporting will assess the current level and quality of disclosure and provide useful feedback to the market."

The review involves assessing annual report and website disclosures of selected issuers against nine principles covering the core elements of good corporate governance. The principles are set out in a corporate governance handbook for directors, executives and advisers, published by the Commission in 2004.

As part of the process the Commission will write to issuers in cases where disclosure can be improved.

The Commission will also publicly report on the findings from this review.

Ends

Roger Marwick 04 471 7659

Source: http://www.seccom.govt.nz/new/releases/2009/230309.shtml

What do we really know about fraud?

2009-03-22T04:09:00.004+13:00

Looking at the news recently and seeing all these corporate scandals and frauds pass by, I would like to propose a question: how big is your tip really?

It is a well known fact that most frauds are and often stay undetected.

We base our strategies on what we detect and resolve. But is it actually the right approach when you think of it?

We learn from ex-fraudsters and from professionals. And here comes just one potential issue with such an approach:

it is a well know fact that most fraudsters get away with. So when we claim we learn from those that were caught, do the actually represent the fraudster in general or are they representing the group that is was not good enough to get away with it?
We learn from the professionals that got the fraudsters but then again these same professionals are understood to only scratch the tip of the iceberg. On top of that they may base their theories and strategies on experiences with fraudsters that got caught, e.g. the minority. Time and time again it is shown that all these professional strategies and models do not prevent massive frauds to take place under the eyes of boards, senior management, investors, employers.

So here's the question, are we really getting on track or are we just getting better at discovering those that were making mistakes anyway? This may be a question that comes from sleep deprivation of course. On the other hand, looking at the stats and odds? What do do we really know about fraud and fraudsters? Could it maybe be that we are looking at he wrong red-flags or that out red flags only establish the obvious while missing the more subtle signals?

I hope this will evoke some reactions. Or in the words of Jay Deragon: "what say you?"

Some Do's and Don't in Relation to Identity Theft

2009-03-22T03:01:00.000+13:00

Since it is such an important subject here are some Dos and Don’ts:

DO keep all personal documents in a secure place
DO destroy any rubbish that could be used by someone with less noble intentions
DO make sure your bank and credit card statements arrive on time and DO carefully check them for transactions that do not match your receipts
DO inform your bank when you find transactions that you do not recognize
DO sign your bank and credit cards immediately upon receipt.
DO NOT store (if necessary at all) your PIN numbers and cards together, preferably memorize and destroy the paperwork. DO NOT ever give out your pin number.
DO get your credit information at least once a year and see what has been registered in your name and when. Such a check: credit monitor is available for a small fee and sometimes for free and is money well spend especially when you transact through the internet regularly
DO arrange redirection of your mail when you change to a different address, notify all relevant parties and number one the Postal Service, but also your bank, the Inland Revenue and other relevant organizations
DO make sure that you have a secure lockable mailbox AND actually lock it
When you are on holiday: DO arrange for your mail to be collected are held at your Postal Service
DO NOT share personal details with anyone unless you are absolutely sure whom you are dealing with
DO NOT respond to telephone calls or emails asking for personal details or financial information
DO NOT get tricked into giving out personal information like your full name and or date of birth, address details etc, unless again you know who you are dealing with

Some more in respect of on line transactions specifically:

DO NOT ever follow links in an email asking for personal details
DO get up to date with the basic security programs for your computer and internet connection and make sure you update these regularly
DO use strong passwords (8 characters with at least 1 Capital, 1 number, 1 special symbol)
DO NOT store or share your passwords and log in ID’s
DO ALWAYS log out after you finished online transactions
DO make sure that when you are in the process of online transactions, it is through a secured site: look for the padlock in the bottom right of your screen. Look if the website address changes to https://website address
DO stick to organizations that are reputable and have exemplary privacy and other policy statements)
BE AWARE that conducting transactions with overseas companies can pose difficulties when things go wrong and that assistance might be hard to find
DO make hard copies of all your online purchase transactions
DO be wary of dramatically lower prices: if it sounds too good to be true, it usually is!!

Finally some Dos and Don’ts relating to posting your resume on line:

DO MINIMIZE your contact information: remove:
- Name, address and listed phone numbers, most cell phone numbers are unlisted and therefore provide more security
- Your business email address (a huge DO NOT)
- Your personal email address when it is associated with a detailed profile (for instance AOL)
DO replace your email address with one that is harder to trace: G-mail, Hotmail, Yahoo)
DO NOT use ridiculous email addresses such as hotsexystuff@example.co instead use it as part of your marketing for instance: dierckx-LLM@example.co
DO modify your employment history, especially your current employer’s details to minimise risks to current employment. For instance change “The Warehouse” into a chain of household supply stores, “Dell” into a multinational information technology company or Dierckx & Associates to an internationally operating investigative services, BI/and CI, litigation support, forensic services and risk management consultancy services provider.
DO modify your job title when it is unique and replace it with a generic but accurate description: Canterbury and Otago Regional Rose Marketing Manager would translate into multi-provincial marketing manager for specific plants product line.
DO NOT provide your social security number and never provide any credit or other references or leave their details to just a first name. It is accepted usually if you advise in your resume that references are available on request and that you are withholding these for security purposes.

When job hunting online, use your common sense: provide enough information to be found by hiring managers but safeguard your information where it can be used by criminals to assume your identity. When in doubt contact the company personally and find out if there is a way to forward your full resume by business email or fax.

Humans weakest link in security

2009-03-21T02:01:00.000+13:00

Cnet reported today that according to a study performed by ESG Research, humans are considered the weakest link in Information Security, according to the interviewed security professionals from the US and Europe.

Moreover, more than 25% of these security professionals rated their organizations “fair” or “poor” when it came to training and communicating users on confidential data security policies. In other words a lot of organizations are not doing well when it comes to data privacy and security training and communications of and to their employees. Jon Oltsik, who wrote the Cnet article “People are the biggest security vulnerability” concludes that the message is clear and frightening and goes along to conclude that it is “no wonder that there are som many security breaches”. Moreover if the human part is neglected we might as well stop investing in security technologies. I suggest there may be some emotional truth to this but I suggest that we do not take this too literally. I think security systems are very important nowadays but would have to agree that proper training and communucation are essential for this technology to work! Moreover I think that the human element is the most important as well.

At the same time looking at my own experiences over the years, besides humans and technology, there is a lot of data within a business that is available in a physical sense that is often overlooked. I freshly recall some of the old dumpster diving experiments to find that where shredding equipment and policies may be in place, a good dive will often still deliver a lot of valuable information. In addition to that, while organizations may have great security technology in place, all too often it is very easy to obtain printed conidential data, kept by users throughout offices. In drawers, on desks, under desks in a repository of “To Do” or as will be seen later, in the parking garage. That same documentation more than once ends up being taken home for some “light reading” and gets thrown out later when the home office or that space under the bed gets overcrowded. It may all sound obvious, but at the same time those very obvious things are often overlooked.

As an example:

Sandra was hired as a temp to participate in a knowledge management project by a large multinational with a substantial research facility. Part of the project involved setting up data bases with documents and reports that would be available for future reference in all kinds of areas the business was involved in. The project is also used to incoprate a classification system. Sandra, initially very busy scanning in documents and gathering documents with research managers, marketing managers and even senior management, ends up with lots of information to be entered and linked into the databases, and is very busy summarizing the documents. She gets interested in some of the topics covered which closely allign to her current study activities and, motivated as she is, she decides that she is going to take some of these documents home over the weekend.
A bag filled with reports, Sandra walks down to the exit of the compound where she is stopped by an alert security guard who wants to do a routine check on her bag. He lets her pass, because there was no inventory or stock found in her bag and even says that it looks like she is in for a “busy weekend and wishes her strength.”
Things went wrong and Sandra leaves her bag on the backseat of her car. The bag must have looked attractive to someone in the parking garage of the mall on her way home because the car gets broken into. Her bag and everything in it are gone and not long aftyer that several top secret reports are being offered for sale to senior management of Sandra’s temporary employer. Sandra is in the end and after a lot of investigative costs identified as “the leak”. During the investugation it became clear that Sandra was never properly advised on security policies and procedures, because …. well they are available on the intranet.” Suffice to say that np one ever told Sandra about that as well. It was further established that none of the holders of these documents ever questioned Sandra about whether she was authorized to have or access this classified information, in fact two senior managers even left their filing cabinets unlocked so that when they were not there, Sandra could get from there what she needed!

Another example I reported on about two years ago dealt with an after hours walk around the premises of a client to find:

client lists printed out on desk
supplier arrangements printed out on desk
contracts , draft R&D reports, strategic documents, plans and financials on desk and in waste bin under desk
computers open and logged on
computers closed but password and log in available on a post-it on the side of the computer screen, or in the unlocked top drawer
computer logged on to the internet, Kazaa open and downloading 12 pornographic movies. I advised him that such peer to peer options should not be possible in the first place.
4 times msn mail box open on screen, 2 times yahoo and a staggering number of 14 Gmail accounts open and accessible

Not a bad score for a less than 100 staff business. And yes, the business involved had:

clean desk policies
policies about closing of equipment, network and internet connections
password protection
screen protection
internet usage (accepted use policies)
and much more….

Similar to the previous example, policies and procedures were not communicated clearly and available on the internet only.

More recently I had the pleasure of finding a flash-drive right in the middle of town to find that there was an incredible amount of company sensitive if not vital information on the drive. The drive was safely returned to the happy but ashamed owner but he could consider himself lucky. He had not yet “found the time to report it to management” and now
he did not have to. So I advised him “well that is unless I offer management a copy of the information you lost.” The man went all red and advised that he went out had a few beers, and the thing must have slipped from his pocket. The guy learned his lesson so I let it at that.

The examples show not only the importance of educating your staff, including temporary staff about policies and procedures, but besides that that nowadays information security can not afford to slack down. More importantly is seems clear that whilst we are (and I must say quite necessarily) focussed on keeping threats out, we cannnot afford to keep a clear focus on the “insider threat” as well and that is primarily your human factor and by the way not just in relation to information security.

The article spoke of interviewed “security managers” and I wondered how this would translate to daily life in SME.
So, I went over some of the information and files of the past years to find that even basic security technology such as firewalls, up to date virus scanners, mal and spyware removal tools are not always as evident as you would expect.
At the same time by now I guess, and if only because of tightened regulations and potential liabilities things appear to be moving up in this area at leasty where it comes to the basics. When I looked for “information security policies and measures” only two came up. It may seem over the top but I suggest that you consider formulating one, of only because it forces you to actually think about these issues. Similar as to other fraud prevention strategies, it does not necessarilly have to be complex and costly, but you do want to have your basics covered, and the human element is paramount.

To close off a bad example of information security I ran into the other day. I arrived at a relation and used (as always) the visitor park in the parking below the building. That day things looked different. A massive pile of boxes was stored in the parking garage. Well you might think it probably is a closed parking. Yes it is bit it is share by around 15 other organizations!

Upon a closer look, and actually after opening some of the boxes, I ended up finding a lot of confidential and even privacy sensitive data. Since, a the sign indicates this is a provate parking, I decided to have a look how easy it would be to enter this parking during day time.

Two options: wait till a car arrives and walk in after that before the gate closes and and wa;lk back out using the lift to the entrance hall. Or enter to the entrance hall and use the lift to go down in there and the same way out or … follow a car that is leaving.

If clients and business relatiosns of this organization knew what happened to their records and confidential and private correspondence I doubt they would still be as keen to enter into any relationship with this organization.

Now, I might have a milion invested in security technology but if this saving on secured physical storage is leaving me open for a a substantial claim than am I not puttinhg at least part of my money in the wrong places? I get this info which I can basically put it in th trunk of my car and leave without anyone asking questions an sell it to the highest bidder. A clear case of non-risk awareness I would say.

What’s more none of the other users of this building appear to have alerted the organization involved, else this material would not still be here. Even worse: one other organization in the same builing must have been inspired by this cost effective way of archiving documents because now there is a similar pile up against another walll of the parking. The sad part: the first box I opened I found tax documents with all confidential details of people on them. This is an example of where you as an identity thieve must feel like hitting the jackpot, you don’t need to dumpster dive it is all nicely archived and sorted for you. And likewise as a corporate spy: thank you for the clear description on the boxes; it made looking through them and selecting the ones to take a lot easier. These archive boxes are like a gift wrap.

Being aware or better yet making sure your staff is aware of fraud and information risk is a first step I would say. Edecate and train your people to think about what the potential consequences of their actions might be. I doubt whether the management of these two companies would still be as content with this cost saver if it resulted in a multi-million dollar claim: saved $500 on secured storage and lost a million on a negligence claim. I guess safeguarding your bottom line starts with simple things.

DIY Background Checks for US Residents

2009-03-18T14:39:00.000+13:00

If you've had a need or desire to investigate someone without spending money on PI feesthat you should have a look at www.webstigate.com.

What can you do with Webstigate?

Background Checks
Background Reports
Criminal Records
Court Records
People Trace
Search by Name
Reverse Phone Search
Reverse Address Search
Public Records
Bankruptcies & Liens
Unclaimed Asset Search
Property Records
Vital Records
Birth Search
Marriage/Divorce Search

Webstigate.com further offers an Unclaimed Asset Search. A
pleasantly surprised customer allegedly found a three year-old $3,000.00 tax
refund that was owed to her. Needless to say, she's a very happy
Webstigate.com customer.

Webstigate.com claims to have over 3 million criminal records available. Since
laws regarding available criminal record information vary from state to
state, click "Coverage Area"
to find out exactly what criminal record information is or will not be
available. Instant Report Access is US $24.95 and you can add 1 year
unlimited search passes for just $14.95.

Now before you start going wild with this site: I suggest you also talk wit your lawyer. The terms of use or not entirely straight forward and you may want to check whether your intended use is legitimate, especially in a more professional environment.

Here are the terms (the small print):

Use of Data

By
conducting any searches on the Websites, you represent and warrant that
you will only use the Websites and Data for a lawful purpose. Examples
of lawful purposes include, but are not limited to: (a) fraud
prevention; (b) asset verification; (c) location of criminals,
witnesses, beneficiaries, or heirs; (d) research for debt collection
activities; (e) child support enforcement; and (f) compliance with
federal, state, or local laws or regulations. You may not use the
Websites or Data for any unlawful purpose. Examples of unlawful
purposes include, but are not limited to: (a) stalking or harassing any
individual; (b) requesting information under false pretenses; and (c)
using Data for any other purpose prohibited by law (“Unlawful
Purposes”). Furthermore, you agree not to access, reproduce, duplicate,
sell, resell, transfer, or exploit the Data for any commercial
purposes. NOTE: CIS Worldwide is not a consumer reporting agency as
defined under the Fair Credit Reporting Act ("FCRA"), and the
information in our databases has not been collected in whole or in part
for the purpose of furnishing consumer reports, as defined in the FCRA.
You may not use the Websites or Data to: (a) establish an individual's
legibility for personal credit or insurance; (b) assess risks
associated with existing consumer credit obligations; or (c) evaluate
an individual for employment, promotion, reassignment or retention
(including employment of household workers such a nannies,
housekeepers, or contractors) or in conjunction with assessing the
merits of entering into any other personal business transaction with
another individual (“Unauthorized Purposes”).

Who to Trust?

2009-03-17T16:39:00.001+13:00

In a recent post David Alexander, discusses the issue of trust, an interesting subject at all times but even more nowadays. David outlines how he was advised to tell people that he can be trusted: something that may according to some be an issue for some based on David's past. Quite rightfully I would say, David did not agree with such an approach and goes for an actions speak louder than words approach. Regardless of what the right approach is in David's case, this post got me to reflect back on some of the cases I worked in the past 15 years.

If the recent times are teaching us anything it is that in the end instead of just trusting people you will need to look after your interests. Trust has become a very relative thing I guess in these times of corporate bailouts and collapses, in these times where one after the other is being identified as a fraudster and where tax payers bailout moneys are used for bonuses to those that were at the foundation of the current malaise and institutions paying each other. At the same time and that is perhaps why things have gone so terribly wrong for some: these people never asked for trust, they got it for whatever reason.

It made me think how many of the cases I worked on actually involved fraudsters that went out of their way to prove their trustworthiness. Would it not be that if you actually are trustworthy, at least to your own standards,there is no longer a need to emphasize that?

I remember one of them from a place down south of Christchurch who was actually know for always referring to his Christianity and active involvement in the church: "surely that would prevent him from being anything but completely honest." Or consider many of the Drug leaders in Latin America that have been supporting their communities substantially so as to create relationships of trust and good images, likewise with some Mafia families. Yes they were high profile criminals but at the same time members of society that enjoyed a great deal of trust and status. Or what to think of the trust that so many clergy had whilst at the same time they were involved substantial breaches if trust.

One book that came out in New Zealand some time ago has the title "Trust Me I am a Lawyer". Compare that next to the number of complaints and cases in the past twenty years of lawyers putting their hands on trusts accounts, over-billing their clients, delivering bad services (malpractice), and these cases are the ones that came to surface. And the same applies for those other professionals like accountants, doctors, scientists well you can think of a few more I guess. Look at the old generation and you will see that the trust in all these learned professionals is almost self-evident and comes with the status. It is this same generation or even the ones before that that have burdened our free thinking abilities with sayings such as: "once a thieve alsways a thieve". Look at recent events and what do we see? That the convicted person is supposed to work hard to regain trust at the same time as corporate trusted hotshots are defrauding us while we speak. It is a well now fact that most identified corporate fraudsters and thieves have a clean criminal record and are often first time offenders. They abused the trust that was hard earned and given in the years prior to their offending.

What is this all telling us? Perhaps that trust is something that should be earned and not claimed or asked for, regardless of your background. Whatever your level of trust in David, he has some valuable insights to share with many of us, professionals and lay people alike. Does it really matter whether or not your trust him? If trust is an issue: make sure your contractual arrangements and controls make up for the level of trust. I all honesty, while it is fantastic if a business relationship has something personal to it and with that the question of trust, it is hardly a generic requirement. Where there is no trust there can still be a very beneficial relationship, you may just want to look at how you secured your interests. Too much trouble for your taste? Find another party.

This brings us back to the question of David and his past: pleading his trustworthiness is not going to help him in any event cause those that need such a plea apparently don't trust him anyway, great results and added value will.

Time and time again it has been proven that the insights of ex-fraudsters and con men have been useful in fraud prevention and detection exercises. Look at Barry Minkow, Frank Abagnale, Nick Leeson or Kevin Mitnick, people that have taught us a lot from their perspectives and insights and they have all contributed in one way or another to fraud prevention and early detection. Of course it is not denied that they made their mistakes at the same time they paid the price and are now giving back professionally. Whether you trust these people is of course entirely up to you and with that comes whether you will ever be able to get any benefit from their insights.

If you don't trust them professionally don't hire them, if you don't entirely trust the person as a person, either find someone else you eel more comfortable with or put tighter controls in place. I guess to some extent my old boss in the Netherlands was spot on when he said: "trust is great but control is better."

Payment Processing Job Scams: GEORGE FOOD

2009-03-16T11:26:00.001+13:00

Recently I have been receiving a lot of payment processing job offers. The FBI already sent out a warning about these offers some time ago and I guess it never hurts to give this some extra attention. Don't fall for it!

These types of mails may be a way to get someone's hands on your confidential information or to unwittingly have you involved in illegal activities such as money laundering.

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

Dear friend,

Top of the day to you from George Weston Food LTD Accra Ghana , It is
pertinent to inform you that we are urgently in need of an account officer
in Canada and United States of America . We deal on (farm product) we buy
and sell into Europe, Asia, America , and Canada .

We already have representatives in these counties we only need in America
and Canada as of now, you are to represent this company and assist us in
receiving payments from our customers in your region. Your payment will be
10% of every total money receives from our customers through you to us.

Please if you are interested all you need to do is send us you CV and your
information bellow:

Full Name:
Full Address:
Direct Mobile Number:
Age:
Country
Sex:
Present Ocupation:
Any form of Identification:

Please note that we already have customers who want to make payment but we
have instructed them to hold on till we get a reliable person who can
honestly work with us as the company representative in helping us receive
payment from them.

Regards the above information I will advice you contact this office
immediately for verification and if you are qualify you will be require to
start your duties immediately.

Have a great day as I wait to hear from you swiftly.

Best Regards
Mr. Geoff Star
Chief Executive (George Weston Food Ltd Accra Ghana)
Tell: +233541672616.

THE FRAUD DISCOVERY & EXPOSURE CENTRE OPENS SOCIAL NETWORK

2009-03-13T22:48:00.001+13:00

We are proud to announce that besides the website and the blog you are now reading we have opened a social network on Ning at http://arcisfdec.ning.com.

We have found that whole blogs are an opportunity to have conversations, the social network environment offers more opportunities to closely stay in touch with clients and fellow professionals.

We truly hope that you will find this additional environment a place that will assist you in keeping your business and private life better protected against frauds and scams. A place for people to learn and help each other. We aimed to create a place where businesses can connect with other businesses and private individuals for all the good reasons, a place where we can all learn from each other and a place where you can find professionals to assist you with your fraud, scam and risk related interests, whatever they are.

I look forward to seeing you at http://arcisfdec.ning.com.

There Is No Such Thing As A Small Fraud: Only Large Ones Given Sufficient Time to Grow

2009-03-12T14:22:00.001+13:00

The Daily Express of 11 March reported that and RSA commissioned survey showed that around 54% of Britain's employees admitted to stealing from their employer.21% confessed to taking more expensive items such as computer hardware and mobile phones. I would be surprised to see those figures differ substantially anywhere else in the world.

Furthermore the survey showed that offices are twice as likely to be targeted than manual workplaces.

Despite such figures, most businesses fail to address the issue of "petty theft" in the workplace, leaving their business unprotected. From my own experience can say that in many instances such cases of petty theft are hardly considered a crime in many instances. Previously I wrote that is it not smart to let the decision of what it acceptable and what not in the hands of your employees.

"Petty theft" is typically an example where employers need to step out of their comfort zone and set a clear line. What starts with a small box of pencils or pens may very well end up with more expensive items. There is nothing wrong with allowing some favors for your employees but make sure that you are in control of who receives which small favors.

While I know many employers would feel uncomfortable with the idea of addressing such a petty issue, but 54% small issues start to mount up very quickly, check your own figures for fallout or leakage and you will be amazed at how quick it may run up. Need assistance in tackling this issue? Contact me.

Billing Schemes: Very Popular Amongst Corporate Fraudsters

2009-03-11T18:05:00.001+13:00

Off course the newspapers media are all over the David Bain (re)trial which is actually important news in New Zealand.

Today two fraudsters were convicted for defrauding the Otago District Health Board in New Zealand. The case has been covered at length in the past period.They were found guilty of fraud, which they both denied, in December last year.
During the men's trial, the Crown said they had used 198 invoices from Sonnford Solutions, a company formed by one of the two fraudsters, to charge the board $16.9 million for IT-related services that were never provided.

The two fraudsters had been billing the Otago Health Board for maintenance and program upgrades and had cashed in around 16.9 million, 10% of which was kept while the other 90% was paid to related companies.

One could ask oneself: how could it be that these things happen right under the noses of everyone? While I am not privy to the details of the case: typically the fact that such a big service provider is being run by an employee should be something to raise alarm bells. From the companies office details it transpires that none of the fraudsters was not the director a two minute check would have shown that there was a significant shareholding. I would imagine that at least some due diligence should have been part of the tendering process.

At the same time, billing schemes are known to be a favorite of corporate fraudsters. At the heart of these schemes lies a perpetrator causes the victim organization to order and pay for something that is either never delivered or does not need or is obtained against a highly inflated price.

A simple set up as seems to be used by the CITO. You set up a shell company and use that company to invoice yur employer. I do not rule out that as part of the process the same fraudster had to authorize payment of the bills sent through the shell company. In the case above it was identified that the services billed out were never rendered. In other instances the shell company may be offering completely legitimate services but for a ridiculous price. Very often the person running the scheme is also the one tht authorizes the payment of the invoices by the shell company.

Obviously, proper control mechanisms should prevent anyone from approving his or her own invoices. The reality shows however on a regular basis that such controls are not in place. Similar schemes are known to be used to invoice the employer company for personal expenses. In several of the schemes the manager authorizing payments had been submitting completely bogis invoices from non-existent entity that supposedly had provided all kinds of consulting services strangely enough the bank account number of the consultant company was the same as his own.

I recall one case a few years ago where the fraudulent billing involved completely bogus taxes: the fraudster, also the tax expert of the company, had invented a lical tax that id not exist and had used invoices of the local council, a pair of scissors and the company's professional priniting facilities to create a a rim of blanco tax invoices supposedly by the local council. This man was discovered after a thorough investigation in which I identified that the bank account numbers on the council's invoices for taxes were different. Tips about the man's lifestyle and the fact that he was regularly being picked up from work by call girls that were in no way looking like his wife. The bank accunts used were belonging to himself and one of the call girls.

Not all fraudsters are in a position to authorize their own invoices for payment. Methods know to have been used are false purchase orders, using ficticious invoice numbers, altering existing purchase orders or by misreperesenting the nature of the purchase and the list goes on. Are you completely sure what all your bills are for and whether they are fair and reasonable?

Perhaps it is time to review or audit your accounts payable.

Acai Berries, Rachel Ray and Oprah Winfrey: why are these sites still up?

2009-03-09T17:15:00.001+13:00

The other day my wife asked me about the Acai berry and weight loss programs and since I once write about it she asked me whether I was so sure about what I write because even Rachel Ray and Oprah Winfrey recommended these products.

I was surprised to hear about that and asked her to show me what she meant. And sure there were several sites she pointed me to that indicated that this berry was actually promoted by these two all time favorite television diva's that are also know to have weight issues every now and then. Here they were and I must say even convincing:

Jenny's diet blog
Rachel Ray Diet
Alyssa's Rachel Ray Diet Blog
Rachel Ray Diet which even claims to be Rachel Ray Approved

And these were just a few. Now call me a cynic I asked my wife whether she had actually checked the sites of these ladies themselves and sure enough there the truth came out.

The Truth About Oprah and Açaí

Consumers should be aware that Oprah Winfrey is not associated with nor does she endorse any açaí berry product or online solicitation of such products. Attorneys for Harpo are pursuing any companies that claim such an affiliation.

Rachael Ray Does Not Endorse Açai Berry Products

Many of you have brought to our attention concerns regarding solicitations involving Açai Berry products that bear Rachael Ray’s name or photo. Please note that Rachael Ray has not endorsed any Açai Berry products, and she is not involved with the solicitation of any such products. The use of her name or photo in connection with these solicitations is unauthorized. We want to apologize if you have experienced any confusion or inconvenience pertaining to this matter.

All I can say is do your research before you hand over you money. At the same time it goes to show how easy it is to have a credible looking site. What surprised me most is that these sites are still up and running, fooling another number of people.

Warning: Scam mail received allegedly rom Kiwi Bank and HSBC

2009-03-07T01:16:00.001+13:00

In the past days I received several scam emails regarding my Bank Account at Kiwi Bank and My Bank Account at HSBC and that I needed to log in and update my accounts.

Especially the HSBC scam mail looks very convincing.

Sion't fall for the trap however: these are bullshit emails aimed at trying to get your private details.

The giveaway?

Check in the bottom of your screen what the links are for these "security updates" and you will know it is fake!

Besides that remember that your ban would not approach you like that, they would send you an official letter. AAnd if you are still in doubt: call your bank and tell them about the email.

Facebook faced with new Koobface worm

2009-03-03T13:48:00.001+13:00

Like flies to cow dung, rogue apps are swarming to Facebook.

The popular social-networking site has been hit by what's believed to be the fourth rogue app in a week or so and is investigating the spread of a new variant of the Koobface worm, according to security firm Trend Micro.

The Koobface worm spreads via a message from a Facebook friend that includes a link to what looks like a video, Rik Ferguson wrote on the Trend Micro blog.

Read the full story here >>>

NZ Police Ask For Help Nabbing Fraudster

2009-03-03T13:47:00.001+13:00

The New Zealand Police are looking for assistance and information about the whereabouts of the man on the left.

Tony Edwin Meihana Hartley has been on the run since late 2007 where he did not appear at a parole board hearing.

Hartley is known to have used a number of aliases including Anthony Edward Hartley, Gregory Mulligan and Tony Lorenzo.

According to Detective Felicity Mansell, information suggests that he continues to use other people's identities to create false documents.

Hartley has contacts in Auckland and information suggests he was on the South Island recently. Although part Maori, his identity could be mistaken for European or Mediterranean. He is known for changing his appearance, including hairstyle and color, facial hair and even colored contact lenses.

Anyone with information is asked to contact the Fielding Police.

Facebook and Myspace Security Issues

2009-03-03T13:09:00.001+13:00

Facebook and MySpace were dealing with several new security issues last Friday that could expose personal information and communications from friends. Facebook advised to have removed a new rogue application that was spamming users and exposing their information. Meanwhile, over at MySpace, a spokeswoman said the company fixed a vulnerability on Friday that enabled strangers to view MySpace users' private comments. As with the other privacy holes that have been reported on, someone would have to know the exact URL and insert the correct user ID to exploit the weakness.

Read the full story at CNet

Fraud Awareness Week: Are We Actually Ready for More Fraud?

2009-03-03T12:03:00.001+13:00

More than once I have wondered how it can be that the chances of conviction and imprisonment are higher when you are caught stealing a car than when you defraud investors or creditors from $15 million. It is not that hard to guess I think: in the first instance there a clear cut criminal offense and if indeed caught for it a fat chance of a guilty plea or at least a confession and therefore a relatively easy addition to the stats. With frauds and scams it is not always that easy, and as a result the cases are often more complex and difficult to investigate and prosecute, even more so in those large scale frauds that are at the moment discovered on a very regular basis.

In a recent Law in Action: Fear of Fraud episode the expected rising figures of fraud are discussed against the background of how fraud is being dealt with in the UK. The question is whether we are putting enough resources into tackling fraud. Ex-Public Prosecutions Director Sir Ken MacDonald sketches a grim picture. His claims are supported by Monty Raphael, head of fraud and regulatory law at Peters and Peters. I would have to agree with Monty Raphael that in order to actually tackle the issue of fraud, more investigators are needed. There is a requirement to gain a critical mass which is currently not available in most jurisdictions. Looking at current media reports, I could envisage this to be not just a matter of justice, but also a way to restore confidence in the system. The public is receiving very mixed messages.

I can speak from experience when I say that the investigation and prosecution of fraud, and especially the larger and institutional frauds are highly complex and with that costly. In addition that that there is not always a fair chance of success when it comes to prosecuting fraud do to complex regulations and evidential burdens. As a result, more often than not governments seem on the lookout for alternative ways to sanction otherwise criminal behavior. In many European jurisdictions as well as on a EU level I have seen the introduction of so-called "Administrative sanctions" even in cases of blatant fraud. Other alternatives could be expulsion or debarment and or disqualifications to serve as for instance a director or senior manager. At the same time however we see our prisons filled with "criminals" that have been convicted for crimes that had far less severe consequences than what those big fraudsters may have been pulling of.

You could wonder of course what the message is that you are actually sending out to the public. On a regular basis we see how true white collar crimes are being dealt with on an almost consensual basis as opposed to an adversarial basis. Systems and structures actually support such an approach and as a result: the "blue collar" scam artist that changed his baseball bat or even shotgun for a laptop and a telephone, get's a conviction and prison sentence on the basis of a relatively small fraud, while the mega fraudsters walk away with fines and plea bargains and very importantly NO STIGMA. Most of all, where the small time scam artist gets a conviction and a criminal stigma that may last for years: high profile fraudster end up not getting these stigmas and disqualifications. Does that not convey a message to the public that we are relatively lenient when it comes to dealing with serious financial crimes?

Whilst the Police Commissioner is making his annual speech each year so as to commend and applaud the efforts and results of the Police, I doubt that any victim of a fraud will be equally enthusiastic after having seen their file classified as something like "more of a civil case" or "no resources available" or citing the "public interest" as a reason to not investigate and prosecute. Similar results can easily be expected from any of the other under-resourced and under-funded enforcement agencies. All up, six agencies in New Zealand are responsible for enforcing the laws against white collar crime: the Serious Fraud Office, the IRD, the Police, the National Enforcement Unit of the Ministry of Economic Development, the Official Assignee's office, and the Securities Commission. Ultimately only a fraction of the fraud complaints pouring into their offices every week is investigated, let alone make it to a prosecution.

There is a perception that only soft targets make it to prosecution. More than once I have been involved in cases whereby an initial "no thank you" could only be turned around when a ready to go ABC prosecution file was made available: and even then there are no guarantees. I used to get upset to find out that another case was not being picked up, until I realized that some of the national enforcement agencies in New Zealand have less investigative capacity available than the local fraud squad I used to work for in the Netherlands. So can you blame these people and their agencies for setting high thresholds and priorities?

I would say well yes and no. Yes, because I cannot help but noting that, especially the small time losers /victims are the ones that seem to be served the worst even though they are the largest in number and most often thew impact is equally severe on a relative scale. And even if cases are pursued through the criminal courts, most legal systems are aimed at confiscation of criminal proceeds rather than reparation of the damages for the victims. So where does that leave the guy that invested his nest egg into a scam or the elderly being ripped off by scrupulous scam artists, or the next victim of a pyramid scheme disguised as MLM? I cannot help but thinking how especially those that need the help the most, the most vulnerable are time and time again left out to hang and dry because of the way the system operates. No, because the harsh and simple reality is that these agencies that are supposed to tackle frauds and scams are faced with tight budgets, limited resources and a caseload that is well above their resource capacities.

About a year ago the Sunday Star Times reported how defrauded commercial entities are prepared to pay big money for investigative leg work to put together a ready to prosecute file. I can vouch for the accuracy of that and also that even when a ready to go file is being presented to the Police ot other enforcement agency, there is no way a guarantee that the file will be picked up and taken through the courts. I guess one of my first files in New Zealand, R v Samantha Stevens is a good example of that and likewise R v Michael Devine. Both victims in these cases had to spend considerable resources to get their case prosecuted. Not every victim has those resources available to have the inquiries and case file building and where required additional (legal) advice organized by a private party.

Like McQuilter I would have to say that more than once dealing with the perpetrator directly may open up to alternative resolution if only in terms of recovery. At the same time however, many fraudsters do not commit fraud as a means of building up savings, they spend the money and more than once there is simply nothing or virtiually nothing to recover. And where your damages are relatively small, you could wonder wether the costs outweigh the benefits.

It is these same small time victims that are faced with another barrier in terms to access to justice: they are not poor enough to get legal aid and not wealthy enough to simply fund a civil case in order to seek recovey of damages, that is if there is something left to recover. This brings me back to the reason why the FDEC was established: to serve as good as possible those small time losers, the pops and mums investors, the home based business scam victims, the investment scam victims, the elderly and all these other parties that have suffered relatively minor damages per party but when aggregated represent considerable damages. Pooling for the purpose of class type actions may be an option. Besides that exposure is at all times to be considered as a way to at least prevent others from falling for the same trap.

We will be opening our "Report a Scam or Fraud" form soon and I suggest you keep coming back here to read the lastest news on that. For the time being, contact me at john@arcisfdec.com if you have a complaint and I wil get back to you as soon as I can. To ensure priority handling, make sure you put "Complaint" in the subject line.

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David Alexander on the second SAA crew drug bust and Carl Niehaus's financial woes

2009-02-28T01:29:00.001+13:00

Recently I advised you about David Alexander's interview with Moneyweb. It can now be seen on Youtube as well.

Acai Berry: Be Careful. Your Trial may be more Expensive than Expected

2009-02-28T00:47:00.001+13:00

In the past period I ran into several complaints about the "Free Trials" of Acai Berry. The bait used is that you are allowed a free trial with only shipping to be paid.

In the small print however it is found that if you do not cancel: you will find your credit card billed after that for new monthly shipments. And yes I did find that the promotion is effectively involves a negative option or opt out, but taking into consideration the many complaints about unexpected credit card billings. See a full list at the Complaints Board
here >>>

Some examples of how this fine print works:

http://www.acainonidiet.com/
Terms & Conditions: (these terms/conditions only apply to the free trial) Start your trial now to receive a full month supply of Acai-Noni Burner (retails for eighty four dollars). You will have 14 full days from today to evaluate and decide if you wish to keep the remaining 30 day supply and continue receiving Acai-Noni Burner. If you enjoy Acai-Noni Burner, simply do nothing. You will be billed the discounted price of only 79.95 at the end of your 14 day trial period for your initial supply. You will be billed again for the same amount 30 days from today to replenish your supply and begin your monthly auto shipment billed monthly at the same price unless cancelled(this is a savings off the retail price, and is available to you today). You will enjoy our auto ship program that will deliver your monthly supply of the Acai-Noni Burner Diet. You are still receiving this trial one hundred percent risk free because if, for ANY reason, you decide that Acai-Noni Burner is not for you, simply call 877-271-4199 and we will quickly assist you with canceling your Acai-Noni Burner auto ship program as well as help you with a refund. No future commitments, no hassles. Cancel any time.

I UNDERSTAND THAT THIS CONSUMER TRANSACTION INVOLVES A NEGATIVE OPTION AND THAT I MAY BE LIABLE FOR PAYMENT OF FUTURE GOODS AND SERVICES, UNDER THE TERMS OF THIS AGREEMENT, IF I FAIL TO NOTIFY THE SUPPLIER NOT TO SUPPLY THE GOODS OR SERVICES DESCRIBED.

Also See for similar practices:

So: before you get your free trial make sure you have read the terms and conditions or you may end up being stuck with this product for longer than you planned. Additionally, even if you do remember to cancel in time, going from the complaints, that is no guarantee you will actually succeed.

Fraud Awareness Week

2009-02-27T23:27:00.001+13:00

In the week from 2-9 March 2009, fraud awareness is promoted. The message promoted this year a simple one that can not be emphasized to often: Scams Target You - Protect Yourself.

The campaign is meant to raise awareness under New Zealanders as to how they can spot a scam, report the scam and help to protect others.

In Australia and New Zealand the campaign is ran under the umbrella of the Australian Consumer Fraud Taskforce, which is made up of 19 Trans Tasman Government regulatory agencies and departments. Coordination in New Zealand is in the hands of the Ministry of Consumer Affairs and the Commerce Commission, with a number of other organzations undertaking their actions in parallel.

For a list of supporting organizations in New Zealand see here >>>

David Alexander Speaks With Moneyweb

2009-02-22T01:39:00.000+13:00

We are of course very happy to advise you that one of our "partners in crime: David Alexander was interviewed by Moneyweb. David talks about corporate culture and social engineering in the context of two scandals hitting the media in South Africa.

ALEC HOGG: Fraud specialist David Alexander is with us in the studio. A couple of big stories that have hit us this week. The first one - let's start of with SA Airways and its drug bust now. You would have thought, after the scandal that erupted in January when the crew was arrested at Heathrow, that they would have made sure that it never happened again. Well, it did. It happened again this week. Did it surprise you? Read the rest here. Or if you'd rather listen to the actual interview, go here. A definite recommendation.

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Fraudsters and how they do it: Distractions

2009-02-22T01:01:00.000+13:00

Fraudsters and scam artists need to be convincing: else who would fall for their scams? Regularly I am made privy of communications or I sign up to receive more information relating to one product or another. There are two tactics I see on a regular scale that you should be aware of. I see the same tactics being used, consciously and even unconsciously, when I interview people that are allegedly involved in fraud.

One of those used tactics is to flood you in a very short time with an overload of material.
You hardly got a chance to see what it was you were provided with and shebang there is the next lot. More than once the material provided is not necessarily relevant to you. Some time ago I was approached by a pressure seller of some investment opportunity, and sire I was referred to a bunch of websites all dealing with general information that of course said nothing about the results this pressure seller was generating.

A well known way to do this is the way for instance Amway/Quixtar/A2K recruiters "show the plan." Instead of coming down to business they draw you in with questions that have nothing to do with the actual viability of the "opportunity" shown: tactics used are "dream building". Instead of focusing on the merits of the offer, people are distracted by getting them to focus on the big dream. By the time you actually get to finally see the actual business opportunity you are with your head the in the clouds and too distracted to see what you are actually buying into.

Another example came when a client of a New Zealand based and operated expat health insurance scheme started asking questions about his insurance program, he forwarded some of the emails. The insurance program administrator had to admit that this was not an underwritten and re-insured and provided information about how this program was set up through a health care trust. This would allegedly provide "a more robust" system and the client should actually be happy about that, even though the system was not underwritten or re-insured. A lengthy document was attached explaining how some UK Health rust worked. The information looked impressive and promising but had nothing to do with the financial viability of the particular program, about which the client was enquiring!

Recently I posted an article and that illustrated this tactic just perfectly. I was referred to website reports with all fantastic graphs but was it really about the opportunity I was invited to? NO! Conmen are besides that a master in drawing big conclusions from little or no evidence. Read the article about E1 Asset Management here.

Those distractions may also come in displays of wealth. One lady I helped out some years ago, advised me how she was brought in to some home based business opportunity, it would bring her wealth, financial freedom an anything you could think of or wish for. The meeting took place in a beautiful mansion and a Mercedes, a Ferrari and a Saab were parked right there. This off course was to have the guy pretend that they look at this opportunity because look at what it brought me. Some, blinded by this wealth signed up that same day an invested in this fantastic opportunity. Later research showed they guy never owned anything: the mansion as well as the cars all turned out to be rentals.

What it al boils down to is that you need to make sure that the information you are provided with is actually referring to what you are being invited to invest in, whether it is a business opportunity or an investment opportunity. And when it comes to that: don't be distracted by glossy and flash looking prospectusses or business plans. It's all part of THE GREAT DISTRACTION. Come to think of it, our New Zealand based insurance provider was a master at that as well.

Related articles:
http://www.arcisfdec.com/Red-Flags-of-a-Scam.php

FRAUD RISK ASSESSMENT NOW AVAILABLE

2009-02-21T02:12:00.001+13:00

We are pleased to announce that we can offer you our ONLINE FRAUD RISK ASSESSMENT.

The Fraud Risk Assessment is a checklist, that has been used for several years by John Dierckx, to get a quick insight in potential gaps in your business systems and procedures that relate to your Fraud Risk. The Assessment is not meant as a be all end all but provides sufficient enough insight into where your organization may be at risk. And now it is available online!

Doing the assessment itself is FREE OF CHARGE and can be done online. The responses so far have been that doing the assessment itself has been an eye opening experience. However it is strongly recommended that you opt in to get a preliminary advise based on the outcomes of the assessment or better yet to discuss the outcomes of the assessment as well as the preliminary advice with one of our professionals.Whilst fixed prices may seem attractive, we have found over the years that there are no "one fits all all" answers so you can be assured that any preliminary advice or feedback is of a highly personalized nature taking into consideration your specific circumstances. Quotes may therefore vary based on your answers (every no is in principle a reason to further evaluate/investigate) and the size and nature of your business.

Both options are covered in the ASSESSMENT. Should you chose either one of them you will be send a quote, free of obligation as well as (online) payment details. And you do not have to decide straight away, you details will be kept for three months after which they are destroyed.

TAKE ME TO THE FRAUD RISK ASSESSMENT

El Cheapo Fraud Prevention: Hire the Right Employees additional video

2009-02-18T01:39:00.001+13:00

As a complement to the previous post a video by John Sileo, identity theft speaker and data theft expert.

El Cheapo Fraud Prevention: Hire the Right Employees

2009-02-18T01:31:00.001+13:00

No fraud prevention and detection system is going to work right if you hire dishonest employees. But that is not necessarily the point I am trying to make: I am talking about hiring the right employee.

Most employees who commit fraud against their employers do not have any prior charges or convictions for fraud. Yet, it still makes sense to attempt to weed out potentially bad employees. This means having an effective screening process that includes thorough interviews, background checks when permissible, and verification of past employment and references.

It all starts with ensuring that you have a clear view on what the requirements are for the job you're hiring for: not just education and experience, also job requirements such as being able to perform under pressure, being a team player, additional requirements because the job has some flexible elements, the culture of your organization and so on. This may seem to have to do nothing with fraud prevention but it is common experience that those that when an employee can't handle the job there is a risk that he may utilize means to cover this up, which could ultimately lead to manipulated results.

Furthermore make sure that where possible you advise any applicant upfront that a background check: including a financial check, criminal check and where a drivers license is a job requirement a drivers license check and verification of past employment and education are part of the process. Make sure that you have the appropriate forms available as part of the application process to get that kind of information released.

This will send out and rightfully so that you take your applicant serious and will very likely shy away those that want to hide something.

Prepare interviews and have thorough interviews. That may seem obvious but in many instances I have seen how shallow and not necessarily to the point these interviews are. Consider - depending on the vacancy - psychometric testing, to get an objective test result next to your gut instinct.

And when it comes to verification of previous work history, take your time to actually do proper verification! Likewise and as far as possible for previous education. Start of by insisting that you see originals of diplomas and certificates. I remember very well how, when I arrived here in New Zealand, no one bothered to much about it: "just send me, fax me or mail me a copy, she'll be right." And as far as references: ah they were probably in a not so handy timezone, so why even bother. Too often a previous employers check is skipped and taken for granted. And where you find inconsistencies, ask again until your are satisfied.

Too often when doing checks in hindsight I have to find that either employees had a criminal record, left previous employers for reasons of dishonesty or other misconduct and the the new employer, once the damage has been done (again) clients sit down and think :"why have I not done this before?"

In many SME employees are your most valuable asset: treat briging in these assets like that. It cannot be denied that many employee frauds and thefts are perpetrated by someone that has no prior record, but there are most definitly more potential factors that could help you weed out the good from the better. In many instances, taking the hiring process serious goes a long way.

Mortgage Meltdown and Mortgage Fraud Video News

2009-02-16T04:08:00.000+13:00

After this Mortgage Meltdown, Mortgage fraud appears to be on the rise: you are in trouble (read gullible) and then this knight in shining armor comes to the rescue.

I recommend watching the video below as well

Headlines 15 February 2009

2009-02-15T20:12:00.001+13:00

U.S. Agents Scrutinize Texas Firm

For years, R. Allen Stanford, a flamboyant Texas billionaire, richly rewarded the well-heeled clients of his private investment empire. But now federal authorities are investigating whether those rewards were simply too good to be true.
Several federal agencies, including the Securities and Exchange Commission, the F.B.I. and the Internal Revenue Service, have spent “many months” looking into the business activities of the Stanford Financial Group, which is based in Houston, and Mr. Stanford’s bank based in Antigua, which issues high-yielding certificates of deposit, according to two individuals briefed on the investigations who were not authorized to speak publicly.

See the complete story at NY Times

Judges Plead Guilty in Scheme to Jail Youths for Profit

At worst, Hillary Transue thought she might get a stern lecture when she appeared before a judge for building a spoof MySpace page mocking the assistant principal at her high school in Wilkes-Barre, Pa. She was a stellar student who had never been in trouble, and the page stated clearly at the bottom that it was just a joke.

Instead, the judge sentenced her to three months at a juvenile detention center on a charge of harassment.She was handcuffed and taken away as her stunned parents stood by.

Read the full story at NY Times

Britain Investigates A.I.G. Unit in London

The American International Group’s financial products unit, which brought the firm to the verge of collapse with bad bets on credit-default swaps, is being investigated by British prosecutors for possible criminal conduct. Investigators of the Serious Fraud Office are working with the authorities in the United States who are conducting separate reviews, the fraud office, which is based in London, said Thursday. A.I.G. said it was cooperating with the inquiry. The investigation does not involve A.I.G.’s insurance operations.

Read the full story at NY Times

U.S. Seeks New Powers to Fight Tax Evasion

The Justice Department is seeking expanded powers to prosecute offshore tax evasion and other financial crimes, including those related to the mortgage industry and potential misuse of government bailout money.

The efforts, which have gained traction in recent weeks, could give the agency tougher prosecutorial tools to combat fraud amid the economic downturn. As part of the effort, the agency has thrown its weight behind a Senate antifraud bill that, if passed, would make it easier for the agency to apply money-laundering statutes in cases of suspected tax evasion, particularly those involving offshore accounts.

A top Justice Department official laid out the aims on Wednesday in comments at a Senate Judiciary Committee hearing on the bill, known as the Fraud Enforcement and Recovery Act of 2009.

Money-laundering statutes generally carry stiffer penalties, are regarded more seriously by courts and make it easier for prosecutors to force defendants to forfeit assets and make restitution, said Robert G. Morvillo, a white-collar criminal defense lawyer in New York.

Read full story AT NY Times

'Japanese Madoff'

TOKYO - THE businessman accused of a con worth at least US$1.4 billion (S$2.1 billion) in Japan's biggest ever pyramid scheme had promised to build a paradise on Earth for investors, some of whom even called him divine.

But to lawyers investigating him, 75-year-old Kazutsugi Nami is an old hand at such scams whose cult of personality pulled in elderly people and housewives who thought they could get rich quick.

Read the full story at Straits Times

A big thank you to Neal S. Lachman for alerting me, he can be twittered here: a top 1% visionary, we should all be following and watching.

Proposed DNA Bill Is An Outrage

Friday, 13 February 2009, 4:40 pm
Press Release: Libertarianz Party

PRESS RELEASE
FOR IMMEDIATE RELEASE
Law And Order

Proposed DNA Bill Is An Outrage

Libertarianz leader Richard McGrath said a proposed law change that would allow police to demand DNA samples from arrested New Zealanders is an outrageous violation of individual rights.

"The Attorney-General knows that such a law is inconsistent with the Bill of Rights Act, which is supposed to protect New Zealanders and their property from unreasonable search and seizure," said Dr McGrath. "Yet despite this he says he will personally vote to have it passed."

Read full press release at Scoop

Mortgagee sales rise "frightening"

MORTGAGEE SALES listings on New Zealand's two top real estate websites have more than doubled in the past year as homeowners struggle to meet mortgage repayments amid rising unemployment.

On TradeMe, mortgagee sales listings soared 231% - from 32 to 106 - between January 2008 and January 2009, while its online competitor, realestate.co.nz, says its numbers jumped 200% from 95 listings to 285.

TradeMe's head of property Brendon Skipper and realestate. co.nz's Alistair Helm say the speed of the increase is frightening.

Now one in every 200 homes listed for sale on realestate.co.nz is on the hock after being forced into foreclosure by the mortgage holder, usually a bank.

Read the full story at Sunday Star Times

El Cheapo Fraud Prevention and Detection: Sign Every Payroll Cheque Yourself

2009-02-14T12:43:00.001+13:00

This may seem like a time waster, but it is generally well worth your while.

Review the checks to make sure they are for people you know.

If there's a in there that you do not recognize or recall: find out more about that that person. Keep a weekly count of the number of people on your payroll, and verify that number against the number of checks made out. Especially where there is limited oversight and separation of duties, chances of ghost employees entering the payroll master ledger are real.
Ensure that no changes can be made to your company's payroll master file without your approval and signature.

Another option: have a separate bank account for payroll, and deposit the exact amount of your payroll in that account; then insist on a prompt monthly reconciliation.

2009-02-13T15:13:00.001+13:00

http://ping.fm/pIxP2 KPMG Survey and SME. The Survey indicates, consistently with previous years that SME (I went for <500 employees) experience a lower level of fraud than larger businesses. While this may be giving you some form of relief, it is noted that the survey was sent to the 2,018 largest businesses in Australia and New Zealand, resulting in 420 ‘usuable’ responses. With this said, there is no guarantee that the figures presented are actually representative especially for SME.

Social Media Target for Not So Social Practices: Digg

2009-02-13T13:08:00.001+13:00

Recently I was approached through a social engineering attack in which the profile of Mark Neely, one of my Facebook contacts had been hacked and was used by a hacker/social engineer to lure me into transferring money immediately to get him out of his alleged trouble. (See story here >>>)

More recently there appears to be a stream of reports indicating that social sites such as Facebook, Linkedin, MySpace, Twitter have been targeted by not so very social practices. Linkedin was attacked whereby fake celebrity profiles were used to lure unsuspecting users into handing over their personal details. End last year the Telegraph reported on the sale of stolen Facebook accounts for around the price you would pay for downloading an mp3 file. The accounts are subsequently used to send spam messages to millions of people urhig them to click on links, photos or videos that infect people's computers with spyware, virusses and trojans that are subsequently being used to track and copy detaols such as passwords and login id to form instance bankl accounts, other profiles and skype.

More recently Digg joined the line of attacked sites and once again hackers are reported to have been using celebrity names in order to get people to download malware to their computers. Sean Paul Correll reported to InternetNews.com:

Correll told InternetNews.com that he found 52 accounts posting news stories or comments with malicious URLs. Many of these accounts purport to be news items about celebrities, including actors Christian Bale and Alyssa Milano, singer Britney Spears and Paris Hilton.
They contain a link to a video about the celebrity that takes victims to one of several sites that downloads the Adware/VideoPlay fake anti-malware, or scareware, package when the user clicks on it, Correll said...
Correll said the malware distributors are using two tactics - posting fake news stories about celebrities, or commenting on real stories about the celebrities.
Correll said hackers using Digg are also blogging on Blogspot to bolster the credibility of their fake messages and stories. "For example, if they talk about Heath Ledger being naked in the shower, they create a post on Blogspot on that topic," he explained.

And besides that, according to IBM's X-Force Trend and Risk Report, not just social media sites but increasingly the sites of businesses are being targeted with attacks such as SQL injections.

I guess the attacks through sites such as Linkedin, Facebook, Myspace and Twitter indicate that there is a downside to becoming part of the mainstream. It appears to increase the susceptibility of a website or network. At the same time we do not seem to be learning. The scams and tactics used in phushing scams have not changed, and yet we continue to keep falling for them and end up being duped int handing over privacy and security sensitive data including passwords.

It could be argued that websites should be doing their utmost to prevent spamming, phishing and hacking. At the same time however whenh will we (finally) learn not to click on just any link you are offered and when in any doubt not to click it.

Try to have different passwords for each of your accounts.

Most of the major web security companies have online virus scanners so: if you think you might have gotten hold of something nasty, scan your system hassle free.

Don't let recent alarming reports spoil your web experiences. But at the same stay informed about what's happening on the net, be alert and keep your software updated.

2009-02-12T23:35:00.001+13:00

http://ping.fm/o4Xuo 4 years in prison for identity theft

2009-02-12T17:10:00.001+13:00

http://news.bbc.co.uk/2/hi/technology/7879755.stm
Half of Europe's teenagers browse the web with no parental oversight or supervision, a survey suggests. The research into the web habits of 20,000 14 to 19-year-olds across Europe found that 51% enjoy unfettered access to any and every website.

El Cheapo Fraud Prevention and Detection Tip: Send the Accounts Person/Book keeper on a Holiday and Review the Books

2009-02-12T14:35:00.001+13:00

Many small business owners faced with a fraud problem, are surprised if not completely flabbergasted to discover employees who always appeared loyal actually was stealing from them:

they never took vacations
they never stayed home sick
they were always all over the place ensuring the business was running smoothly
they always took care diligently of all the financial aspects of the business so that I could focus on the operations, marketing and sales

The reason these people have to be in the office constantly is to cover a complicated paper trail. Insist that employees who perform daily accounting/bookkeeping take vacation every year. Ideally, this vacation should be at two weeks in length, and occur at month end, when usually the books are being closed. Use this time to review or have someone else review your books and look for discrepancies.

The KPMG Survey and SME

2009-02-12T14:22:00.001+13:00

The KPMG Fraud Survey 2008 covering Australia and New Zealand, published recently showed several major findings:

The total value of fraud reported was $301.1 million with an average value for each organization of $1.5 million
Gambling was the most common motivator of fraud with an average value of $1.1 million per incident
Fifteen percent of the largest fraud incidents involved some form of identity fraud.
Forty-five percent of all respondents experienced at least one fraud during the survey period
Respondents reported 222,577 separate frauds
Non-management employees were found to be the group most likely to commit fraud
Internal controls were the most effective means of detecting fraud. Conversely, poor internal controls were the most important factor contributing to major fraud.
Fraud red flags were ignored in 22 percent of the largest fraud incidents
Seventy-nine percent of respondents had a system for the anonymous reporting of fraud
In 89 percent of the value of major frauds none of the money or goods was recovered.
Fifteen percent of employees involved in fraudulent conduct had a history of dishonesty with previous employers. In 3 percent of cases the employee had a history of dishonesty which was known to the employee’s current employer

What do these findings means for SME?
The Survey indicates, consistently with previous years that SME (I went for <500 employees) experience a lower level of fraud than larger businesses. While this may be giving you some form of relief, it is noted that the survey was sent to the 2,018 largest businesses in Australia and New Zealand, resulting in 420 'usuable' responses. With this said, there is no guarantee that the figures presented are actually representative especially for SME.

SME’s in my experience still tend to have a more relaxed attitude towards fraud. Perhaps this could be attributed to the increased difficulties in having internal controls, such as segregation of duties. On the other hand it may have to do with the closer working relationships in SME’s. It appears that most often a higher degree of trust exists between employees. Whatever the reasons may be there is a way more important reason why SME may need to worry about fraud risk.

One of the difficulties facing SME’s is their ability to absorb the cost of a fraud if it occurs. The fraud survey identified that in the vast majority of the fraud incidents, none or only part of the money lost was recovered. Full recovery of losses was realized in 11% of the cases. It should further be noticed that the actual recovery rate does not take into account the additional financial impact, including business interruption, of having to deal with the fraud and the reputational impact a fraud can have on a business. The fraud and the consequential costs can be crippling if not detrimental especially to an SME.In order to better manage the risk which fraud poses, SME’s should consider fraud prevention and early detection using common sense precautions. It could save a lot of disruption, adverse publicity and money in the long term.

Some of the things you may want to consider:

Establish a good ethical tone at the top. Flawed and inconsistent ethical leadership continues to featured in the top four reasons for unethical behaviour to occur within organisations: Set acceptable standards that are monitored
Implement adequate segregation of duties and strong internal controls that are difficult to override. Where it is difficult to have adequate segregation of duties and internal controls, implement another fraud risk management strategy to manage the risk
Review transactions periodically and observe unreasonable variations in the SME’s financial records
Look for and take notice of red flags such as employees who don’t take leave, live beyond their means and don’t delegate work: listen to your gut instincts, they were probaly the same that made your business a success
Ensure that pre employment screening is completed for all new employees
Verify the identity of contractors and suppliers

When I see publications on fraud and theft appear on the net and there is room for comments, I regularly find comments such as:

what about the honest employees?
don't honest employees have a right to be trusted?
Is implementing fraud controls not going to have a negative drawback and influence on genuinely honest staff?
Is there not a way to keep a problem level of control and at the same time trust the honest staff?
Fraud prevention and detection is expensive, I have a hard enough time keeping the head of business above water to "invest" in fraud prevention. I have got more important things to do.

Questions like these are very understandable. At the same time however implementing internal or fraud controls does not nececcessarily mean that you stop trusting your employees: they are (to be) part and package of every serious business. Furhermore, how would these same hinest employees feel i their employer came and said: " I trusted all of you, but one of you was dishonest and has caused severe damage. I will have to lay of 25% of you all; I cannot afford you any longer as a result of this." It is noted here that depending on which reports you read, sunstantial pecentages of bankruptcies have been caused by fraudulent activity.

Finally, it is very important to understand that there is not such a thing as an honest and a dishonest employee in general. Dishonest behavior is to be understood as a function of pressure, an opportunity to rationalize the dishonest behavior and an opportunity to commit fraud. So the same employee that asks questions like the ones above, could very well end up in a situation of pressure that could cloud his judgment on what is and what is not acceptable.

And as for business owners: I think it is first and foremost important to understand that fraud prevention and detection is not necessarily an expensive exercise. Many simple internal control and anti-fraud measures can be implemented at virtually no or very little cost.

If you like to know more, why not contact us or consider following the "Questions of Integrity?" workshop for you and your staff, and learn from a professional, a former fraudster and a victim what you may do to prevent your business life standing on the line because of wrong perceptions. In any event we are always prepared to see where we can help you. The cheapest thing you could do is signing up for our weekly email and get fraud, fraud prevention and detection thought, news an tips.ognored

2009-02-12T12:26:00.001+13:00

http://ping.fm/etva2
Madoff's wife withdrew funds on eve of his arrest

2009-02-12T12:21:00.001+13:00

http://ping.fm/RM53v
KBR pleads guilty in Nigerian bribery case

2009-02-12T00:02:00.001+13:00

http://ping.fm/MgM1O
Three plead guilty in MD flipping scheme

2009-02-12T00:01:00.001+13:00

http://ping.fm/h8hRW
The First Circuit Defines The Scope of Aiding And Abetting

The First Circuit Court of Appeals gave definition to aiding and abetting liability in an SEC enforcement action, requiring that the agency prove what specific acts each defendant performed which rendered substantial assistance to the primary fraud. In making its ruling the Court rejected the SEC’s claim that aiding and abetting liability could be predicated on conduct that happened after the fraud was completed even though that conduct arguably constituted a subsequent breach of fiduciary duty. SEC v. Papa, Case No 08-1172 (1st Cir. Decided Feb. 6, 2009).

2009-02-11T23:59:00.001+13:00

http://ping.fm/XXBDK
Overpromising and underdelivering, Geithner stumbles out of the gate: What others are saying (and as you can imagine, it's not very enthusiastic or complimentary)

* Investors say devil is in lack of detail
* Wall Street Criticizes 'Bad Bank'
* Geithner Plan Lacks Freshness And Clarity
* Geithner Does Little To Create Confidence
* Bond Risk Rises After Geithner Warns Bank Rescue to 'Take Time'
* For Geithner’s Debut, a Lukewarm Reception

2009-02-11T23:57:00.001+13:00

http://ping.fm/NnmNB
Insurance Phone Scam Missiles Hispanics in Washington

Internet Fraud Booms as scammers targeting people through insurance company by fake telephonic means . As Security measure is concern Washington Attorney General’s Office sounds alert about this on going phone scams, in which fraudsters are using Spanish language while conversing , and claims to be register agent of company.

2009-02-11T23:54:00.001+13:00

2009-02-11T23:52:00.001+13:00

http://ping.fm/Ribcb
Judge Says Firm Must Explain ‘Fraudulent’ Removals or Pony Up $25K

2009-02-11T18:34:00.001+13:00

Madoff in Partial Settlement With S.E.C. http://ping.fm/s90Ho Days before a deadline in his criminal case, Bernard L. Madoff has agreed to a partial settlement of civil accusations that he ran a $50 billion Ponzi scheme.

2009-02-11T18:32:00.001+13:00

Governor Testifies at Ex-Senator’s Trial , http://ping.fm/uYNoY

2009-02-11T17:01:00.001+13:00

http://ping.fm/ZPNCa Whether starting a business is right for you

2009-02-11T15:58:00.001+13:00

http://ping.fm/97Y6P NZI Business on Fraud Survey KPMG,

2009-02-11T15:56:00.001+13:00

KPMG Fraud Survey 2008, http://ping.fm/KdGSK registration required.

2009-02-11T15:41:00.001+13:00

http://ping.fm/274Nt Crime Scene Investigation by Rob Kirby: Last week on Thursday February 5th, 2009, The President’s Working Group On Financial Markets held their first official soiree with former New York Federal Reserve Bank President, Timothy Geithner, installed as President Obama’s pick as Treasury Secretary.

In the spirit of “Change has come to America” and transparency, cameras were invited in for the ‘proverbial photo-op’ in what was no doubt an attempt to demystify this shadowy organization. You can see this press conference for yourself beginning at the 3:20 minute mark of this video excerpt.

2009-02-11T15:26:00.001+13:00

http://ping.fm/EJw5K Treasury Plan Has No Bailout Money For Insurers, Insurers will not be allowed to participate in the federal government’s bailout program for financial institutions, a top Treasury official said today.

EL Cheapo Fraud Prevention Tip: Create a Positive Work Envirnonment and Set the Tone at the Top

2009-02-11T14:35:00.001+13:00

Creating a culture of honesty and integrity in your business can be realized through various means:

management should at all times model appropriate behavior
hire the right kind of employees
communicate expectations and require (written) confirmation of acceptance
create a positive work environment
develop and maintain effective policies and enforcement in case of behavior that not accepted

A culture of honesty openness and assistance require a positive work environment. That does not just happen, that is something that will need to be cultivated. Time and time it is shown that open door policies and positive staff and operating procedures go a long way in preventing fraud. Open door policies contribute to fraud prevention because it empowers staff and management to discuss problems before they get out of hand. It is a know fact that many employee thefts and frauds occur where people experience or perceive pressures and have no one to talk to. This may in turn lead to a loss of clear perspective as to what is appropriate or what the consequences of inappropriate behavior may be. Open door policies keep managers aware of pressures, problems and potential rationalizations and enable them to act pro-actively.

On many occasions I have had the chance to talk to the perpetrator of fraud and theft not just about the what but also the why, and the justifications for the identified dishonest behavior. Too often I have heard messages such as "nobody seemed to talk to me especially the owners, nobody seemed to care about me. I was treated like a piece of trash in my view and they deserved it." At the same time I hear managers asking the discovered fraudster: "why did you not come and talk to me?" This clearly indicates that apparently employees did not feel that they could come and talk to their manager or senior manager. Just putting an open door policy out there is not the end all, open door policies and open communication is something that needs to be fostered and cultivated, so that employees know they can walk in at any time and trust and respect you enough to actually do so.

Clear staff and operating policies and procedures are key factors in high- and low fraud environments and include things such as job security, reasonable rewards, recognition of job performance, clear and reasonable performance expectations and operational procedures, positive feedback and reinforcement, promotion and development opportunities are other contributing factors.

Consider establishing and instituting a "code of ethics" or "code of conduct" with clear delineations of what is acceptable and what is not, to be read and signed by all employees. Not only do they set standards but they eliminate potential rationalizations. By requiring the employees to acknowledge that they read and understood the code they are effectively buying in to the idea that fraud causes damage for everyone, that not everyone is "a little bit" dishonest, and that dishonest acts are not tolerated and considered serious.

Finally a key element of reinforcing honesty and integrity is to set the proper example for your employees, sometimes referred to as setting the "tone at the top." Management cannot expect others in the business to act a certain way if they do not live up to that standard themselves. Leadership by example is key here.Through their own actions they will need to set an example for desired behavior and at the same time reinforce that dishonest, questionable or unethical behavior is not tolerated and this includes management itself. We can not have employees come back and say" they are allowed to do it, so why not me?"

2009-02-10T14:31:00.001+13:00

Madoff In Partial Settlement With S.E.C.
http://ping.fm/Jps2v

The Lastest Scam Mails Received

2009-02-10T14:08:00.000+13:00

From Mr JB Alhassan < jbalhassan2010@gmail.com>
reply to jbalhassan242@gmail.com

Date 8 February 2008
Subject From Mr JB Alhassan

ATTN

I have on 30th day July 2006 received a payment credit instruction from

the Government of Ghana to credit about four individual Construction

Companies with their FULL CONTRACT FUNDS from the Millennium Challenge

Account with our bank, But why i contacted you is that one of this

companies is not existing again and the company has a problem in between

the owners ,and that resulted the down fall of the company , and I have

been keeping this secret for my self because I want to wait and see if

anybody will come for the payment , but nobody came for the money , so i

went and deposited it with a Local Bank in anonymous name to avoid any

trace from any body.

The total Amount is ( 10.7 million United State Dollars ) and Be informed

that every arrangement regarding how to move this money from here to your

country through Diplomatic Services has been made , and there fore , by

virtue of its nature as being utterly CONFIDENTIAL , top secret should be

maintained Because I am still in the active service, so i do not need any

form of implication especially now I am in the verge of my retirement to

endanger my career. Finally all the necessary modalities will be worked

out to enable us carry out the fund claim under a legitimate arrangement,

I have resolved to offer you 50/50%, but the most important thing I need

from you is trust, I will give you more details about the transaction when

I receive your affirmative response together with your direct telephone

number and your address, more clarification information.

Thank you and remain blessed.

Cordially yours,

Mr. J.B AlHassan

Budget and Accounts

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

	from	Guadalupe Credit Union <web-adm@guadalupecu.org>

date		6 February 2009 02:46
subject		Official Notification From Guadalupe CU

You have 1 new ALERT message

Please login to your Guadalupe Credit Union Online Login

and visit the Message Center section in order to read the message.

To Login, please click the link below:

Guadalupe Credit Union Online Banking

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

2009-02-10T12:39:00.001+13:00

NY Times on Click Fraud http://ping.fm/7nIpc

Pyramid Scheme Alert Assists CBC's Market Place to Expose "Busines in Motion" (BIM)

2009-02-10T12:09:00.001+13:00

Canadian Broadcasting Corporation (CBC) television news show, Marketplace,
dedicated its February 6, 2009 show to a devastating exposé of the
Canada-based multi-level marketing scheme, called "Business in Motion."
PSA President Robert L. FitzPatrick was invited on the show to
attend a BIM meeting in Toronto (undercover, with hidden cameras and
microphones) and then to offer an expert analysis.

The show can be seen in full here >>>

FitzPatrick's conclusion: BIM is a blatant pyramid scam which - by its design - will inflict losses on 90+% of all consumers who are ensnared.
As the show noted, pyramid schemes are illegal in Canada, yet the founder of the scheme, Alan Kippax, defended his scheme mostly on the
grounds that the Canadian authorities had not prosecuted him.

Anti-fraud law enforcement has become so lax and incompetent in recent years in both Canada and the United States that this is now the regular defense of fraudsters, including Bernard Madoff who ran a $50 billion Ponzi scam on Wall Street. Madoff mirrored Kippax when he had defended his scam for years on the grounds that "I can't possibly be doing anything illegal because the government has never prosecuted me."

BIM, like all multi-level marketing schemes (MLMs), also offers a "product" and claims that the "sale" of a product automatically makes BIM legal.
Camouflaging the pyramid money through a "product purchase" and then calling the pyramid payments "commissions" is the preferred disguise
for money-laundering in MLM pyramid scams. Usually the products are absurdly over-priced, not retailed, and are only purchased by the
"salespeople." These purchases actually serve as "tickets" to participate in the pay-to-play scam.

BIM fits this model perfectly. Marketplace showed that the product was actually worthless. It claimed to be a $3,200 "membership" in a travel club that offered low cost travel packages. However, Marketplace revealed that the same travel packages offered by BIM were available for far less cost through free travel services on the Internet.

Marketplace also shockingly revealed that the Canadian Competition Bureau (equivalent to the FTC in the United States) and the Canadian national
police, which are supposed to protect the pubic from pyramid frauds,not only had done nothing to stop the scheme but, as filmed on the show, actually arrested the Canadian consumer activist Dave Thornton for protesting the scam. Thornton's Crime Busters Now website had previously exposed the Canadian Ponzi scam, Pigeon King, which collapsed after ruining more than 1,000 family farmers. Canadian authorities did nothing about that scam either.

The founder of BIM became angry and loud when confronted by Marketplace anchor Wendy Mesley, claiming that he had "100 experts" that would
defend BIM's legitimacy against PSA President Robert FitzPatrick whom Marketplace had cited as the expert that concluded BIM is an illegal pyramid scheme.

The show also noted that Kippax had operated a nearly identical scam, called Treasure Traders International, which sold overpriced (nearly worthless) emeralds, rather than travel packages. The government of England had shut it down as an illegal pyramid scheme. Kippax then closed that scheme in Canada, costing Canadian investors thousands. Now, he runs the same scam with only superficial changes and under a new name, and it operates openly in Canada. BIM is holding recruitment meetings in hotels all over Canada. It claims to have over 8,000 "members" and travels in a bus with a
large sign on the front, reading "I Can't Believe Its True!"

2009-02-10T11:29:00.001+13:00

Buying into the pitch to become rich http://ping.fm/3t5eh BIM Corp - Ultralife exposed

2009-02-09T18:29:00.001+13:00

http://ping.fm/KC4wR
Leadership by example in New Zealand: do you wonder now why it's so corrupt here?

Identity Theft: It could just as easily happen to you

2009-02-09T11:47:00.001+13:00

ID theft occurs when personal information is obtained by someone
else without the owner's knowledge. It may support criminal activity
including fraud, deception, or obtaining benefits and services in the
victim's name.The results can be devastating. Once thieves have your information,
they can open new credit cards or bank accounts in your name and run up
debts, take out loans or apply for a new passport or identity document,
and use your identity as a cover for criminal activity.

Picton woman Jo O'Connell was shocked to find threatening letters demanding the payment of more than $10,000 in her mailbox upon returning from holiday. What made this all so shocking is that she never took out the personal loan the letter claimed she was in default on. As it turned out a loan application was made and approved on the same day she lost her wallet in Auckland. Prime source of identification was her cancelled drivers license.

Live in the studio an interview with Managing Director of GE: Greg White.

See the whole TV NZ Close Up documentary here >>>

2009-02-08T15:09:00.001+13:00
Business week: A Guide to Self-Employment
Advice for recently laid-off workers considering going into business for themselves.
http://ping.fm/Sui4e

Very nice read for those that are at the brink of going for it themselves.

Work From Home Scams

2009-02-08T00:35:00.001+13:00

Today stumbled upon this feed from the FBI's Internet Crime Complaints Centre about working from home scams. I can but say that it was to be expected that such activities will be on the rise with many people stressed out over money and jobs. Perceived pressures are high which often leads to guards being down.

Intelligence Note

Prepared by the Internet Crime
Complaint Center (IC3)

February 3, 2009

Work-At-Home Scams

Consumers need to be vigilant when seeking employment on-line.
The IC3 continues to receive numerous complaints from individuals who have fallen victim to work-at-home scams.

Victims are often hired to "process payments", "transfer funds" or "reship products."

These job scams involve the victims receiving and cashing fraudulent checks, transferring illegally obtained funds for the criminals, or receiving stolen merchandise and shipping it to the criminals.

Other victims sign up to be a "mystery shopper", receiving fraudulent checks with instructions to cash the checks and wire the funds to "test" a company's services. Victims are told they will be compensated with a portion of the merchandise or funds.

Work-at-home schemes attract otherwise innocent individuals, causing them to become part of criminal schemes without realizing they are engaging in illegal behavior.

Job scams often provide criminals the opportunity to commit identity theft when victims provide their personal information, sometimes even bank account information to their potential "employer." The criminal/employer can then use the victim's information to open credit cards, post on-line auctions, register Web sites, etc., in the victim's
name to commit additional crimes.

If you have been a victim of Internet crime, please file a complaint at www.IC3.gov.

=============================================================================

To illustrate here is one offer I received today from Abril

From: abrilagent@excite.fr

Subject: job offer

Abril/SalonQuip Company Supplying the beauty, nail and spa industries
with furniture, equipment, waxing products, salon disposables, eyelash
tinting and perming,and many other beauty and nail salon products for
more than 20 years. We are currently seeking for Two Regional Sales
Manager, Two Proof Reader and one Online Communications Officer. You
can can work directly from your computer at home and spend more time
with your family.

You should be:

- Of excellent computer skills and manner with computer skills.

- No prior experience required

- Good working relationship with new people is an asset

- Good and convincing with people especially on the phone

- Able to use your initiative and act independently

- Working as a 'Proof Reader' with knowlegde to Editing and Correcting English Errors

Your job:

- must understand English language

- Responsible for our client services and must be above 18 years old

- Creating and managing various customer accounts as well as their follow-up

- Organizing local marketing studies and you will be directly responsible for Sales Consultants

- (Proof Reader) Job description involves correcting customer service
message errors all with good Spelling, Punctuation and Presentation

We offer:

- A creative and varied job with a highly motivated team

- Earnings up to $ 45â€™000 monthly + high commission weekly

- A personal HP inspiron 2008 edition laptop.

- Participation in the creation of an international network

- Quick career progression.

- Salary : Starting from $13,000 - $40,000.00 Monthly (NEG) with a Weekly payment of $250.00.

To apply, e-mail your resume to forex1work@hotmail.com or contact us via email for more information.

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

And here's another example, clearly set up to get someone's hands on your private details.

From: staffing.tunnelfurniture@gmail.com
Subject: Account Receivable and Payable Clerk Needed (Job Offer)
Reply to: paul.staffing@live.com
Dear Sir/Ma, Would you like to work online from Home/Temporarily and get paid weekly? We are glad to offer you for a job position at our company, The Tunnel Furniture Company, we need someone to work for the company as a Representative/Bookkeeper in the USA. This is in view of our not having an office presently in the USA. You don't need to have an Office and this certainly wont disturb any form of work you have going at the moment. Our integrated Interior and furnitures manufacturing operations use state-of-the-art equipment from the world's leading suppliers. Order processing, production monitoring and process flow are seamlessly integrated through a company-wide computer network. * The average monthly income is about 4000.00 USD. * No form of investments from you. * This job takes only 1-3 hours per day About the job: We have sales representatives all over the world to distribute our products. You know, that it's not easy to start a business in a new market (being the US). There are hundreds of competitors, close direct contacts between suppliers and customers and other difficulties, which impede our sales promotion. We have decided to deliver the products upfront, it's very risky but it should push up sales on 25 percent. Thus we need to get payments for our products as soon as it possible. Unfortunately we are unable to open Bank Accounts in the United US without first registering the company name. Presently with the amount of Orders we have, we cannot put them on hold. For fear of loosing the customers out rightly. Secondly we cannot cash these payments from the US soon enough, as international Checks take about 14 working days for cash to be made Available. We lose about 75,000 USD of net income each month because we Have money Transfer delays* your task is to coordinate payments from customers and Help us with the payment process. You are not involved in any sales. Our Sales Representative makes direct contact for sales of products. Once orders are received and sorted we deliver the product to a customer (usually through FEDEX). The customer receives and checks the products. After this has been done The customer has to pay for the products. About 90 percent of our customers prefer to pay through Certified Checks and Money orders based on the amount involved. Your Task We have decided to open this new job position for solving this problem. Your tasks are; 1. Receive payment from Customers 2. Cash Payment at your Bank 3. Deduct 10% which will be your percentage/pay on Payment processed 4. Forward balance after deduction of percentage/pay to any of the offices you will be contacted to send payment to. Local Money transfers take barely hours, so it will give us a possibility to get customer's payment almost immediately. For example you've got 3000.00USD You take your income: 300.00 USD Send to us: 2700.00 USD First month you will have 15-20 transactions on 3000.00-4000.00 USD so you may calculate your income. For example 10 transactions on 3500.00 USD gives you 3500.00 USD Plus your basis monthly salary is 1000.00 USD Total: 4500.00 USD per month After establishing a close co-operation with us you'll be able to operate with larger orders and you'll be able to earn more. Our payments will be issued out in your name and you can have them cashed in your bank or other Cashing Services. Deduct your weekly salary and forward the balance to the company via western union money transfer.We understand it is an unusual and incredible job position. This job takes only 3-7 hours per week. You'll have a lot of free time doing another job, you'll get good income and regular job. IS THIS LEGAL? Yes it is. As a matter of fact, our legal department checked all legal provisions to ensure if there is any domestic or international law against businesses or deals in this manner and also money laundry acts, also it complies with USA Patriot Act Section 314(b) But this job is very challenging and you should understand it. We are looking only for the worker who satisfies our requirements, a diligent worker, very consistent and will be an earnest assistant. We are glad to Offer this job position to you. If you feel that you are a serious and earnest worker and you want to work forThe Tunnel Furniture Company, Get back to us with information below information, so that we can add your mailing address to our Regional database and forward it to our customers for them to send payments. First name:- Middle name:- Last name:- Address Line 1:- Address Line 2:- City:- State:- Zip/Postal code:- Sex:- Age:- Marital Status:- Nationality:- Home phone:- Cell phone:- Current Occupation:- YOU'RE PREFFERED MODE OF COMMUNICATION EITHER BY PHONE OR BY EMAIL Your response to this email is needed, so that we can reconfirm your mailing address details we have in our database. We will be updating you as soon as the payment is being sent to you and you will be directed as to where to have the remaining 90% of the money sent to, after the deduction of your 10% pay on any payments received and processed by you. A swift acknowledgment of the receipt of this email will be appreciated. Thanks For Your Total Understanding. Paul Tunnel The Tunnel Furniture Company 46 Tunnel Road, Liverpool L7 6NG Tel: + 44 703 196 7899 Fax: + 44 151 709 1035 Email: paul.staffing@live.com NOTE******* Interested applicants should ensure response is forwarded to the email below: paul.staffing@live.com ---------------------------------------------------------------------------------------------------------------------------- Work from home scams are often dine using spam email, advertisements in the newspaper or on notice boards. The internet is extra atractive because ot is relatively easy to treach a large number of people with relative little effort. Many of them are no real job offers but actually fronts for money laundering scams, advance fee scams and pyramid schemes. They come in different shapes such as an offer to receive money for a foreign company and in reward you are offered a percentage as commission to be taken of the received payment before you pass it on. In effect you could be participating or seen as instrumental in money laundering activities which are illegal. As the second example appears to illustrate, some of these job offers are nothing more than an attempt to get to your private details that can subsequently be used for identity frauds.Sometimes it is a fishing expedition for your bank account details in order to clean out your account. Another large number of these jobs require you to do something like stuffing envelopes or promotions or fill out paid surveys or to type copy or advertisements. You buy yourself a starter package or pay a fee to access the site through which you need to do the work and after that you either receive nothing at all or find yourself always too late for the 'juicy' surveys and advertisement jobs. Additionally you may even receive instructions to recruit others to join this opportunity. And finally you could end up in a work from home assembly job: you purchase the materials from your emploter and than when you hand in your assembled products the employer claims that the quality is not good enough to warrant payment. Some of the warning signs: 
the job offer comes as unsolicited mail (be aware that some of these mails try to look as if you had made enquiries before to which they are responding)
high rewards for little effort (using your home computer and internet connection)
guaranteed succes
a fee to be paid upfront
all the job entails is the receipt and transfer of sums of money
the email contains spelling errors and dubious or odd use of the English language
use of free email services such as @gmail.com, @yahoo. etc, @msn.com, @hotmail.com and @live.com

Due Diligence
If the job entails nothing more than receiving and transferring money, would suggest you really think twice before you get involved as money laundering is a criminal offense that could very well attract attention from the police.

Try to finds out i the company that is offering your the job is well known and reputable. A ring to the appropriate authorities such as the Commerce Commission here in New Zealand or the relevant fair tradng organization in your country never hurts. Make sure you check whether there are any restrictions or licensing or other constraints in relation to this product or service and if there is actually a market for what you may need to sell.

Consider whether or not the upfront costs are reasonable and remember that many small amounts amount to a big one in the end, and in large part that is what these scam artists count on: the law of the big numbers.

Do not ever jump into something before having asked for an offer in writing and perhaps consider never to pay anything upfront other than upon receipt of the starter kid so you can consider returning it. If the job is legitimate there is no issue on with being provided additional information and advice before you sign any contract. At all times it is recommended to seek professional advice before signing or investing anything. Ensure that there is a buy back policy or maney back guarantee.

Always ask for references and make sure they are verifiable and go through the trouble of speaking to these people.

Go to the various sites where people can lodge complaints, such as rip-off report or the complaints board and do a good check on work from hime scams. Beware of sites that ask questions like "Is this or that opportunity a scam or not?" More than once they are sites to promote the work from home scheme, similar to pyramid schemes.

And if it is already too late: REPORT THE SCAM INVOLVED WITH YOUR LOCAL POLICE, AND SPREAD THE WORD, to family, friend, colleagues, community centres, or on the net.

2009-02-07T16:41:00.001+13:00
Digital Pirates Winning Battle With Studios
http://ping.fm/EdF8L

2009-02-07T16:36:00.001+13:00
Teen accused of sex assaults in Facebook scam
http://ping.fm/8PG4f

When was the last time you sat down to discuss internet safety with your child.

2009-02-07T16:26:00.001+13:00
Late Payments on Credit Cards Reach Record Levels
http://ping.fm/Hn7jA

2009-02-07T16:14:00.001+13:00
Teen accused of sex assaults in Facebook scam
http://ping.fm/8PG4f

2009-02-07T16:11:00.001+13:00
Phishing scam aims to hoodwink hotel habitants
http://ping.fm/ixCxV

2009-02-07T16:08:00.001+13:00
Privacy fears over Google Latitude
http://ping.fm/kj4Xv

2009-02-07T16:02:00.001+13:00
Fraud Cases in Britain Peek http://ping.fm/83H8o compliments Neal Lachman http://ping.fm/2rN2S

2009-02-07T02:26:00.001+13:00
Man Sues for Refund After Buying Out Madoff Account From Ex-Wife
http://ping.fm/W7ZSL

2009-02-07T02:24:00.001+13:00
At Madoff Hearing, Lawmakers Lay Into S.E.C.
http://ping.fm/JHvRl

New Securities Law for Investment Advisers and Market Participants

2009-02-06T00:42:00.001+13:00

On the phone today with someone it transpired that apparently not everyone doing investment stuff, is aware of the changes in the law that came into force last year. I guess some investment adviser is going to get some hard questions. To ensure that our NZ readers are aware, I published the landing page of the New Securities Law website below.
A website is set up by the Securities Commission to explain the changes to securities law that came into force on 29
February 2008 (http://www.newsecuritieslaw.govt.nz/). The changes were made when Parliament passed the Securities
Legislation Bill in October 2006. The accompanying regulations were approved by Cabinet on 3 December and announced by the Minister of Commerce that day.This website explains changes to the Securities Act 1978 and the Securities Markets Act 1988.
If you are a securities market participant or adviser to participants you need to know about changes relating to insider trading and substantial security holder disclosure, and new law on market manipulation.If you are an investment adviser, financial planner, broker, lawyeror accountant who gives investment advice to members of the public youneed to comply with new law relating to investment adviser disclosure.The Commission has been given new powers to enforce the new law.

A guide to the new law can be downloaded here.
Hard copies are also available. Register here to order a free copy.

2009-02-05T22:16:00.001+13:00
Italian YouTube privacy trial postponed until 18 February http://ping.fm/sh3VY

2009-02-05T21:04:00.003+13:00
Beware of Lawyers Bearing Foreign Clients
http://ping.fm/3ODac
E-mail scams targeting lawyers begin with 'attorney' asking for out-of-area help

2009-02-05T21:04:00.001+13:00
Lawyer Falls Prey to Pricey Internet Scam
http://ping.fm/XGtCk

2009-02-05T20:52:00.001+13:00
MySpace: 90,000 sex offenders removed from site
http://ping.fm/c6CTs

2009-02-05T18:37:00.001+13:00
Lunch Box Police thwarted! http://ping.fm/HOcoI (an implicit layoff?)

2009-02-05T17:11:00.001+13:00
City to Question Bus Companies in Fraud Case
http://ping.fm/S2WyR
The city’s Education Department plans to review whether nine school bus companies that transport a fifth of the New York City’s public school students are fit to do business with the city after allegations that they paid bribes to department inspectors, in some cases to allow overbilling of the department.

2009-02-05T17:07:00.001+13:00
Goldman Sachs lifts gold price forecast to $1,000/oz
http://ping.fm/YwjVW

2009-02-04T15:14:00.001+13:00
Suit Alleges Internet Espionage
Morningstar Accused by a Rival of Gaining Unauthorized Access to Its Computers
http://ping.fm/iNpEY

2009-02-04T15:11:00.001+13:00
Google Executives Face Jail Time for Italian Video

http://ping.fm/qkO7L

Four executives of Google begin trial Tuesday in Milan on criminal charges of defamation and privacy violation in regard to a video posted on Google’s Italian site.

The case involves a three-minute cellphone video, posted in 2006 to Google Video, in which four youths in Turin tease a boy with Down syndrome. After an Italian advocacy group complained that the video was objectionable, Google quickly removed it from the site. Prosecutors argue that the video should not have been published at all.

2009-02-04T15:08:00.001+13:00
SEC charges adviser with fraud linked to bailout

http://ping.fm/kLKsw
By MARCY GORDON

WASHINGTON (AP) — Federal regulators on Wednesday charged an investment adviser with securities fraud, saying he bilked clients of at least $6.5 million in the first scheme using the government's $700 billion financial bailout program as a front to lure investments.

The Securities and Exchange Commission won a court order freezing the assets of Gordon Grigg of Nashville and his firm, ProTrust Management Inc.

Grigg and ProTrust consented to a temporary restraining order, the asset freeze and an accounting of all funds raised, the SEC said. The agency is seeking unspecified restitution and fines against them; a hearing has been scheduled for Feb. 6.

2009-02-04T15:05:00.001+13:00
http://ping.fm/HqMFG

Local Police Want Right to Jam Wireless Signals
People use their cameras and cellphones to photograph the inaugural parade review stand on Pennsylvania Avenue before Inauguration Day.

It is an increasingly common technology, with federal agencies expanding its use as state and local agencies are pushing for permission to do the same. Police and others say it could stop terrorists from coordinating during an attack, prevent suspects from erasing evidence on wireless devices, simplify arrests and keep inmates from using contraband phones.

But jamming remains strictly illegal for state and local agencies.

Denver Police Turns Down Evidence of Identity Theft

2009-02-04T13:21:00.001+13:00

Brandon Michael, bought the contents of a storage unit in Denver expecting to find the usual: items he could sell online.

When he opened the door to the storage unit he stumbled upon something completely unexpected: boxes, cabinets and garbage bags filled with passports, birth certificates, driver's licenses of patients that had been admitted to the emergency unit, drugs, pills, SSN cards, a special printer to use fake or counterfeit documents such as cheques and ID's.

Shocked about what he found he packed it all up and drive straight to the Police who wasn't interested and advised him the throw it all in the trash. Brandon decided to deliver it all to the 9 News who quickly located the party responsible for the contents of that storage unit Paul Simmons (oral transcription). In all fairness, why this made the news is because it was delivered to the news after a police officer turned it down. It may have been a simple mistake or judgment error. The Denver Police Department participates
in events at least twice a year that teach people how to protect their
personal information. Police cadets also volunteer time to help
residents shred documents that don't belong in the trash. When 9News contacted the police, Denver police
asked the station hand in the evidence in the storage unit so that
it could begin a criminal investigation. 9News complied.

A hospital employee was quickly identified that had accessed medical records at St. Anthony, when they investigated the findings. When confronted the employee confessed and was fired. She had worked there for five years and passed a criminal-background check and compliance tests, according to St. Anthony.
You could now wonder whether that was because she may have used a false identity of course.

Victims were flabbergasted seeing their own drivers license with someone else picture on it, forged cheques. With the available information,, an identity thieve could actualy make out cheques to himself or better yet one of his other forged identities, obtain titles, even start companies, and clean out bank accounts as one victim found out. And as for Paul Simmons, he appeared to have been careful in which identities to use as indications were found that he checked or had checked the identies of victims, only to use the one with a clean record and good credit.

Keep in mind that there are identity there that do not make mistakes such as Paul!

Check out the video below and read the Denver Post coverage here.

El Cheapo Fraud Prevention Tip: Stay Involved

2009-02-03T19:17:00.001+13:00

Here you are, business and heavily involved in operations, sales and marketing of your business, you make long hours. Once you get home you are still not finished, cause there is the financial administration of the business that need to be done. At one point or another many business small business owners either start looking at hiring an office manager or hires a bookkeeper. Since you have plenty to do on your own plate and you really need to start thinking about work - life balance, you go for what could be described as a hands off approach.

This is all still fine as long as you don't completely leave the financial responsibility of your business in the hands of that office manager, accounts manager or bookkeeper. That is a what you could call a recipe for disaster.

As the owner of the business you need to stay involved in overseeing and supervising the finances. This is your money we are talking about so make sure you are aware of what is happening with it. So, open your bank statements yourself and review them regularly so you know what is coming in and going out. I suggest even to have them sent to your home.

Review expenditures and assure yourself that the right vendors are being paid for services and goods you actually purchased, assure yourself that the details of these vendors are correct, including bank accounts. I have had several occasions where vendors were identified that the owner was not aware of and turned out to be a ghost-account set up or by or under control of the person responsible for the finances, who used the account, sometimes even accompanied with fake invoices and purchase orders. Review expenditures and where you have people out on the road, expense reports and most of all ask questions where you can't . By doing so you are also sending out a message that you are supervising the financial responsibilities and that that you are keeping an eye on what is happening in your business. If possible in all the operations, personally sign off all payments.

I have seen too many occasions where hands off led to cleaned out. Don't let it happen to you!