Have you ever encountered an Internet Fraud? And what exactly is considered Internet Fraud?
Where and how does it occur?
Internet fraud refers to the use of Internet services to present fraudulent solicitations to prospective victims, to conduct fraudulent transactions, or to transmit the proceeds of fraud to financial institutions or to others connected with the scheme.
Internet fraud can occur in chat rooms, email, message boards or on websites. Introduction
Online auctions like Ebay has 147 million number of people registered to use the site at the end of March 2010. They have everything you need. Just type it in the Search bar, and here you go-the item you want with the seller and rating. It is just a click away.
Indeed, the convenience of having the internet and everything within your reach has increase simplicity to life.
It has taken a big integral part in our daily life routine.
There are many types of Internet Fraud
Let us look at some examples :
- Dating fraud
- Money transfer fraud
- Paypal fraud
- Purchase fraud
- Internet marketing and retail fraud
We shall go in depth to Money transfer fraud and Purchase fraud.
Money Transfer Fraud
Money transfer fraud consists of an offer of employment transferring money to a foreign company, supposedly because it costs too much to do it through other methods.
The prospective victim receives an email like these two examples:
Dear Sir/Madam, XXXXXX is a small scale company in XXXXXX. We supply XXXXXXX to clients in some countries. We have reached big sales volume in Europe as a starter, and now we are trying to penetrate the US/Canada market. Quite soon we will open representative offices or authorized sales centers in the US and therefore we are currently looking for people who will assist us in establishing a new distribution network there.The fact that despite the US market is new for us we already have regular clients also speaks for itself. The international money transfer tax for legal entities (companies) in XXXXXX country is 25%, whereas for the individual it is only 7%. There is no sense for us to work this way, while tax for international money transfer made by a private individual is 7%. That's why we need you! We need agents to receive payment for products in money orders, cheque or bank wire transfers) and to resend the money to us via Money Gram or Western Union Money Transfer. This way we will save money because of tax decreasing. JOB DESCRIPTION? 1. Receive payment from Clients 2. Cash Payments 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 (Payments are to be forwarded either by Money Gram or Western Union Money Transfer). HOW MUCH WILL YOU EARN? 10% from each operation! For instance: If you receive 7000 USD via cheques or money orders on our behalf. You will cash the payment and keep $700 (10% from $7000) for yourself! At the beginning your commission will equal 10%, though later it will increase up to 15%! ADVANTAGES: You do not have to go out as you will work as an independent contractor right from your home office. Your job is absolutely legal. You can earn up to $3000–4000 monthly depending on time you will spend for this job.You do not need any capital to start. You can do the Work easily without leaving or affecting your present Job. The employees who make efforts and work hard have a strong possibility to become managers. Anyway our employee never leaves us. MAIN REQUIREMENTS: 18 years or older legally capable responsible ready to work 2–4 hours per week.with PC knowledge e-mail and internet experience (minimal) And please be informed that Everything is absolutely legal. If you are interested in our offer, please reply to the following email address: XXXXXX@XXXXX with your; (1)Your full names: (2) Contact address: (3) Tele/cell numbers: (4) Occupation: (5) Age: (6) Sex: Thanks for your anticipated action. And we hope to hear back from you soon.
Dearest. Reply in My E-mail:(XXXXXXXXXXX@YYYYYYY.ZZZ) I am Miss XXXXXX YYYYYYY. My reason of contacting you is that i need your assistance to receive the sum of (US$10.500.000,00 ) into your account for a profitable investment in your country. I have made all the necessary arraangement for successful transfer of this fund into your account without any problem I will give you full detail on how this process will be done. Itis 100% risk free. thanks.
Miss XXXXXX YYYYYYYY
Reply in My E-mail:(XXXXXXXXXXX@YYYYYYY.ZZZ)
I am sure all of us has seen emails like these. Especially in junk or spam mails.
HOW THEY WORK
The fraudsters then send fake cheques or postal money orders, in the hopes that the victims will cash the fake money instruments and send money to the scammers before the fraud is discovered.
Because the fraudsters are often able to get the victim's personal information, including their bank account number.
These scams often become phishing scams as well, leading to identity fraud.
Next, we will look at Purchase Fraud.
Purchase Fraud
Purchase fraud occurs when a criminal approaches a merchant and proposes a business transaction, and then uses fraudulent means to pay for it, such as a stolen or fake credit card. As a result, merchants do not get paid for the sale. Merchants who accept credit cards may receive a chargeback for the transaction and lose money as a result. They provide reliable information of themselves.
It can also be an online transaction of two parties. Eg selling items.
HOW THEY WORK
This is a real life example of an online transaction fraud.
Real life example which was reported in 24 Oct 2007.
I was involved in this purchase fraud 3 years ago and this is the web I have purchased from.
It looks trustworthy with the bank account details and information.
Even the phone number was given (not shown in the picture)
- Targeted victims were mainly in their teens
- they had ordered goods from the two websites - www.nice-spree.blogspot.com and www.nicespree.blogspot.com and had not received them after payment.
- Once contacted by a buyer, owner would ask the victim to transfer payment to an account. He would also gave his mobile to create a false impression that he was a genuine seller.
- After the money had been transferred, the victim would either e-mail or text-message the owner, who replied that the goods would be delivered in three to four weeks.
- After receiving the money, he would withdraw it to pay for his personal expenses and settle his debts. No deliveries were made despite repeated calls by the victims.
Extract taken from SPF website:
Police have arrested a 28-year-old Chinese man and his 19-year-old girlfriend on suspicion of cheating over 40 online shoppers of almost $10,000.
Between 19 Sep 07 and 18 Oct 07, Police received reports from more than 40 victims who had transferred money to the suspects for goods purchased over the internet from 'nice-spree.blogspot.com and nicespree.blogspot.com'. The goods were not delivered even though money had been transferred. The victims were also unable to contact the suspects.
The suspects were traced and an ambush laid. A computer and a handphone were been seized for investigations from the man's residence at Tampines.
Commander Bedok Police Division, Deputy Assistant Commissioner Lim Kok Thai said, “ Let this be a strong signal to would-be criminals that police take a very serious view of such offences and will go all out to apprehend those that break the law. In addition, Police remind members of public to be cautious when making purchases online."
Police urge anyone who had bought items from the 2 websites and are facing a similar predicament to call the Police hotline at 1800-255 0000.
The suspects will be charged in court on 25 Oct 07 for the offence of Cheating under Sec 420 of the Penal Code, Cap 224. If convicted, both suspects faces a jail term of up to 7 years.
PUBLIC AFFAIRS DEPARTMENT
SINGAPORE POLICE FORCE
24 October 2007 at 5.00pm
Between 19 Sep 07 and 18 Oct 07, Police received reports from more than 40 victims who had transferred money to the suspects for goods purchased over the internet from 'nice-spree.blogspot.com and nicespree.blogspot.com'. The goods were not delivered even though money had been transferred. The victims were also unable to contact the suspects.
The suspects were traced and an ambush laid. A computer and a handphone were been seized for investigations from the man's residence at Tampines.
Commander Bedok Police Division, Deputy Assistant Commissioner Lim Kok Thai said, “ Let this be a strong signal to would-be criminals that police take a very serious view of such offences and will go all out to apprehend those that break the law. In addition, Police remind members of public to be cautious when making purchases online."
Police urge anyone who had bought items from the 2 websites and are facing a similar predicament to call the Police hotline at 1800-255 0000.
The suspects will be charged in court on 25 Oct 07 for the offence of Cheating under Sec 420 of the Penal Code, Cap 224. If convicted, both suspects faces a jail term of up to 7 years.
PUBLIC AFFAIRS DEPARTMENT
SINGAPORE POLICE FORCE
24 October 2007 at 5.00pm
