March 10, 2013

'Jamaican lottery scam' bilking senior citizens out of millions

By Kevin Miller kmiller@pressherald.com
Staff Writer

WASHINGTON - It began with a series of reassuring calls and a request for a $500 fee -- not a back-breaking sum for a retired professional pilot -- in order to claim the prize.

click image to enlarge

Kim Nichols of Maine will testify Wednesday in Washington about her father’s experience with scammers.

Photo by Pat Grossmith/Union Leader

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By the time the nonstop calls were halted six month later, Kim Nichols' elderly father had lost his health, his trust and $85,000 to Jamaica-based scam artists who were as convincing as they were relentless. And worst of all, Nichols was told there was practically nothing anyone in the federal government -- not the FBI, not the attorney general, not customs officials -- could do about it.

"I can't even begin to tell you how alone that made me feel," said Nichols, who lives near Bangor.

Nichols is far from alone.

There is a rising number of complaints from family members, phone company officials and local law enforcement that federal officials are not doing enough to address the so-called "Jamaican lottery scam" that has likely bilked millions of dollars from senior citizens in Maine and northern New England.

On Wednesday, the issue will get congressional attention during a hearing before the Senate Select Committee on Aging. The problem is national in scope but appears to be heavily focused on Maine, New Hampshire and Vermont, three states with among the oldest populations in the country.

"There's nobody taking the ball and advancing it down the field on the scams, and I don't know why," said Chief Deputy William King with the York County Sheriff's Office, who has taken the lead regionally in attempting to fight the scam and will testify along with Nichols on Wednesday. "They are complicated cases, but not that complicated."

Pursuing and prosecuting international scams is challenging due to lack of jurisdiction and the scope of the problem. But senators are expected to ask officials what more can be done to combat the scam, whether in the U.S. or in other countries.

Representatives from U.S. Immigration and Customs Enforcement, the U.S. Postal Service and the money-wire service Western Union will also testify at Wednesday's hearing, called "876-SCAM: Jamaican Phone Fraud Targeting Seniors," due to the country's "876" area code.

"While I believe that our Senate hearings will increase public awareness of these schemes, it is also critical that governments at all levels and across international boundaries work together to shut down these con artists before their sophisticated scams exploit yet another trusting senior citizen," Maine Sen. Susan Collins, the top-ranking Republican on the committee, said in a statement.

It's impossible to say how many seniors have been duped by the sophisticated crime ring. Phishing for victims, the scammers call senior citizens advising them they've won a prize such as a car or a large amount of money.

Many eventual victims start off skeptical but are slowly convinced by the steady stream of calls from other people at legitimate-sounding offices, all of whom assure them the prize is real. All they need is an initial payment -- a fee to cover taxes or other costs.

Gradually, the scammers build the victims' trust as they ask for more and more money as well as access to personal information.

Although there are many scams targeting senior citizens, the lottery scams originating in Jamaica have become big business, with an estimated 30,000 calls a day to the U.S. Jamaican authorities have pegged it as a $300 million industry run by gangs and organized crime units.

Working with FairPoint Communications, King has identified nearly 200 victims so far with an average loss of about $70,000. They also believe that only about 10 percent of victims come forward, with most staying silent about their losses due to shame or fear of losing their financial independence.

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