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Financial Crimes
03/04/2011

ICE agents return $1,500 to victim of telemarketing fraud

WABASH, Ind. - Special agents with U. S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) on Friday returned $1,500 to an elderly victim of telemarketing con artists operating from Canada.

The money was returned March 4 to a 69-year-old Wabash, Ind., woman following a multi-agency investigation under a joint U.S.-Canada initiative called "Project COLT." Although there are many variations to the scam, in this case the callers told the elderly woman that she had won a $150,000 million lottery prize, but she had to pay fees and service charges to collect the fictitious winnings.

The Indiana victim lost about $30,000 of her savings to the scam artists. She wishes to remain anonymous, but submitted the following statement to help inform others about how to protect themselves from fraudulent telemarketing offers:

"My husband and I were living on social security and needed some extra cash. I started getting sweepstakes offers in the mail and thought I had a chance to win some extra money. The prize offers looked legitimate, but my first mistake was to pay a processing fee up front. I was very naïve and didn't realize you should never send money for something you supposedly won. The individuals who called me claiming to be customs agents in Canada and they always sounded honest and professional. They told me I had to pay some insurance fees to get my winnings through customs before I could receive the prize money. They encouraged me to sell my gold, cash in my insurance policies and put charges on my credit card to pay the necessary fees. They had an answer for everything and they ended every phone call with "May God bless you." I wouldn't wish this situation on anybody. Please report any suspicious activity to your local police or ICE before sending any money to these criminals."

ICE HSI special agents warn that con artists often pose as lawyers, customs officials, police officers or lottery company officials to scam their victims out of millions of dollars.

Project COLT was formed in 1998 to identify, disrupt and dismantle telemarketing fraud operations in the United States and Canada. Project COLT members include the following law enforcement agencies: ICE HSI, the Royal Canadian Mounted Police, Surete du Quebec (Quebec Provincial Police), Montreal Police, the FBI, and the U.S. Postal Inspection Service (USPIS).

"These scam artists are relentless in their efforts to charm vulnerable elderly victims out of their life savings," warns Gary Hartwig, special agent-in-charge of the ICE HSI office in Chicago. "Together, with our law enforcement partners, we are working to put these criminal enterprises out of business. However, the first line of defense is to be skeptical of anyone promising riches."

Fraudulent telemarketers often instruct their victims to pay for service charges, federal or provincial taxes, customs duties, handling, insurance or other charges. Victims are told to send the funds via mail, courier or wire-transfer companies, such as Western Union or MoneyGram. Scammers are often able to then receive the transferred funds using false identification. Con artists frequently pose as government officials to convince their victims to send money.

Project COLT includes a unit of officers who intercept funds and work to prevent further victimization through public education. They also investigate these cases to bring to justice those who commit the fraud. Project COLT intercepts about $1 million annually. These funds are returned to victims who are instructed how they can avoid future victimization.

Project COLT members have formed partnerships with the Canada Border Services Agency, Canada Post Corporation, Federal Express, Purolator, UPS, DHL and other companies to assist with intercepting and returning funds to the victims.

Since its inception, Project COLT, a partnership between American and Canadian law enforcement, has recovered about $27 million from fraudsters and initiated numerous complex criminal investigations, resulting in 94 indictments and 74 convictions. There have been 175 U.S. and Canada-based arrests. In addition, Canadian law enforcement authorities have executed more than 75 search warrants and shut down 50 Western Union and Money Gram offices involved in telemarketing fraud conspiracies. Canada-based telemarketing fraud organizations report that consumers have lost more than $280 million to fraudsters. Law enforcement officials believe that amount represents only about five percent of the actual total loss to consumers.

ICE encourages the public to report suspected telemarketers or fraudulent activity through its toll-free hotline at 1-866-DHS-2ICE. This hotline is staffed around the clock by investigators.