Familiarize yourself with con games people play to protect yourself as well as your business

Familiarize yourself with con games people play to protect yourself as well as your business

Telemarketing Fraud/telephone fraud/ mobile phone fraud The telephone has long been used by the criminals to make calls pretending to be a bank investigator, examiner or an employee of a bank or credit card company, now with advances in telephone technology, it is possible for criminals to make fraudulent calls or use Short message services through mobile money transfers such as WorldRemit or Western Union money transfer to lure their prey.

When you send money to people you do not know personally or give personal or financial information to unknown callers, you increase your chances of becoming a victim of telemarketing fraud.   Customers for example, have been defrauded of a lot of money by people who call to inform them that they are winners of an ongoing promotion. The fraudsters are then able to access one’s detail and even withdraw money by asking simple questions about the account holder.

Through the mobile money transfer services, criminals have also found a way of demanding money, especially ransom. Multitudes are also losing millions of dollars when they send money to the wrong people by mistake.   Fraudsters are always devising new ways to con people. Since it is hard for scams to infiltrate the Mobile App system, they opt for non-technical methods , or social engineering, as it is popularly known. This involves tricking unsuspecting people into breaking normal security procedures and finally manipulating them into among other things, revealing their PIN or withdrawing from ATMs remotely.   There are many conspicuous messages which are bound to lure you as potential prey to telephone fraud.

Soft Fraud

Incase you are not aware, social engineers are those who use both social skills (such as psychological manipulations) and engineering tools (such as software or a tech gadget)  to achieve a given objective is to defraud someone of money or important information. Social engineering is as old as hacking. In the early days when emails were first introduced, hackers could get access to target’s email credentials by for example asking one what their secret questions were or just guess the passwords as most people use their spouse’ names. Birthdays, or even pet names as their passwords. These were pure sociological psychological tricks which succeeded and laid the foundation for fraud schemes.   Social Engineering uses aspects of social constructs such as trust, confidence and love in order to get access to someone’s systems so that engineering tools can be implanted. An example would be sending  a loved one a photo  of oneself but the attachment contains hidden code or file for example  key logger or phishing malware for gathering desired information. The last phase would be pure engineering skills where hackers get access to one’s information purely from a remote location by taking advantage of the weaknesses in the information sharing and transmission mechanisms.   Money transfer fraud seems to be following the same paths. The initial phase of mobile money fraud has been purely sociological. Some examples of the sociological methods used include a fraudster sending a text message to an unsuspecting customer with  the message purporting to have originated from the service provider. The sender then calls the victim and asks the victim to send back the money as it was sent to a wrong number. The victim complies thereby ending up losing money in the process.

Advance Fee Schemes

In these types of fraud, you are contracted, usually by telephone, and told you have won a grand prize which is a very large sum of money. To collect the winnings, you must pay the taxes/fees upfront for the money to be sent to you. After a short period, you are contacted again and told there were problems with the winnings and you must send additional money to collect your prize. The prize never comes and you realize you have been scammed. An advance fee scheme occurs when the victim pays money to someone in anticipation of receiving something of greater value such as a loan, contract, investment or gift and then receive little or nothing in return.   The variety of advance fee schemes is limited only by the imagination of the con artists who offer them. They may involve the sale of products or services, the offering of investments, lottery winnings, found money or many other opportunities. Clever con artists will offer to find financing arrangements for their clients who pay a finder’s fee in advance

Employee theft

Employee theft cost business an estimated hundreds of billions of currency each year. Business owners spend a significant amount of time and resources protecting their business from a variety of risks, whether its liability for their products or services or severe weather. Managing employee theft starts with the employees themselves. They have to make theft as difficult as as possible for employees and develop strategies to prevent it from occurring in the first place by instituting stringent financial controls.     The most prevalent frauds perpetrated by company employees are:

Expense reimbursement:

Employees may submit additional expenses that either never occurred or are not related to a specific business event. Employees should require receipts for reimbursable expenses and question those that seem unusual or not related to a specific trip or project. Having an immediate supervisors review expense reports before they are submitted for payment can also help identify questionable expenditures.

Cheque Tampering:

Employees can use a company cheque to pay themselves or reissue older uncashed cheques in their own name and cash them.

Payroll Schemes:

This involves either changing the amount on the employees payroll cheque or creating duplicates of their cheque so it can be cashed more than once. Another manager or the owner should review the cheques before they are issued to look for duplications.

False billing and vendor invoices:

Creating dummy invoices that have to be paid each month.


Organizations that engage in cash transactions are vulnerable to skimming by their employees. Skimming involves theft of cash, generated usually from sales, prior to its entry into the accounting records. Skimming is a relatively common occurrence in professional practices where fees are collected in cash. The cashier responsible for collection might pocket the cash and not enter the transaction into the accounting records or subsequently delete those records after being entered into the system. Instituting proper internal control systems that mandate giving receipts to the customers or installing surveillance equipment can reduce the risk of fraud caused by skimming.

Use of a shell Company:

High-level employees within an organization with authority over disbursements may create shell companies that they control. These shell companies then bill the organization for fictitious goods and services. The perpetrator usually is In a position to approve charges or has authority over personnel who approve payments on behalf of the organization. As the payment is made to the shell company, the perpetrator has effectively stolen funds from the organization.

Ghost Employees:

A common fraudulent scheme involving payroll is for human resources manager or payroll managers to create ghost employees. The ghost employee, while on the payroll of the company collects wages periodically but does not actually work for the company. This could be a fictitious person or a perpetrator’s family member. By means of falsifying personnel and payroll records, a ghost employee is added to the payroll and hence collects monthly wages. The potential loss to the victim organization of a ghost employee scheme could be enormous due to the recurring nature of the theft. After the perpetrator has successfully created a ghost employee in the payroll system, the regular process of issuing paychecks ensures a steady stream of funds to the perpetrator.

Identity theft:

Identity theft occurs when someone assumes your identity to perform a fraud or other criminal act. Criminals can get the information they need to assume your identity from a variety of sources, including by stealing your wallet, riffling through your trash, or by compromising  your credit or bank information. They may approach you in person , by telephone  or on the internet and ask you for the information.

Pyramid Schemes/ Ponzi Schemes/ Endless Chain:

A pyramid scheme is an often illegal, unsustainable business model that lures members via a promise of payments or services for enrolling others into the scheme, rather than supplying any real investment or sale of products or services to the public. Such schemes have existed for at least a century, with variations to hide their true nature. Some multilevel marketing plans have also been classified as pyramid schemes. The victims themselves are induced to recruit further victims through the payment of recruitment commissions. In the recent past we have had quails farming as a get rich quick scheme and DECI Schemes which collapsed with investors funds.   More specifically, pyramid schemes also refereed to as a franchise fraud or chain referral schemes or marketing and investment frauds are where an individual is offered a distributorship or franchise to market a particular product. The real Profit is earned, not by the sale of the product , but by the sale of new distributorships.

Emphasis on selling franchises rather than the product eventually leads to a point where the supply of potential investors is exhausted and the pyramid collapses. At the heart of each pyramid scheme is typically a representation that new participants can recoup their original investments by inducing two or more prospects to make the same investments. Promoters fail to tell prospective participants that this is mathematically impossible for everyone to do so, since some participants drop out, while others recoup their original investments and then drop out.

Ponzi Scheme:

Ponzi scheme pays off old investors with money coming from new investors. in brief, Ponzi and Pyramid schemes may also be characterized by: -Reliance on funds from new investors to pay returns, commissions or bonuses to old investors; -Need for an inexhaustible supply of new investors -Absence of a profitable product or efforts to make profits through productive work.

Pigeon drop or lottery scam

In this type of scam, the suspects work in pairs. One befriends an unsuspecting citizen, the pigeon claiming to have either a large sum of money he just found or the winning lotto ticket. He cannot go to a bank  because he/she is an immigrant or another plausible sounding reason. As the first suspect is talking with the victim, the second suspect approaches and gets involved. One of the suspects will go to the phone and call a lawyer. The suspect returns and says they can keep the money and split it three ways but to get their share, all have to put up some good faith money as well as the second suspect by putting the money into a bag. You are then given the bag to hold while the two suspects go to collect the money. Covertly a switch has been made and you are left holding a bag containing only shredder paper.

Charity Switch

This is a very similar to the pigeon drop, but with a slight variation. You  are approached by one suspect who claims to have recently come from America with a large amount of cash to be delivered to a church, but no one is at the church. The suspect tells you he must leave the country soon and asks you and another person (a second suspect) to deliver the money later. You are asked to put up good faith money to show you are honest. The suspects switch the money and disappear.

Planned Insolvency (Bust Out)

A business fraud where the suspects request credit, via a fraudulent credit application, for small quantities of goods or services. They initially pay as agreed, the credit line and order is subsequently increased with the suspects receiving 30 to 45 days to pay. After receiving a large order, the suspects and their business disappear. Sometimes, the suspects will pay with a bad cheque in order to gain more time to make their escape.

Theft by false Pretenses

A from of theft whereby the possession and title to money or other valuable property is voluntarily transferred from the victim to the suspect who has made a misrepresentation(a lie). The Suspect never had any intention of holding up their end of the bargain. Before you realize their dishonesty they are long gone with your money

Sweetheart swindle

This scam often involves an elderly man who is befriended by a young woman. She convinces him that she truly cares about him and implies a romantic interest. She tells him she needs money for rent, food, furniture, her business or she needs surgery. She may swindle him out of his life savings, often causing him to file for bankruptcy. This is a very common fraud among Gypsy women.

Fortune-telling/psychic fraud

You may be approached at stores, hotels, restaurants, stage, church and so on to go to a psychic reader. The psychic convinces you that you have an evil curse or evil spirits that must be cleansed.  Cleansing is an ongoing process that requires you to pay thousands of dollars in cash, jewelry and vehicles.

Distraction/ Imposter Burglary

A suspect comes to your house claiming to be from a city or county agency such as water or power. He needs to come into your house to check for problems. Once inside the suspect distracts you and steals cash and other valuables.


This is a term used when the identity thieves send out a very official looking E-mail to try and get you to provide them with your personal information. They will try to fool you into thinking your bank has sent the E-mail by placing the banks logo in the message. The email will ask you to verify your personal information. Once the identity thieves have this information they may use it to apply for new credit in your name, or make a withdrawal from your account. Your bank already has this information and will never ask you to verify this information via e-mail. Be very aware of this type of scheme. Do not ever respond to this type of E-mail, and it is not necessary to report this alone as a crime. If you have sustained a loss immediately contact your local police station to report the crime.


A demand for money or other consideration under threat to do bodily harm, to injure property, to accuse of a crime, or to express secrets.


When money, goods, services, information or anything else of value is offered with intent to influence the actions, opinions or decisions of the taker. You may be charged with bribery whether you offer the bribe or accept it.

Computer crime

Where computer hackers steal the information sources contained on computers such as: bank information, credit cards, and propriety information.


Occurs when someone copies or imitates an item without having been authorized to do so and passes the copy off for the genuine or original item. Counterfeiting is most often associated with money however can also be associated with designer clothing, handbags and watches.


When a person who has been entrusted with money or property appropriates it for his or her own use and benefit.


Occurs when one person illegally obtains property from another by actual or threatened force, fear, or violence or under cover of official right.


When a person Passes a false or worthless instrument such as a cheque or counterfeit security with the intent to defraud or injure the recipient

Insider Trading

When a person uses inside, confidential or advance information to trade in shares of publicly held corporations.


Occurs when a person who sells an item pays back a portion of the purchase price to the buyer.


When a person wrongfully takes another person’s money or property with the intent to appropriate, convert or steal it.

Money Laundering

The investments or transfer of money from racketeering, drug transactions or other embezzlement schemes so that it appears that its original source either cannot be traced or is legitimate.


The operation of an illegal business for personal profit.

Tax evasion

When a person commits fraud in filing or paying taxes.

Weights and measures

The act of placing an item for sale at one price yet charging a higher price at the time of sale or short weighing an item when the label reflects a higher weight.  


An actor states that victims money is cursed. In order to remove the curse, the money must be placed into a bag or box that the actor provides. The bag or box is witched. Actor advices victim to perform certain rituals over the money and the curse will be removed. The bag or the box cannot be opened for a period of time. When it is opened, the money is gone.

Police Impersonation

Actor tells victim that his bank is being operated by fraudulent bank officers. Actor instructs victim to take money out of bank and place it into a good bank. After the money is withdrawn. The actor allegedly takes the money to the polices station for safe keeping. The victim never sees the money again.  






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