SOPHISTIZATION AND ANONYMIZATION OF THE FINANCIAL FRAUD CRAFT

WILL THIS EVER STOP?

Posted by     "Jeffrey J McGee" on Saturday, May 25, 2019

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SOPHISTIZATION AND ANONYMIZATION OF THE FINANCIAL FRAUD CRAFT

In general, we can say that different degrees of enlightenment, ranging from lying claims over deception to real enlightenment, have long existed in a primal form, but in the meantime highly refined forms have also crystallised. The latter are mainly found in financial fraud, for example in certain life settlements and in certain interest rate swaps. Certain excrescences are even so sophisticated that they are, as it were, almost ‘predestined’ to mislead. As a rule, they also look very reliable and are marketed by equally reliable wolves in sheep’s clothing. An average good family man is not resistant to such clever and cunning forms of fraud, nor can he be blamed for anything. But that doesn’t take away from the fact that also artisanal forms of swindle still flourish. There are still swindlers who collect money from their victims for all kinds of investments and insurances and give them their periodic payout rings, with the money of the victims themselves. After some time, these payments stop and go to work with the rest of the capital. In practice, I’ve been able to establish that tried and tested recipe several times with several victims. Especially seniors are coveted prey for fraud with investment and insurance products. On the one hand seniors want to place their savings safely, but on the other hand they also want to get some kind of interest to live on. This is perfectly understandable, but it also makes them ‘vulnerable’ to the fraudulent instincts of rogue investment advisors who have only one thing in mind: sell as many products as possible on which they earn commissions, both during the sale and in the subsequent management. The higher the risks they take, the higher the commissions they earn. But the unsuspecting saver skilfully turns a blind eye to them. They are always told that the products are ‘safe’, ~but at the end of the story it turns out that only one person pays for the risks, and that is the saver or the investor. Each month, the saver or investor receives an amount in his account that he thinks is income. At least, that’s how it is suggested. In reality, the saver or investor is eating up his own capital all the time. This means that there is zero return, sometimes over very long periods of time, and that the injected capital slowly melts away like snow in the sun without people realising it. You can probably imagine the shock and frustration of the victims. But when the light at the victims begin to daydream, the bank, insurance company and intermediaries often stand by with an outstretched face: ‘But you knew, sir, that there were risks involved: We also find this new complexity in cybercrime or Internet fraud. Part of the problem starts with the technical complexity of the crime and the speed with which the investigations must be carried out. The digital traces often disappear very quickly. The police are currently working on the distribution of a roadmap that clearly explains which elements must be included in the complaints and which procedure must be followed to start the investigation with a chance of success. However, this knowledge is still insufficiently disseminated at present. It is also striking that the ‘clean hands’ factor inherent in scams, because the perpetrators literally do not have to get their hands dirty, at most their ‘white collar’, is even more pronounced in modern, sophisticated forms of scams. Often the victims will only notice their losses after years, at a time when everyone has disappeared from sight. Moreover, there is hardly any contact between the perpetrator and the victim after the harm has been done. Of course, the sellers have to make a little effort to sell, but afterwards it becomes a ‘paper file’. In the case of scams with life settlements, the perpetrators use all kinds of complex foreign constructions, as a result of which the distance between victim and perpetrator becomes even greater and the criminal mastetminds feel unapproachable. The increasing distance not only reduces the chance of being caught, but also soothes the offender’s conscience insofar as he does not have to look his victim in the eye. In artisanal scams, on the other hand, the contact between perpetrator and victim is much stronger.