An advance-fee fraud, also known as a 419 fraud, is a type of scam in which the victim is convinced to advance money to a stranger. In all such scams, the victim is led to expect that a much larger sum of money will be returned to him or her. The victim, of course, never receives any of this money.
Those who fall for an advance-fee fraud and forward money to the criminal are likely to be targeted for additional payments. That is, the criminal may claim that a second or third advance is necessary before the victim will be entitled to receive the promised money.
An Early Version of the 419 Scam
As far back as 17th century, an early version of this fraud was in use in Europe. Known as the Spanish Prisoner fraud, the scam in that case consisted of a correspondence in which the criminal would claim to be a prisoner who knows where some buried treasure is located. The "prisoner" would ask for money to bribe the prison guards so that he could escape and get to the treasure. In return for such money, the "prisoner" would promise to share the treasure with the target of the scam.
In reality, the "prisoner" was not in jail at all and was simply using the story as a way to get his hands on the target's money.
The Modern 419 Scam
The modern version of the advance-fee scam usually takes place via email correspondence. Like the older version, it typically involves a promise of treasure. The "treasure" may involve a lottery jackpot, a promise of a share of a large bank account, or some other made-up story to explain why a large sum of cash will be forwarded to the victim.
The criminal will also make up a plausible story to explain why a fee is needed in advance. The email may claim that a few hundred dollars are needed as an "application fee" to the contest that has purportedly already been won. Another common claim is that the wire transfer of such a large sum of money involves fees that must be paid in advance.
Criminals running 419 fraud rings use many tricks designed to lure in even skeptical targets. For example, they will send out mass mailings via the internet, but make each letter appear as though it has been received by only one individual. They may provide working phone and fax numbers to targets who demand them, and furnish documents that appear to have authentic government seals and stamps.
Most people who receive an email offering millions of dollars in return for a comparatively small advance fee will realize that it is nothing more than an attempt to defraud them. However, a tiny percentage of targets will fall for the bait. When millions of solicitations go out, even a small percentage of takers can represent a good profit for the criminal. This explains why the 419 fraud continues to succeed despite the efforts of consumer awareness organizations to educate the public with one simple rule: never send money, your bank account information, or your social security number to a stranger.
This scam is also referred to as a "Nigerian Letter" because large-scale use of the 419 fraud first began in that country. In fact, article 419 of the Nigerian Criminal Code deals with obtaining property by false promises, which is exactly what the advance-fee fraud is all about.
Nigerian letters have been emailed to hundreds of millions of individuals to date. The typical Nigerian letter claims that a large sum of money is sitting in a Nigerian bank, but the rightful account holder for some reason cannot access it. The excuse may be that the account holder is a being persecuted for being a relative of a deposed dictator, or some other plausible but unlikely story. The advance fee may be explained as being necessary for a wire transfer out of the country, or needed to bribe a bank official into looking the other way. In reality, of course, the advance fee is simply money that is being stolen from the victim.
The 419 fraud became pervasive during the 1990s, with thousands of people in Nigeria participating in hundreds of different fraud schemes, making fraud one of Nigeria's most significant source of revenue from abroad. During the first decade of the new millennium, the 419 fraud spread to other African countries including Ghana, Benin, Togo, Senegal, and Burkina Faso.
However, the scam is not limited to African nations. Countries as diverse as Spain, Russia, Malaysia, and the United States are also sites of significant advance-fee fraud operations.
Avoiding Advance-Fee Fraud
The simple rule given above is your best protection. Do not provide funds or personal information to strangers, no matter what kind of story they have to tell.