Fraud remains big business

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Scammers,
skimmers, crooked contractors and fake charity organisers were among the wide
range of con artists about whom members of Cayman’s business community were
warned at a fraud seminar held last week.

Speakers,
who included special agents from the American Secret Service, local police, and
a banknote manufacturer, gave members of the Cayman Islands Chamber of Commerce
tips on how spot scams, counterfeit money and fraudsters at the one-day seminar
on Wednesday.

Marcia
Brown, a US Secret Service special agent, told the audience that identity theft
was becoming a huge problem in the United States, accounting for 74.5 per cent
of all cases the Secret Service dealt with last year. “It is surpassing drug
trafficking as our number one crime,” she said.

“We’re
seeing about nine to 10 million victims of identity theft a year and those
numbers continue to increase. As access to the Internet is easier, the victim
rate starts to get a lot higher… No-one is immune,” she said.

She
also warned of a growing spate of charity scams. “Charity scams are another big
scam we are starting to see, particularly with some of the natural disasters we
are seeing around the world. Everybody wants to get in on making some quick
money. When it comes to donations, we encourage people to do some research,
look online, ask questions, go to your Chamber of Commerce website, or Better
Business Bureau sites. Try to find out who the people are who are collecting,”
she advised.

She
urged those in the banking and financial services industry to ask questions of
clients and customers who wanted to make investments or unusual payments, such
as, is the venture in which they want to invest asking them for credit card or
bank account numbers up front and are they being asked to wire money quickly,
through Western Union or MoneyGram.

“Anytime
you feel any pressure at all to act quickly, whether to collect a prize or buy
into some type of venture, you need to be really wary of that,” Ms Brown said.

She
also advised people to check the requests or emails they receive for proper
spelling and grammar as scam originating in countries where English is not the
primary language. “If the venture was legitimate, you’d think they would take
the time to get the language right,” she said.

She
urged people to ensure they dispose carefully of their bank and credit card
statements and other sensitive and private documents to prevent “dumpster
diving”, in which fraudsters search through rubbish to find information to help
them steal a person’s identity and set up bank accounts and get loans. “Tear it
up, burn it, shred it, so somebody cannot come by and pick up your information
and compromise your identity,” Ms Brown said.

Trends
seen locally in Cayman, and how they were being dealt with by police, were
addressed by Senior Detective Constable Richard Clarke of the Financial Crimes
Unit of the Royal Cayman Islands Police Service, who gave an example of the
practice of individuals or companies taking deposits to do work that they never
intended to carry out.

“Post-Ivan,
there was a lot of that…. there is evidence where individuals hid behind a
company where they have taken money to build a house and they don’t do it. You
went to get your money back and they said ‘sue me’, they know it’s a costly
venture and a very time-consuming one.

“There
has been quite a lot of that on the Island and even to this day, that is still
happening,” he said.

However,
with changes to the Penal Code and the introduction in 2008 of the Proceeds of
Crime Law, police are better able to deal with such frauds, which are no longer
simply a civil matter, and can charge suspects with theft, Mr. Clarke said.

“One
of the approaches that the Financial Crimes Unit is taking, where there is
evidence of habitual behaviour with certain companies, we will go and charge
them with a criminal offence because they feel that by talking about ‘civil’,
they can just get away with taking people’s money,” he said.

Mr.
Clarke later confirmed that a man was charged on Friday with 13 counts of
theft, two counts of obtaining services by deception and one count of uttering
a false document in relation to deposits from customers totalling more than
$80,000. He is scheduled to appear in court Tuesday.

At
the seminar, he also outlined two recent cases in which details of credit and
debit cards, which had been illegally skimmed, were used to make thousands of
dollars worth of purchases. In one case, a telephone company lost $7,000 in
top-up purchases and in another case, a bank reported that about 20 of its
customers had reported fraudulent spending on their credit cards, totalling
about $40,000.

Mr.
Clarke warned people to keep an eye on their credit cards and not to give out
credit card details over the phone.

He
showed the audience the skimming machine used to swipe cards and capture
information – a small, black, handheld machine. “I know there is more than one
on the Island, we are looking out,” he said.

This
was the fourth fraud prevention seminar hosted by the Chamber of Commerce,
which holds these seminars every two years.

The
Chamber’s Economic Crime Survey 2005-2006 reported that an average $20 million
worth of economic crime is committed annually (2005 figures) with $40 million
being spent in preventative measures.

Police
Commissioner David Baines, speaking at the opening of the seminar, told Chamber
members: “Your conference and the area of fraud is probably the most complex of
areas and most challenging to pursue in real time and requires more than ever
for you to be at the top of your game.”

He
added: “You will deal with a threat of major criminal gain, visible to no one,
executed across continents in seconds, not minutes, where to function effectively,
you require allies, similarly trained, professional in their approach and willing…  to help.“

Stuart
Bostock. president of the Chamber of Commerce said: “One thing is for certain,
fraud is not a problem limited to ‘big businesses’ nor is it a victimless crime
– on the contrary – as we all suffer when our local businesses lose money in
this way. Either business owners have to adjust their product or service costs
to keep afloat or in some instances may close their doors all together. 

“Now,
in the flailing economy we find ourselves in today, any opportunity to prevent
this type of fraudulent activity and loss of business income must be
explored.” 

The
Chamber, in partnership with Deloitte, has produced a Beating Fraud Brochure,
which is available for download from www.caymanchamber.ky or can be picked up
at the Chamber office.

TOPFraudPreventionSTORY

Speakers in the Chamber of Commerce’s fraud prevention seminar on 2 June, 2010. From left, Patrick Bodden of CIMA; Police Commissioner David Baines; Michele Ebanks of Cayman National Bank; Marcia Brown, US Secret Service; De-tective Sergeant Mi-chael Montaque of RCIPS;Jason Naylor, US Secret Service; Deborah Ebanks of CIMA; and Matt West of De La Rue.
Photo: Submitted