INFORMATION ABOUT "419" FRAUD SCAM
The term 419 is derived from Section 419 of the Nigerian Criminal Code and means obtaining money or goods from a company or its representative, through deception.
The so-called Nigerian Letter Scam is intrinsically an advance fee fraud. The fraud is also known as the “419 scam” and is operated by a fraudster, usually a member of a Nigerian criminal syndicate. (It must be noted, however, that though these scams originated from Nigeria, syndicates of other West African countries, the DRC and lately even Zimbabwe, have become involved in these advance fee fraud scams).
The scam is initiated with the fraudster contacting a targeted company, either by fax or mail. However, approximately 80% of the latest fraudulent letters have been sent electronically via the Internet. A business proposal is made in the letter, fax or via e-mail, usually by a syndicate posing as senior government officials. The fraudsters claim that they are in possession of a large amount of over-budgeted money, usually American dollars. The proposal entails the transfer of the over-budgeted money to a bank account outside of the country where the scam originates, which is that of the targeted company. A plausible explanation is usually given for the transfer. It sounds appealing to the intended victim. The person receiving the letter or fax is generally promised between 20 to 35 percent of the money to be transferred as commission for the use of his/her bank account. If the intended victim is interested in the deal, they are requested to forward a variety of paperwork which generally includes blank company letterheads which are duly signed, blank invoices, telephone and fax numbers, and especially bank account details, which are required to effect the transfer of the money into the “victim’s” bank account.
The money is obtained from the victim in a number of ways, such as:
· Asking the victim to deposit money into a specified bank account to help cover expenses for completing the
deal, which may include paying bribes to other parties in the country from where the scam is operated;
· Once the original fee has been paid, “complications” may arise which necessitate the payment of more fees;
· Organising a meeting in certain countries and, once the victim is in the said country, his passport is
confiscated and he is detained until sufficient payment is received;
· Using the bank details on official letterheads to transfer money out of the victim’s bank account and into
An account under the control of the criminals;
· Once the money is lost, an “official” may contact the victim on the pretext of helping the victim retrieve
the lost money, which in turn, also costs money.
One might think that it is inconceivable that a person could fall victim to such a questionable scheme. People have, however, fallen prey to the scheme to such an extent, that it has forced a number of countries to set up specific units to deal with these letters. There are no reliable figures which can be used to illustrate the extent of this scheme, as many of the victims do not report the incident due to the embarrassment it causes them.
3. The South African Police Service has developed a system similar to that of the United States
Treasury Department, through which all “419” scam letters are put on a database from where they can be managed
and distributed for further investigation. The required feedback is then given to the international complainants.
The police have stressed, however, that due to the number of “419” scam letters received, they will only able to act
and report back on cases where a financial loss has been suffered or where correspondence has been entered into
between the relevant parties.
4. Other strategies that have been adopted by the Commercial Crime Unit to address the situation
are as follows:
i) The general public is warned via the media that they should not enter into suspicious agreements
when approached by perpetrators. In these warnings, the modus operandi and type of transactions
used, are described;
ii) The matter has been discussed at the Banking Action Task Group, Business Against Crime (BAC)
and South African Reserve Bank (SARB) meetings;
iii) Organised trade and industry are informed of the scam via the local media
5. The Branch of the Commercial Crime Unit and the Minister of Trade and Industry have criminalized the "419”
advance fee scam letters and gazetted this in Government Gazette No 22459 of 13 July 2001, under General
Notice No 1643 of the same date. (Should missions require a copy of the Gazette in question, please direct
requests electronically to Route hda141 or hda149).
6. Foreign citizens and residents
· Please fax a copy of the “419” correspondence received to the Commercial Crime Unit
· Furnish banking data (if applicable)
· State whether there has been “Loss” or “No Loss”
· If there is a South African connection to the “419” operation, please state clearly
all relevant details
· Provide contact details and telephone number(s) of the individual affected
The above information must be faxed to (27-12) 3391202, marked for the attention of Superintendent SC
Schambriel. He can also be contacted by telephone in the event of an emergency: (27-12) 339 1203.
7. Should additional information be required pertaining to these scams, members of the public are
urged to consult the South African Police Services’ website at www.saps.org.za under
“crime prevention” and “specific crimes” where details pertaining to the operation of the
scheme, indicators of a possible scam, the number of ways in which money is obtained
from the victim, as well as precautionary measures are outlined.
8. We would like to stress that the “419” advance fee fraud scam is an international problem
and that these syndicates target countries and individuals world-wide. It goes without saying
that schemes of this nature deceive the public and unreasonably prejudice and/or unfairly
affect consumers in general.