Nigerians warned against trending ponzi scheme called Loom Money Nigeria

The Securities and Exchange Commission (SEC) has warned Nigerians against fraudsters currently running an online investment scheme tagged “Loom Money Nigeria’’. Acting Director-General of the commission, Ms Mary Uduk gave the warning at a news conference on Thursday in Abuja.

A statement by SEC’s Head of Media, Mrs Efe Ebelo, said that Uduk, who was represented by acting Executive Commissioner, Operations of SEC, Mr Isyaku Tilde, said Loom Money Nigeria had taken over the social media. She said that the scheme targeted young people, luring them to participate in a pyramid model of the Ponzi.

The director-general disclosed that the fraudsters carried out their illegitimate activities via social media platforms like Facebook and whatsapp. She added that they lured young Nigerians to invest as low as N1000 and N13, 000 and to get as much as eight times the value of the investment in 48 hours. Uduk said that the venture was a Ponzi scheme, where returns would be paid from other people invested funds, adding that it had no tangible business model.

“We are aware of the activities of an online investment scheme tagged ‘Loom Money Nigeria’. “The platform has embarked on an aggressive online media campaign on Facebook and whatsapp.

“They lure the investing public to participate by joining various Loom whatsapp groups to invest as low as N1, 000 and N13, 000 and get as much as eight times the value of the investment in 48 hours".

“Unlike MMM that had a website and the promoter known, the people promoting Loom are not yet known and this pyramid scheme operates through closed groups mainly on Facebook and Whatsapp".

“If it were a local Ponzi scheme with known offices, it would be very easy for the Commission to seal their offices and freeze their accounts".

“We therefore wish to notify the investing public that the operation of this investment scheme has no tangible business model hence it’s a Ponzi scheme, where returns are paid from other people’s invested sum".

“Also, its operation is not registered by the Commission,” she said.

Uduk, therefore, advised the public to distance themselves from the scheme, adding that anyone that subscribed to the illegal activity did so at his own risk.

She assured that an inter-agency committee, Financial Services Regulation Coordinating Committee (FSRCC), was working on the issue, and that the commission was also collaborating with security agencies to track them down.

A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors.

Loom Pyramid Scheme is not new to the world. Last month, Daily Mail UK reported that the scheme has resurfaced online all over the world, with different names such as ‘loom circle’, ‘fractal mandala’ and ‘blessing loom’.

In Nigeria, its central name is Loom Money Nigeria with individuals creating their own WhatsApp groups such as Jack Loom, Catherine Loom, among others.

Vanguard

Poland to extradite Nigerian to U.S. for $7m online fraud

A yet-to-be identified 27 year-old Nigerian is awaiting extradition by Poland to the United States over an estimated $7m cybercrime.

The Nigerian was arrested by Poland’s police in the southwestern city of Wroclaw in connection with alleged cyberfraud and extortion done over the internet.

The Police Central Bureau of Investigation said in a communique Wednesday that the Nigerian was nabbed as a result of cooperation with the FBI and Interpol, which had circulated a warrant for him. The police raid took him by surprise, the communique said. The man is suspected of banking fraud, extortion and theft of online banking access data.

Vanguard

Medical doctor turned hacker says hacking into Nigerian banks is very easy

A medical doctor turned international hacker, who has been on the Police wanted list, Michael Thompson Williams, has been arrested by the Lagos State Police Command.

Michael, who boasted of his escapades as a hacker, took a swipe at the Nigerian banking system, describing it as the easiest to hack, including government-owned account.

The 28-year-old suspect mentioned an American leading Hollywood actor, John Travolta, as one of his prey, revealing that his (Travolta) account was being monitored through a programmed device, where cash running into millions of US dollars were diverted weekly.

During preliminary investigation, it was discovered that the suspect, who has mastery of the cyber café environment, created credit cards of deceased foreigners through cyber Ghost 12. When the credit cards matures, it would be funded through a hacked Swiss account and then any transaction done by genuine accounts owner through Swiss account would be manipulated by the suspect and wired to his contrived credit card. 

Lagos State Commissioner of Police, Imohimi Edgal, paraded the suspect before journalists yesterday. After a successful transaction, the suspect as gathered would buy posh cars, sending fake alerts to the owners. The bubble burst in March after he bought a Porche car worth N28 million from a car dealer in Lagos and sent him a fake alert before making away with the car. 

However, on getting to the bank to collect the money, the car dealer, Abidogun Adewale, discovered to his shock that no amount was paid. Asked how that was possible, the suspect said he used HTTPtunnel.com to send such fake alert. 

He disclosed that during such payment, the amount would appear on the seller’s account at that moment, even if he visited his bank to confirm the payment, adding that it would disappear after one hour. Three of the vehicles he bought through such process were traced to Asaba, Delta State, and Owerri, Imo State. The number plates on the three vehicles read HRM OGUEZI 1, II and III, respectively.

Vanguard

Nigerian internet scammers targeting corporate email accounts

West Africa’s infamous internet scammers have evolved, dropping their impersonations of online love interests, princes and U.S. soldiers in favor of hijacking corporate emails, costing businesses hundreds of millions of dollars a year.

It is a much more lucrative venture that works by gaining access to corporate email login details or passing off almost-identical addresses as the real deal, a scam known as Business Email Compromise (BEC), according to a report by cybersecurity firm CrowdStrike issued on Thursday.

These Nigerian rackets now dwarf other types of online criminal theft, amounting to at least $5.3 billion of losses between October 2013 and the end of 2016, said CrowdStrike and the U.S. FBI’s Internet Crime Complaint Center (IC3).

“There’s a disproportionate amount of criminal gains they get from it,” Adam Meyers, vice president of intelligence at California-based CrowdStrike, told Reuters. “The lion’s share of ill-gotten, fraudulent money is around these business email compromise attacks. It’s a huge problem for our customer set.”

Nigeria has become one of the hubs of BEC. Nigerian online fraudsters, known as “Yahoo boys”, became notorious for trying to pass themselves off as people in financial need or Nigerian princes offering an outstanding return on an investment.

The capers became known as “419 scams” after the section of the national penal code that dealt - ineffectively - with fraud.

Yahoo boys even impersonated a U.S. forces commander in Afghanistan to defraud people by asking for help in recovering the assets of deceased soldiers. It forced the commander to issue a Facebook statement saying he would never try to contact anyone asking for financial help.

Now the scammers have bigger fish to fry, with the potential gains amounting to hundreds of millions of dollars a year, according to CrowdStrike.

Behind the fraudsters is an organized crime network with its hands in human trafficking, drugs, prostitution, money laundering and email fraud and cybercrime, the CrowdStrike report said. “The magnitude of this criminal threat has only recently begun to be understood,” it said.

The Black Axe gang sprang from Nigerian universities and now extends from Africa to North America, Europe and Asia. Its targets have ranged from semiconductor makers to schools in U.S. states including Connecticut and Minnesota, passing themselves off as executives and lawyers to trick employees into wiring sometimes millions of dollars a day into bank accounts.

From there, the money is quickly laundered through a series of bank accounts that can be traced to Hong Kong and China, where the trail often goes cold because diverging regulations foil monitoring, CrowdStrike’s Meyers said.

With that money, the Nigerian scammers are often enjoying the high life, said Meyers, noting social media accounts filled with pictures of them posing with luxury Mercedes cars, gold watches, jewellery and champagne.

“It’s really hard to stop; you can’t stop it with anti-virus or any kind of software, it’s really kind of a human problem.”

Reuters

Hacker attempts to help victim of Nigerian 419 scam recover $400,000

An American female minister named Janella thought at first she was dealing with a Bank in Spain in which she has so far lost $400,000. However, upon further investigation it was later revealed to her that all her money has gone to a Nigerian fraudster who calls himself Obi. He apparently was playing the middle man in this financial exchange. Another unfortunate statistic in the Nigerian letter scam.

A hacker on the good side who calls himself Gray Hat has decided  to help Janella get her money back.

It's a shame that in our current generation Nigeria is pretty much synonymous with cyber crime to the point of it becoming a Hollywood movie.