Examining an Emerging Internet Fraud Problem: Who Has Responsibility & What Should Be Done? Facilitator: Dr. Graeme R. Newman Kristen Rosselli, RPD Strategic Initiatives Mgr. Patrick Niemann, RPD Training Sergeant POP Conference 2005, Charlotte NC
Work-at-Home/ Repackaging Fraud Raleigh NC Police Work-in-Progress POP Conference 2005, Charlotte NC
Raleigh, NC USA POP Conference 2005, Charlotte NC
M. O. of the Crime n Two Variations of the “Work at Home” scam: 1. Re-Packaging Variant 2. Money Order Variant (variants can also be combined) POP Conference 2005, Charlotte NC
Commonalities to Both Variants n All victims responded to a job listing which advertised “work at home” opportunities. POP Conference 2005, Charlotte NC
Job Ad Example POP Conference 2005, Charlotte NC
Commonalities to Both Variants n n All suspects were overseas. At the request of the suspect, all victims provided detailed resumes. POP Conference 2005, Charlotte NC
Commonalities to Both Variants n The suspect will “use” each victim for approximately two weeks. POP Conference 2005, Charlotte NC
Re-Packaging Variant n n n Victim is advised that they will receive parcels from several areas within the USA. The victim is then instructed to re-package or combine the parcels, and ship them to the suspect (overseas). The victim is sometimes referred to a specific carrier’s (i. e. UPS) business shipping account for postage. POP Conference 2005, Charlotte NC
Re-Packaging Variant What’s really going on… n n The suspect is purchasing high-value items online with stolen credit card numbers. The orders are shipped to the victim, who re-packages them, and forwards them to the suspect. POP Conference 2005, Charlotte NC
Re-Packaging Variant There’s More… n Sometimes, when using “corporate shipping” accounts, the victim was unknowingly billing himself for the shipping. POP Conference 2005, Charlotte NC
POP Conference 2005, Charlotte NC
Money Order Variant n n Victim is advised that they will receive money orders, from various sources within the USA. The victim is then instructed to cash the money orders. They are allowed to keep a small amount for themselves (usually 5%), but must wire the remainder to the suspect. POP Conference 2005, Charlotte NC
Money Order Variant What’s really going on… n The suspect is posting fictitious items on online auctions. He instructs the “winner” of the auction to send the price of the item, via money order, to the re-shipper. POP Conference 2005, Charlotte NC
POP Conference 2005, Charlotte NC
Additional Impact to the Victim n n Upset merchants, auction bidders, and law enforcement are contacting the re-shipper, demanding answers or restitution. Since the re-shipper has provided a resume to the suspect, continuing identity fraud is a possibility. POP Conference 2005, Charlotte NC
International Aspects POP Conference 2005, Charlotte NC
International Aspects POP Conference 2005, Charlotte NC
There can be several distinct crimes… n Fraud n Identity Theft n Credit Card Fraud n Computer Crimes? POP Conference 2005, Charlotte NC
RPD Statistics Several case reports were filed with RPD, which ultimately identified: n n n 3 re-shippers in Raleigh 15 victims throughout the US who sent money orders or merchandise Two countries where proceeds were being sent (Russia, Ukraine) POP Conference 2005, Charlotte NC
National Statistics No authoritative data yet on re-shipping scams in particular, however… n From 1/1/04 through 12/31/04, there were 12, 703 work-at-home and business opportunity fraud complaints reported to the FTC’s Consumer Sentinel. Source: FTC’s “National and State Trends in Fraud and Identity Theft” published 2/1/05. POP Conference 2005, Charlotte NC
Typical Investigation n Out-of-town victims are called, and interviewed at length. Raleigh victims / re-shippers are visited and interviewed. Court Orders are obtained for IP addresses (email trace). POP Conference 2005, Charlotte NC
Typical Results n n Re-shippers were unusually naïve, and desperately hopeful. All IP address traces ultimately ended overseas. POP Conference 2005, Charlotte NC
Prosecution Results n n State Prosecution declined on local re -shippers, and no jurisdiction on foreign suspects. Crime / damages do not meet threshold for prosecution at US Attorney’s Office (NC Eastern District). Therefore, no FBI, USSS, etc. involvement or adaptation. POP Conference 2005, Charlotte NC
Are victims warned? n Caveat on “jobspider. com” POP Conference 2005, Charlotte NC
Are Victims Warned? n Caveat from IFCC POP Conference 2005, Charlotte NC
Scanning n Emerging complex crime in Raleigh n Multiple victims/case n $7, 000 - $20, 000/case n ~2 week window n Multiple jurisdictions/case n Low solvability factors POP Conference 2005, Charlotte NC
Analysis n Analyzed crimes separately n Underlying cause: “Opportunity” n Vulnerable victims n Vulnerable networks n Motivated offenders POP Conference 2005, Charlotte NC
Analysis: Resources n COPS Guides Identity Theft n Check and Card Fraud n Financial Crimes Against the Elderly n Shifting & Sharing Responsibility for Public Safety Problems n n POP Center website: popcenter. org n Police Practitioners & Researchers POP Conference 2005, Charlotte NC
Analysis Job Scam Victims/Targets Re-packager/Re-shippers Online Merchants Shipping Companies Credit Card Companies POP Conference 2005, Charlotte NC
Analysis Places/Systems Internet E-job websites Newspaper Ads Job Scam Email Services Online Merchant Websites Shipping Networks US/ Int’l Shipping Locations Banking Networks POP Conference 2005, Charlotte NC
Offenders Analysis Scammers Repackaged Parcel Recipients Job Scam POP Conference 2005, Charlotte NC
Analysis Offenders Places/Systems Internet E-job websites Scammers Newspaper Ads Repackaged Parcel Recipients Email Services Job Scam Online merchant’s websites Banking Networks Shipping Networks & Locations Victims/Targets Int’l Reshipping Re-packager/Re-shippers locations Online Merchants Shipping Co. Credit Card Co. POP Conference 2005, Charlotte NC
Analysis Offenders Places/Systems Identity Thieves Internet Online product purchasers Online merchant websites Identity Theft Shipping networks & locations Place CC was compromised Victims/Targets Credit Card Theft Victim Re-shipper Online Merchants & Shipping Co. Credit Card Co. POP Conference 2005, Charlotte NC
Analysis Offender Places/Systems Ebay Auction Site Scouts Internet Website Designer Email Services Ebay Auction Sites Internet Fraud Victims/Targets Ebay Bidder Ebay Re-shipper POP Conference 2005, Charlotte NC Money Order Locations US & Int’l Shipping Networks & Locations
Analysis: Job Scam n High offender commitment n Financial gain n Organized crime n Predatory & consensual/ participatory V-O relationships POP Conference 2005, Charlotte NC
Analysis: Job Scam Victim Facilitation n Making initial contact n Providing personal info n Allowing shift to trust & waives customary safeguards n Believing offender’s pitch n Providing access to funds POP Conference 2005, Charlotte NC
Analysis n n n How capable are they? Who else can help solve the problem? Who has ownership? POP Conference 2005, Charlotte NC
Analysis Job Scam Guardians Family Media Email Providers ISP Law Enforcement Financial Institutions Corp Fraud Depts Credit Reporting Agencies FCC & FTC Shipping Companies POP Conference 2005, Charlotte NC
Analysis Place/Systems Managers Email Providers ISPs Job Scam Website Managers Newspaper Ad Depts Corp Fraud/ Security Depts. Package Delivery Services Package Receivers POP Conference 2005, Charlotte NC Mailbox Companies
Analysis Handlers Law Enforcement Organized Crime Members Others Job Scam POP Conference 2005, Charlotte NC
Response n Solving cases n Preventing future opportunities POP Conference 2005, Charlotte NC
Response: Solve Cases n Exhausted all leads n DA declined to prosecute n Little to no solvability n Cases inactivated n Seeking other response ideas… POP Conference 2005, Charlotte NC
Response: Prevention n Attempted to influence n n Addressed motivation of “owner” n n Victims & Guardians Place/System & Managers Offenders & Handlers Unable, unwilling, gain more from ignoring, profit from crime Requested prevention efforts n Voluntary – Coercive POP Conference 2005, Charlotte NC
Assessment n Not effective at removing causes n No prosecution n Some business practice changes n Problem continues n Seeking suggestions… POP Conference 2005, Charlotte NC
Request for Feedback n n What other information should be collected? Who is in the best suited to address problem? Other response ideas? What are other ways to measure success? POP Conference 2005, Charlotte NC
Shifting/Sharing Responsibility n n n What level of “due diligence” is required for emerging crimes? What are the public’s expectations of local police response? How much local police resources should be used? POP Conference 2005, Charlotte NC
Contact Information Kristen Rosselli Raleigh Police Department 919 -890 -3865 kristen. rosselli@ci. raleigh. nc. us Patrick Niemann Raleigh Police Department 919 -872 -4144 patrick. niemann@ci. raleigh. nc. us POP Conference 2005, Charlotte NC
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