The check returned to the victim Friday by ICE HSI was recovered by investigators as part of Project COLT (Center of Operations Linked to Telemarketing), a binational effort involving numerous agencies, including ICE HSI, the U.S. Postal Inspection Service, the Security and Investigation Services for Canada Post and the Royal Canadian Mounted Police.
ICE HSI agents say the ploy used on the Bay Area octogenarian, whose name is being withheld at his request, is a common one employed by telemarketing fraudsters. In this case, the victim was contacted by a man from Canada who told him he had won "7th prize" in a sweepstakes, but before he could collect the unspecified "prize," he would need to send the caller a check for the taxes.
Believing he had actually won a sweepstakes prize, the victim told HSI agents and Berkeley Police Department (BPD) officers he immediately sent the caller a check for $38,000. A few months later, the same individual contacted the Bay Area man again demanding another $15,000, which the victim promptly sent. This time the check was intercepted in Canada by the Project COLT investigative team.
"This man was fortunate investigators were able to get at least some of his money back," said Shane Folden, special agent in charge for the ICE HSI in San Francisco. "Sadly, that's often not the case. While ICE HSI and its enforcement partners are doing everything possible to stop this kind of fraud, the first line of defense is for people to be suspicious of anyone who calls and asks them to send money."
"There are so few times with these ever increasing worldwide scams that we are able to collaborate and return such a loss to an individual," said BPD detective John Lenny. "BPD is grateful to all the agencies that supported this investigation on behalf of one of our older Berkeley community members. It was a truly rewarding experience."
According to ICE, fraudulent telemarketers not only pose as sweepstakes or lottery officials, but as relatives, lawyers, government representatives, police officers and accountants. The victims are typically told they will receive a sum of money varying from thousands to millions of dollars in lottery winnings. Investigators emphasize the con artists are very savvy and will persist until they bilk as much money as possible from their victims.
"I probably will never see the first check for $38,000 I sent to this guy, but I'm very grateful to have the $15,000 back," the victim said. "There is much to the saying that, if something sounds too good to be true, it is too good to be true."
Since its inception in 1998, Project COLT has recovered approximately $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 organizations that track these types of telemarketing scams report that consumers have lost more than $280 million to fraudsters. Law enforcement officials believe that represents only about 5 percent of consumers' actual total loss.
As part of Project COLT, law enforcement officers strive to intercept funds - often cash and cashier's checks - so they can ultimately be returned to victims. Project COLT investigators also work to prevent further victimization, both through public education and the prosecution of those who commit the fraud.
In support of the effort, Project COLT members have formed partnerships with the Canada Border Services Agency, Canada Post Corporation, Federal Express, Purolator, United Parcel Service, DHL and other companies to facilitate fund interception and return.
Before sending any money to telemarketers, ICE HSI urges the public to contact PHONEBUSTERS, Canada's Anti-fraud Call Center at 1-888-495-8501. The staff at PHONEBUSTERS works closely with Project COLT investigators and other law enforcement agencies. More information on the initiative is also available through the PHONEBUSTERS website at www.phonebusters.com.