immediate release - Tuesday, February 11, 2003.
Bob Brammer - 515-281-6699.
Nigeria Counterfeit Check Scam
cashier's checks are deceiving Iowans who sell items on-line. This con-scheme
has new elements that make it an alarming new threat."
Iowa Attorney General Tom Miller warned Iowans to avoid a scheme that
costs victims thousands of dollars when they are duped into wiring money
to con-artists in Nigeria. People selling merchandise on the Internet
receive and deposit a U.S.
bank cashier's check, but days later it turns out to be a very impressive
counterfeit, Miller said.
"This is a new twist,
and it's ripping-off Iowans," Miller said. "We are concerned that it's
much more likely to deceive people than the other Nigeria scams that have
been around for decades."
For a "Consumer Advisory"
bulletin on the scam, see: Nigeria
Counterfeit Check Scam: Warning! Phony Cashier's Checks Cheat On-Line
Miller listed the
hallmarks of the new scheme:
- The victim is selling
a used car or some other item via the Internet. A buyer based in Africa
sends an e-mail message that he wants to buy the item.
- The buyer says
he will pay with a cashier's check from a bank in the U.S.
- At the last minute
the buyer has some story why the cashier's check will be much more than
the asking price - thousands of dollars more. "Just wire the difference
back to me," he explains, "-- after the cashier's check clears, of course."
- The victim thinks
the cashier's check must be good when it's accepted by his or her bank
and the funds are provided - but in a week or so the check turns out
to be counterfeit.
the victim has wired thousands of dollars to Africa, never to be seen
The bank requires
the victim to pay back all the funds provided for the phony check.
"I want to state
in no uncertain terms that victims of this new scheme are not naive and
they are not greedy," Miller said. "They typically are skeptical and careful.
But this is a more perilous scam than the Nigerian e-mails we've all received
for years that promise a one-third cut of $60 million if we will only
provide a U.S. bank account for them to place the money. Yes, it's the
same huge gang of perpetrators, but they're using new tricks," he said.
"Even the most skeptical
consumer can be deceived, and it all comes back to the cashier's check
supposedly from a U.S. bank," Miller said. "First, the checks are superb
facsimiles -- counterfeit, but so authentic that they often fool bank
personnel who study them. Second, people think the cashier's check must
be good when the bank gives them the money - especially if they insist
they are skeptical, as many victims do."
Miller issued the
warning at a news conference at his office in Des Moines. He was joined
by victims of the scheme: Larry Pegg of Des Moines, who lost thousands
of dollars, and Shawn and Jeff Mosch of Bloomington MN, who lost $7200
to the scam - but who are fighting back by warning others and supporting
victims through their own web site, "ScamVictimsUnited." (On the Web,
go to http://www.scamvictimsunited.com/news.htm
Paul Johnson, Resident
Agent-in-Charge for the U.S. Secret Service Iowa/Nebraska office in Omaha,
also participated. The U.S. Secret Service is the lead U.S. agency battling
Nigeria scams. (See their Web site for background: http://www.secretservice.gov/alert419.shtml
.) Johnson led the Secret Service's Nigerian Organized Crime Unit from
1997-99 - and helped open the unit's office in Lagos, Nigeria, in 1998.
Johnson has traveled several times to Nigeria.
"We just pieced this
together, and we consider it an urgent priority to warn consumers," Miller
said. He advised consumers:
- If you are selling
on-line, be extremely skeptical of any e-mail offers from Nigeria or
Africa offering to pay by cashier's check. Reject it -- it's almost
certainly a scam. Don't swallow any story that asks you to wire money
abroad. Remember, a bank may make money "available" to you almost at
once if you deposit a purported bank cashier's check, but that's NOT
a guarantee the check is authentic. It still could be counterfeit, and
the bank will hold you responsible for the money.
- If you are a VICTIM
already of the Nigeria Counterfeit Cashier's Check Scam, contact the
US Secret Service, the lead agency fighting this fraud. Call 202-406-5572,
or write to: US Secret Service, Financial Crimes Division, 950 H Street,
Washington, DC 20001. Send complaints to the Secret Service at
Also notify the Attorney General's Consumer Protection Division (515-281-5926,
Get excellent info
and support at www.scamvictimsunited.com/news.htm/.
- Spread the alert.
Tell friends and associates. Ask buy-and-sell web sites to post warnings
about the danger posed by the Nigeria Counterfeit Check Scam.
Back - Shawn and Jeff Mosch
"We are extremely
grateful to Shawn and Jeff Mosch for helping spread the alert to Iowans
and people all over the nation," Miller said. Late last year the Mosch's
placed an Internet ad to sell a 1961 Buick. They were contacted by "an
African car dealer" who wanted to buy. He said that someone in the U.S.
owed him $8,800 and he would just have the person send a cashier's check
to expedite the purchase. The Mosch's would deduct the $1600 price of
the vehicle and send him the remainder of $7200 via Western Union -- once
the check cleared - so that he could arrange and pay for transporting
The Mosch's thought
it sounded "fishy," thought they'd never see a check anyway, thought a
check would never clear if it did arrive. But the cashier's check did
arrive soon by express mail, and their local bank accepted it and said
it would clear within 24 hours - despite the Mosch's insistent questions.
"I need to know when we can be sure that it is a good check, that it has
cleared, and that it is real money that we can touch and use. I don't
want to get a charge or have this come back and bite us in the butt,"
Shawn said. "They told me, 'Tomorrow afternoon, ma'am. No problems,' "
The Mosch's waited
not one day but two, and then wired the $7200 to a Ben Olawale of Magrove
Transportation in Lagos, Nigeria. Later, when the cashier's check turned
out to be counterfeit, the bank called the Mosch's and told them the check
was counterfeit - and that they owed the bank $8,800. Ultimately, after
much wrangling and the Mosch's insisting that the bank bore much responsibility
for assuring them strongly that the check would clear, the Mosch's and
the bank came to a mutual agreement for an out-of-court settlement to
the situation. (Most other victims tell the Mosch's that banks insist
on consumers replacing the funds deposited to them from Nigerian counterfeit
Miller said: "We
are very impressed and appreciative of what Shawn and Jeff did next: they
set up their very own web site called ScamVictimsUnited to warn others
and support victims. (http://www.scamvictimsunited.com/news.htm
) They've had 12,000 hits in just three months. They've contacted authorities,
urged on-line sales sites to post warnings, consoled and consulted with
victims. And they've done all this just to help others avoid the shock
and harm of big losses, humiliation, isolation, and even suspicion that
they are part of a criminal enterprise. We tip our hats to Shawn and Jeff
and thank them for driving down to Iowa to tell their story."
Click here for photo of Shawn Mosch and Iowa Attorney
General Tom Miller, Feb. 11, 2003.
Back - How we can all help:
Miller said his office
learned about the new elements of this scam - on-line sellers being victimized
by sophisticated counterfeit cashier's checks - a few days ago, and learned
of the Mosch's after that. "We're going to join them in sounding the warning
to Iowans and others," Miller said.
Miller said many
forces already are spreading the word -- including on-line web sites for
selling cars, pure-bred animals, and other items. He said his office will
be asking others to be sure they consider steps to help, if they haven't
already, such as Internet warnings being posted by the Secret Service,
Postal Inspection Service, and Internet Fraud Complaint Center operated
in part by the FBI.
The Iowa Bankers
Association said it is supporting efforts to prevent the scam. Miller
said his office will share warning information and encourage financial
institutions and associations to alert front-line staff to recognize the
situation and take preventive measures - such as explaining that money
being quickly "available" does not mean a check is valid until it has
gone back to the originating bank and been cleared, which can take five
days or sometimes much longer.
Miller said his office
will spread the word to others, including livestock and dog breeders and
associations, online car sales sites and other online sites, local law
enforcement agencies, and other State Attorney General offices.
"We have to stop
the scam on our end, here in Iowa and the U.S.," Miller said. "It's probably
impossible to stop it at the source, in Nigeria and few other countries
where it's spread, so we have to just spread the word and choke it off
Miller said his office
has issued warnings for years about the "Nigeria Letter Scam," but only
discerned the new dynamics of the Counterfeit Check Scam a few days ago.
"We already are putting the pieces together that this is harming Iowans.
Larry Pegg of Des Moines joined Miller at the news conference. Miller
said Pegg probably was one of the earliest victims of the scam - last
summer. Pegg says he took the U.S. bank's cashier's check to a local branch
of the bank and had several officials study it, who said it was good.
He deposited the check at his own bank and then sent thousands off to
An Eastern Iowa dog
breeder narrowly averted losing $4100 recently when she was to receive
a check for $5000 for three bred puppies and wire the remainder to Africa.
Another Iowa dog breeder is said to have lost thousands when a cashier's
check for Great Danes "cleared" and she wired $4100 to Nigeria.
A Des Moines woman
lost over $3,000 in a car-sale situation last month - and almost lost
$3,000 more when the buyer asked to cancel the car purchase "since he
needed the money because a friend's father died."
"We tend to think
the Nigeria Letter Scam, which offers millions of dollars and still operates
through a blizzard of e-mails, only snags one in a thousand or one in
10,000 victims," Miller said. "We are worried that this Counterfeit Check
Scam may snag one in fifty or one in five - who knows? It poses a real
threat and we all need to spread the alert."
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