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Phony Phones?

16 Jun 2001

Les,

My name's Mike and I live in England.  I'm seeing what appears to be a clear scam but I need your help/confirmation as I've never come across anything like it.  The operation presently involves mobile phones and works like this;

My trader advertises/sets up a website to advertise mobile phones, prices are hidden by password.  He gets a call from someone else in the scam offering to buy 1700 Nokia phones at £240.00.  A purchase order is sent to my trader.

My trader then contacts another scam member and offers to buy 1700 phones for say £238.00.  My trader's customer then pays £408,000 into my trader's bank account.  My trader then pays £404,600 into the supplier's bank account.  This happens as I've inspected the bank accounts.

The supplier then sends a purchase invoice to my trader informing him the goods are in a particular warehouse (Always the same warehouse).  My trader then issues a sales invoice to his buyer informing him where the goods are and also issues a 'Release note' to the warehouse.

Each transaction is known as a deal and the paperwork for each deal is kept together (Purchase/Sale/order/Release note)

The profit is always approximately the same £1,900.  In 16 deals in one month over £4,000,000 went through my trader's bank account.  He made over £33,000 profit without spending a penny of his own money.

Factors indicating a scam are;

a) His main business activity is not mobile phones.  Why should phone companies approach him for phones? Surely with this amount of money they have great buying power and better contacts.

b)  The Companies involved buy and sell to each other via the same companies.  For example my trader will sell Nokia's from one Company for say £242.00 and one the same day submit a purchase order to the same company for the same number/model phones at £240.00.

Basically the phones 'stand still' in the warehouse and are being bought and sold hundreds of times in one day.  Nobody ever takes them into possession.  Nobody uses their own money apart from right at the beginning.

Nobody buys without already having a buyer.  Everybody is making a small profit.  The depositing of money of such magnitude appears unthinkable but when you think of it they are always depositing someone else's money rather than their own.

To be honest I'm unsure what happens at the beginning or at the end but I'm clearly seeing a scam of some kind. I've been churning this over in my mind. Can you clear the mist?  All the above is fact.

Thanks,   Michael


Hi Mike,

You've got me on this one.  I imagine someone who understands the process would immediately see the problem but I'm not a forensic accountant so I can only guess.

My first thought when you churn money but not goods is money laundering. The profit is a small expense for the service as the average cost to launder money has gone up to about 25% due to enforcement efforts.

Beyond that I have no idea I'm afraid other than one horrible possibility.

Should your trader get a transfer based on forged drafts or securities and he then pays out with real money or "an obligation to his bank" before the truth is discovered the scammers could just run off with the cash from all the participants who are real business entities.

Sometimes it takes days or in the case of foreign accounts weeks to discover the truth.  But when the bank does they simply charge back the person who "deposited" it, mainly the trusting business.  He is then left trying to track down the perps in some far-off retreat.

Please let me know what eventually happens.

Les


Les,

Thanks, I will.  Laundering is a huge possibility as most of the phones are obtained in the first place by business entities that go missing.

We're finding the evidence of say £1000,000 of mobiles being imported by a business but when we visit the premises it's just an accommodation address and the people and the phones have gone missing.  We're used to this but I'm not quite sure how this leads into the 'continual buying and selling' scenario I detailed in my earlier e-mail.  I'll keep on churning it through my brain.

Also, it's quite clear that the world's criminal organisations are heavily into mobile phones laundering their ill gotten gains with purchase of these high value products.  I believe that mobile phone sales is one of the few areas the US is behind Europe.  Almost every individual in the UK from 12 years of age has one with 'text messaging'.

Mick


A Memory for Scams

Subject:: Memorial Day Software Liquidation Sale! - a new vicious scam?
28 May 2001

I got the enclosed email and remembered some old schemes in which people advertised merchandise in major newspapers over holiday weekends (when it is difficult to check much)-- collected a lot of cash and certified checks from gullible people and then ran.

The ad below is MUCH too good to be true.  It is also weird because there is no mail or phone associated with it AND the supposedly secure form it leads to is not in fact an HTTPS but an HTTP address...  and there is no shipping charge (it's a heavy bundle of stuff) and so on.  So it CAN'T BE.

Either these jokers take money and ship nothing or they are just collecting card numbers-- in my opinion of course.  I do not have anything to prove it and I am not about to risk the money or the card number to do a "demo".

I contacted VISA investigations and the FBI (San Diego office) and both took the info but wouldn't comment further except that VISA said they are working a number of internet schemes where people are apparently collecting card numbers to use to get merchandise before the card owner realizes the number is stolen.

There is a WHOIS on the site owner-- and I forwarded that to FBI as well.  If you would like the full header and the WHOIS info, please advise. I think people need to be warned about stuff like this.

"Pierre" (a physician in Southern California)

----- Original Message -----
From: software@fosdirect.com
Cc: recipient list not shown:
Sent: Sunday, May 27, 2001 2:50 AM
Subject: Memorial Day Software Liquidation Sale!

Incredible Software Bundle - AVAILABLE NOW!

--------------------------------------------------------------------------

We have recently received an over-shipment and are actively liquidating our excess inventory. Check out all of the great software titles included in this incredible software bundle:

Adobe Photoshop 6.0 with Image Ready 3.0

Taking the world-standard image-editing solution to exhilarating new heights, Adobe Photoshop 6.0 offers innovative artistic tools and new Web features -- and now gives you the power of Adobe Image Ready 3.0 for advanced image processing for the Web. The first integrated toolset for taking your images from creation to launch in print and on the Web, Photoshop 6.0 maximizes your productivity while helping you achieve the finest quality output in both media. PLUS...

Microsoft Office 2000 PREMIUM, including WORD,  ACCESS, EXCEL, OUTLOOK,  POWERPOINT,  FRONTPAGE, PUBLISHER, PHOTODRAW

ALSO included in this amazing software offer

a.. ADOBE ILLUSTRATOR 9.0
a.. ADOBE PAGEMAKER 6.52
a.. ADOBE PREMIERE 6.0
a.. ADOBE GO LIVE 5.0
a.. ADOBE INDESIGN 1.5
a.. ADOBE AFTER EFFECTS 5.0
a.. ADOBE FRAME MAKER 6.0

(All titles are FULL version for Windows PC -- not Demos or Upgrades!)

This amazing graphics suite is available for only $49.95 (Same day Express shipping included.) We accept Visa and Mastercard through our safe and secure order page for your protection. Upon completion of your order, you will be instantly provided with tracking information regarding your order!

To order the Adobe software suite with Microsoft Office 2000 Premium, simply click on the order button below:   http://www.fosdirect.com/order.html

If you have any questions or comments, please send an e-mail to:
support@fosdirect.com

Act now, this offer is valid only while supplies last. Limit one order per customer.
Thanks for your time and enjoy!


Boy, don't I wish it was true. A few thousand dollars worth of software for fifty bucks. Even as cheap as I am I think I would have sprung for it had they used a better story to dispel skepticism,  such as minor smoke damage to cardboard packaging, rather than just being overstocked.



Negative Option Billing Leaves No Options

Hi, Les, 

I really appreciate your site. Between yours and Quatloos.com, I have been able to reveal several scams in progress that have been presented to me in recent years. This latest problem I face may be up your alley, maybe not.

Recently, I received "membership packets" from several different companies describing themselves as travel clubs and buyers clubs. The common thread these "clubs" all share is that they are offering a free trial membership to whatever it is they peddle and if I DON'T take action to either call or write them to cancel my "membership" during the trial period, they will bill my credit card for whatever membership fee they're charging.

Keep in mind that we were not contacted by any telemarketer or by any other method beforehand, and never authorized these companies to enroll us in anything, and never provided them a credit card number! 

continued



Crown Holidays "Membership" scheme
Date: Fri, 03 Aug 2001

Hi Les,

I recently found your website dealing with scams and fraudulent schemes. I have a story to share with you which is similar to the posting that Mile Wilcox has on your site.

My wife recently bought a gadget thru a television ad and we were told that we would be enrolled for a free 30-day trial membership in "Discounts USA" (a company offering discount travel programs and such) and my card would automatically be charged a membership fee after the trial period unless I called up and cancelled.

We cancelled the membership on the same day.

When my credit card statement came the next month, there was a membership charge from this "Discounts USA" and from a company called "Crown Holidays" that we had never even heard about.

continued


Vacation Offer No Laughing Matter

Your website is chock full of information, and I read with both horror and fear about the Vacation scams.

I think I just feel victim to this scam just a few hours ago. Sadly, my friends and I had been discussing a vacation in the past few days and I was a little overwhelmed by the sales pitch for vacations to Florida.

On looking back it seems like a really poor idea. The whole thing went nearly exactly as describe on your page. A company called me, told me about several packages, asked for $598, and then transferred me to another department. I was told I would get an email verification (which I haven't received) and a package in 7-10 days.

Do I have any recourse here? Do I have to wait to find out if I have been scammed? All the elements are there. Including the 18 month open ended trips. Free tours, etc. After reading your page, I have decided that even if the package comes, and I cannot get my money back, I will probably avoid using the "vacations" for fear of wasting even more money on the trip once I arrive.

I've already contacted the credit card company. They are of little help at this stage. You can imagine my horror when I found out that cross-border crimes are even harder to redress.

Any advice would be greatly appreciated.

Thanks sincerely,

Howard Ha 6/28/01


Are the solicitations offering $10-$150 for being in a focus group legit? All of a sudden these are everywhere. I'm getting them by phone and by email at a dreadful rate.

What's the surprise? Are they willing to pay me $10 just to find out what kind of a sucker I am?

Curious 06/05/02

Good question. Any views appreciated as it hasn't hit my radar yet.


Criminal ORGANization?

I am writing to get your views on the sale of high priced organs to the elderly. My mother got involved with one of these operations about 6 years back, but I figure this has been going on forever.

They continue to have contests for 'free lessons' that you can enter at the supermarket.  If you are 65 or over, you win.  They don't want to deal with anyone younger for some reason.  You have probably seen their locations; they are music stores in the major malls.

If someone younger walks in, they are not usually even welcomed as a potential customer if there are any old suckers around who might hear them asking unpleasant questions.  Their sales techniques seem to be borderline legitimate high-pressure, like some of the techniques for contests and such you describe on your site, or like what many insurance or car salesmen use.

The prices on their organs are up to whatever a retired person with savings can afford, maybe $10,000-$100,000.  I think that my mother got involved to the tune of $50,000 or so, and I'm honestly glad that she did, because her life was very dull before and much more interesting now, but I don't know if there's any reason that someone couldn't have sold her the same instrument for $10,000 and made a nice profit.

If you buy an organ, they promise you free lessons for life, also various concerts and events held at the retail locations.  This keeps you coming back to the store to get pressured again and again to upgrade your instrument to the latest model, and musical talent, accomplishment, ability or need is very little involved in any of this.

It's great for some of the old folks to get out of the house, meet people, be active, socialize, etc, but the cost is high.  I don't know much about the product, but the price tags seem way too high. And they try to arrange the social activities so that the people who have bought the most expensive instruments are the most respected in the group, as they have contributed the most to the business that subsidizes the entire social structure.

Many of the old folks who can't play too well buy and buy and buy to keep up their self-image and social standing. My mother has played piano for about 50 years and can play her organ pretty well and hasn't bought anything from them in five years,  but I always wonder if she will be able to continue to resist the sales pitches as she ages.

Maybe it's just a good example of traditional American salesmanship, but there is so much salesmanship in that package that it's a little suspicious to me. According to their standards, Professor Harold Hill was an honest businessman.  Maybe he was, but he was targeting the wrong demographic. I wonder what those organs go for in estate sales, how much markup and commission the salesmen and stores take out, and what the manufacturer's financials look like, too.

Skeptical in Oregon 06/06/02


One company you should investigate is APPGAS.com which offer 20% gas discount cards that work like a Visa card except it's $300 to join and you can buy up to 15 cards at $200 each in the year.

It seems you have to buy and use virtually all the cards to even get your money back  The gas station isn't giving the discount, so it's coming out of the membership fees.

Buying 15 cards X $200.00 bucks is $3000 worth of gas for $2400 but as it costs you $300 to join you could potentially save only $300 bucks. The focus seems to be on promising big dividends for signing up folks in your down line.

Also, we run an internet help desk and have been helping the elderly get computers on the internet that they bought just cause they're promised that they can sit at home and watch their bank accounts soar with all the people that will join up under them. I'm really saddened after helping some retired folks do this cause their dreams are NOT going to be realized!

John 06/08/02


I used to date a guy who was involved in some type of investment he called KOMAX...I think that is how it was spelled. The gist of the deal, as I recall, was this group of people were trying to get these millions of dollars out of Europe.

I can't remember why this money was there, but they were collecting money for legal fees etc. while they worked on it. Most of the people (that I knew) who were involved had approximately $500 - $1500 invested.

There were phone numbers you could call for recorded information and updates. They did have a meeting once in a hotel in DC. My boyfriend went to hear about what was being done and get some answers and of course he gave more money.

He came back from that one and told me there was a special offering to get an additional person in on the investment for just $20.00. He wanted me to get in on it. I told him forget it, I didn't want my name associated with that ridiculousness!!!

I always thought this was a scam and told him so. The phone numbers with the recorded information kept changing and sometimes there would be no number to call at all, or sometimes the message wouldn't be changed for months. He would get a letter every now and then with some "information" in it. All in all, he was expecting to get something like $2 to 5 million dollars though his cut kept going up as well.

Anyway, I was wondering if you had heard of this one? Is it a known scam?

Bobbi Savaliski 06/14/02


Have you heard of the BTStrust. This is something my Mom has gotten into for $750 and I think it is scam. She signed a paper saying that the money was a GIFT. They told her the money goes into a trust and that within about 45 days she would get that back and more.

They claim to send your money in cash by Federal Express. The Web site is www.BTSTRUST.org though a user ID and Password is required to look at the site.

Kathy Baver 06/16/02

While I'm sure that worldwidescam has more details it is likely a high yield Prime Bank type scam.


Teed Off

I was brought into an "IPO" offering by "Camry Consulting Services Inc" of Las Vegas for some company whose name could not be disclosed because of privacy agreements. I recently looked back through the paperwork and noticed inconsistencies between phone numbers and email addresses.

From the internet I was able to find that the company did have an address and phone number in NV, but also that the person who signed off on this offering (Colin Nathanson) had  been given a Cease and Desist order in the State of Ohio for selling FCC rights, and stocks without a prospectus.

I want to at least get my money back. What can I do?

Update: Wanted to let you know that after sending in my request for a refund on August 14, 2002, payment from Camry Consulting arrived last Friday (8/29/02).  Since then I have deposited the check, and received confirmation from the bank of its clearance. Thank you for removing the more derogatory statements I made earlier.

Derek Pulvino 06/19/02


Lighthouse Credit Foundation and Integrated Credit Solicitation called many times an 81 year old  woman and asked for all account balances. Their address is 8550 Ulmerton Rd #F200, Largo, FL.

What's the scam?  What do they do with balances?

John Davis 06/28/02


I found your amazing site while sifting through info on our little friends like Chuck from Primebuytown/network/international/godknowswhatnext and discovered your postings on igennex. Well let me tell you something! These are the same guys that started Titan / Newport / TheAlphaClub etc etc.

The latest rip-off was Netguard in New Zealand marketed by Stuart Baldwin and Malcolm Stockdale (Great friends of John Carway).

They were networking a vehicle tracking device (great product) they sold it out of the same igennex/alpha/titan/Newport system for $6800 per pop. The only trouble was that the people who joined never got to see their tracker or their money again.

They allegedly jumped on a plane and have not been seen since, both wanted by the Australian/New Zealand authorities. Check out this site www.clintrdog.demon.co.uk for more info. We'll be adding a link to your great stuff, top site.

Graham George 08/06/02


Lost in the Void

A "Harris County Investigator with the Texas Check Fraud Division" informed me that I had a hot check for $33 outstanding and I needed to pay $133 ($100 in investigative fees) or I'd be arrested at work the following day.

After much hassle and questioning, I gave in to their demands and paid over the phone.

The following few days I had a chance to investigate the matter myself and found out that the check number they gave me was not a hot check, but rather a "voided" check I submitted to authorize a bank-draft for a salon membership almost a year ago.

The membership was cancelled in March of this year and all was well until last week.To try and get more information on this matter, I went to the salon, but they could provide me with no information on this matter other than the actual cancelled contract.

I then found that the "Harris County Investigator with the Texas Check Fraud Division" was actually a nickel and dime collection agency and all they could provide me with was the same cancelled contract and a copy of the check that had VOID written across it 3 times. I visited them in person and while I was there waiting to speak to them, their "receptionist" informed me that "all their collections were on voided checks".

I advised that there was a mistake somewhere on their part but they refuse to acknowledge this.They said that I should "sue them" if I had a problem with what they said or did to get the money from me. Well, since then I've become fairly well versed in the FTC laws regarding what they did and of all the laws they broke in their collection process, including the fact that prior to speaking with me, they phoned my father and another party stating that they had a warrant for my arrest.

But now what? Where do I go from here to stop them and their ruthless practices?

At this point I know longer care for a refund.I've written to DA Cornyn, the Attorney General, and the FTC and they have done nothing. No attorney I've spoken to is willing to take this on as there is "no real money" involved.

Should I give up? Will it be worthwhile to go take this matter to civil court? Do you know of an attorney or organization that will assist me in this matter?

Amanda Warren 09/26/02


 

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