The Black Axe is synonymous with cybercrime.
It’s spread around the world.
They’ve claimed to have as many as 30,000 members globally.
How much were they trying to get out of you?
Like, 96,000 [dollars] and saying that I was going to go to jail.
The various law enforcement agencies
operating out of various countries globally
have a huge problem tackling transnational organized crime.
In October 2021,
eight men were arrested in Cape Town on serious fraud charges.
It was quite a coup,
following a protracted international investigation
involving Interpol and the FBI
as well as an elite squad of South African police.
The men were allegedly members of the Black Axe,
a notorious Nigerian organized crime group.
But their targets hadn’t been major financial institutions
or even local businesses.
Instead, their frauds came wrapped up in romance.
Literally, in that the gang’s entire operation
revolved around defrauding lonely singletons around the world
of their life savings.
What I lost with him was probably well over 500,000.
It was humiliating.
Very humiliating.
The method was simple:
create a fake dating profile for a fictitious Prince Charming,
find a divorcee or widow,
or just someone naive enough to fall for it,
and strike up a fictitious relationship.
They’re going for loneliness,
and they’re targeting people’s need for companionship.
They’re using keyword searches on platforms like Facebook.
It’s very easy.
Once embedded, the stories would start.
They needed money for a pressing debt or operation
or even to release an inheritance.
Who wouldn't want to help their partner in need?
Of course, they’d never met in real life.
It’s around deception, it’s around cheating,
and it’s around choosing those things
in order to gain a financial advantage.
It’s efficient, it’s effective,
and at the end of the day, fraud is all about money.
The gang is accused of scamming over 100 victims, mainly in the US,
and netting almost $7 million over the last decade.
But romance scams are common enough,
even if few reach the levels of organization and success.
It's just another way that fraud is evolving with the times.
[THE BUSINESS OF CRIME]
This is the
In this episode,
we’re looking at the future of fraud.
How sophisticated deception, increasingly complex scams,
and the opportunities offered by new technology
are being put to use satisfying the same old greed and cruelty.
What do we think of when we hear the word “fraud”?
More than likely,
there’s a couple of competing impressions that come to mind.
There's the gritty, everyday sort of financial crime,
typified by the figure of the scam caller
who peels off a few pin numbers from vulnerable senior citizens.
Then perhaps there’s the jolly and presumably always unsuccessful farce—
the junk email promising a vast and unexpected $800 million inheritance
from a recently deceased industrialist,
yours in exchange for a relatively small tax, of course.
We have all gotten those bogus emails from a certain Nigerian prince,
who promises to share his vast fortune
as long as you give him your bank account number.
Well, investigators say these schemes
are now becoming more sophisticated and expensive,
costing victims, in this case, millions of dollars.
It’s very easy and very convenient
for offenders to put out blanket approaches
to large groups of individuals,
and they only need a small number of individuals to respond back,
to engage with them in order to be successful.
Or maybe it’s the lone bedroom hacker,
tinkering away in their darkened room,
prodding at the Bank of America’s online defenses
to check for weak points.
Like any cliche,
there’s at least a grain of fact in all three depictions,
even if the world of fraud has become dramatically more sophisticated
over the past decade or so.
Adaptation is key.
As defenses become stronger,
scams increase in sophistication.
Sophisticated malware, social engineering,
brute force attacks,
these are some of the contemporary tools
noted by experts working in the field.
Fraud is, unsurprisingly, big business.
The US saw this as a priority.
They were losing $4 billion annually to cybercrime.
The FBI charging 80 people
with trying to scam at least $46 million out of their victims
by using fake online romance schemes or hacking businesses.
It starts with something plausible.
One 78-year-old victim was conned out of her entire life savings
after clicking through on a link
offering a deal on a discounted electric toothbrush.
Another fell victim to a convincingly cloned website
that mimicked the popular platform MoneySuperMarket.
Fraud has one of the lowest rates of reporting across all crime types.
There is a high level of victim blaming that exists for fraud.
And I think fraud is one of those offenses
where there is active participation on the part of the victim,
so victims in many circumstances have willingly transferred money.
Victims feel very ashamed.
There was one case of which I’m aware
where a victim in the US committed suicide.
Successful scams require incompetent institutions.
Take bank fraud, for example.
Theft wouldn’t be possible with adequate defenses,
and some of the world’s biggest banks are often falling woefully short.
Some tried to address this by hiring dedicated staff.
Others have blamed social media, where many of the scams are seeded—
even if the biggest platforms
don’t seem particularly fussed with addressing concerns.
Fraud isn’t simply a matter for the old, the lovesick,
or the technologically challenged.
Warnings have even been raised
about the security in the world of online video games.
From
young players have been targeted around the world
for bogus in-game purchases
or even for the recruitment of money mules—
teenagers who agree for a third party
to drop illicit funds into their account
in exchange for a cut of the profits.
They said within three, four days,
there’ll be, like, four grand in your account,
and you can have half.
It’s slightly harder to feel sympathy
for the victims of a major recent crypto fraud.
The scam was based out in South Korea,
where 470 investors pumped almost $2 million
into a scheme that offered guaranteed returns using the “kimchi premium,”
AKA the gap in crypto prices between South Korean exchanges
and others across the world.
The student caught by Korean Customs Service
had sent around US$35 million to Hong Kong,
for which they earned the kimchi premium of US$1.7 million.
Three people were arrested after complaints about the alleged fraud
when the promised returns didn’t materialize.
Just the latest similar case
in an unregulated boom industry rife with deception.
By definition, fraud is hardly the most glamorous crime.
If successful, it doesn’t involve real-world violence
or even a face to put to a name.
It's anonymous and clandestine.
It's also cowardly and exceptionally vicious in its own right.
It relies on the very worst of human nature—
the predatory taking advantage of the vulnerable,
the cruel deceiving the lonely and desperate.
It can center on an appeal to individual greed,
like the get-rich-quick promises
of the bogus crypto speculators in South Korea and beyond.
It isn’t a problem that is ever likely to go away.
How do you eradicate cruelty and greed?
As scams get increasingly sophisticated
and scammers ever more technologically savvy,
law enforcement and cybersecurity will continue to scrabble to keep up.
For the Nigerian nationals caught running their romance scams
out of South Africa,
the outlook isn’t particularly rosy.
If guilty, they’ll face 20 years in prison.
It isn’t clear exactly
what that will do to recover their victims lost livelihoods.
There will be many more victims.
We are not close to seeing the end of the Black Axe.