Fakes, frauds and scams

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2010-03-10T22:20:00.001Z

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LIFELOCK unbolted

2010-03-10T21:39:00.004Z

US company Lifelock which capitalised on people's fears about identity theft have been branded a scam by the Federal Trade Commission and ordered to pay back $12 million back to its customers. The company promised to protect clients from fraudsters by placing alerts with financial companies. The best bit was CEO Todd Davis use of his social security number in advertising campaigns to prove his confidence in the service. It turns out someone used it to take out a $500 loan in his name in 2007. Read the story here on Wired. I suppose it's another version of the investigator who offers to get your cash back from a 419er for a fee.

SMALL'S Big House

2010-03-05T15:39:00.003Z

This is a bit late, but just in case you haven't seen this report it's worth checking out the house a fraudster built. Builders' merchant Gerard Small from Tyrone, Northern Ireland, defrauded revenue of st£4.5 million in unpaid tax and false claims for family credits. He preferred to splash it all on his ornate house. He even held an open-day so neighbours could come in and gawk. Have a look at the pictures here on the BBC.

SLOW burn Bernie

2010-03-03T10:16:00.004Z

I've moaned about how slow things are to move against Irish fraudsters when compared to how quick the US authorities moved against Bernie Madoff. His sons blew the whistle in October 2008 and by March 2009 he was serving a life sentence. There's nothing like the immediate threat of jail to uncover any hidden stashes of money. But it seems the US financial watchdogs have not covered themselves in glory. Self-confessed 'Greek geek' Harry Markopolos has written No One Would Listen about his ten year battle to expose Madoff as a fraud. He was pointing the finger long before Madoff was forced to admit he was a conman. Check out this very interesting extract here.

AIB and fraud

2010-03-02T14:48:00.004Z

Two men have now been charged with one of the UK's biggest property frauds which saw Allied Irish Banks lose st£56 million. Achilleas Kollakis persuaded the bankers he was a big player in the property market. He got loans thanks to having blue-chip tenants for various properties (such as UK government agencies.) The claims were fake or exaggerated. Read the press release from the Serious Fraud Office here and follow the links through a previous post for more information on Kollakis' colourful life.

EASY money

2010-02-25T15:15:00.004Z

There was an interesting case in today's Dublin Circuit Criminal Court where a guy showed how easy it can be to steal money from a bank. The only drawback for Limerick man, Pat Sheedy (40), of Cliona Park, Moyross, was that he got caught. In 2007 he set up a bank account in Dublin to enable the fictitious transfer of cash from his non-existent company in the UK and then used an overdraft to gamble away over €10,000 of the bank's money. He used his real passport and a reference from his real employer to set up the sting. Sheedy, who has 25 previous convictions is now awaiting sentence.

BOGUS smokes

2010-02-23T16:43:00.004Z

Irish Revenue today seized a big consignment of smuggled cigarettes which they 'conservatively' estimate to amount to 28 million cigarettes. While the Regal brand seized are the real thing, part of the cargo includes counterfeit Superkings. Read about it here on RTE. A billion cigarettes are smuggled into Ireland every year of which the tobacco industry estimate a third of which are counterfeit cigarettes rolled and packaged in black market factories. Read the previous posts on Ireland's black market tobacco trade here.

BOILER rooms

2010-02-19T16:50:00.003Z

Financial graduates and junior bankers looking for work have been warned about signing up to work for bogus brokerages. Better known as 'boiler-rooms' the scam involves talking people into buying worthless stock. Sometimes the shares don't even exist or are propped up by the fraudsters trading shares with eachother in a practice known as 'pump and dump.' The Serious Fraud Office in London warned graduates that the moment they suspect their employers are crooks they have to report it to the authorities. If they ignore their suspicions and continue working then they become part of the scam. Sales people can earn thousands of euros for one successful deal so the temptation is there. The con-artists will also be looking to recruit website specialists and IT experts to support their operations. The advice is to make sure the recruiting company is legitimate before signing up. Check out my previous post on Paul Robert Gunter.

419 scams

2010-02-17T21:50:00.005Z

The 419ers (so-called after the section of the Nigerian constitution outlawing fraud) are a democratic bunch when it comes to scamming victims. Last week in the UK, it emerged during a court case how an eye-surgeon was blind-sided by a 419er. Chinaenye Mokelu (44) sent a spam email to the UK seeking help to transfer his $300 million fortune to Britain. Needless to say, the cash didn't exist and Mokelu duped a consultant doctor into sending him st£352,000. He turned up in London at one point to show his hapless victim a suitcase of fake cash. Mokelu got five-years at Basildon Crown Court for his crimes. Read the court report here.

COUNTERFEIT drugs

2010-02-16T10:59:00.005Z

Pfizer have done their best to scare the hell out of everyone with a press release on counterfeit drugs today, read it here. In fairness counterfeit drugs are a huge problem, especially in the developing world. Arguably, the big pharmaceutical companies could do a lot more by allowing generic versions be sold cheaper to poorer communities. In the latest Pfizer release the demand for prescription 'lifestyle' drugs, such as Viagra, has helped to fuel the counterfeit trade. Presumably this is the same demand they helped to create. In the past Ireland has had consignments of fake toothpaste and condoms ending up on the market. Anyway, don't buy drugs off the internet, 90 per cent of which are fake, according to the World Health Organisation. Check out Pfizer's ad on counterfeit drugs here and read my previous posts on counterfeit medicine.

CARD attack attacked

2010-02-12T23:11:00.002Z

The banking industry has hit back quickly against claims that chip and PIN cards are vulnerable to fraud. Click here for the Press Association story on the issue.

CARD attack

2010-02-12T10:21:00.003Z

The banking industry's confidence about chip and PIN cards looks set to take a battering. It has been demonstrated by researchers at the University of Cambridge how a stolen card can be used in retail outlets and online. The problem for customers is that it comes up as a PIN verified transaction and banks are refusing to refund customers for what appears to have been a legitimate transaction. The cards can't be used by criminals at an ATM or once it has been reported stolen and cancelled. Read more about it here.

Johnny Bottles

2010-02-06T21:20:00.009Z

This goes some way to explaining how the Rathkeale travellers can afford €185,000 cars. Johnny 'Bottles' Sheridan heads up up just one of about 20 crews doing tarmacadam scams all over Europe. The sales pitch starts with: "..we are working on a big motorway project and have some tarmacadam left over that's going to be dumped, but we can use it to surface your driveway for free..."

Read the full story in the Sunday World. If you have any problems playing the clip, it is also available on the Sunday World home page.

CARBON crooks

2010-02-04T10:03:00.004Z

Not only are the carousel VAT fraudsters targeting carbon emission credits - so are computer hackers. Emission credits have been stolen and sold to companies who thought it was a legitimate transaction. Read the story here. The latest attack on the emissions-trading market comes after it emerged that up to 90 per cent of the trading could actually be fraudulent. See the Green Fraud post from 5 January.

Fraud and Midweek

2010-01-28T21:22:00.003Z

Last night I got another chance to go on about fakes, frauds and scams, this time on TV3's Midweek with Colette Fitzpatrick. If you missed it or want to watch it again click here for the TV3 catch-up. Una Dillon from the Irish Payment Services Organisation (IPSO) was also on the show talking about how ATM and credit card skimming works. And then there was the shameless plugs again...

FAKE illness

2010-01-26T17:45:00.006Z

This is another story from the "You Couldn't Make it Up" department. Lisa Hayden-Johnson was jailed for three years last week for pretending her son had a range of serious illnesses. She spent welfare benefits, grants and donations from well-wishers thanks to her son's diabetes, cerebral palsy, cystic fibrosis, a neurological condition, a metabolic disorder, food allergies and an intolerance to sunlight. Neighbours got suspicious when they spotted the teenager playing football in the back garden and eating an ice-cream. Read the full story here. If it wasn't so serious it would be funny.

MORE mortgage fraud

2010-01-21T10:03:00.005Z

Last year banking officials told the Dail Accounts Committee that they were pretty much on top of mortgage fraud and the use of false documents and declarations to get loans. Their optimism was quite surprising. This week yet another Irish solicitor has been struck off over making false loan applications. Mary Miley from County Wicklow got loans worth €1.25 million using her maiden name and fake documents. The Law Society has struck her off and she could now face a criminal prosecution.
In Belfast a welfare fraudster Frances McCluskey used her cash to build up a property empire, borrowing £4 million using fake documents. The Serious and Organised Crime Agency got a High Court order yesterday to seize 41 properties in Belfast and Spain along with paintings and cash held in bank accounts. Both cases highlight how easy it has been to use fake identities and documents to acquire mortgages. No doubt there's more to come.

REAL fakes

2010-01-18T21:54:00.005Z

Sometimes the fakes are the real thing, but are being passed off as something else. Pictured are euro, turkish lira and thai baht coins. If you ain't quick you might just get one or two of these in your change. I got these from a newsagent I know (with his co-operation). Apologies for the bad photography, but for the record the top coin is a two euro piece while the lira is bottom left and the baht is on the right.

CARD sharks

2010-01-15T17:18:00.005Z

It's looks like we were right to be paranoid about credit card fraud. A court case in London has laid bare the extent of the black market in stolen personal data. A secret website, DarkMarket, was uncovered when one of it's organisers, Renukanth Subramaniam (pictured), was stung by an undercover FBI agent. Strictly invitation only, users of the website from all over the world, sold and swapped stolen personal details that allowed them to carry out huge frauds. One buyer spent st£250,000 in just six weeks for stolen information. The operation to shut down DarkMarket came after the FBI cracked the ShadowCrew site in the US. They think the site was just one of a 100 they know about, but that hundreds more could exist. Read the full story here in The Guardian.

DEAD man's birthday

2010-01-14T15:41:00.005Z

There was a case today in the Dublin Circuit Criminal Court that says it all about welfare fraud. A 65-year-old man Patrick McLoughlin drew his pal's pension for 23 years after his death. From Ballyfermot, Dublin, he admitted to a sample of charges of forging pension vouchers from 1984 until 2007. The fraud was discovered when welfare officials were getting ready to pay out a bonus to mark the man's 100th birthday. When an official called to the dead man's address the new owner said he'd bought the house in 1989, only then did they get a death cert dating from 1984. The case has been adjourned for sentence. It took a while for the bureaucracy to join the dots.

BOGUS Angels

2010-01-13T16:05:00.003Z

A pair of fraudsters wormed their way into an elderly lady's life by faking their religious devotion. Brothers Conor and James Murphy got the woman to hand over cash and cheques worth €400,000 over an 11-month period, leaving her virtually destitute. One of them even claimed to have seen visions of her dead brother. Galway Circuit Court judge, Raymond Groarke, said it was one of the meanest and most miserable crimes he had ever come across. Read the story here.

POINTING the finger

2010-01-12T21:59:00.002Z

It seems that people don't like to hear about their neighbours ripping off the welfare system anymore. The Department of Social Welfare have reported a record increase in the number of tip-offs from members of the public about suspected welfare fraud up from 1,044 in 2008 to 5,600 in 2009 (Read here).
If only the same civic spirit existed in the banking sector then the currently long, slow and painful process of investigation into Anglo Irish Bank might be going a bit a quicker.
These are some the issues that may be touched on by Transparency International's seminar next Monday in Dublin on the topic of protecting whistleblowers. Speakers include former AIB auditor Eugene McErlean and Bernadette Sullivan a former nurse at the Our Lady of Lourdes Hospital in Drogheda.

RATHKEALE travellers

2010-01-07T10:38:00.005Z

The Rathkeale traveller-traders came home to County Limerick in fine style this Christmas. The tiny village was overwhelmed by the influx of expensive SUVs and luxury cars that made it look like the Old Trafford players' car park. We ran a story in the Sunday World about the cars and how some of the Rathkealers make their money. Read it here.

THE Fraudsters on TV3

2010-01-06T13:22:00.005Z

I got invited to have a chat about fraud on TV3's morning Show with Sybil Mulcahy and Martin King. Watch it here (on the TV3 Catch Up player) and count the shameless plugs...

GREEN fraud

2010-01-05T12:35:00.003Z

IT'S nice to know Europe's professional fraudsters are going green. Carousel VAT fraud is a lucrative sector for professional con-artists. In the simple version of the fraud a string of companies is set up to import and export goods in and out of different EU states. Exploiting the varying VAT rates between member states, the fraudsters use at least one firm in the chain to reclaim VAT on the 'transaction' which later disappears when tax officials start asking questions. It is also known as missing trader fraud. Small, but highly valuable, cargoes of items such as computer chips or gold bars are shipped around the chain of companies to create a series of transactions - hence the name Carousel fraud.

Now thanks, to the EU's Emissions Trading Scheme the fraudsters don't even need that cargo. The scheme was set up in 2008 to combat climate change by allowing firms to trade permitted emissions. But Europol believe that as much as 90 per cent of the market, worth €5 billion, is caused by fraudulent activity. Ouch.

Read the full story here.