The Reynolds "Charity" Empire in Decline

A few years ago I wrote a post entitled, "Is The Breast Cancer Society a Worthy Charity", to which the answer was "No". The comments to that thread are extensive, and include a defense of the organization from Kristina Hixson, which avoided answering any of the tough questions or giving an honest explanation of the organization's operations. She went so far as to post a series of fake endorsements to the thread, trying to bury valid criticism behind fictitious praise.

Oh yes, and she went on to marry the man who ran that "charity", James T. Reynolds II.

Over time, the Reynolds' family of "charities" started to receive press scrutiny. The Tampa Bay Times published an article, "Intricate family connections bind several of America's worst charities". It opens

Carol Smith still gets angry when she remembers the box that arrived by mail for her dying husband.

Cancer Fund of America sent it when he was diagnosed with lung cancer six years ago.

Smith had called the charity for help. "It was filled with paper plates, cups, napkins and kids' toys," the 67-year-old Knoxville, Tenn., resident said.

"My husband looked like somebody slapped him in the face. "I just threw it in the trash."

The story continues,

In the past three years alone, Cancer Fund and its associated charities raised $110 million. The charities paid more than $75 million of that to solicitors. Cancer Fund ranks second on the Times/CIR list of America's worst charities. (Florida's Kids Wish Network placed first.)

Salaries in 2011 topped $8 million — 13 times more than patients received in cash. Nearly $1 million went to Reynolds family members.

The network's programs are overstated at best. Some have been fabricated.

The Federal Government has finally managed to partially shut down the Reynolds empire:

In reality, officials say, millions of dollars raised by four “sham charities” [Cancer Fund of America, Cancer Support Services, Children’s Cancer Fund of America and the Breast Cancer Society] lined the pockets of the groups’ founders and their family members, paying for cars, luxury cruises, and all-expense paid trips to Disney World for charity board members.

The 148-page fraud lawsuit accuses the charities of ripping off donors nationwide to the tune of $187 million from 2008 to 2012 in a scheme one federal official called “egregious” and “appalling.”...

Among the allegations is that [Reynolds' ex-wife, Rose] Perkins gave 10% across-the-board bonuses twice a year to employees [of the Children’s Cancer Fund of America], regardless of performance, and was allowed to set her own salary and bonuses up to a limit without the approval of board members. In 2010, when donations to the Breast Cancer Society were declining, Reynolds II’s salary ballooned from $257,642 to $370,951, according to the complaint.

What can a grifter do, but grift? Even having been shut down, the Breast Cancer Society promises to come back to leach off of the good intentions of people who want to help cancer survivors:

The silver lining in all of this is that the organization has the ability to continue operating our most valued and popular program, the Hope Supply. Our Board will work tirelessly to maintain the Hope Supply program services that have benefitted our many patients for years – initially under the TBCS banner as it transitions under a different organization – all with the goal of seamlessly providing services to you. I take solace in the fact that this wonderful program has the chance to continue operating.

There is a note of honesty, "I have loved leading TBCS...." Why wouldn't James love working in a job that paid him royally for performing little work, despite his indifference to the needs of the people his charity was supposed to help? It's a gravy train he's eager to re-board, so watch out for his next "charity", coming soon to a list of the nation's worst charities near you.

If you want a good measure of James Reynolds II's character, watch him on video.

Shipping Cost Fraud and Misrepresentation on Ebay

One of the problems with buying on eBay is that, although there are many legitimate sellers, there are also many sellers who engage in dubious or even fraudulent business practices, and even in cases of unambiguous fraud eBay seems to do nothing to shut down dishonest sellers. (Similar problems seem to be arising on Etsy - it looks like they shut down some obviously fraudulent sales, but the vendor is still going strong.)

One convenience of eBay is that you can search by price, with or without shipping, to sort through the offerings of vendors who are selling the same product at various price points. By including shipping in your sort, you avoid the vendors who try to trick you into buying what seems like a low-priced item, but makes up for it (or more than makes up for it) with excessive shipping fees.

Or, at least, that's the way it should work. eBay's listing policies should ensure that there's no confusion:

When you create a listing, make sure all your text and other information are complete and consistent throughout. For example, you can't say one thing in the title and then describe it differently in the description....

Not Allowed: Inconsistent details throughout your listing (titles, descriptions, product details, shipping, payment information, and so on)

To push misleading shipping costs into the search feature not only necessarily involves hiding additional fees somewhere in your listing other than the area in which shipping costs are to be described, it undermines the integrity of the search feature - the abusive seller can rank above honest sellers who accurately list their shipping costs.

I expect that regular users of eBay are well aware of this type of fraud. It's the less frequent user who is apt to get burned. Shipping cost manipulation has been going on long enough that last year somebody did a study of how hidden shipping charges affect sales. They did not do the experiment on the U.S. eBay site because the U.S. site is designed to "automatically reveal[] shipping charges in its search listings". But that, of course, presupposes an honest vendor.

Let's take a look at how this works. Here's a screen capture of a sale by a vendor named garrys_world_exchange_square (Yee Mei Tam):

Very clearly, shipping to the U.S. is listed as $3. Does that seem low? If so, you probably click on "See details" to see additional terms.

And right there, you find a shipping calculator. Enter your ZIP code and, sure enough, it confirms that shipping to your address is $3.

So you place your order and next thing you know, you're being told that you have to pay an additional shipping charge. "What?", you say, "I made this purchase based upon the flat shipping fee you described in your listing. I confirmed it with your calculator! What gives?" And a vendor like garrys_world_exchange_square will respond, "If you read the description for the product you'll see that I said there's an additional charge for shipping to the United States."

Note that as eBay listings are described, when you click that "See details" link for shipping - you know, to get to the place where any additional details related to shipping are supposed to be described - the description is no longer visible on the page. So unless you click back to the description and scroll way down "below the fold", you are not going to learn about the additional charge. The content is hidden from the "Shipping and payments" view of an eBay sales page.

Again, this seems to be a painfully obvious violation of eBay's rules for listings - you aren't allowed to have inconsistent details in your listing, including inconsistent details pertaining to shipping. But a very useful site called Toolhaus provides a more comprehensive look into a seller's conduct than you can get directly through eBay - particularly given the games and tricks that dishonest sellers use to get negative feedback removed from their profiles.

With this particular seller you learn that he has a long history of misleading consumers about his products (e.g., for movie sales, "Never told in description it is uncut. Already listed the total running time" and "I have never mentioned that it is the remastered version"), has many complaints about misleading shipping prices ("False Advertising - stated shipping 3.00 then wants 30.00 let money to pay ebay"; "If you buy from this seller, scroll all the way down for TRUE shipping charges"; "Ensure DVD region code works in your country +Read fine print on his shipping"), and on top of it all he's obnoxious ("Refused to pay and left me -ve feedback! Are you nuts?"; "I already return your money order, Why do you leave bad feedback? How absurd !!"). I like this one:

Feedback: Dvd did not contain complete movie. No reply to my emails. Got Taken !

Response: You're already left Negative for me, How can I refund payment for you ? Crazy !!

I had no idea that it became impossible to refund a purchase price if the buyer complains that you sent a poor product. You learn something every day.

Seriously, hasn't eBay established a sufficient base of sellers that it can afford to enforce its rules and purge sellers who engage in sales tactics that are fraudulent or intentionally misleading, even to the point of diminishing the quality of its search and rendering its postage calculator useless?

Pay No Attention to the Woman Behind the Curtain

Powerful, one might say overwhelming evidence of cheating behind D.C.'s improvement in standardized test scores under Michelle Rhee.

McGraw-Hill's practice is to flag only the most extreme examples of erasures. To be flagged, a classroom had to have so many wrong-to-right erasures that the average for each student was 4 standard deviations higher than the average for all D.C. students in that grade on that test. In layman's terms, that means a classroom corrected its answers so much more often than the rest of the district that it could have occurred roughly one in 30,000 times by chance. D.C. classrooms corrected answers much more often.

In 2008, the Office of the State Superintendent of Education (OSSE) — the D.C. equivalent of a state education department –– asked McGraw-Hill to do erasure analysis in part because some schools registered high percentage point gains in proficiency rates on the April 2008 tests.

Among the 96 schools that were then flagged for wrong-to-right erasures were eight of the 10 campuses where Rhee handed out so-called TEAM awards "to recognize, reward and retain high-performing educators and support staff," as the district's website says. Noyes was one of these.

When questioned about the evidence of cheating and her administration's apparent indifference to the issue and disinterest in conducting a meaningful investigation?

When reached by telephone, Rhee said she is no longer the chancellor and declined to comment further.

What about the current D.C. administration?

D.C. officials declined to let USA TODAY visit schools or talk to principals, including Adell Cothorne, the principal who succeeded Ryan at Noyes for the 2010-11 school year.

Typical of government, and unfortunately it increasingly appears to also be typical of Rhee, the taking of responsibility and the acceptance of consequences for ineptitude are important for others but not for themselves. Self-adulation based upon exaggerated or even false claims of accomplishment, on the other hand, are par for the course.

Reforming "Funny Money"

While listening to NPR, I heard about a series of Boston Globe articles on SSI for children, how the number of cases has exploded, and raising questions about both whether the current criteria for SSI eligibility are appropriate and the extent to which the system is abused by people looking for "no strings attached cash aid" to supplement their family's welfare benefits or modest earnings.

The interview took a "You may not be aware of this, but..." approach to the explosion of child recipients of SSI, but it's not exactly a closely held secret that many people who were removed from welfare rolls as a result of 1990's-era welfare reforms ended up on SSI. A lot of that transition was legitimate. But as with any system, some were quick to attempt to exploit the system.

I believe I first heard the term "funny money" in the early years of welfare reform from a classmate who had moved to a Bible Belt state, and who related that the term was being used by people who wanted their kids, whatever the reality, to be classified as disabled. That idea is more than a bit creepy - find a way to have your child classified as mentally ill (that's a lot easier to do, after all, than getting a classification of physical illness) so you can significantly boost your family's income. And it was not unusual for families who played this game to have multiple children, perhaps all of their children, collecting "funny money".

The Globe covers some of the consequences - parents who get upset when their children's mental health improves because it could mean losing the money, teenagers who are fully capable of working part-time jobs who are instead pressured to remain idle lest their employment result in a reduction or the end of their SSI checks. It's hard not to be judgmental. One article opens,

Geneva Fielding, a single mother since age 16, has struggled to raise her three energetic boys in the housing projects of Roxbury. Nothing has come easily, least of all money.

Even so, she resisted some years back when neighbors told her about a federal program called SSI that could pay her thousands of dollars a year. The benefit was a lot like welfare, better in many ways, but it came with a catch: To qualify, a child had to be disabled. And if the disability was mental or behavioral — something like ADHD — the child pretty much had to be taking psychotropic drugs.

Fielding never liked the sound of that. She had long believed too many children take such medications, and she avoided them, even as clinicians were putting names to her boys’ troubles: oppositional defiant disorder, depression, ADHD. But then, as bills mounted, friends nudged her about SSI: "Go try."

Eventually she did, putting in applications for her two older sons. Neither was on medications; both were rejected. Then last year, school officials persuaded her to let her 10-year-old try a drug for his impulsiveness. Within weeks, his SSI application was approved.

"To get the check," Fielding, 34, has concluded with regret, "you’ve got to medicate the child."

That's a pretty sympathetic spin, but I'm not buying it. It didn't occur to Fielding that perhaps the reason her oldest two children didn't receive SSI was because they didn't have qualifying disabilities? That pushing them onto medications they don't need in order to try to get them on SSI would represent bad parenting?

I would propose a simple reform: instead of issuing a "one size fits all" check, the Social Security Administration should assess how much money a typical family might be expected to spend, above and beyond its normal budget, for the condition at issue, while otherwise maintaining Medicaid eligibility rules such that medical costs aren't an issue. Then, rather than issuing $700 checks, they could issue payments that range from quite small (e.g., for the toddlers who are now being pushed into the system over "delayed speech" who will often already be eligible for a free and full set of services through the public schools) while being able to offer more significant benefits to families that are dealing with disabilities that have more substantial costs attached or require a parent to become a full-time caregiver. For some disabilities (e.g, delayed speech) there should be an automatic sunset date for benefits at which time, absent a new diagnosis, benefits will end. Such modifications will not only better direct financial help where it is most needed, it will significantly reduce the financial incentive to push normal kids into the disability system.

When little Alfonso tried a full sentence it came out in a swirl of sounds, often followed by a major league tantrum when he realized he was not understood. And so his mother, Roxanne Roman, was not surprised when the 18-month-old was diagnosed by a specialist with speech delay.

It came as a shock, however, when she learned from relatives that Alfonso’s problem might qualify him for thousands of dollars in yearly disability payments through the federal Supplemental Security Income program. For Roman, pregnant with her second child at age 17 and living at her mother’s, the extra income was attractive. She wanted to rent her own place.

Within three months, the boy’s application was approved. Alfonso receives $700 in monthly cash benefits, plus free government-paid medical coverage. Roman said her relatives told her she can pretty much count on the disability checks for Alfonso, now 5, to keep arriving in the mailbox for the rest of his childhood.

"They don’t ask many questions about the child once you’re approved," Roman said.

Some questions are well overdue.

I understand the argument that a lot of the families who game the system are living well below the poverty line. It was suggested on the radio program that the average family that gets a SSI check for a child doubles its income based upon that check - that is, if there even is a wage earner in the family we're talking part-time, minimum wage work. But I can't see the abuse of the disability system to be justified by the inadequacy of other aspects of the social safety net. Leaving the taxpayer aside, it's unfair to families who are trying to live within the rules, it sets a terrible example for other families, and it isn't healthy for the children. And, of course, it opens up the entire welfare system to attack as overly generous and beset with fraud and abuse. (Unless you truly believe that proponents of welfare reform care, please don't tell me that such an attack would be misleading and unfair. Do I need to remind you about Cadillac-driving welfare queens?)

Fixing the Mortgage Mess

An opinion column in the Times is skeptical that the mortgage documentation mess can be fixed with legislation:

The banks and other players in the securitization industry now seem to be looking to Congress to snap its fingers to make the whole problem go away, preferably with a law that relieves them of liability for their bad behavior. But any such legislative fiat would bulldoze regions of state laws on real estate and trusts, not to mention the Uniform Commercial Code. A challenge on constitutional grounds would be inevitable.

Asking for Congress’s help would also require the banks to tacitly admit that they routinely broke their own contracts and made misrepresentations to investors in their Securities and Exchange Commission filings. Would Congress dare shield them from well-deserved litigation when the banks themselves use every minor customer deviation from incomprehensible contracts as an excuse to charge a fee?

It may well be inevitable that some lawyers would attempt to challenge a federal law, but is there a reason to believe that the litigation would be successful? Federal law can bulldoze state laws - it's called preemption. For the most part, even now, homeowners don't seem particularly inclined to fight the foreclosure process. Legislation would further narrow the pool of people willing to litigate, and banks could redouble their efforts to document those transactions so as to moot their cases.

Perhaps the author is speaking of the potential litigation between the various financial institutions involved - attempts to force buy-backs of mortgages or securities, fraud actions, breach of contract actions.... But the players seem to know the risks associated with that game, which is why they're presently working through their lobbyists as opposed to their law firms.

There are alternatives. One measure that both homeowners and investors in mortgage-backed securities would probably support is a process for major principal modifications for viable borrowers; that is, to forgive a portion of their debt and lower their monthly payments. This could come about through either coordinated state action or a state-federal effort.

The large banks, no doubt, would resist; they would be forced to write down the mortgage exposures they carry on their books, which some banking experts contend would force them back into the Troubled Asset Relief Program. However, allowing significant principal modifications would stem the flood of foreclosures and reduce uncertainty about the housing market and mortgage securities, giving the authorities time to devise approaches to the messy problems of clouded titles and faulty loan conveyance.

Unless the documentation is in order, how do you know you're dealing with the correct party? Or is the author's assumption that, despite the irregularities and fraud in banks' attempt to document mortgages, they banks have it right in the vast majority of cases and eventually the paperwork will catch up?

Also, which is more likely to come out of the next Congress - a law making it easier for financial institutions to overcome deficiencies in their documentation of mortgages, or another bailout of the financial industry? It may be easy to forget now that the astroturfers have redefined the movement, but the Tea Party Movement grew out of popular disgust at the first bailout.

Update: Who could have seen this coming.

"Show Me The Note" and the Latest Foreclosure Mess

Via Paul Krugman, this article provides a good summary of the latest nightmare flowing from dubious lending practices and the securitization of mortgages. Krugman ponders, "You really have to wonder how all this gets resolved."

I suspect it will have to be solved legislatively.

A year ago I was skeptical of the "show me the note" defense, not that it doesn't have some validity but that it was being used by borrowers who knew that they owed the money against servicers who, although perhaps deficient in their paperwork, would ultimately provide a court with sufficient documentation to establish their right to foreclose. What I had not anticipated was the extent of both the problem, the sheer number of notes that appear to have been lost along the way, or the willingness of the servicers to engage in outright fraud to get around the deficiencies in their documentation.

At present a servicer who lacked the ability to properly document their right to foreclose could sue everybody up the chain to establish their rights in relation to the note, but that would be costly and cumbersome, and it could end up with the entity that thought it "owned" the note having recourse against those who assigned (or, should I say, claimed to assign) the note to them as opposed to the homeowner. There could be massive, multi-party suits designed to resolve the rights of the various financial entities involved in these transactions, but again that would seem more likely to result in the shifting of financial responsibility between financial institutions and not to resolve the issue of "Where is the note?" And the litigation would likely both highlight the extent of the mess and viability of the "show me the note" defense, while otherwise rearranging the deck chairs - the big issue isn't figuring out who can foreclose, but what happens if the financial industry is unable to foreclose on hundreds of billions of dollars in real estate.

It does not appear likely at this point that the legislative patch, making it difficult for homeowners to dispute out-of-state affidavits, that is falling to President Obama's pocket veto is likely to be revived. And it does not seem likely that state legislatures will respond in a way that will make it easier for lenders to foreclose based upon dubious affidavits when they can't produce the actual note. Also, as a number of people have pointed out,

But while we have at least some recognition that this document mess might force a lancing of the festering mortgage foreclosure infection, a predictable PR pushback is taking shape. From the very beginning, the servicers have taken the position that the document problems are mere “technicalities”. While that’s a stretch even with the affidavits (false affidativs are a fraud on the court), the problem of widespread failures to convey notes to the securitization trust isn’t a “technicality”; it means what were sold as MBS are potentially just unsecured consumer paper. And it goes further than that: if no notes were conveyed at closing, the trust under New York law (and all these trusts elected NY law for the trust operation) was “unfunded” meaning it does not exist (multiple top experts on NY trust law concur on this issue).

About the only way around all of these problems is to create a federal law (thereby preempting state laws) that would allow the various entities involved to resolve the issue of note ownership between themselves, with the conclusion of the process being binding on state courts. As a matter of due process, borrowers would be entitled both to notice of a proceeding pertaining to their mortgage and of the right to participate in the proceedings. Within such a system, I expect that the financial institutions involved would for the most part cooperate such that ownership claims could be quickly resolved. But should homeowners participate, in some (perhaps many) cases the lack of documentation could effectively result in a finding that nobody has the right to foreclose. (Are you beginning to see why preventing courts from effectively reviewing out-of-state affidavits was thought to be a better solution by the banks who pushed that bill through Congress?)

Update: Via Eschaton, the mortgage industry appears to be heading toward a storm of internecine litigation:

The Association of Mortgage Investors, a trade association, has called on trustees, who oversee loan pools on behalf of investors, to demand that loans be repurchased by their originators if required documents are missing. Typically, sellers have 90 days to fix such problems or buy back the loan. The group has also asked trustees to audit and hold servicers accountable for any losses due to improper servicer practices.

"It's very hard to see how the servicers can avoid reimbursing the trusts for losses caused by taking short cuts," said David J. Grais, an attorney in New York who represents investors. Investors could press trustees to investigate servicer conduct, sue the servicers to recoup damages or replace a servicer, he said.

Gingrich & Goodman Idea #9: "Stop Health-Care Fraud"

I guess it's hard to come up with a list of "10 GOP ideas", which I suppose John C. Goodman and Newt Gingrich include non-GOP ideas, ideas at odds with actual GOP ideas, and even Democratic Party ideas in their list. As with "making health insurance affordable", it's rather silly for either party to try to lay claim to fighting fraud.

Every year up to $120 billion is stolen by criminals who defraud public programs like Medicare and Medicaid, according to the National Health Care Anti-Fraud Association. We can help prevent this by using responsible approaches such as enhanced coordination of benefits, third-party liability verification, and electronic payment.

Were the GOP to propose legislation with a serious likelihood of combating fraud, I think it would pass by overwhelming support from both parties. But... this isn't actually a GOP priority and they have proposed no such bill.

Who is making a crack-down on fraud a priority? Well, it's not Newt Gingrich:

"The Obama administration is committed to turning up the heat on Medicare fraud and employing all the weapons in the federal government's arsenal to target those who are defrauding the American taxpayer," HHS Secretary Kathleen Sebelius said during a news conference at the Justice Department with Attorney General Eric Holder.

"But our joint efforts don't just stop at the jailhouse door," she said. "Every dollar we can save by stopping fraud can be used to strengthen the long-term fiscal health of Medicare, bring down costs and deliver better service to Medicare beneficiaries."

The government's job will be anything but easy.

During the past five years, thousands of Medicare fraud offenders have shown that they can outsmart the vulnerable healthcare system for the elderly and disabled. Their weapons: cash kickbacks to Medicare patients, manipulation of medical records to justify bogus charges, and use of different billing codes to get around Medicare's technology to block false claims.

Maybe Gingrich missed the speech?

The only thing this plan would eliminate is the hundreds of billions of dollars in waste and fraud, as well as unwarranted subsidies in Medicare that go to insurance companies -- subsidies that do everything to pad their profits but don't improve the care of seniors. And we will also create an independent commission of doctors and medical experts charged with identifying more waste in the years ahead.

Without wanting to diminish the importance of empowering patients, it should be noted that if you restructure Medicare's payment system such that each doctor can "renegotiate and reprice their services" with each individual patient, as Gingrich and Goodman propose, you're significantly increasing the opportunity for fraud.

I'll give Gingrich and Goodman credit for having the President's back on this issue, but I'm surprised they don't know that President Obama is a Democrat.

(Return to Parent Article.)

The Motive for Cloning a Website

A Florida personal injury firm is, understandably, upset that its website was cloned (with some minor changes) and put online on behalf of a fictitious firm based in Manchester, England.

Gordon & Doner is represented in the trademark infringement suit by Doner and Edward McHale of McHale & Slavin in Palm Beach Gardens. John Rizvi, a copyright attorney with Gold & Rizvi in Plantation who is not involved in the litigation, said he had never heard of a similar cyberhijacking.

"I'm trying to figure out a motive," he said. So are the attorneys at Gordon & Doner.

"Our lawyer, Michael Slavin, surmises that it may be a ploy to knock us down on Google," Doner said.

I expect that an investigation will uncover a different motive.

The fake website, maslinassociates.com, is registered to the email address, "maslinassociates@gentleiyke.com" That site, gentleiyke.com, is registered to an address in Engugu, Enugu, Nigeria. With a fake website for a law firm based in London, and an easily detected connection to Nigeria, the odds seem extremely high that the cloned law firm site was to be used to add credibility to a 419 scam. These scammers have a history of "borrowing" real names and logos, and of creating fake websites for "banks" and "lawyers" who are referenced in their letters and emails. Heck - a few years ago, they borrowed a logo from one of my sites. What easier way of getting a content-rich, credible looking website than to steal a real one? Another news article observes,

Indeed, an astute purveyor of legal services might have noticed that all was not right with Maslin & Associates. For instance, one of the photographs lifted from the Gordon & Doner law firm featured a tropical backdrop, not exactly typical of the famously gray English climate. And lawyers aren't known as "attorneys" in England: They go by the titles of solicitor or barrister.

If you've read any quantity of emails from 419 scammers, you know from the proliferation of spelling and grammatical errors that they're not particularly concerned that astute readers will catch on to the scam - that's a given. It's a volume business.

A Really Bad Analogy

One of Bernie Madoff's former victims clients, suing the SEC for a lack of oversight, states,

"If the government knew you were being stalked and it didn't stop the stalker, then you should be able to sue the government," she says.

You could sue... but absent unusual circumstances you would lose.

The article provides this amazing fact:

Picard [the court trustee appointed to seek assets for distribution to victims], who said there's no evidence Madoff bought any securities for his investors for at least 13 years, has so far managed to recover less than $1 billion in assets.

Wow....

Everything Old is New Again

With all of the recent variants on advance fee fraud (419 scams), particularly money order fraud, It's been a while since I got the classic "I'm the millionaire son of a tyrant who needs help figuring out how to FedEx a suitcase full of diamonds" version. But my wait is over:

FROM MR. ZUBI ADAM (VERY URGENT)

TEL: +27-784100444

EMAIL:zubiadam2@live.co.za

ATTENTION: SIR/MADAM,

You may be surprised to receive this message from me since you don't know me in person, but for the purpose of introduction, I am MR ZUBI ADAM, the son of late MR. THAMBA ADAM, who was murdered in a land dispute in ZIMBABWE. My late father was among the few black Zimbabwean rich farmers and a strong member of opposition party MDC (MOVEMENT DEOMCRATIC OF CHANGE) who is murdered in cold blood day by the agent of the ruling government of President ROBERT MUGABE for his alleged support and sympathy for Zimbabwean opposition party. Which we communicated to the whole world through BBC AND CNN.

Before the death of my father, he took me to SOUTH AFRICA to deposit the sum of EIGHTEEN MILLION US DOLLARS ($18M) with a security and finance company, as if he knew the looming danger in Zimbabwe . The money was deposited as a gem or precious stone to avoid much demurrage from the security firm. This money was earmarked for the purchase of new machinery and chemicals for the farms and the establishment of new farms in Lesotho and Swaziland .

This land problem arose when President ROBERT MUGABE introduced a new land Act. Which wholly affects the white rich farmers and some few blacks vehemently condemned the 'MODUS OPERANDI' adopted by the government. This resulted to rampant killing and mob actions. I and my family who are currently staying in South Africa as a refugee or an asylum seeker have decided to transfer this money to a foreign country where we can invest it. I am faced with the dilemma of investing this amount of money in South Africa for fear of encountering the same experience in future since both countries have the same political history.

I have meet and agreed after consulting financial expert who humbly advice us that the best way for realizing and safe guarding this fund without South Africa authority being after the money is to involve a foreigner.

Moreover, the South African monetary policy/law does not allow such investment hence I am seeking for an asylum or refugee. And the nature of your business does not necessary matter. So if you are willing to assist us, I and my family have agreed to give you 35% of the total money, 60% will be for a joint business venture I will be doing with you in your country and the remaining 5% will be mapped out for all expenses we may incurred during the transaction.

Therefore, if you are willing and interested to render the needed assistance, endeavor to reply through the above email address. Remember that this is highly confidential and the success of this business depends on how secret it is kept.

Expecting your reply soonest.

Best Regard.

ZUBI ADAM

(FOR THE FAMILY)

From its carefully personalized opening, "ATTENTION: SIR/MADAM", to its emotionally wrenching close, "(FOR THE FAMILY)", to the admission that the money (that doesn't actually exist) was stolen from a program "for the purchase of new machinery and chemicals for the farms and the establishment of new farms", I have to tell you... the proposal was hard to resist.

At Least He's Honest

Caught up in what you would thing would be an obvious scam, a lawyer admits,

"I'm a capital 'D' Dumbass."

I don't say that to be hard on the man, but to emphasize this: When you're offered huge amounts of money for doing virtually nothing, odds are you're being scammed.

I don't want to review the entire history of international financial scams - it's long, and predates the Internet. Yes, those promises of wealth from foreign lotteries you haven't entered, deaths of foreign relatives you didn't know existed, or desperate millionaires who can only get their money out of a developing nation if you let them wire it to you? There was a time that they came by mail or fax. Now they come primarily by email, and although they evolve the central theme remains the same:

1. You are selected at random, for no apparent reason;

2. You are offered a great deal of money to do virtually no work; and

3. If you go along with the scam, you'll end up losing a great deal of money.

A relatively recent version of this scam is a "work at home" scam, where you supposedly process payments for a company, forwarding them their balance when the checks clear. You retain a percentage, say 10 - 20%, as your fee. Now it should be pretty obvious that there's something fishy here - why would a company direct its clients to send you their checks (more probably, money orders), and pay you to process them, when it would be cheaper and easier to receive the payments directly?

I received a phone call the other day, inspired by an article I wrote a few years ago on this type of money order fraud. It was a story I expect to hear repeated quite often in the current economic climate - a woman, facing financial hardship, answers an ad offering home-based employment. She signs up, starts receiving and processing money orders, and "clears" a couple of money orders through her bank before they are revealed to be fraudulent. She's already forwarded the money, less her "share", to an international address. Her bank wants its money back from her. The money orders in that case looked very real because they were real - all except for the dollar figures. The scammers had managed to steal some blank money orders.

But that woman is "small fry" compared to the lawyers who have been targeted. It's exactly the same deal, except the scam comes from somebody claiming to represent an international corporation trying to collect on an unpaid account - tens or hundreds of thousands of dollars. They offer the lawyer a sizable percentage of the money recovered. Ironically, this percentage vastly exceeds the 10 - 20% offered in the "work at home" version of the scam, because ordinary people would probably be incredulous that they could get 30 - 40% of the payment merely for processing a check. The lawyer-victims, not so much.... They sign up, call the debtor, are told, "No problem - I'll mail that right out," get a check within days, and it never occurs to them to wonder, "If the debtor was that eager to pay, why didn't the creditor simply call and ask for payment and why would they offer, let alone agree to, this fee?"

Here's my proposed solution - banks should prepare brochures outlining the most common version of this scam, and have them available at their counters. When a customer comes in to deposit a money order, their tellers should be instructed to ask, "Do you personally know the person who sent you that money order? Have you seen our brochure on money order fraud?" Even at the ATM machine, banks could give a general warning about money orders to customers making deposits - display the full warning one time, and offer a "press here to learn about money order scams" option for future deposits.

Because I suspect that 90% of the people suckered into this type of scam, once made aware of how the scam works, would figure out whether or not they should be depositing the money order. Banks lose money on these scams, as well. Wouldn't this simple step be less costly for everybody?

Hey.... Buddy....

Wanna buy a five star hotel?

Internet Fraud Goes "Old School"

I've been informed by a couple of people that they have received letters, postmarked in Spain, which they believed to be associated with "my company", due to the expropriation of a logo from the ExpertLaw website:

The letter itself is one that most reading this have received by email - the representation that somebody who happens to share their surname died in Africa, and the law firm is so eager to find an heir for their multi-million dollar fortune that they'll give it to anybody who happens to have the same surname. (The letter I was sent was carefully personalized - the recipient identified as "Dear UHIRIG".)

The letter indicates that Mr. PETER UHIRIG and his wife were killed in the Madrid train bombings, for some reason leaving $14 million in the hands of Mr. Cook. If you know the drill, Mr. Cook has searched exhaustively for heirs, but can't find a one. So because you share the last name, you win the lottery!

I like how they even included the ® symbol - but can you really expect participants in advance fee fraud to extend a great deal of respect to intellectual property law? I doubt that there is truly a "Christopher Cook & Co Solicitors" in Madrid, and if there is I truly doubt that their email address is "barristercook@aim.com". If that's the case, perhaps Mr. Cook needs to devote some time to figuring out if he is a solicitor or a barrister.