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Microsoft, Yahoo! & Western Union Tackle Internet Lottery Scams

By Andrew Redfern @ 31st October 2008 6:05 pm

Today Marketing companies – Microsoft Corp, Yahoo! Inc, Western Union and the African Development Bank today announced the formation of a coalition to raise global awareness among consumers of the threat posed by lottery hoax e-mails.

Through this collaborative effort, the coalition members will educate internet users so they are better able to protect themselves against fraudulent activities online.

Internet lottery scams are a common form of advance fee fraud, a crime in which the victim is deceived into paying money upfront to receive a fictitious gift or cash prize. Law enforcement officials have expressed concern that scammers will step up their activity to take advantage of people concerned with or affected by the global economic downturn.

Speaking at the 6th German Anti Spam Summit, Tim Cranton, associate general counsel for Worldwide Internet Safety Programs at Microsoft, said, “This online threat differs from those that try to exploit software code or attack computers. Lottery scammers prey not on software, but on the hope of their victims – and with scams that can be so creative and plausible, internet users simply don’t know whom they can believe.

Microsoft is announcing this coalition with the African Development Bank, Western Union and Yahoo! today with the goal of helping to better ensure end-to-end trust in the internet for everyone.”

“As one of the world’s largest web mail providers, reaching hundreds of millions of internet users, we realize that Yahoo! is in a unique position to help educate consumers about dangerous scams online, and we have a special responsibility to help provide a safe online experience,” said George Hadjigeorgiou, general manager of communication and community products, Yahoo! Europe.

“At Yahoo!, we’ve long told our users that if it sounds ‘too good to be true,’ it probably is. But as internet fraudsters continue to get more creative in their approaches, consumers continue to be deceived. This unique initiative is a continuation of our online safety and trust initiatives and is intended to help support our consumer awareness efforts.”

The announcement of the internet lottery scam coalition coincides with the release of independent research commissioned by Microsoft into consumer experiences of lottery scams in Denmark, France, Germany, Italy, the Netherlands, Spain and the UK. Of 4,930 people interviewed, 113 people, or one in 44, said they had lost money to an internet fraudster in the last 12 months, with individual losses ranging from less than 100 euros to more than 7,000 euros.

The research also shows that the following:

Of internet users surveyed, 27 per cent thought it likely they would become a victim of an internet lottery scam that would cost them money.
More than half (51 per cent) said that lottery scam e-mails made them more reluctant to buy goods from the internet.
As a result of internet scams 36 per cent said they were more reluctant to use the internet.

“It’s a common perception that only naive and extremely gullible people fall victim to lottery scams. However, it can happen to anyone, especially those who are experiencing financial pressure,” said Christopher Fischer, senior counsel EMEASA, Western Union Financial Services.

“Our goal is to help consumers protect themselves by helping them understand how our service operates and how internet lottery scams work. For example, we advise all consumers never to send money to a stranger using cash-to-cash money transfer services. Evidence shows that consumers themselves are the first, last and best line of defence against fraud. Consumers that are educated, well-informed and sceptical are better able to protect themselves and their hard-earned money.”

Lottery scammers often misappropriate or misrepresent established and credible brands to add authenticity to their hoaxes. The huge volume of e-mails they send coupled with the fact that their use of the internet enables them to transcend national borders makes it hard to understand the true scope and range of their activities.

To address this, victims of lottery scams that involve any of the coalition companies’ brands or services can report their experience to their local police authority. Interpol will communicate with national law enforcement agencies to inform them of the initiative and provide guidance on critical information to collect.

Victims will be invited to send a copy of the police crime report to the relevant coalition company member. Each company can then apply its own in-house investigative expertise in an effort to identify trends and common patterns, such as multiple scams emanating from the same geographic region.

“All four companies share a common interest in addressing cybercrime and online scams,” said William Godbout, chief security officer at African Development Bank. “There has been an exponential increase in the volume of online criminal activity using our trademark. Although there is no financial loss to the bank, these crimes impact our reputation and image.

The reputation of African banking, of African development institutions and of the African continent in general are significantly jeopardized by the explosion in cybercrime falsely using African entities. With the assistance of our partners, in conjunction with both international authorities and local African law enforcement organizations, we will prosecute this criminal activity to the greatest extent possible.”

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