Serious crime

I have a confession to make. I’ve been lying.

Don’t feel too bad for me, I don’t actually feel that guilty. I’m not going to lose any sleep over it because of who’s been on the receiving end of my lies and fabrications.

A scammer.

And not just the ordinary level of scammer, this one is the real thing. A real, 100%, unadulterated criminal, thief and crook.

A few days ago I received an email from an organization calling itself “The Stellios Foundation”. It went like this:

“Hello, We are Stellios Foundation, engaging in human development and training and developing prospective leaders in the aspect of human development. We send our specialized trainers to different corners of the world to train upcoming human developers. We would be glad to co-operate with you in the aspect of travel arrangement for our team to different parts of the world. Please get back to us on your booking procedures and terms.

Best Regards, Alexander Stellios”

The usual clues were there that this wasn’t genuine. There was the rather poor English in their email and on their web site and the fact that their web site was only created on 23rd April this year, despite them claiming that it was “Copyright 2008”. Also, there was the clue that the person who registered the web site also registered a site for another “Foundation” in February but this has now disappeared. Should I be suspicious that he registered it from Lagos, Nigeria?

However I was curious. What was this one about? How were they planning to steal my money?

Using one of my many fake identities (OK, just a Gmail account with an assumed name) I responded. Within minutes they replied, without seeming to notice that I had replied using an identity different to the one they initially used. They said:

“We are in need of travel arrangements. The most pressing right now is International flight booking for our trainees. Please advise how you can assist with the flight booking.”

I won’t bore you with the dozen emails we exchanged but I do now know what the scam is. It’s credit card fraud and this is how it works.

This fictitious foundation recruits people to act on their behalf in booking flights for their entirely fictitious staff. All I have to do is open the right sort of bank account here, a “merchant’s account” and they can then pay me using a credit card. A stolen credit card. Here’s the clever bit. Let’s say the flights cost $1,500. Just before they tell me to charge the cost of the flights to their credit card they’ll call me and ask me to add additional money on top of the flight cost. They might say it’s to cover spending money for the employees, a hotel bill that will need to be paid in cash or car hire, it could be anything. They’ll tell me just to add it onto the credit card charge, making it $2,000 in total. I won’t mind of course, it’s not my money, I’m taking money from them.

Of course the credit card details are stolen. Sooner or later the bank that issued the card, wherever they are in the world, will notice that it’s been used and will instruct the charge to be reversed. But that could take several days, perhaps even weeks. In that intervening period the scammer will be in touch with me again breaking the bad news that the trip has been cancelled. Whether the tickets have been paid for yet doesn’t matter, that can probably all be reversed and after all, it’s not my money, is it? However what matters to the scammer is that extra amount, the cash we added on top of the flights, the extra $500. He’ll very politely ask for that back. He might even ease my disappointment by telling me that I can keep some of the cost of the flights as compensation. Most importantly he’ll want the $500 sent back to him using some method other than a credit card. He’ll say, apologetically, that although he has a credit card, he can’t receive payments to it. That’s when, you’ve guessed it, they ask for it back using Western Union. That reverse payment of the extra money is what this is all about. I don’t know exactly how much this will be, but if you consider that they’re certainly running many scams concurrently you can imagine how much they’re making, even if they only get a few hundred dollars from each victim. But why would they stop at a few hundred? As far as the victim is concerned he’s got thousands from the credit card payment. The sky’s the limit.

It’s also not particularly expensive to get stolen credit card details. If you have the right contacts online you can buy stolen credit card details for $25, maybe $50 for a high value card. The economics of this are simple. That’s all he needs.

If the scammer’s lucky all of this can happen in the period between the payment appearing in my account and it being reversed by the bank.

Luckily I suspect that most potential victims of this particular fraud are going to find it too difficult and complicated to operate. They won’t be able to open the necessary merchant account necessary to receive the credit card payment, either because their bank will ask too many questions or they only have a personal account, not a company one. The likely target market here is small. But, as I’ve observed before, scammers operate within a free market. The fact that they are trading and are constantly coming up with new ideas to separate us from our money suggests that the basic idea is working. Otherwise they’d get a real job, probably selling second-hand cars.