The Blank Check Swindle

If you read this blog regularly, you've no doubt noticed the gradual decline in posts. The reason for this drop-off is not the dissipation of my fervor, but rather the lack of anything new to write about Jamaican Sweepstakes scams. There's only so much you can say about Advance Fee fraud, and its perpetrators.

Sadly, I have fresh fodder for discussion: The Blank Check con. Embarrassed as I am that they (the crooks and my brainwashed father) snuck this one past me, I am not about to let my embarrassment deter me from exposing the tactics Caribbean slime use to fool innocent people.

In keeping with that sentiment, here is an overview of the latest game the criminals ran on my father, who effectively has no access to cash (because, as his conservator, I cut it off):

1. They told my dad they would need a blank check, to "verify to the IRS and FBI, that the 3.5 million dollars are to be deposited in your account." (Huh?)
   
   
2. Instead of having my father send the check directly to Jamaica, the fraudsters instructed him to mail it to a collaborator in the U.S. (the fraudsters are too smart to accept checks personally, but will happily let their money mules handle them, thereby taking all the risk)
   
   
3. The helper forged the check, cashed it, and sent all or a portion of the proceeds to the crooks. (Like I said in an earlier post, cash is king in Scam Land)
   

Although it is unclear at this stage, I suspect that, like my father, the check-casher is being duped by the con men. Whether he is or not, one thing is for sure: He forged a check, and for that he is going to be prosecuted, both because I aim to get my dad's money back, and because prosecution may be the only thing that will stop the go-between from throwing his money away, too.

To sum up, here are the takeaways from my latest encounter with the scammers:

• Never, ever, send checks, or give checking account information, to strangers, no matter what they promise.
  
  
• Do not accept, or attempt to cash checks, from alleged sponsors or past winners of sweepstakes or lotteries.
  
  
• Do not wire the proceeds of such checks to strangers, either overseas, or in the United States.
  
  
• If you are the guardian of a "scambler," restricting your ward's access to cash may not be enough. You may have to take away their check book, as well as their credit cards.
  

So much for the Blank Check swindle. As with all the other schemes I have recounted in this blog, I hope that my father's loss, is your gain.

Playing The Float

Though I have alluded to it several times before, I am dedicating this post to a popular technique Jamaican criminals use to dupe Sweepstakes scam victims: Playing The Float.

The reason I am doing so, is that many Advance Fee fraud victims send money to the crooks, out of the belief that they have been sent money, by them.

It is all a con game, of course, and here's how it typically works:

1. The scammer calls the target, and tells them they have won millions in prize money in a sweepstakes or lottery.

2. The fraudster tells the target that a fee - such as a tax or delivery charge - must be paid in advance, to collect the winnings.

3. If the victim balks at the charge, the caller offers to help pay the fee by sending a check, usually described as an advance on their winnings. The check is no good of course, although the crooks do their best to make it seem legitimate, by pretending it is from a major financial institution like Wachovia Bank, or Bank of America.

4. The target is instructed to deposit the check, and immediately wire a portion of the proceeds to Jamaica, or a payment processor (translation: money launderer) in the U.S..

Here's what the criminals know, that most scam victims fail to realize: If a depositor has enough money in their account, it is the policy of many banks to cash the check in advance, before it clears. If it bounces, the depositor is responsible for paying the loan back.

The crooks know this all too well, and consequently use the float - the amount of time it takes a bank to determine if there are sufficient funds in a check writer's account to cover a payment - to extract cash from the innocent. In essence, the criminals are buying time with bad checks, to fool people into sending them money. Depending on the institution, this time window can be anywhere from 24 hours to six days.

Playing the float is clearly a scam because:

• No legitimate sweepstakes or lottery, requires winners to pay fees in advance, to collect prizes.

• Sending checks in exchange for cash doesn't make sense, at least from the victim's point of view. Why can't the sender simply deduct the amount owed, from the prize money? Answer: There is no prize money, and subtracting fees provides no opportunity to rip people off.

It is important to note that rubber checks don't just originate with the crooks: Sometimes, they come from other victims acting on the criminals' instructions.

And - as I have reported in previous blogs - the fraudsters have tried to play the float by making phony payments by phone, on my father's credit card accounts. Needless to say, it is absurd for a stranger to pay your $9000 credit card bill, in exchange for $300 cash. I mean, if I offered you a thousand dollars in return for fifty, you would either think that a) there was a catch, or b) that I was loony.

To normal adults, the catch in the "more-check-for-less-cash" ploy is obvious. To vulnerable seniors, it is not so apparent, which is why we must do everything we can, to protect them from scams and scammers.

Torpedoed By Sunk Costs

Since becoming the guardian of a scam victim, I find myself muttering a lot. One of the things I mumble is, "How, after losing so much money, could my dad continue to send payments to those Jamaican sleazeballs and their American helpers?"

It took me a while to realize that a possible answer lies in the question itself: Maybe my father kept sending money, precisely because he lost so much of it.

Initially, this prospect seemed so backwards that I was tempted to dismiss it out of hand, or write it off to my dad's impairment. I could ultimately do neither, however, for one main reason: Scores of unimpaired people - including me - sometimes throw good money after bad, thanks to a form of faulty reasoning called the Sunk Cost fallacy.

This phenomenon is well named, because those who fall prey to it continue to sink funds into losing ventures, fearing that if they stop, they won't recover their investment.

In reality, the Sunk Cost fallacy is actually two fallacies (false beliefs) in one. Specifically, that:

1. Despite all evidence to the contrary, their investment will ultimately pay off, and
   
2. Past losses justify future expenditures
   

Two wrongs don't make a right, of course, and no undertaking better qualifies as a loser than a Sweepstakes scam, where the payback is zero. Why victims can't see this, escapes me. Yet they don't, and some - like my father - become so invested psychologically in this con game, that nothing can deter them from it.

Unwilling to admit defeat and cut their losses, repeat victims of Advance Fee fraud often see no alternative but to keep paying the crooks' bogus fees, in the hope that someday their ship will come in. Which it never does, because it has been blown out of the water by the Sunk Cost fallacy, and the Caribbean con men who exploit it.