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SWINDLES, SCAMS AND STINGS
Col Fry, Australian High Tech Crime CentreRussell Smith, Australian Institute of Criminology
Delia Rickard, Australian Securities & Investment Commission
Chaired by Louise Sylvan (ACCC)
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2007 National Consumer Congress
Col Fry
Coordinator
Australian High Tech Crime Centre
14 March 2007
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Role of the AHTCC
Centre of knowledge and expertise
assist Australian policing jurisdictions in building high tech crime capacity
Coordinated national approach
serious, complex and/or multi-jurisdictional nature
generally beyond the capability of any one Australian policing jurisdiction
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Key Partners
State / Territory Police Services
International Law Enforcement Agencies
Internet Service Providers (ISPs)
Commonwealth Government agencies
Australian Communication and Media Authority (ACMA)
Australian Financial Institutions
Anti Virus Vendors
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Key Investigation Tools
Data supplied by ISPs
Telephone / Data Intercepts
Search Warrants
Technical analysis of compromised computers
Information sharing with International law enforcement agencies
IP / Domain redirection
Data from victim organisations
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Limitations
Transnational nature of crime type
Technical counter-measures designed to disrupt law enforcement activities
Level of cooperation between jurisdictions / organisations
Legislative limitations
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Effectiveness
IP Blocking effected within hours of site identification
Deregistration of illegitimate sites
2 – 4 days dependent on action by site registrar
?? % of sites removed from internet
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Australian Government
Australian Institute of Criminology
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Australian Government
Australian Institute of Criminology
0
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1953 57 61 67 71 75 79 83 87 91 95 99 2003
National Consumer CongressSwindles, scams and stings – what do we know?
Recorded Australian Fraud Offences 1953 - 2006
Rate / 100,000
pop.
Year
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What are swindles, scams and stings?
Categories Sub-categories
Advance fee schemes Pyramid schemes, Ponzi schemes, chain letters, ‘Nigerian’ emails, business opportunities, prizes and lotteries
Non-delivery and defective products and services
Online auctions, internet services, computer products, sexual services, credit and loan scams, health scams, educational qualifications
Unsolicited and unwanted goods and services
Spam, securities and investment fraud, bait advertising, inertia selling
Identity fraud Phishing, plastic card fraud, card skimming, un-authorised transactions, online banking fraud
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What are the main types of scams? Most prevalent current types of scams
Lottery advance fee scams Pyramid / chain letter scams Employment / money mule / work from home scams Other advance fee / Nigerian scams Investment / get-rich-quick scams
Developing types of scams Phishing scams Online auction scams Mobile and wireless scams Email threats and extortion scams
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The path to being scammed‘Experiencing’ scams
Aust (online scams) – 25% NZ (consumer scams) – 48%
USA (consumer fraud) – 36%
Responding to scams
NZ (Nigerian scams) – 1% NZ (ID theft) – 1% NZ (investment scams) 0.5%
Phishing (NZ) – 4% (USA) – 8%
Being victimised by scams
Aust (14-64) – 9% (>65) – 4% UK (adults scammed) – 6.5%
ID fraud (Can)–20% (USA)–4% Online fraud
(USA) – 40%
Losing money to scams
Aust (Scamwatch callers) – 16% Aust (Sensis online fraud) – 4%
UK (plastic card fraud) – 3% Hong Kong (cybercrime) –
13%
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Current avenues for reporting
Consumer Affairs / OFTs
Independent Commissions Against Corruption
Professional Boards
Civil Courts
Health Complaints’ Commissioners
SCAM VICTIMS
Audit Offices
Private Sectore.g. banks, companies
Aust Crime Commission
Identity Document Issuers e.g. Passports, RTAs
Aust Federal Police
Aust Competition & Consumer Commission
Aust Securities & Investments Commission
Registries e.g. BD&MOmbudsman
Police Fraud Squads
ACMA - Spam
Aust High Tech Crime Centre
Internet Industry & ADNR
DCITA - Phones
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How do consumers respond to scams?
Make no report
Aust (Scamwatch callers) – 69% Aust (online scams) – 50%
Aust (offline fraud) – 12% Aust (online
auctions) – 19% USA (consumer fraud) – 29% USA (ID fraud) – 21% Canada (marketing
fraud) – 44% Canada (ID theft) – 17%
Report to police
Aust (Scamwatch callers) – 7% Aust (online scams) – 3% Aust (offline fraud) 24%
Aust (online auctions) – 6% USA (ID fraud) – 34% Canada (marketing
fraud) – 6%Report to other agencies
Aust (Scamwatch callers) – 13% Aust (online scams) – 21% Aust (offline fraud) – 8%
Aust (online auctions) – 2% Canada (marketing fraud) – 1%
Report to bank / card issuer
Aust (online scams) – 26% Aust (offline fraud) –
72% Canada (marketing fraud) – 6%
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Improving our knowledge of consumer fraud
ACFT / AIC survey of callers in March 2007 Survey of those who call ACFT agencies throughout March 2007 go to www.aic.gov.au/surveys/acft/
ACFT / ABS household survey of consumers in 2007 Scam victimisation questions in the ABS national household survey
Coordinated data collection by ACFT member agencies Consultation between ACFT agencies to improve data holdings
Encouraging reporting by consumers Publicity to improve scam reporting rates by the public
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Swindles Scams & Stings
an ASIC
Perspective
Delia Rickard
2007 National Consumer Congress
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What we will cover
The scams, victims & some solutions re
• Illegal investment schemes
• Early release of super scams
• Cold Calling; and
• Online banking & wrong number scams.
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Illegal Investment Schemes
• Often structured as managed investments.
• 2 categories:– Inadvertently illegal– Deliberately illegal
• Often marketed through affinity groups• Techniques to tackle include, proactive
ad monitoring, better use of intelligence, research, enforcement and consumer information campaigns.
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Early release of super schemes
• Early release only possible in very limited circumstances.
• Schemes target people on low incomes or in financial difficulty
• Consequences tragic – often lose all your super plus expose yourself to heavy tax liability.
• ASIC, the ATO & industry working together to tackle.
• Compliance checking, enforcement and education.
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Cold Calling Scams
• Top scam complaint to ASIC• Numbers growing• Broad range of potential victims.• International cooperation re enforcement but
won’t get all.• Education essential:
– Key message – just hang up– Check ASIC’s free databases:
• are they licensed• does the company exist• have they been banned• are they on our illegal cold caller list?
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Online banking & wrong number scams
• Phishing, skimming, unauthorised transactions
• Organised crime.• Review of the EFT Code
• Wrong number scam
Bottom line:• If it sounds to good to be true it probably isn’t;
and• Even if it doesn’t, do your checking before
ANY investing.