Articles

It's A Scam: Boarding The 419 Or The Spanish Prisoner Reborn

By Emeric J. Dwyer

The e-mails are ubiquitous: A poorly worded plea for help from a foreign national trapped by a terrible situation, in possession of vast sums of money which they will gladly share with you if only you can lend them a smaller sum to allow them to escape. A Nigerian Princess and her evil uncle is the most common theme, designed to appeal to those who think Disney movies are real.

If you've seen such an e-mail, you've seen the first step of an Advance-Fee Fraud. These scams are as varied as the people who practice them. But they all have one thing in common: At some point, the scammer needs you to pay them money before you have your payout in your account. The basic scheme, a plea from a Nigerian princess, is so well known it's been lampooned in popular culture, including in the popular NBC show "The Office."

The scheme is a centuries-old confidence game. Around the time of the 1700s, swindlers and schemers would visit nobles and gentry and tell the story of an ailing man held in a Spanish prison. The con artist, holding himself out as a loyal servant, agent or attorney, would plead with the gentry to aid in funding his release through a bail or bond payment. Upon obtaining release, they promised, a vast treasure would be used to reimburse and reward the payor. Of course, when a payment was made, the swindler would disappear into the night and the nobleman would be left waiting for "the Spanish Prisoner."

As occurred in "The Office", many of these schemes target the unsophisticated, unaware or willfully ignorant. In that show the office manager (Steve Carell's bumbling Michael) gleefully invests money into an e-mail promise for great returns, ignorant to the cries of his coworkers that it is a scam. While it's hard to imagine who might not recognize such a scam, many have fallen for them.

In recent years, however, the schemes have become far more complex. While some scammers are content to troll via e-mail, others have concocted elaborate internet hoaxes hoping to drag in the unwary. Many of these scammers target attorneys directly, and in doing so have sent us some

We thought we might share a few of the better attempts at scams that have come through our firm:

• Many scammers are foreign, which they use as cover to help deflect questions about their unusual methods. This e-mail was received from a person purportedly from Denmark: "We are urgently in need of the services of a contract attorney. Advise as to the availability of your firm to represent us as requested. Your prompt response will be most appreciated." It came replete with contact information and a website, which was operational and described the nature of the business. A cursory Google search showed the company to have a presence; however none of the listed employees of the company appear to exist. The scammers hoped that our firm would take the existence of the company as enough. They would then concoct some contract claim, proffer a phony check for payment, ask us to take our fees from the check and pay the remainder out of firm accounts to them before the phony check could be cleared.
• Another fell along the same lines: A Chinese company claimed to have a contract dispute with a local company. They were contacted by telephone to confirm the details of the arrangement. When told that we could represent them pursuant to normal terms, the "local company" immediately proffered payment (with a very phony check). Again, the hope was that our firm would make immediate payment before the phony check cleared, leaving us holding the bill. Of course, when contacted directly the local company knew nothing of the occurrence - how could they?

All of these are variations on the advance fee fraud scheme - money appears to be on our account by way of check. The scammers hope we then wire money to them (their share of the judgment) which they can disappear with before the fraud is detected by the bank, and our firm is left with the bill.

Bankers and Lawyers have been the first targets of advance fee scammers. It is only a matter of time, of course, before other professions are sought by scammers as well. Sophisticated scammers can appear very legitimate, offering websites, telephone offices, carefully constructed paperwork, and references on request. The nature of real estate, medical services, and online retail make them equally tempting targets for scammers.

Below are some basic tips that are highly recommended to help protect yourself from scammers. Remember - even sharp professionals have fallen for these schemes, so don't always expect to recognize a scam right away. Think about all those who gave money to Bernie Madoff and Tom Petters, who only after the fact learned they had lost their savings.

• The basic rule is an old one: If a deal is too good to be true, it is. Anyone promising vast and immediate rates of returns for a small up front fee is probably trying to rob you.
• Never move too quickly. Scammers often create a sense of urgency to prevent the victim from verifying their information. As with the examples with our firm, the clients would demand payment immediately even though the money had not yet cleared. Always wait for the financial institutions involved to confirm the actual existence of the money.
• Do your research. Does the company or person you are working with exist? Do they appear on a web search? How many times? Do they have a Linked-In and/or Facebook profile? Does this person exist, and is that the person you are dealing with?
• Do not use wire transfers or cashier's checks unless you are absolutely sure that the party you are working with is legitimate. These types of transfers are very difficult to trace and, once dispersed, impossible to recover.
• As always, consult a lawyer on business arrangements and contract agreements. Transactions, especially those involving large sums of money, should be made in accordance with the law or else you open yourself up to greater liability regardless of whether it is a scam.

Emeric J. Dwyer is an associate with Mansfield Tanick & Cohen, practicing in the areas of commercial, real estate and employment litigation. He can be reached at 800-401-6194 or via email at edwyer@mansfieldtanick.com.