Fake Fridays

U.S. Brings Charges Against Phone Scams

A few weeks ago, I read an article by Eric Tucker of The Associated Press.  It was about how the Justice Department announced charges on Oct.27 “against 61 defendants in the United States and abroad in connection with call-center operations based in India.”

The crime?  Callers pose as officials of the I.R.S. or the U.S. Immigration and Customs Enforcement, threatening victims with immediate arrests or deportation if they do not pay invented penalties.  “The government says it’s a scam that’s tricked at least 15,000 people into shelling out more than $300 million.”

I was nearly hooked by one of these calls over a year ago when someone called, saying he was from the Treasury Department.  Assistant Attorney General Leslie Caldwell states, “U.S. government agencies do not call to  demand immediate payments to avoid deportation or to avoid arrest.”

I have also had threatening calls from people posing as I.R.S. officials.  I didn’t know about the U.S. Immigration scam.  That one seems particularly vicious because the criminals prey on people who are even less familiar with how our official agencies work and may be terrified of deportation.  I am really glad to hear of the actions take by the Justice Department.

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Art forgery

Art forgery has always been a crime that has interested me, and one of the most notorious art forgers is the subject of a very good book, The Forgert’s Spell by Edward Dolnick.

During the 1930’s and ’40’s, Hans Van Meegeren was a Dutch painter who fooled the art world with his paintings that were credited to the 17th century Dutch painter Johannes Vermeer.  He didn’t copy existing Vermeers and try to sell them.  He painted works on new themes and said he had “discovered” unknown Vermeers.  Hermann Goering, second only to Hitler in the Nazi party, bought one of his fake Vermeers as a genuine one.  Because of this sale, when the Netherlands was liberated, Van Meegeren was charged with working with the enemy.  To save himself from being labeled a traitor and possibly executed, Van Meergeren had to prove he was a forger.

To learn more, check out this book’s site on Goodreads.

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Ponzi scheme

One con that has never gone out of style after more than a hundred years is the Ponzi scheme.  Every year, I hear of businesses being exposed as Ponzi schemes.  The fraud Bernie Madoff committed is considered the biggest Ponzi scheme in U.S. history.  A Ponzi scheme even helped bring down the Albanian government in 1997.

Although there are many ways to disguise the fraud, the essence of a Ponzi scheme is to pay early investors with the money received by later investors.  Very little if any real investing is ever done on behalf of the investors.

The con is named after Carlo Ponzi, also known as Charles Ponzi, although he did not invent the scheme.  In Brooklyn, in 1899, William Miller, who is profiled in The Confidence Game, used this fraud to steal between $1-$2 million dollars from investors, according to Hoaxes and Scams.  But Ponzi made the con famous.  In less than a year, in Boston, 1920, Carlo Ponzi defrauded investors of $5-$10 million.  As Hoaxes and Scams states, “no one ever knew for sure” how much how much Ponzi stole.  To read more about Carlo Ponzi, click here for the Wikipedia article.

The Securities and Exchange Commission has an excellent page on its website about what Ponzi schemes are. It also compares it to Pyramid schemes, another kind of fraud.  The website also gives advice on how to protect yourself from this kind of con.



Fake Fridays


This new book is a very good place to start learning about cons and how they work.  My only criticism is that I wish it had photos because Ms. Konnikova writes about so many real-life cons that it would be nice to have faces with names to keep everybody straight.  The chapters are long, and sometimes I felt overwhelmed with information.  So I broke up my reading, placing a few days between chapters, so I could absorb the information.

What makes the book uniquely helpful are all the psychological studies it cites, showing how cons exploit certain human tendencies in our perceptions and thought processes.  I found these even more interesting than the stories of  various cons ad crooks, which are very compelling as well.

Click here it visit the book’s page on the author’s website.

Fake Fridays

My experience with a con

My personal exposure has been with telephone cons, which I’m sure a lot of people have experienced.

For awhile, I kept getting calls from “Windows”.  The person on the line said they were a technician and that my computer had been hacked.  He needed my personal information to fix it.  I hung up.

The one I time I almost got hooked was when a message was left on my answering machine.  The Treasury Dept. said there was a problem with our taxes and left a number to call.  I panicked, which is exactly what con artists want you to do.  They don’t want you to think.  They play on your emotions and want you to make decisions based on them.

The reason I panicked was because we had just recently given away a vehicle and had to fill out tax forms explaining the transaction.  I jumped to the conclusion that we had done something wrong.  I’m sure cons call thousands of people, and the ones who bite are ones who have some kind of backstory like mine.  So we very helpfully select ourselves as targets for the cons.

I quickly dialed the number left in their message.  As soon a man answered and said he could fix the problem, I knew I had made a mistake.  I hung up and finally started using my  head.  I looked up the number for the Treasury Dept. and called.  In their automated message, while listing the menu, there is also a statement that if you have received a call claiming to be from the Treasury  Dept., it is most likely fraudulent.  Until then, I hadn’t realized phone cons like this one were so prevalent.  I called the IRS, and their automated message had the same warning.

So I didn’t had over my personal information to crooks.  But I did getting threatening messages for several weeks after that, saying some government agency was starting legal procedures.  Since I had called back, the criminals had my number and thought they could wear me down.  When I didn’t respond, they finally gave up.

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