The most prevalent and successful cases of Advance Fee Fraud is the fund transfer scam. In this scheme, a company or individual will typically receive an unsolicited letter by mail from a Nigerian claiming to be a senior civil servant. In the letter, the Nigerian will inform the recipient that he is seeking a reputable foreign company or individual into whose account he can deposit funds ranging from $10-$60 million that the Nigerian government overpaid on some procurement contract.
The most common forms of these fraudulent business proposals fall into seven main categories:
The criminals obtain the names of potential victims from a variety of sources including trade journals, professional directories, newspapers, websites and commercial libraries, but they mainly use the scattergun approach of massive spam email dumps. Often these are generated by 'bots', people's computers that have been compromised, turning them into spam dissemination machines.
The sender declares that he is a senior civil servant in one of the Nigerian Ministries, usually the Nigerian National Petroleum Corporation (NNPC). The letters refer to investigations of previous contracts awarded by prior regimes alleging that many contracts were over invoiced. Rather than return the money to the government, they desire to transfer the money to a foreign account. The sums to be transferred average between $10,000,000 to $60,000,000 and the recipient is usually offered a commission up to 30 percent for assisting in the transfer.
Initially, the intended victim is instructed to provide company letterheads and pro forma invoicing that will be used to show completion of the contract. One of the reasons is to use the victim's letterhead to forge letters of recommendation to other victim companies and to seek out a travel visa from the American Embassy in Lagos. The victim is told that the completed contracts will be submitted for approval to the Central Bank of Nigeria. Upon approval, the funds will be remitted to an account supplied by the intended victim.
The goal of the criminal is to delude the target into thinking that he is being drawn into a very lucrative, albeit questionable, arrangement. The intended victim must be reassured and confident of the potential success of the deal. He will become the primary supporter of the scheme and willingly contribute a large amount of money when the deal is threatened. The term "when" is used because the con-within-the-con is the scheme will be threatened in order to persuade the victim to provide a large sum of money to save the venture. The letter, while appearing transparent and even ridiculous to most, unfortunately is growing in its effectiveness. It sets the stage and is the opening round of a two-layered scheme or scheme within a scheme. The fraudster will eventually reach someone who, while skeptical, desperately wants the deal to be genuine. Victims are almost always requested to travel to Nigeria or a border country to complete a transaction. Individuals are often told that a visa will not be necessary to enter the country.
The Nigerian con artists may then bribe airport officials to pass the victims through Immigration and Customs. Because it is a serious offense in Nigeria to enter without a valid visa, the victim's illegal entry may be used by the fraudsters as leverage to coerce the victims into releasing funds. Violence and threats of physical harm may be employed to further pressure victims.
The fraudster may establish the credibility of his contacts, and thereby his influence, by arranging a meeting between the victim and "government officials" in real or fake government offices. In the next stage some alleged problem concerning the "inside man" will suddenly arise. An official will demand an up-front bribe or an unforeseen tax or fee to the Nigerian government will have to be paid before the money can be transferred. These can include licensing fees, registration fees, and various forms of taxes and attorney fees.
Normally each fee paid is described as the very last fee required. Invariably, oversights and errors in the deal are discovered by the Nigerians, necessitating additional payments and allowing the scheme to be stretched out over many months. Several reasons have been submitted why Nigerian Advance Fee Fraud has undergone a dramatic increase in recent years. The explanations are as diverse as the types of schemes. The Nigerian Government blames the growing problem on mass unemployment, extended family systems, a get rich quick syndrome, and, especially, the greed of foreigners.
Indications are that Advance Fee Fraud grosses hundreds of millions of dollars annually and the losses are continuing to escalate. In all likelihood, there are victims who do not report their losses to authorities due to either fear or embarrassment.