Maryland Securities Division - Investor Education

Invest With Common Sense

Letters from Overseas that Promise Easy Millions Can Guarantee Hard Times for You

You, or your small business, often receive solicitations by mail or facsimile promising to help you make a profit. With a little effort or a little up-front money, fortune awaits. We are accustomed to getting offers in the mail to win BIG MONEY from magazine subscription services or Hollywood celebrities, promising a chance to receive millions if we follow the instructions and return the information right away.

Combine that adventurous spirit with some REALLY BIG MONEY (say, tens of millions of dollars), and a hint of larceny (but not too illegal!), and the glamour and intrigue of the world of international high finance, and the chance to get rich by doing nothing except acting as a conduit for foreign funds, and you have the opportunity to...

... get ripped off big time in a FOREIGN MONEY TRANSFER SCAM!

Despite the best on-going efforts of State law enforcement officials, federal agencies, the Secret Service and U.S. Postal Inspectors, the Nigerian bank transfer scam is one of the fastest growing fraudulent schemes around. And it could be in your mailbox, or on your fax machine. In its simplest form, the scam works like this...

You receive a letter from someone claiming to be a high ranking Nigerian official (often signing himself as "prince" or "general" or "minister") who asks your help in getting millions of dollars out of his country and into the United States. You have been "recommended" by some "chamber of commerce," the letter goes, because of your trust-worthiness and good credit standing. The official writes that the funds are "left over" after completion of a construction project or a government contract in his country, supposedly as a result of over-invoicing or bribery. With a blatant mix of larceny and entrepreneurship, the "official" claims he wishes to move the surplus money out of Nigeria for his own use before it is discovered. With your help, and the use of your bank account, he can secretly transfer the money into the U.S.

There are two possible forms of this scam: a bank transfer scam and an advance-fee fraud. In the first, the letter asks you to fax or send a blank business invoice, and your confidential bank account information. Then, the official promises, he will wire transfer the money out of Nigeria and into your account, and split the money with you.

In the advance-fee fraud, the official asks you to provide funds to help "negotiate" (paying a "government tax" or bribe) the transfer of the money by personally traveling to Nigeria or by forwarding some cash; eventually $5,000 or more of your seed money is needed for the deal. In exchange for your help, the promise goes, you will be paid a huge sum of money... millions of dollars!

It sounds too good to be true. It is. It isn't true. It's a scam.

Those who respond may find themselves swindled or worse. Bank accounts have been wiped out, and credit ruined. Those going to Nigeria have faced extortion and blackmail and been threatened with physical violence. Victims face not only loss and embarrassment, but a reluctance to turn to authorities out of fear they have broken American and Nigerian laws.

Why would anyone fall for this scam? A business needs a sudden infusion of cash... A personal life style bordering on bankruptcy... The chance to get rich quickly at someone else's expense without actually doing anything or putting much money at risk... The chance to play in the game with an opportunity usually reserved for the big corporations, or the rich and famous.

Before you become poor and infamous, learn how to spot these scams and avoid them:

• Be wary of get-rich-quick schemes touted by someone you don't know, especially foreign nationals who may not be subject to American laws. Ask yourself why a stranger would approach you with offers of wealth.

• Be wary of offers from someone trying to cheat his own government or others. He is already admitting to dishonest behavior. Why will he be honest with you? Do not expect to find honor among thieves.

• Be wary of sending money to strangers for foreign deals. Before you travel to an unfamiliar place to provide money in strange circumstances, verify conditions and your "business colleagues".

• Be wary of putting your own reputation on the line. Do you really want to risk becoming involved in a self-proclaimed illegal or unethical operation? Do you really want to risk the embarrassment and possible sanctions for being involved in an illegal money laundering operation?

• Be wary of giving your financial identification (bank account numbers, credit card numbers, social security number) to anyone. Make it a rule NEVER to give out that information to someone you do not know or deal with directly and regularly. Con artists acquiring such personal financial information can create false identities and credit accounts using the credit card numbers of innocent victims -- and run up large debts, possibly ruining the victim's credit worthiness.

The Nigerian bank transfer scam preys on the unwary and the dishonest -- don't fall for it. If anyone wants you to put your money or your reputation at risk in an investment or business deal, remember ... if it sounds too good to be true, it probably is!

Call us, we're here to help!
The Maryland Securities Division
(410) 576-6360