Fake money orders hit area

Fake money order— © 2008 Gallup Independent / Brian Leddy

Copyright © 2008
Gallup Independent
By Phil Stake
Staff writer

GALLUP — Few things seduce like free money.

That notion has roots in gambling addiction and goes a long way toward explaining the success of the state lottery. In fact, the tendency is strong enough to make many thousands of financially struggling Americans vulnerable to scammers in distant locales such as Nigeria, the Netherlands, England and Canada, where cons forge fake checks and money orders, and then mail or FedEx them under some flimsy pretense. They claim you’ve won a contest that you never entered. Or that you’ve been selected to participate in a consumer research study.

Explanations vary but the scam is always the same: you cash or deposit the counterfeit check or money order and send the money back to the con via Western Union or wire transfer in exchange for a 10 or 15 percent commission. But soon the seduction falls apart. Sometime after you’ve sent the money and kept only a fraction, the counterfeit check or money order raises a red flag inside the wires of the American banking system and you’re required to pay it all back, or get arrested for fraud.

It’s often referred to as the “Nigerian Scam,” having origins that trace back to the west African nation. The “Nigerian Scam” started gaining momentum around 2003, according to the U.S. Department of Justice Web site, and in the three years that followed, American banks reported $12.2 billion in attempted check fraud — more than double the previous three years — according to a November 2007 report from the American Bankers Association.

These numbers are not a distant reality. But instead of depositing the counterfeits at a bank, many Gallup area residents attempt to cash them at one of the local trading posts or pawn shops. Ellis Tanner Trading Company has blocked 86 such attempts this year, according to General Manager Lorie Haight.

Over the years, Haight and other staff members have grown weary of the counterfeits and learned to identify the trademarks of a fake. She said the first thing they look for is a check stub, as counterfeits never have one. And the paper is thinner and of a different quality.

“The paper looks just a little bit different,” Haight said.
Additionally, she will often ask to see the envelope in which the check arrived.

“Most of the envelopes have Canadian stamps ... some are FedEx from Nigeria or Australia,” she said.

Seemingly genuine, but counterfeit, money orders and travelers checks have also made their way into local circulation. In January of last year, a Window Rock woman arrived at Ellis Tanner’s to cash four $930 MoneyGram money orders bearing the Wal-Mart seal. Aside from having slightly different dimensions, as was later discovered, the money orders looked real. In that case, the tell-tale giveaway was the amount of the money order. MoneyGram only issues in amounts of $500 or less.

The woman who received those money orders said she was working for a man in New York, Haight said. She began receiving the fakes after meeting him on the Internet, which renders yet another dimension of check scamming.

In September of last year, a mid-30s Zuni woman, who asked not to be identified, fell prey to an Internet scammer who called himself Adams Cole. Cole said he was an artist in London, England and began a monthslong conversation with the woman through e-mail. She said she was reluctant to believe him, at first, and surfed the Internet looking to verify his identity.

“I tried to Google him but didn’t find anything,” she said.
But during the months of e-mailing, Cole convinced her he had received payment for goods in the form of money orders representing American currency, which he was unable to convert. Cole, a man she’d never met and who had found her e-mail using Yahoo!’s directory, asked the woman to open a new bank account and deposit four $950 money orders, and then to wire all but 10 percent to his foreign account. Finally, she agreed to cash the money orders, deposit them into her account and transfer the money. Cole sent the counterfeit money orders via FedEx. She e-mailed her phone number so he could call to verify the transfer had been made.

On Sept. 5, 2007, she took the money orders to Joe Milo’s White Water Trading Company, which soon received word from First Federal Bank that they were fraudulent. McKinley County Sheriff’s Department was immediately notified and about that time Cole called the woman from a private number. He spoke broken English and had a thick foreign accent.

“Right when I told him I got caught he hung up,” she said. “I got myself in trouble ... I had tried to cash them, then they became fraudulent and I almost went to jail.”

This scenario is not isolated, according to Gallup Police Lt. Rick White, who said the department has been receiving similar complaints for about five years.

“There are some good-looking counterfeits,” White said about the seemingly accurate reproductions.

When Gallup Police receive a fraud complaint, they forward it to Assistant District Attorney John Bernitz for prosecution. Bernitz has encountered enough of the counterfeit checks, money orders and accompanying letters to pinpoint the common clues of a fake. For example, the letter and letterhead purport to represent one company, while the accompanying check is from a different and unrelated business.

A case he received in June of this year includes a letter, which purports to come from “Insider Mystery Shopping,” while the enclosed check for $4,989 has “Rose Garden Senior Apartments” printed as the account holder.

Another clue is that the return address at the top of the letter is often printed incorrectly, written by someone unaccustomed to the American format.

“There are a lot of tell-tale signs ... and that’s one of them: incorrect usage of the English language,” spokesman for the New Mexico Attorney General’s office Phil Sisneros said.

“And if they tell you, ‘You won a lottery,’ and you didn’t enter one, it doesn’t take a whole lot of common sense to figure out that is a fake ... People say you don’t get anything free in life, and it really is true.”