CCB forges ties with banks to tackle Lottery Fraud
Commercial Crime Bureau (CCB) presented a seminar on Lottery Fraud at Police Headquarters on September 3 for representatives from a cross section of the banking industry. The seminar highlighted the trends, prevalence, current modus operandi, use of banking facilities in Hong Kong by fraudsters, and profiles of both victims and fraudsters.
The seminar was well received by an audience of over 200 staff members from some 60 banks.
Lottery Fraud is a global problem and is becoming increasingly prolific. Hong Kong, with its reputation as a financial hub, has been used by fraudsters to lure victims to pay funds into local bank accounts. Typically, from a Hong Kong perspective, most fraudsters and victims are located outside Hong Kong, and are Putonghua speakers.
Situation in Hong Kong
Between January 1, 2008 and July 31 this year, CCB has received 1 499 cases, which have been classified as being related to Lottery Fraud. The total monetary loss was nearly $181 million.
Although the vast majority of victims and fraudsters are outside Hong Kong, the cases are being reported to the Force because of the apparent connection to Hong Kong - the lottery agency, a Hong Kong bank account, a Hong Kong based remittance agency, Hong Kong mobile phone numbers, e-mails, property addresses or fictitious Hong Kong companies.
Typical Modus Operandi
Under the typical modus operandi, a victim receives an email, letter or a cold phone call from a purported lottery or sweepstakes company claiming that the victim has won a considerable amount of prize money in a lottery or sweepstakes competition.
Lottery Fraud fraudsters often use the names of legitimate local or overseas lotteries, such as Hong Kong Mark Six and Spanish Lottery, or may provide an email address, telephone number or Hong Kong address that purports to represent a fictitious Hong Kong company, so that the purported prize money would seem credible. The email or letter asks the recipient to respond quickly or risk missing out on the winnings. It is not uncommon for the recipient to be asked to keep the winnings confidential for the sake of security. Fraudsters do this to prevent the recipient from seeking confirmation from the genuine lottery company or independent sources.
Victims' Profiles
The majority of the victims were residing overseas with only 37 being locals. Predominantly the overseas victims were Chinese nationals speaking Putonghua, and the majority was located in Australia, Singapore, Taiwan, North America and New Zealand.
Prosecution
By August 26 this year, CCB have detected 41 syndicates and arrested 117 suspects for being involved in Lottery Fraud. Fifty-six suspects have been convicted and sentenced to imprisonments ranging from four to 66 months.
Way Forward
To prevent and investigate money laundering in connection with Lottery Fraud, or indeed any kind of fraud, CCB strives to maintain a close liaison with the banking sector and exchange intelligence. Meetings and seminars provide an ideal platform for exchanging information and maintaining dialogues.
Prevention is also a major effort to tackle Lottery Fraud. Publicity programmes are progressing both in Hong Kong and overseas to alert potential victims.
Crime Prevention
Advice
The following simple tips might help one avoid falling victim to Lottery Fraud:
* You can't win a lottery without buying a lottery ticket;
* Beware of free e-mail lottery draws. They are likely to be fraudulent;
* A legitimate lottery will NEVER ask you to pay a fee in order to collect your prize;
* Do not answer unsolicited e-mails or other similar communications;
* Do not send or hand over your identification documents; and
* Do not send any money.
The
seminar
attracts over 200 staff members from some 60 banks