Beware of Nigerians Bearing Gifts

by George Waldon  on Monday, Nov. 4, 1996 12:00 am  

More and more Arkansas business people are receiving correspondence from Lagos, Nigeria, offering wildly lucrative international trade opportunities. One letter that recently made its way to Little Rock outlines a hush-hush deal that would net a profit of $11 million for a willing participant.

This unusual foreign contracting venture is offered by Steve Kalu, who says he's a certified public accountant with the Nigerian National Petroleum Corp. Kalu says in his letter he needs help transferring $45.5 million from the Central Bank of Nigeria to America.

His story surrounding the money is muddled, if not implausible. But it's OK because the transfer is risk free. Kalu says so.

There will be some incidental expenses along the way. But what's thousands of dollars when millions will be reaped in return. And, hey, the transaction will only take 30 days to close. Kalu says so.

However, the too-good-to-be-true proposal is just that and reflects the sinister side of the growing global economy.

"It is a scam," says Laurie Jo Ashcraft, chief investigator for consumer protection at the state attorney general's office. "The good news is it raises eyebrows, and I don't know of anyone who has actually sent in any money from Arkansas. We receive a lot of referrals from consumers who are suspicious and send the solicitations to us for review."

Records at the AG's office indicate the number of Nigerian scam letters arriving in Arkansas is on the upswing. Twenty-six referrals were made in 1994, 79 in 1995 and 123 this year.

The content of these unsolicited business letters is outwardly suspect and even ludicrous. Red flags should be snapping sharply from all the hot air of this bogus offer.

Surprisingly, some recipients still take the bait and pay the price. These type of schemes drain up to $250 million annually from duped investors, according to federal investigators.

"People see a lot of money, and their common sense flies out the window," says Nicole Healy of the U.S. Justice Department in Washington, D.C.

Healy, a trial lawyer with the criminal division's fraud section, helped prosecute a case against a Nigerian who bilked a Virginia businessman of $4.5 million. Amazingly, the victim was conned into wiring funds overseas nine times before catching on to the ruse.

However, authorities managed to catch the Nigerian con man in Switzerland, where he was extradited to the United States for trial. He was convicted and sentenced to 51 months in prison and $600,000 restitution. The victim also obtained a $12 million judgment against him.

Collecting the judgment and restitution is another matter. Only $300,000 worth of property and money have been recovered so far.

The case still marked a breakthrough as the first time a Nigerian scam artist was nabbed overseas. U.S. officials have met with zero success trying to extradite Nigeria con men from their homeland.

Financial scams have become something of a cottage industry for Nigeria. The official stance of the Nigerian government is to beware of business deals that sound too good to be true. However, the Nigerian government's track record for helping catch and punish wrongdoers has frustrated U.S. authorities.

"I can tell you they have never extradited a citizen in a white-collar case, although we have fugitives who might well be in Nigeria," Healy says.

In 1995 more than 500 scam letter claims were lodged by the Federal Trade Commission through the State Department against the Nigerian government. None were collected on.

"These letters have been going on for at least 10 years," says Alicia Robinson, international trade specialist with the Commerce Department's Office of Africa in Washington, D.C. "It's just that they've become a lot more prevalent and numerous in the last four years."

The proliferation of Nigerian scams reached the point that three years ago the Joint West African Fraud Task Force Unit was formed. The group is composed of agents from the Secret Service and U.S. Customs Service, officials from Immigration and Naturalization and postal inspectors.

The focus of the task force is actually Nigeria, but the name is a diplomatic move made with economic considerations. Nigeria is the United States' largest trading partner in the sub-Saharan region of Africa.

The task force netted its first catch in Atlanta: Charles Nnabuife, a 32-year-old Nigerian who was sentenced to two-and-a-half years in prison in March.

Nnabuife was convicted of mail fraud and Social Security fraud after being caught with hundreds of business scam letters and bogus Nigerian bank documents.

Investigators point to growing evidence that money obtained through various schemes is being funneled to Nigerian drug traffickers. Heroin is a mainstay of this illicit import-export business.

Arkansas Arrivals

Nnabuife was known alternately as Prince Ikechukwu, Dr. Charles Ikemba, Charles Ike, Derek Flood and Stanley Grant. The would-be victims included residents of Australia, Hong Kong and Taiwan.

One of his gambits was to entice businessmen to provide bank account numbers and blank letterhead stationery for the purported transfer of millions of dollars in excess import duty collected by the Nigerian government.

None of Nnabuife's alter-egos surfaced in a sample of letters from the state attorney general's office. Names and pitches gracing Nigerian scam letters sent to Arkansans include:

• Alhaji Shittu Salami — 25 percent of $45.5 million left by overinvoicing of a contract. (The letter is word-for-word identical with one reprinted with this article and signed by Steve Kalu, including fax and phone numbers).

• Dr. Jubril Tanko, different fax and phone numbers but otherwise a carbon copy of Kalu's and Salami's baloney.

• Dr. Amos Tijani — 25 percent of $38.5 million left by overinvoicing of supplies and contracts.

• Douglas Obed — Penned identical letter as Tijani's.

• Ahmed Gana — 25 percent of $38 million left by overinvoicing of supplies and contracts.

• Dr. Ibruhim Mohammed — 30 percent of $37 million, surplus from oil refinery substation construction.

• Sule Abuka — 25 percent of $35.5 million overinvoicing of supplies and engineering works contacts.

• Godswill Zitego — 20 percent of $25.5 million left by a Bulgarian firm.

The more elaborate schemes involve layers of con men posing as Nigerian officials who provide reasons why the transfer of the money is taking longer than expected. Of course, each successive stage strings a victim along and requires more and more money. The phony deal continues as long as the victim keeps putting up cash.

Even when the jig is up, another con man may contact the victim to help try and retrieve the lost funds. It's one more stage in the game that requires a cash transfer to Nigeria.

"If the victim responds, they always ask to send money," Healy says. "You have to admire the insidious crookedness of the scheme."

A variant on the theme targets nonprofit organization. A diocese in the Midwest narrowly averted losing more than $90,000 in such a scheme.

U.S. agents stopped the wire transfer after learning of the deal. The money was sent to pay inheritance taxes on a phantom fortune left by a Nigerian benefactor.

"It's been going on for quite a while, and we get various reports about various scams every week," says Dennis Millard, international trade specialist with the Little Rock Export Assistance Center.

Instead of buyer beware, the warning these days is beware of Nigerians bearing gifts. n

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