419 Fraud: A Canadian twist on an old scam
CTV.ca News Staff
Updated: Fri. Feb. 13 2004 4:41 PM ET
Nigerian scams are among the oldest in the book. Also called 419s after a section in the Nigerian Criminal code, these schemes often target their victims through an unsolicited fax, email or letter.
Most go something like this: the sender identifies him or herself as a member of a wealthy African family who is unable to get their fortune out of the country or they are in possession of a government contract that can be paid out to anyone listed on the document. Usually, the perpetrator claims to be a doctor, a lawyer, a top official with the Nigerian National Petroleum Corporation or the child of an ex-general or other important person, who is seeking a “partner” who can assist them. These schemes always promise huge rewards – from the opportunity to double or triple your investment to a cut of millions of dollars worth of loot – in exchange for cash up front.
While these schemes have been around for years, they’ve recently taken on a Canadian face. And this new twist on an old trick has got the criminals’ profits soaring.
In Moose Jaw, Saskatchewan, Dan McLaren lost more than $200,000 through a Nigerian 419 scam. The grain farmer seems an unlikely victim – not someone you’d expect to be tied in with a young African and his alleged $500 million fortune – but McLaren invested his money believing it could end his struggle to make ends meet.
McLaren was promised a 500 per cent return on his money if he helped bring a man named Charles Kofi to Canada where he could claim his fortune. When he was hit up for extra cash to cover immigration and flight problems, he continued to shell out in hopes of seeing the promised returns. But that was several years ago, and McLaren has yet to see a cent in return.
Skeptics may wonder how McLaren was convinced to buy into such an old scam. But he trusted that he wasn’t getting conned because unlike most Nigerian schemes – which reach their victims through a faceless email or letter – McLaren was approached by someone he knew.
Henry J. Statz, who often goes by the name Jerry, was a trusted and familiar face around Moose Jaw. He approached his victims with a dramatic story about Charles Kofi – one about a shootout between the young man’s father and uncle over the family fortune; of Charles finding his dying father and being told it was up to him to get his family’s estate out of the country.
Statz told his victims Charles’ fortune was in a Barclay’s bank vault in Toronto, in the form of gold and gold dust, diamonds and cash. And he claimed a special card called a “golden tally” – that’s now in the possession of the police – would unlock the fortune.
In all, Statz used that story to draw more than $10-million from dozens of Canadians.
But after being arrested and charged with conspiracy to commit fraud in August 2002, Statz admitted his story was “a complete and utter fiction,” and served 10 months in jail. Now, however, he’s out and insisting his story was real all along.
Det. Sgt. Mark Simchison, the officer who investigated Statz, says there’s no way. “In my view, he was a very typical con man,” Simchison says. “He looked it – he had the gold jewelry, he had the black shirt, he had the shaded sunglasses, and he talked a mile a minute. As soon as we questioned him to pinpoint him to an answer, he would change the subject.”
Simchison isn’t basing his belief that Statz is a fraud on appearance alone. He says most of what he told his victims was “out-and-out lies.”
“Barclay’s bank does not even exist in Canada anymore, let alone a Barclay’s bank vault. You know, it didn’t take a brain surgeon to figure that much out – it was one call to the Canadian Bankers Association.”
Simchison also says that other than his passport, not one of Statz’s documents was legitimate. “Any document pertaining to the Kofi estate … they were all fake. They were all bogus and proven that by the authorities here and overseas.”
As for the golden tally, “it’s probably worth about a dollar. And I do give the Nigerians credit for making that card, but again, Adobe PhotoShop can work wonders.”
But although Simchison classifies Statz as “a typical con man,” his scheme wasn’t the typical con. “Most of our victims traditionally are out of country. That’s just the way Nigerian criminals operate. This one, the victims were Canadian, and it appeared somebody orchestrating this was Canadian – Jerry Statz.”
Simchison was intrigued, and his investigation led him to the heartland of Nigerian crime. Surprisingly, the epicentre isn’t deep within Africa – it’s actually in Amsterdam, in a neighbourhood where hundreds of 419 operations keep shop.
Bal Ma Meer is an eight kilometre squared area of high-rises, underground garages and parks, where thousands of men and women are recruited to work in these boiler room operations. There, they spend long hours on computers and cell phones trying to cheat victims around the world.
“Compared to other countries, Dutch law is very easy on them,” explains Inspector Rene Van der Wouw, the head of Amsterdam’s fraud squad. Unlike countries where con artists can face harsher penalties, in the Netherlands, perpetrators are arrested, serve a short jail sentence and then are sent out of the country, he says.
But although they are deported, Van der Wouw says the scams continue because “when you arrest one of the West Africans, he’s easy to replace. It’s hard crime to fight.”
Back in Canada, Jerry Statz insists his story isn’t one of those scams. “I’ll swear on my grandfather and my father and my mother, on their graves, that no, Charles Kofi has never been a scam and never will be and nobody can make me think that.”
Statz maintains that he admitted to making up Charles Kofi back in 2002 to that charges would be dropped against his girlfriend.
But Simchison says Kofi does exist in a way. “For lack of a better name, I’m going to call him Charles Kofi, but that’s not who he is. He’s an expatriate Nigerian, operating very well with a lot of criminal cell support throughout the world. And he’s made a hell of a lot of money.
“He’s a person -- we have his picture. We don’t know where he is right now, but I’d like to get my hands on him or I’d like for the Dutch National Police to get their hands on him or the Scotland Yard, or anybody else in the world.”
But with thousands of Charles Kofis out there, Simchison admits it’s going to take a lot more than he has to put an end to Nigerian scams.
“It’s a factory,” he says. “A 419 factory – I’m not going to stop it.”
This is part of a transcript of a program about the Nigerian scams shown on CTV in Canada