CJE 4610 CH 15

1) free prize schemes, (2) foreign lotteries, (3) pyramids scams, (4) investment frauds, and (5) work-at-home cons

top five postal frauds

grand larceny

A felonious theft that is generally classifies the stolen thing by its value

swoop and squat

A form of automobile fraud in which a car quickly cuts in front of a legitimate motorist, hits the brakes, and creates a rear-end collision for which repair and fake medical claims can be made

drive down

A form of automobile fraud that involves waving to another driver to go ahead and make a turn in the intersection or elsewhere and then driving into the car, making it appear that the struck vehicle is at fault

Ponzi/Pyramid Scheme

A fraud in which money received from later investors is used to provide returns to earlier investors, thus giving an appearance of a profitable investment

"Diagnosis Dollars"

A massive fraudulent billing scheme perpetrated by an Armenian-American organized crime ring known as the Mirzoyan-Terdjanian Organization which involved more than 73 individuals working in conjunction across the United States to defraud the system out of $163 million dollars. The group not only opened over 120 fake clinics, they also stole the identities of Medicare beneficiaries and healthcare providers, frequently opening bank accounts in the names of the doctors whose identities were stolen.75 To date, it was the largest Medicare fraud scheme ever perpetrated by a single criminal enterprise and represents the vulnerability of not only Medicare, but other American financial systems that may be compromised from an organized attack

petit/petty larceny

A misdemeanor theft, which constitutes a dollar amount less than the amount necessary to constitute a felony

economic stimulus scam

A recorded phone message that sounds like President Barack Obama directs victims to websites requiring online applications and $28 in fees to receive a large sum of stimulus money. (occurs via telephone/online)

paper accident

A type of automobile fraud in which no accident has taken place. One may provide a wrecked car to get insurance or have their car fake being stolen.

Astrological reading scam

A victim receives a free reading but is enticed into paying for a full reading to learn about something favorable about to happen in form of spam or pop-up message

-checks made payable to the business or to cash by customers are deposited in an account the employee controls; replacement checks to the employee are issued when there is no need to do so, for example, the original check was not lost; -payroll advances to the employee are not subtracted from the next paycheck; -there is no documentation explaining why checks are made payable to "Cash" or what happened to them; -the employee is reimbursed for unexplained expenses; -the employee keeps promising to show the business owner the bank statements, but it never seems to happen; -vendors and suppliers are complaining about slow and late payments

Among the signs that an employee in a position of trust such as bookkeeper or business manager may be or is committing check based crimes are these

"Hitman Scam"

An e-mailer claims to have been sent to assassinate a victim, but the victim would be spared if he/she wires money overseas.

security

An investment instrument from which an investor expects to derive financial benefit through the efforts of others

security fraud

Any manipulation or deception that affects the purchase or sale of a security and usually includes the misrepresentation or omission of significant information

estate locators

Con men know people fantasize over lottery winnings/getting inheritance and fuel that fantasy with letters delivered to our mailboxes from these people who purport to be efforts "to locate the heirs of a substantial sum of money." These letters are, like other mail frauds, sent out in the thousands to unwary recipients who are asked to pay $30 or more for an "estate assessment."132 This scam may also ask for personal information as the first step in an identity theft

-Establishing early warning signs -Forming task forces with LE agencies -Forming partnerships and working with retailers and manufacturers -Monitoring stores' goods supplies -Using social networking sites to gather info about shoplifting incidents

Deterrents of organized retail crime

- 85 % of victims report that their first realization about the theft comes from a negative contact - most identity thefts and the follow-up crimes come to light only one to six months after they began, meaning that victims' recollections about how and when the identity theft occurred may not be very helpful and that documentary evidence is of vital importance in working the case

Difficulties for investigators to detect identity crimes

-the victim's belief that the police are not interested in bicycle theft and will therefore do little or nothing to catch the offender and return their stolen bicycle -police departments record bicycle thefts in different ways, thus inadvertently concealing the full scope of the problem -difficult to prove ownership

Why bicycle theft is often underrepresented

-goods sold -demographics and seasonal variation -methods used by shoplifter -type of shoplifter

Factors contributing to shoplifting

-billing for services never provided -Filing duplicate claims. -"Upcoding" or using billing codes for more expensive tests or longer office visits than actually occurred. -"Unbundling charges," which is the practice of charging separately for each component of service. This produces a greater claim than if the service was properly billed as one single charge. -Misrepresenting the diagnosis in order to get paid for services not covered by the health plan or to charge for costly tests not actually provided. -Performing unnecessary tests;71 a Massachusetts orthopedic surgeon routinely gave patients potentially harmful X rays and steroid injections they didn't need so he could falsely bill Medicaid. In less than 3 years, one patient was X rayed 74 times and given steroid injections on 112 occasions. -Billing using the names of people who are deceased. -Charging for home health aide visits which were not made -Employers may enroll employees who are actually not eligible in plans or change the dates of employment or termination to expand the dates of coverage -Members enrolled in health plans may alter the documents they submit in order to get a greater reimbursement than they are entitled to or to let someone else use their plan identification to obtain services -A person may end up with a false medical history

Forms of health insurance fraud

-By trick -By receiving stolen property -By deception -By fraud -theft of service

Forms of larceny

-Bidders colluding to set bids at a higher than warranted price per unit and bidders concealing they are insolvent or have a record of defaulting on their bids. -Providing employees in the procurement office with cash and other types of bribes, such as trips in exchange for being the winning bidder. -Substituting lower-costing or counterfeit goods to fulfill the terms of a bid. -Consultants or contractors overstating the number of days worked or the amount of materials required to do the job. -Submitting bogus invoices for office supplies or other goods in the hope they will be paid. -Bogus Yellow Page advertising. In the minds of most people the "Yellow Pages" are legitimate ads in the local telephone directory; however, because the phrase was never copyrighted or registered others can use it. Fraudsters may offer "yellow page" advertising and either produce just a few one-page copies for the subscribers or simply abscond with the money.

Forms of vendor fraud

It involves a person who has been entrusted with something valuable converts it to their own purpose or use in contravention of his/her legal obligation

How embezzlement/theft of conversion differs from common law larceny

It lacks the element of the use of force, threat, or fear and the victim does not need to be present

How larceny differs from robbery

-Switch card-reading device -install a card skimmer -install a new keypad -install a camera

How thieves steal bank info from ATM

-There is no perforated edge; most checks should have perforation on one edge. -The routing and fractional routing numbers are inconsistent and/or do not match the location of the bank listed on the check. -The check contains spots or stains. -The word "VOID" appears

Indicators that a check has been altered or counterfeited

-avoid contact with sales personnel; -pick up a small item and wander about the store until they have the opportunity to palm it or conceal it on their person; -"have their heads on swivels" to assess their opportunity to steal; -wear baggy clothing or coats in weather not requiring it; -distract sales personnel or serve as shields so their partner can take and conceal items; -make repeated trips to the fitting rooms, sometimes to wear store merchandise out under the clothes they wear; -carry large handbags or push strollers in which items can quickly be concealed.

Investigators working a shoplift detail should be alert for customers in a retail establishment who

-lifting -levering (between loose lock and bicycle stand) -striking (securing chain/lock) -unbolting -cutting (through locks/chains) -picking (locks)

Methods of stealing a bicycle

-Palming (concealing items in palm of hand) -Booster devices (items used to conceal things) -wearing items out -shields (where one or more people shield the thief from and often used to distract employee) -buggy/stroller (used to push buggy/stroller into store to conceal item for stealing and having a baby/toddler steal an item)

Methods used by shoplifters

-Joyride (transportation/enjoyment) -trade for cash -fulfill a request (steal specific types of bicycles to order)

Motives of bicycle thieves

Check kiters

People who open accounts at several banks, knowingly, issuing a check that overdraws their account at Bank 1 and then depositing a check in that account from their Bank 2 account to cover the first worthless check. This process is repeated with ever-increasing amounts until the scheme falls apart because it cannot be continued indefinitely

(1) people are scammed out of their money and do not get a tax deduction, and (2) public confidence in charities is undermined, making it harder for legitimate charities to raise funds for important causes

Problems created via charity and disaster fraud

-In city centers and other busy places, with a large number of casual customers -Fronting on the open street -Close to highways that provide easy escape routes -Near schools, with many juvenile customers -In economically deprived areas, with large concentrations of impoverished or addicted residents

Shoplifting risk factors related to specific locations

-Many exits, particularly where they are accessible without passing through the checkout -Passageways, blind corners, and hidden alcoves -Restrooms or changing rooms -High displays that conceal shoppers (and shoplifters) from view -Crowded areas around displays of high-risk items -Aisles that staff cannot easily survey from one end

Store layout and display factors that put the sore vulnerable to theft

1) lost/stolen wallet, checkbook or credit card; 2) friends/acquaintances/relatives with access; and 3) corrupt employees with access to the information

The "big three methods" of obtaining personal information from victims are . . .

crotching

The action of person who once in the dressing room will layer the stolen clothing under their regular clothing or roll the items up and secret them between their legs

missing person fraud

The con men read the newspapers and visit official police sites where there are Internet postings soliciting information about missing persons, including personal information and the circumstances surrounding the disappearance. The fraudsters send a letter in which they pose as "people recovery specialists," offer phony credentials as former FBI, CIA, or other governmental agents, tout their national and international contacts, provide false accounts of successes, including recovering people from cults, and mention their access to special databases.

wash-wash scheme/black money scheme/advanced fee scam

The con reports that the dollars he is trying to get into this country have been treated with a chemical that turned them black, disguising their true value; in order to be able to wash the $100 bills clean so they can be used, special, expensive chemicals must be bought, and the victim must pay for them. A meeting is set up outside the United States, to avoid the higher risk of arrest. The victim flies there to actually see the money that will be "cleaned and divided." The meeting is conducted in a hotel room or other location. The con has a specially treated bill that is black, and he uses the "small amount of special cleaning chemicals he has left" to demonstrate the process, and the bill is partially cleaned. This process is actually very cheap and on the order of a sleight-of-hand trick. The victim advances several thousand dollars to buy the chemicals; but then, the vial is "accidentally left in a cab or broken." So, the victim advances more money. This is repeated as many times as the victim pays up and then the fraudsters disappear, allegedly to get the chemicals themselves

pigeon drop

The first con artist strikes up a conversation with the mark on a street filled with shops or at a mall. The job of the first con is to make a "quick connection" with the mark and gain his/her confidence; they talk about the mark's family Page 457or whatever is comfortable. The second con approaches with a story of having just found an envelope filled with a lot of money and asks them if it belongs to them. When the envelope is opened, there will be some paperwork suggesting that it came from drug sales or other illegal activity. After asking the first con and the mark what should be done with the money, the mark is lead to the conclusion that all three should share it. Because there is no identification in the envelope, the money cannot be returned, and there is no real harm because the person who lost the money is dishonest. The two cons, quickly joined by the mark, talk about all the things they could do with the money. One of the cons calls his/her employer, who is an "attorney." The attorney advises that the money be put in "his firm's" trust account while a due diligence search is made to find the owner of the lost money. Additionally, the mark and the two cons are to provide a sum of money, as a show of good faith until the found money can be distributed, which will also be placed in the mythical trust account. After the mark withdraws his good faith money, the lawyer may take the group to lunch and take control of all of the money. The victim has thus lost all the money he withdrew from the bank

when people falsely claim they were injured on the job

The most common worker compensation fraudulent claim is . . .

Medicare and Medicaid

The most commonly affected agencies in health-care fraud are . . .

hot products

The most vulnerable parts of the store to shoplifting are those that carry ____________________.

Source tagging

The placement of a small insert between the pages of a book or in a package of tools by merchants, causing the tag to emit a narrow-band radio frequency that triggers an alarm if the item has not been scanned

Organized retail crime

The problem of significant losses to retailers caused by crews or rings of often mobile professional shoplifters

-the counterfeiting of credit cards; -the continuing availability of new technologies has helped counterfeiters produce exact replicas of bona-fide cards, including the so-called "hidden" security features

The quickest exact growing sector of credit card fraud may be . . .

pump and dump scheme/hype and dump manipulation

The touting of a company's stock through false and misleading statements to the market place often by using the Internet After distributing favorable, but false, information to drive up the price of the stock, the price of the stock rallies by its being bought

larceny/theft

The unlawful taking and carrying away of the tangible personal property of another with the intent to permanently deprive that person of his interest in the property

-posting signs about prosecuting shoplifters -placing expensive items in locked cases -putting on display only one of a pair of items -keeping aisles uncluttered to facilitate observation -having roving employees and uniformed security officers

Theft prevention strategies

-avoid prosecution, -increase their profits, -avoid seizure of their accumulated wealth, -evade paying taxes whenever possible, and -appear legitimate

Why people launder money

1. Placement (unlawful conversion of proceeds into legitimate financial institutions or systems) -Smurfing *making multiple deposits of cash or buying multiple bank drafts, which are checks issued by one bank against funds deposited in that bank that authorize a second bank to make payment to the entity named in the draft -black market peso exchange (BMPE) *A sophisticated method of money laundering which is typically operated to convert drug or other illicitly gained money into funds which appear to be from legitimate sources 2. Layering ( funds are moved to other financial institutions to obscure origin) 3. Integration ( illegal funds that have been placed and layered are now clean and are virtually indistinguishable from wholly legal money)

These are steps of how the crime of money laundering is committed

franchise offers

These arrive in the mail touting fast food or quick printing business opportunities that require a substantial investment. These offers mention brand names, such as FedEx Office or McDonald's, which are familiar to people or "soon to be very big in this area of the country." Using the cover of appearing to be a legitimate business opportunity, con men drain money from victims for application and other fees and then disappear

Universal Product Codes (UPC)

These help with inventory control and proper pricing at the point of sale where cashiers scan in the price.

senior citizens

These people are ideal victims for scammers because . . . -they generally have good Page credit and a sizable savings. -they are not as likely to report being a victim of fraud because they may not realize they were conned; if they do acknowledge their victimization, they may not report it, owing to embarrassment or shame. -even if they were to report the crime, some of them can be poor witnesses, based on their limited ability to recall information. -Moreover, a significant time lapse between the scam and discovery of the crime makes details of the event more difficult to remember

mortgage

Theses schemes typically involve misrepresentations, false statements, or exclusions related to the property or the prospective buyer and often take form as inflated appraisals, false loan applications, kickbacks, and straw buyers which are manifested in reverse mortgage and foreclosure rescue schemes, illegal property flipping, builder bailout scams, and air loans

Tangible personal property

Things that have physical existence such jewelry, computers, cameras, etc.

intangible property

Things that have value, are abstract, and are not in physical existence (stocks, bonds, saving accounts, etc.)

Soft Fraud

This involves normally honest people who tell "little white lies" and collect reimbursements to which they are not entitled, as in the case when the value of the items reported stolen in burglary is overstated

promissory note

This is essentially a short-term written I.O.U. that promises to pay its holder, the investor, the fixed amount invested plus a fixed amount of interest at some specified date in the future

Hard Fraud

This is when someone deliberately fakes an injury, accident, theft, arson, or other loss to illegally collect from insurance companies

bank examiner con

This person often begins with a call to the mark's home in which the caller identifies himself as a bank examiner who relates there is some apparent wrongdoing at the bank, and the assistance of the mark is solicited in finding out who it is. The mark is asked to withdraw some money from his/her account and then to meet the examiner at a nearby location. This person may be accompanied by "Sgt. Jones," who flashes a badge and praises the mark for his help. This person gives the mark a counterfeit cashier's check to replace the funds withdrawn but asks him/her not to deposit it for the week it takes to complete the investigation. By then, the scam has been run several times in that community, and the con men are long gone before the mark finds out that the check is bogus

Nigerian 419 scam

This scam begins with a potential victim getting an unsolicited fax, e-mail, or letter that purports to be from a current or former Nigerian governmental official or a relative of such. The recipient is told that a "confidential source has recommended the contact." The letter writer wants the victim's help in investing in the United States and will pay handsomely for it, up to 30% of the "total." Another 10% to 15% of the money will be set aside to pay for miscellaneous expenses in getting the money transferred. The victim provides personal information, including bank account numbers to facilitate the movement of funds from Nigeria to this country. The personal information is not immediately abused; later it may be sold or employed in another type of fraud. The victim is pressured into sending money to cover unanticipated costs, which continues as long as the victim sends money. The money requests to the victim are accompanied by official-looking government and bank documents with embossed seals and verification stamps, all of which are counterfeit or phony

clamshell blister

This type of packaging seals a product in a clear plastic container, which allows 360-degree visibility of the product and is difficult to open

-Overpayment fraud *A seller advertises a high-value item—such as a car or a computer—on the Internet. A scammer contacts the seller to purchase the item, then sends the seller a counterfeit check or money order for an amount greater than the price of the item. The purchaser asks the seller to deposit the payment, deduct the actual sale price, and then return the difference to the purchaser. -Wire-transfer schemes *start with fraudulent and misleading ads for the sale of high-value items being posted on well-known online auction sites. When buyers take the bait, they are directed to wire money to the crooks using a money transfer company. Once the money changes hands, the buyer never hears from them again. -Second-chance schemes -involve scammers who offer losing bidders of legitimate auctions the opportunity to buy the item(s) they wanted at reduced prices. They usually require that victims send payment through money transfer companies, but then don't follow through on delivery

Types of auction fraud

-identity theft -follow-on crimes

Types of criminal acts involved in identity crimes

-professionals -amateurs -drug addicts -kleptomaniac -vagrant

Types of shoplifters

-1-900 and foreign exchange number *Scammers will leave a telephone message or send an e-mail from someone offering to engage in phone sex, telling the recipient they have won a prize, telling them that a family member is sick, or some other bogus message. The recipients think they are making a domestic long-distance call, but they are actually being connected to a number outside the United States and are billed at international call rates. Return callers often have to wade through automated menus and hear "dentist office" music to keep them on the line. These scams average $35 per call or more, which appears on the victims' telephone bills -Mexican collect call scam *The telephone rings and a voice, using the correct names of family members, says this is an emergency collect call, and the caller accepts the charges only to discover a stranger is on the line talking about something entirely different -Cramming * The practice of placing unauthorized, misleading, inaccurate, or deceptive charges on the victims' telephone bills, which may be accidental but is often intentional

Types of telephone scams

one year callable CD

Unscrupulous sellers of this often trumpet the higher rates of interest to be paid but do not explain to investors about the terms used, thus misleading them

Job site scam

Victims are persuaded to provide personal information or copies of payroll checks only to find their bank account drained

Fake pop-ups for antivirus software

Victims click on fake pop-up ads warning them about threatening viruses on their computers and end up downloading malicious computer codes or viruses.

-Acknowledge customers as they enter the store or department. *Fast efficient services will deter most shoplifters. Shoplifters want minimum contact with sales help, thus a friendly, helpful, observant salesclerk is a good deterrence to theft. -Know the sales area. *A knowledgeable salesclerk is in a much better position to spot items that have been moved or are missing. -Watch the nervous customer who does not want assistance. -Be careful of persons walking with merchandise in hand. *Ask them "May I help you? Would you like me to put that by the register until you are ready?" -Watch the customer's hands. -Keep an eye peeled for unauthorized people in the stock room or shipping and receiving area. *They may be looking for items to steal, or they may be purposely there to distract you while their partner hits the sales floor. -Watch customers with open packages, shopping bags, oversized handbags and purses. -Place expensive items in locked cases. -Never put out more than one expensive item at a time on a counter top (especially jewelry) for a customer to look at. *If they should decide to grab the merchandise and run from the store at least the theft will be limited to that single item.

Ways employees can deter shoplifting

-Calling credit card companies, asking them to change the address "your" bill is mailed to and quickly running up charges on accounts. The victim may be unaware of any problems for a month or more. This practice is called account takeover. -Opening up new, fraudulent, credit card accounts using the victim's name, banking information, Social Security information, and other data. The first hint of trouble for a victim may be when a card company or collection agency calls because the "account" is in serious arrears. -Establishing new accounts for wireless telephone service, which go unpaid. -Opening bank accounts on which they write worthless checks. -Using counterfeit checks and debit cards to drain victims' banking accounts. -Purchasing cars by taking out loans using the victim's name, defaulting on payments and then fleeing with what is now a stolen vehicle. -Using the victim's identity if involved in an automobile accident, stopped for a traffic violation, or arrested by the police. If released by the police or bonded out of jail following an arrest, they don't show up for any required court appearance and an arrest warrant is issued in the victim's name. -Fraudulently obtaining other types of identification, including passports, drivers' licenses, Department of Defense cards, and Social Security numbers. -Committing mail, investment, telemarketing, and Social Security frauds.

Ways follow-on crimes are committed

-Stealing wallets and purses containing identification, bank, credit, membership, and other types of cards. -Stealing mail, which provides bank and credit statements, preapproved credit offers, Social Security numbers, and other personal data. *Some thieves follow mail carriers at a distance and then steal from mailboxes that appear to have just had a large stack of mail delivered. Alternatively, they might cruise affluent neighborhoods looking for raised red flags on mailboxes and stealing outgoing correspondence. -Going to the Post Office and completing a change of address form to divert mail to another location. -Rummaging through the victims' trash, or the trash of businesses, to "mine" for personal data—a practice described as dumpster diving. -Fraudulently obtaining the victim's credit report by posing as a potential landlord or employer. -Stealing personal identification from the victim's home. -Opportunistically using information from lost wallets and purses. -Family members, relatives, roommates and acquaintances misappropriating information. -Stealing personal data assistants (PDAs) and smartphones, such as Blackberries and iPhones, and laptops and tablets; this area may become more significant in the future, because more than one spyware virus for PDAs and smartphones are known to exist. -Obtaining personal information by hacking into home and business computers or by such tactics as downloading spyware programs. (Identity thieves posing as a legitimate business duped an Atlanta-area company out of personal information for perhaps as many as 400,000 people nationally.42) -Stealing information from employers, medical and insurance offices, student records, and other locations or bribing corrupt employees to provide the victims' personal data. -Scamming victims out of personal information on the Internet is done by a technique known as phishing. *Two common phishing scams are sending an e-mail to potential victims that appears to be from a legitimate source, such as eBay, AOL, Yahoo, Best Buy, Wells Fargo, a credit card company, or a bank, and asking that they update their account information data. The second method involves using an e-mail to notify victims they have won a prize, such as the Canadian or Netherlands Lottery, but need to pay a processing fee to receive it, thereby tricking the victims into completing an accompanying credit form.44 *There are numerous variations on these two methods. One is an e-mail promising a free credit report subject to the recipient completing a personal information form. A second method is an e-mail from the U.S. Internal Revenue Service offering an $80 credit if they will participate in an online satisfaction survey, Form IR-2007-148, which also requires the disclosure of personal information. Any time a possible victim reports an unsolicited e-mail contact from the IRS it is a phishing attack, because the IRS neither initiates unsolicited contacts that way nor does it ask for passwords and other related information. Other bogus forms falsely attributed to the IRS include IR-2007- ending in 49, 75, 104, 109, or 116. Victims should be directed not to open attachments associated with such e-mails and to report the attack to [email protected]. Since this mailbox was established in 2006, more than 30,000 taxpayers have reported 400 separate phishing incidents. -Shoulder surfing, or watching and listening from a nearby location as victims identify themselves and use credit cards or write checks or are punching in their long-distance calling-card numbers. -Using technology, such as skimmers, to obtain personal data. Skimmers are pager-sized data collection devices that cost roughly $300. More difficult to detect is "skimmer bug" software that can be inserted into point-of-sale terminals. These bugs store the data read in the terminals' circuitry, and then the modem is used to send the data to the thieves' computers. Some banks have found dispensers filled with bank pamphlets attached to the side of their ATMs. What they discovered is that these thief-placed dispensers actually contain miniature cameras that record the names, debit card numbers, and codes of ATM users46 (Figure 15-7). -Employing card trappers. One example of this involves attaching a false card slot to the front of the ATM. As legitimate users enter their codes, shoulder surfers wait nearby or use binoculars or a camera with a telephoto lens to get the accounts' access codes. Unable to retrieve their cards, customers leave the ATM, and the thieves have both the access codes and the ATM cards.47 -Picking up discarded computers. From these, thieves recover sensitive files between 33% and 50% of the time.48 -Sending a fraudulent letter and IRS-like form to nonresident aliens who have earned income in the United States. The form is an altered version of IRS Form W-8BEN, "Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding." This form asks for many types of personal information and account numbers and passwords. United States citizens receive a similar phony IRS Form, W-9095, the intent of which is also identity theft. An innovative and novel twist on sending a letter from the IRS, is the new scam-letter from the FBI that informs the recipient that they have been the "victim" of a fraud and that the FBI is investigating their case. The unsuspecting individual is then asked for important personal information on which further fraud and theft scams can be conducted. These letters can be received via e-mail or the postal mail and can be quite elaborate. -Calling a home and telling the person that because he or she failed to come to court as required by "the jury duty summons sent to their residence" that the judge is going toPage 446 issue a bench warrant for his/her arrest. When the panicked recipient of the calls insists no such summons was sent, the "Clerk of the Court" says "perhaps there has been a mistake, let's verify some information" and gets enough personal information to commit identity theft. -Offering "debt consolidation" services by phone, promising the unwary that by working with the holders of their credit cards, they can immediately get up to 50% of their debt immediately forgiven, and the one remaining monthly payment "will be less than 20% of the total you are paying now; all I need to get you started right now is your credit card numbers." -In yet another scheme, scammers are stealing Social Security numbers assigned to children who do not have bank accounts. The stolen Social Security numbers are then used to develop phony credit profiles, credit cards, bank accounts, and identification. Thieves run up huge debts that will never be paid off. These schemes unfortunately are quite successful and go undetected for long periods of time, until the rightful owner of the Social Security number applies for credit; if that person is a child, it may be years before the scheme is ever detected.

Ways identity theft occurs

Eighteen percent

_____________ of all stolen goods are sold on the Internet

Check fraud

_______________ is the forgery, alteration, counterfeiting, or knowing issuance of a check on an account that is closed or has insufficient funds to cover the amount for which the check is written

Auction fraud

___________________ involves the misrepresentations of a product advertised for sale through an Internet auction site or the nondelivery of products purchased through an Internet auction site This crime is the most reported Internet offense

money laundering

_________________________ is the illegal practice of filtering "dirty" money or ill-gotten gains through a series of transactions until the money is "clean," appearing to be proceeds from legal activities. The United States Criminal Code defines money laundering as the concealment of the source and/or the destination of money, which has usually been gained through illegal activities

Affinity Fraud

investment scams that prey upon members of identifiable groups, such as religious or ethnic communities, the elderly, or professional groups

white collar crime

nonviolent, illegal activities that rely on deceit, deception, concealment, manipulation, breach of trust, subterfuge, or illegal circumvention