Entries in Fraud (4)


Mexican Teen Fakes Own Kidnapping, Gets Arrested

iStockphoto/Thinkstock(VERACRUZ, Mexico) -- Mexican police have arrested a teenager who faked her own kidnapping so that she could get money to go on vacations with her ex-boyfriend and four other friends.

Nineteen year-old Arely Soto actually wanted her parents to believe that criminals had kidnapped her so that they would pay her friends a $20,000 ransom for her "release."

To get away with this, Arely simply disappeared from her home in the state of Veracruz one day and had her friends call her family, posing as bloodthirsty criminals.

It's a believable story in Mexico, where kidnappings are still a common crime. But things went bust when Arely's parents suspected something was amiss and contacted local police.

Mexican newspaper Zocalo reports that Arely's parents agreed to make the ransom. Police then arrested the teens as they drove to the town where they were going to collect the money.

The teens promptly ratted out Arely, who was found by police in the neighboring state of Hidalgo before her friends were arrested.

Arely told cops that she had been threatened with a knife and was beaten, but once her friends confessed to their role, she allegedly acknowledged that it was all a scam.

Arely and her friends will probably spend some time in jail. They have also reminded us, once again, that real life crimes are sometimes more absurd than those that happen in Hollywood films.

Copyright 2013 ABC News Radio


Brit Convicted of Selling Fake Bomb Detectors, Many in Iraq Still Using Them

Oli Scarff/Getty Images(LONDON) -- An antenna on a black hinge was once a silly, useless gift for anyone trying to find lost golf balls. But British businessman Jim McCormick claimed the device could detect bombs, drugs, even ivory, turning a piece of plastic into a multi-million dollar business -- despite knowing it was ineffective. And for that, a British court ruled, he has blood on his hands.

McCormick, 57, slapped a new label on the $20 "Golfinder" and marketed it as an "Advanced Detecting Equipment," selling them for as much as $5,000 each to Iraqi officials, whom he bribed. He improved the design and sold 6,000 second-generation devices for as much as $40,000 each, amassing a fortune of more than $75 million, according to legal documents.

A British court Tuesday convicted McCormick of three counts of fraud, and now police vow to go after his riches, which include a $7 million British home formerly owned by Nicholas Cage, houses in Florida and Cyprus, and a $1 million yacht.

"McCormick is a fraudster who over the last 10 years has made, manufactured, and sold a device that is completely incapable of detecting explosives, drugs, or any other substance," Detective Superintendent Nigel Rock told reporters. "There are no working parts in that device. It is empty."

McCormick's main market was Iraq, where he traveled at the height of the sectarian war and sold $40 million worth of the devices, according to a BBC Newsnight investigation that led to a British government ban on its sale.

Iraqi police officials introduced "Mr. Jim" at press conferences, and officers fanned out across the city, holding the simple-looking antennas, believing they would detect bombs.

But the court ruled Tuesday McCormick knew all along that the devices couldn't even detect a golf ball, and that he put people at risk.

"McCormick for 10 years has sold this device in countries that are wracked with terrorism and wracked with explosions," said Rock. "He has paid no heed to the people who've stood on checkpoints and security posts believing this device worked."

Officials in Iraq have said they provided a false sense of security. In one case, according to the British media, a bomb that exploded in Baghdad crossed through 23 checkpoints where McCormick's fake bomb detector was being used.

"He has no conscience. He is morally bankrupt," Haneen Alwan, an Iraqi woman who needed 59 operations after being injured in a January 2009 bomb blast, told the BBC. Alwan’s unborn child was lost in the blast. "How could he sell them just for money and destroy other people's lives?"

McCormick's claims were extraordinary. He said his company, ATSC, had four laboratories working independently and that an employee "like Q in James Bond" had created the technology. He commissioned low-budget commercials in which a house and car blow up before the screen fills with the words "PREVENT IT." His commercials and literature claimed to detect explosives within 200 feet, even if they were deep underground or inside lead-lined rooms. As one expert witness who testified in the trial put it: the device's antenna "was no more a radio antenna than a 9-inch nail."

The devices were also sold to Pakistan and have been used outside of major American hotel chains in Karachi, as witnessed by this reporter.

"We will now pursue McCormick's wealth," Rock said, "and make sure crime does not pay."

Iraqi General Jihad al-Jabiri, who used to lead the Baghdad bomb squad and helped McCormick win his contract, is now serving a jail term for corruption.

Reporters cornered McCormick outside the courtroom. Asked how he could continue to defend his product, he said simply, "I'm still defending it. I still am."

Meanwhile, Iraqis are still using his device at checkpoints across Baghdad.
As part of the BBC investigation, a whistleblower described how he walked away from the company after confronting McCormick.

"I said, 'If this really doesn't work, I can't be any part of it,'" the whistleblower told the BBC. "He said, 'It does exactly what it's designed to.' I expected him to say detect explosives, ivory, gold. He never said that. He said, 'It makes money.'"

Copyright 2013 ABC News Radio


FBI Warns Small Businesses of Unauthorized Wire Transfers to China

Jupiterimages/Thinkstock(WASHINGTON) -- The FBI issued a fraud warning Tuesday alerting small- and medium-sized businesses about a series of unauthorized wire transfers going to China which have resulted in $11 million being taken from about 20 U.S. companies. According to the FBI, the cyber-criminals have attempted to steal $20 million but $9 million in transfers have not gone through. The FBI alert issued Tuesday notes that the wire transfers have been between $50,000 and $985,000 going to trade companies along the China-Russia border.
“The intended recipients of the international wire transfers are economic and trade companies located in the Heilongjiang province in the People’s Republic of China....The economic and trade companies appear to be registered as legitimate businesses and typically hold bank accounts with the Agricultural Bank of China, the Industrial and Commercial Bank of China and the Bank of China,” the fraud alert noted.
The FBI cautioned that once the money is in the bank accounts of these companies it is immediately withdrawn. The warning was issued by the FBI’s Internet Crime Complaint Center and the Financial Services Information Sharing and Analysis Center.  The warning notes that the computers of individuals who are authorized to make wire and money transfers are compromised by malware and spoofed emails known as “phishing” attacks. which allow the computer thieves to obtain username and password information.
The FBI also believes the accounts may have been compromised by a Botnet attack which is composed of armies of so-called "zombie" computers, often ordinary people's machines, that have been hijacked by hackers and ordered to vacuum up private information from bank accounts, credit card data and email services. Earlier this month the FBI and Justice Department disabled a Botnet known as “Coreflood” which infected more than two million computers with malicious code. 
“At this time, it is unknown who is behind these unauthorized transfers, if the Chinese accounts were the final transfer destination or if the funds were transferred elsewhere, or why the legitimate companies received the unauthorized funds,” the warning stated.
According to U.S. cyber-security officials, small- and medium-sized businesses have been targeted by hackers since they may not have robust computer security and IT systems in place that large corporations have.

Copyright 2011 ABC News Radio


Millions of Votes Tossed Out in Afghan Parliamentary Elections

Photo Courtesy - Getty Images(KABUL, Afghanistan) -- Afghanistan’s Independent Election Commission is tossing out 1.3 million votes out of the 5.6 million cast for last month’s parliamentary elections.  Of 2,500 candidates, 224 are being accused of fraud and their cases have been sent to the Electoral Complaints Commission for investigation.

Only 23 percent were expected to cast ballots, but the “turnout” -- or votes cast -- was approximately a million more than predicted.

A video obtained by ABC News appears to show underage voters and ballot stuffing. The video at one point shows an individual in a police uniform watching as a person casts dozens of fake ballots. Another part shows a woman with multiple voting cards.

The election process was praised by several western governments and non-governmental organizations as being much improved over last year's presidential election.  Last year, just over 17 percent of the votes were discarded.

Copyright 2010 ABC News Radio

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