Not snow jobs, or cheats or darkened hearts can keep the U.S. Postal Service from its appointed task. And last week, part of the postal service’s daily duty of delivering the mail included bringing reimbursement checks to the homes of people scammed in wide-ranging frauds that cost them millions.
In Philadelphia, checks worth more than $35,700 went out to 18 con-game victims. In the suburbs, 20 others got more than $76,000, according to Nick Alicea of the U.S. Postal Inspector’s office. Nationwide, 3,440 checks worth more than $14 million went to the victims of con artists who used the mail and MoneyGram to perpetrate a variety of scams.
A Canadian sweepstakes was the focus of one scheme, said Alicea, a Postal Inspector team leader.
Victims would receive mailings that included checks for $4,000 and letters advising them they had won a $3.5 million Canadian lottery. The letters and the checks were phony, Alicea said during an Aug. 19 phone interview. They were bait.
The letters instructed victims to call a number to claim their winnings. The person who answered told them to immediately deposit the checks, wait a day and buy a MoneyGram at a recognizable business like Walmart or a local phone store and to wire $3,500 to another person at another location to pay for taxes and other fees so the imagined windfall could be collected.
Of course, the marks were paying criminals.
“They use very common names,” Alicea said. One was George Washington.
The con artists who controlled the scam usually targeted elderly and vulnerable people, he said. “These people are very charming on the telephone and persuasive,” he said.
The fraudsters collected the money by conspiring with corrupted agents who had contracted to do business with MoneyGram, a company set up to do business much like Western Union. A person buys a MoneyGram for a certain amount, pays a fee, gets a reference number for the money transfer, and has it sent to a location the con artists have named.
Frequently, in this scam, the victims sent their MoneyGrams to Toronto, Canada, Alicea said.
“That transfer would be picked up somewhere in Canada …. anywhere,” Alicea said. All the person who got it needed was the reference number assigned to the transfer.
“In these fraud transactions, the person in Canada who is pulling the number out of the [MoneyGram] system is an agent who has been corrupted by the fraudster,” Alicea explained. The head conman pays those agents to remove the number and the money from the system, take 10 to 20 percent for himself and then forward the lion’s share to someone in Nigeria, Romania, the United Kingdom, Spain or anywhere in the world, Alicea said.
It all happens quickly.
“They can get the money in their hands within 10 or 15 minutes,” he said.
The money’s first stop isn’t always Canada, Alicea added. “There are pockets in the United States where we know this activity occurred, too.”
There had been one Philly location, he said, but he didn’t have any specifics. Scores of corrupt MoneyGram agents have been prosecuted nationwide and in Canada, he said. One person from Nigeria has been arrested.
This fraud started in 2004 and continued until 2009. Since some MoneyGram agents participated in this international scheme, the company agreed to set up a $100 million fund to pay back victims. According to the Postal Service, MoneyGram itself profited by the scheme because it collected fees for the money transfers. The company violated U.S. law by processing thousands of transactions for agents known to be involved in an international fraud scheme.
The checks in the mail last week were part of a second wave of reimbursements, Alicea said. In December, the first totaled $46 million and went to 18,000 victims, he added. Alicea said authorities notified more than 68,000 victims, and more than 22,000 have made claims so far. Authorities knew who had been bilked and by how much. All the victims had to do was sign a simple form to get their money back, he said.
A lot of the people getting checks now filed for their money later than those who got paid earlier or they disputed the amounts owed to them.
“A lot of those getting checks now are going to people we had to do significant research on,” Alicea said.
The phony lottery con wasn’t the only one that used MoneyGrams, Alicea said.
There were phony Internet sales schemes and the classic “Grandparents scam.”
Elderly people are contacted by someone purporting to be a grandchild who has been jailed far way or needs money for car repairs. The victims are asked to wire the money and “please don’t tell Mom and Dad,” Alicea said.
Although the MoneyGram part of these schemes might be new, or new-ish, the scams themselves have been known for decades.
“It’s probably worse now than it’s ever been,” Alicea said. A lot of these scams used to originate in West Africa, he explained, but now are being taken over by Jamaicans who have gotten out of the drug business and into fraud because it’s more lucrative.
Nigerians, for example, operated their schemes like they were businesses and looked at the victims like they were “clients,” Alicea said. “The Jamaicans try to take every bit of money you have.”
He said some threaten people and tell them they’re right outside their houses. They’ll use the Internet to look at the homes and then describe them to their victims, he said. They have some elderly people so frightened that they’ll do just what they’re told to do, he said.
“There’s no end,” Alicea said. “It’s nonstop 24/7 with these scammers.” ••