I received the above titled email from one inetm2u1@freenet.de The content of the email look like the following:
M2U NOTIFICATION -
This is to notify you that your account is now inactive and may be closed for security reasons as you failed to provide valid details during the last verification process. Reactivate your account now as inactive accounts will be deactivated till further notice if not activated now. We apologise for the inconvenience.
[Activate] http://www.maybank2u.com.my/
When you hover your mouse to [Activate], it show this address: sambbiu1.addr.com/s1mbb1.htm <== DON'T CLICK ON IT. This is yet another phishing scam.
Showing posts with label Scam. Show all posts
Showing posts with label Scam. Show all posts
Woman RM1.1m poorer after falling for sob story on Facebook
A Malaysian woman who fell for a con artist's sob stories on Facebook ended up being cheated of RM1.1mil.
The man who claimed to be a British citizen had told her he needed her account to bank in money from his contract with Petronas, which he claimed amounted to RM4.6mil.
However, he told the woman he needed her help to pay stamp duty charges and insurance fees before he could get his contract sanctioned.
The suspect claimed he could not afford the fees at the time.
“The victim paid RM1.1mil via several transactions to the man between March 29 and April 19,” said Federal Commercial Crimes director Comm Datuk Wira Syed Ismail Syed Azizan yesterday.
He added that following a police report lodged by the victim, six suspects were arrested in Kepong on Tuesday.
Police also recovered RM15,000 in cash, 18 ATM cards, seven cellphones and a laptop.
“Of the six, two were Nigerians, two were Bangladeshis while the others were locals,” he told reporters.
Comm Syed Ismail said the victim had been sympathetic when she read about the man's predicament.
“She caved in when she heard his sob stories,” he added.
Comm Syed Ismail urged people using popular social networking websites like Facebook to be very careful.
“These unscrupulous people prey on gullible girls through these websites,” he said. “Revealing your personal information on your Facebook wall' is not a good idea.”
The public, he said, had been warned several times not to respond to e-mail from seemingly rich people offering money for safekeeping, yet a lot of them still become victims.
The man who claimed to be a British citizen had told her he needed her account to bank in money from his contract with Petronas, which he claimed amounted to RM4.6mil.
However, he told the woman he needed her help to pay stamp duty charges and insurance fees before he could get his contract sanctioned.
The suspect claimed he could not afford the fees at the time.
“The victim paid RM1.1mil via several transactions to the man between March 29 and April 19,” said Federal Commercial Crimes director Comm Datuk Wira Syed Ismail Syed Azizan yesterday.
He added that following a police report lodged by the victim, six suspects were arrested in Kepong on Tuesday.
Police also recovered RM15,000 in cash, 18 ATM cards, seven cellphones and a laptop.
“Of the six, two were Nigerians, two were Bangladeshis while the others were locals,” he told reporters.
Comm Syed Ismail said the victim had been sympathetic when she read about the man's predicament.
“She caved in when she heard his sob stories,” he added.
Comm Syed Ismail urged people using popular social networking websites like Facebook to be very careful.
“These unscrupulous people prey on gullible girls through these websites,” he said. “Revealing your personal information on your Facebook wall' is not a good idea.”
The public, he said, had been warned several times not to respond to e-mail from seemingly rich people offering money for safekeeping, yet a lot of them still become victims.
GhostMarket.net owners jailed for $26m Crimebook scam
Two British schoolboys have been jailed for up to five years for running a $26 million Facebook-style website for criminals dubbed "Crimebook".
Nick Webber, 19, and Ryan Thomas, 18, were found guilty of starting up and operating the online forum GhostMarket.net, where up to 8000 members exchanged details about thousands of stolen credit cards and used the information to defraud banks and shops across the world, The Guardian reported.
Information about 65,000 hacked bank accounts was also shared on the site, prosecutors said.
Judge John Price of Southwark Crown Court in London, said the fraud was on a "massive scale".
"This was a criminal enterprise offering sophisticated advice on how to hack into computers, cause them to malfunction and retrieve personal information from computers - and how to do it on a massive scale."
He said only the age of the teenagers saved them from harsher sentences.
"I'm extremely conscious of the youth of you all. Were you four or five years older the sentence would be much longer."
Mr Webber and Mr Thomas were still at school when they were arrested by police in October 2009 after trying to use the details of a stolen credit card to pay for a £1000 hotel bill, The Guardian said.
Police found 100,000 stolen credit card details on Mr Webber's laptop and traced it back to the GhostMarket.net site - the biggest criminal website they had ever uncovered.
The pair jumped bail and escaped to Majorca in Spain.
Webber taunted police while on the run, writing on a site: "To be a Legend Carder u gotta be a ghost" and adding, "F--- the Police!", London's Daily Telegraph reported.
With Thomas, he was re-arrested in early 2010 after returning to the UK.
Webber was described by prosecutors as an "extremely experienced computer hacker" and the leader of the gang behind the website.
The gang included 21-year-olds Gary Kelly and Shakira Ricardo, who were jailed for five years and 18 months respectively, the BBC reported.
Thomas worked as a moderator on the site.
Thomas and Webber pleaded guilty to conspiracy to make or supply articles for use in fraud, encouraging or assisting offenders, and conspiracy to commit fraud.
The son of former Guernsey politician Anthony Webber, Webber spent his illegal earnings on expensive goods such as cameras, jewellery and plasma televisions, the BBC reported.
His father said he never thought his son would have been involved in such criminal activity.
"He has always been super brilliant at computers but it never occurred to me anything like this would happen," he told the Telegraph last year.
"What happened to Nicholas has been a big shock to both his mother and to me. ... In a very short period of time things went wrong. He is a delightful son in a lot of respects.
"He is the sort of person that the security services should be employing. His skills are such he could do a lot of things but the very sad thing about this is it is going to affect his future career."
Source: SMH
Nick Webber, 19, and Ryan Thomas, 18, were found guilty of starting up and operating the online forum GhostMarket.net, where up to 8000 members exchanged details about thousands of stolen credit cards and used the information to defraud banks and shops across the world, The Guardian reported.
Information about 65,000 hacked bank accounts was also shared on the site, prosecutors said.
Judge John Price of Southwark Crown Court in London, said the fraud was on a "massive scale".
"This was a criminal enterprise offering sophisticated advice on how to hack into computers, cause them to malfunction and retrieve personal information from computers - and how to do it on a massive scale."
He said only the age of the teenagers saved them from harsher sentences.
"I'm extremely conscious of the youth of you all. Were you four or five years older the sentence would be much longer."
Mr Webber and Mr Thomas were still at school when they were arrested by police in October 2009 after trying to use the details of a stolen credit card to pay for a £1000 hotel bill, The Guardian said.
Police found 100,000 stolen credit card details on Mr Webber's laptop and traced it back to the GhostMarket.net site - the biggest criminal website they had ever uncovered.
The pair jumped bail and escaped to Majorca in Spain.
Webber taunted police while on the run, writing on a site: "To be a Legend Carder u gotta be a ghost" and adding, "F--- the Police!", London's Daily Telegraph reported.
With Thomas, he was re-arrested in early 2010 after returning to the UK.
Webber was described by prosecutors as an "extremely experienced computer hacker" and the leader of the gang behind the website.
The gang included 21-year-olds Gary Kelly and Shakira Ricardo, who were jailed for five years and 18 months respectively, the BBC reported.
Thomas worked as a moderator on the site.
Thomas and Webber pleaded guilty to conspiracy to make or supply articles for use in fraud, encouraging or assisting offenders, and conspiracy to commit fraud.
The son of former Guernsey politician Anthony Webber, Webber spent his illegal earnings on expensive goods such as cameras, jewellery and plasma televisions, the BBC reported.
His father said he never thought his son would have been involved in such criminal activity.
"He has always been super brilliant at computers but it never occurred to me anything like this would happen," he told the Telegraph last year.
"What happened to Nicholas has been a big shock to both his mother and to me. ... In a very short period of time things went wrong. He is a delightful son in a lot of respects.
"He is the sort of person that the security services should be employing. His skills are such he could do a lot of things but the very sad thing about this is it is going to affect his future career."
Source: SMH
Power Balance bracelets scam
A bracelet worn by high profile sports stars that claims to improve athletic performance has been exposed as a sham by the consumer watchdog.The Australian Competition and Consumer Commission (ACCC) has ordered Power Balance Australia to refund all customers who feel they were misled by the supposed benefits of Power Balance bracelets.
The wristbands were touted as providing better balance, strength and flexibility by working with the wearer's "natural energy field".
English cricketers Kevin Pietersen and Andrew Strauss, AFL bad boy Brendan Fevola, St Kilda captain Nick Riewoldt and NRL star Benji Marshall have all been known to wear the bracelets.
But ACCC chairman Graeme Samuel said in a statement: “Power Balance has admitted that there is no credible scientific basis for the claims and therefore no reasonable grounds for making representations about the benefits of the product.
“Its conduct may have contravened the misleading and deceptive conduction section of the Trade Practices Act 1974," Mr Samuel said.
"When a product is heavily promoted, sold at major sporting stores and worn by celebrities, consumers tend to give a certain legitimacy to the product and the representations being made."
The bracelets sell for $60 on the company's website.
Mr Samuel also warned that retailers that continue to sell the products with misleading advertising or packaging would be open to action from the ACCC.
Last month an independent review panel that deals with complaints about breaches of the therapeutic goods advertising code found that powerbalance.com.au violated the code.
Power Balance acknowledged it had breached the code and said the relevant claims had been removed from its website.
The company was also named in this year's Shonky awards.
Consumer advocate group Choice found the bracelets were just rubber bands with plastic holograms.
"The band was tested at CHOICE under controlled lab conditions which showed it did little else than empty purchasers' wallets," Choice said in October.
via SMH. Illustration: Matt Golding.
Microsoft scam calls exposed
Thousands of Australians have been taken for hundreds of dollars each by cold call scammers pretending to be Microsoft but police, regulators and the software company are powerless to fight the growing problem.
The scammers, typically based in Indian call centres, cold call people claiming to be Microsoft staff informing them that their computer has a virus on it. They provide bogus evidence of a virus infection and after winning over the victim, convince them to allow the scammer remote access to their computer through an internet website.
The scammers then pretend to fix the machine and ask for a fee that is up to $400. They use a combination of high pressure sales tactics and social engineering to scare the victim into paying the fee and because victims willingly hand over their credit card details, there is little legal recourse.
As is common with internet crimes, there was little police or local regulators could do to shut down the scams because the perpetrators are based overseas.
Anyone who has allowed remote access into their computer should immediately change all of their passwords, scan their computer for viruses and, ideally, get a professional company to scan the computer as well.
Microsoft had reached out to one of the sites the scammers use for remote access, logmein123, which had implemented IP address filtering and examined misuse of their test accounts to prevent scammers from using the service.
The International Consumer Protection and Enforcement Network (ICPEN), which coordinates responses to global scams such as this said that "both ICPEN and other national enforcement agencies are aware of the scam that you refer to".
However, it could not detail any specific measures taken to shut the scam down.
via SMH
The scammers, typically based in Indian call centres, cold call people claiming to be Microsoft staff informing them that their computer has a virus on it. They provide bogus evidence of a virus infection and after winning over the victim, convince them to allow the scammer remote access to their computer through an internet website.
The scammers then pretend to fix the machine and ask for a fee that is up to $400. They use a combination of high pressure sales tactics and social engineering to scare the victim into paying the fee and because victims willingly hand over their credit card details, there is little legal recourse.
As is common with internet crimes, there was little police or local regulators could do to shut down the scams because the perpetrators are based overseas.
Anyone who has allowed remote access into their computer should immediately change all of their passwords, scan their computer for viruses and, ideally, get a professional company to scan the computer as well.
Microsoft had reached out to one of the sites the scammers use for remote access, logmein123, which had implemented IP address filtering and examined misuse of their test accounts to prevent scammers from using the service.
The International Consumer Protection and Enforcement Network (ICPEN), which coordinates responses to global scams such as this said that "both ICPEN and other national enforcement agencies are aware of the scam that you refer to".
However, it could not detail any specific measures taken to shut the scam down.
via SMH
Lavinia Olmazu jailed for £2.9m benefits scam
A woman who helped more than 170 Romanians illegally claim £2.9m in benefits has been jailed for two years and three months.Lavinia Olmazu, 31, a campaigner for the rights of Romany Gypsies, helped mastermind the scam involving 172 members of the Romanian community.
Olmazu, of north-east London, gained access to them through her work with Haringey and Waltham Forest councils.
She had admitted a fraud charge at Southwark Crown Court in July.
As well as working as an outreach worker with the councils, the university graduate was involved with the Big Issue.
She set up companies with her boyfriend to help facilitate the frauds they carried out as part of a gang.
Sentencing her, Judge Deborah Taylor told Olmazu her role in the fraud was "made easier" by her involvement with the local authorities and charities which granted her access to people within the Roma community.
She added: "You identified individuals who wished to be involved in this scheme and in doing so, abused your position with a number of charities.
"You were a previously well-respected woman working in human rights. You have now lost your reputation by involving yourself in this fraud."
Immigrants from Romania are not entitled to a National Insurance number, and therefore a number of benefits, unless they can prove to the authorities they have been employed.
The court heard Olmazu and her partner would offer false documents to the migrants purporting to be from their employers, and also provided them with fake references.
As well as providing fake documents, they filed false claims for child tax credits, working tax credits and child benefit.
Olmazu, who has an 11-year-old son, admitted one count of conspiracy to supply articles for use in fraud between November 2007 and August 2009.
Armen Kazarian scam millions from US medical insurance system
You don't have to push or deal drug to make million in the US. No blackmailing either. Armen Kazaria leader of Armenian gangsters mastermind the fraudulent of fund from the US health system amounting to over 35 million dollars. BBC has the story below:
US officials have charged 73 people over what is thought to be the largest ever attempt to defraud the country's medical insurance system.
Prosecutors say a network of Armenian gangsters and their associates set up fake clinics using stolen identities to make false claims for treatment.
Investigators said more than $35m (£22m) was paid out.
A US Attorney said the scheme's scope and sophistication put the traditional mafia to shame.
The group, most of whom are of Armenian origin, are accused of setting up some 118 clinics across the US, most of which existed only on paper or were "nothing more than shams, shells, and storefronts", said US Attorney Preet Bharar.
They allegedly stole the identities of real doctors and beneficiaries of Medicare - the US federal insurance programme for the elderly - and "submitted bill after bill for treatment that no doctor ever performed and that no patient ever received," he added.
In addition, the gang were accused of carrying out "a raft of rackets, extortion, credit card fraud, identity theft, immigration fraud, and even the distribution of contraband cigarettes and stolen Viagra".
Investigations began after the personal details of 2,900 Medicare patients in New York were reported stolen, the Associated Press news agency reports.
Much of the paperwork involved also raised suspicion by showing inconsistences such as doctors specialising in dermatology giving heart examinations and ear, nose and throat specialists performing pregnancy ultrasounds, said AP.
Most of the accused were arrested during raids in New York City and Los Angeles on Wednesday morning, but there also were arrests in New Mexico, Georgia and Ohio. The 73 people charged are accused of racketeering and related offences.
Officials say some of the proceeds from the operation were couriered back to Armenia in cash.
The alleged leader of the gang, Armen Kazarian, is now in jail in Los Angeles. He was described by officials as equivalent to a mafia godfather.
"When it comes to making money illegally, this Armenian-American group puts the traditional mafia to shame," said Mr Bharar.
"The reach of this organisation stretches clear across the country and well beyond our shores.
"So in terms of profitability, geographic scope, and sheer ambition, this emerging international organised crime syndicate would be the envy of any traditional mafia family," he said.
US officials have charged 73 people over what is thought to be the largest ever attempt to defraud the country's medical insurance system.
Prosecutors say a network of Armenian gangsters and their associates set up fake clinics using stolen identities to make false claims for treatment.
Investigators said more than $35m (£22m) was paid out.
A US Attorney said the scheme's scope and sophistication put the traditional mafia to shame.
The group, most of whom are of Armenian origin, are accused of setting up some 118 clinics across the US, most of which existed only on paper or were "nothing more than shams, shells, and storefronts", said US Attorney Preet Bharar.
They allegedly stole the identities of real doctors and beneficiaries of Medicare - the US federal insurance programme for the elderly - and "submitted bill after bill for treatment that no doctor ever performed and that no patient ever received," he added.
In addition, the gang were accused of carrying out "a raft of rackets, extortion, credit card fraud, identity theft, immigration fraud, and even the distribution of contraband cigarettes and stolen Viagra".
Investigations began after the personal details of 2,900 Medicare patients in New York were reported stolen, the Associated Press news agency reports.
Much of the paperwork involved also raised suspicion by showing inconsistences such as doctors specialising in dermatology giving heart examinations and ear, nose and throat specialists performing pregnancy ultrasounds, said AP.
Most of the accused were arrested during raids in New York City and Los Angeles on Wednesday morning, but there also were arrests in New Mexico, Georgia and Ohio. The 73 people charged are accused of racketeering and related offences.
Officials say some of the proceeds from the operation were couriered back to Armenia in cash.
The alleged leader of the gang, Armen Kazarian, is now in jail in Los Angeles. He was described by officials as equivalent to a mafia godfather.
"When it comes to making money illegally, this Armenian-American group puts the traditional mafia to shame," said Mr Bharar.
"The reach of this organisation stretches clear across the country and well beyond our shores.
"So in terms of profitability, geographic scope, and sheer ambition, this emerging international organised crime syndicate would be the envy of any traditional mafia family," he said.
Confessions of a scratch-and-win scammer
Some scratch-and-win companies are already getting their salespersons to hit the road and push Chinese New Year packages, a former worker with one such firm said.
Tze Meng (not his real name) also told The Star how he first became involved in the trade and how such companies operated.
He said he started off when he answered an advertisement for a sales job in a Chinese daily.
“The returns or commissions are good; sometimes we get up to 25% of whatever sales we manage from those who supposedly won the scratch and win or draw.
“If we bring in 25 customers, we get at least RM3,000 and this can be achieved within three days.”
Tze Meng revealed that most of the salesmen were from the rural areas, who were naive and thought they could hit the sales target by working hard.
During orientation, Tze Meng said the manager would teach the new recruits how to convince customers to buy their products.
“The ‘lecturer’ made it seem easy to make thousands of ringgit and said everything was legal.
“We were handed 20 cards – 10 with prizes and the others with the words ‘Thank You’ on it,” he added.
Tze Meng said they would be taken to locations such as a shopping complexes, bus terminals, LRT stations, hypermarkets and sometimes outside banks.
“We were taught how to target our customers. If a person is young and we think that they do not have the money then we offer them the ‘Thank You’ card to scratch.
“If the person is older and looks well off, we use the cards that offer prizes like electrical items, energy water system, home theatre system or digital stove worth between RM4,000 and RM5,000,” he added.
Tze Meng said the winner would be brought to the office where a supervisor would give a briefing about the “other prizes” he or she could win; and how much to fork out to redeem them.
They would also be lured into believing they could win a Toyota Altis, Persona, Perodua Viva, 42-inch Plasma TV, LCD TV, Honda motorcycle, refrigerator and video camera.
Before that, the victims would be asked to fill up an agreement form.
“The fine print states that the victims bought the items voluntarily.
“The goods bought were also not returnable,” he added.
However, in most cases, the lucrative prizes never materialised and the customers ended up owning a cheap mattress after forking out thousands.
via TheStar
Tze Meng (not his real name) also told The Star how he first became involved in the trade and how such companies operated.
He said he started off when he answered an advertisement for a sales job in a Chinese daily.
“The returns or commissions are good; sometimes we get up to 25% of whatever sales we manage from those who supposedly won the scratch and win or draw.
“If we bring in 25 customers, we get at least RM3,000 and this can be achieved within three days.”
Tze Meng revealed that most of the salesmen were from the rural areas, who were naive and thought they could hit the sales target by working hard.
During orientation, Tze Meng said the manager would teach the new recruits how to convince customers to buy their products.
“The ‘lecturer’ made it seem easy to make thousands of ringgit and said everything was legal.
“We were handed 20 cards – 10 with prizes and the others with the words ‘Thank You’ on it,” he added.
Tze Meng said they would be taken to locations such as a shopping complexes, bus terminals, LRT stations, hypermarkets and sometimes outside banks.
“We were taught how to target our customers. If a person is young and we think that they do not have the money then we offer them the ‘Thank You’ card to scratch.
“If the person is older and looks well off, we use the cards that offer prizes like electrical items, energy water system, home theatre system or digital stove worth between RM4,000 and RM5,000,” he added.
Tze Meng said the winner would be brought to the office where a supervisor would give a briefing about the “other prizes” he or she could win; and how much to fork out to redeem them.
They would also be lured into believing they could win a Toyota Altis, Persona, Perodua Viva, 42-inch Plasma TV, LCD TV, Honda motorcycle, refrigerator and video camera.
Before that, the victims would be asked to fill up an agreement form.
“The fine print states that the victims bought the items voluntarily.
“The goods bought were also not returnable,” he added.
However, in most cases, the lucrative prizes never materialised and the customers ended up owning a cheap mattress after forking out thousands.
via TheStar
Free Trial Offer, Send Money Today Scam
ONLINE scams targeting young people are proliferating faster than you can say, 'free trial offer, send money today'. As a result, billions are lost as online criminals target the young.
About 10 per cent of all internet users lost a combined $1.2 billion in Australia to various scams last year, according to industry research. Hundreds of thousands also lost personal information, including financial details and tax information, which con artists can 'bank' to commit further fraud at a later stage.
While offline scams frequently targeted pensioners and older people, internet scammers have younger people in their sights, with people aged 18-24 losing an average $1619, compared to $1000 across all age groups.
The problem will be the focus of an international 'net sweep' today involving consumer protection authorities from 42 countries, including the Australian Competition and Consumer Commission. Peter Kell, deputy chairman of the ACCC, said often young people did not understand their rights on the web. 'They may be technologically savvy [but] they can be easy targets.'
A common scam involves ads for jobs that require applicants to send money for 'training'. Other common areas include online shopping, social networking and travel offers. Mr Kell said travel scams increase before Christmas and are often characterised by unknown companies claiming victims have won awards.
Sites targeted by the sweep will range from legitimate offers that contain incorrect information to downright tricks to lure money or personal information. Last year's sweep unearthed a fraudulent football World Cup tickets website and helped shut down 40 other scam sites.
'Many operators of these sites are based out of Australia, they move quickly and are impossible to track down,' Mr Kell said.
A survey by the internet security company VeriSign found 69 per cent of 18- to 24-year-olds did not check for enhanced security when being asked to transfer money over the internet.
Dr Mark Gregory, a network engineering lecturer at RMIT University, said young people often forgot that the internet is a public place.
'It's equivalent to holding [personal information] up on a board in the middle of a supermarket but it's worse than that. You can take the board and go home but on the internet you can't.'
Recommended reading:
* How people counterfeit check from Internet source
* Types of Internet business scam
About 10 per cent of all internet users lost a combined $1.2 billion in Australia to various scams last year, according to industry research. Hundreds of thousands also lost personal information, including financial details and tax information, which con artists can 'bank' to commit further fraud at a later stage.
While offline scams frequently targeted pensioners and older people, internet scammers have younger people in their sights, with people aged 18-24 losing an average $1619, compared to $1000 across all age groups.
The problem will be the focus of an international 'net sweep' today involving consumer protection authorities from 42 countries, including the Australian Competition and Consumer Commission. Peter Kell, deputy chairman of the ACCC, said often young people did not understand their rights on the web. 'They may be technologically savvy [but] they can be easy targets.'
A common scam involves ads for jobs that require applicants to send money for 'training'. Other common areas include online shopping, social networking and travel offers. Mr Kell said travel scams increase before Christmas and are often characterised by unknown companies claiming victims have won awards.
Sites targeted by the sweep will range from legitimate offers that contain incorrect information to downright tricks to lure money or personal information. Last year's sweep unearthed a fraudulent football World Cup tickets website and helped shut down 40 other scam sites.
'Many operators of these sites are based out of Australia, they move quickly and are impossible to track down,' Mr Kell said.
A survey by the internet security company VeriSign found 69 per cent of 18- to 24-year-olds did not check for enhanced security when being asked to transfer money over the internet.
Dr Mark Gregory, a network engineering lecturer at RMIT University, said young people often forgot that the internet is a public place.
'It's equivalent to holding [personal information] up on a board in the middle of a supermarket but it's worse than that. You can take the board and go home but on the internet you can't.'
Recommended reading:
* How people counterfeit check from Internet source
* Types of Internet business scam
Frank Castaldi Gets 23 Years For $77M Ponzi Scheme
Tearful, angry victims of a $77 million Ponzi scheme that targeted hundreds of often working-class Italian-Americans crowded into a Chicago courtroom Thursday to tell their stories before a judge handed the convicted swindler a maximum 23-year prison term.
The federal judge rejected prosecutors' recommendation of a 12 1/2 year sentence for Frank Castaldi – in part because he had reported the two-decade scam himself – saying that would let the 57-year-old accountant and businessman off too easy, given the lives he ruined.
Castaldi, once a respected member of the Chicago-area Italian community himself, sometimes targeted the elderly, widows and immigrants from Italy – many of whom were close friends of Castaldi who trusted him, U.S. District Judge John Darrah said.
"This is an offense of a huge magnitude," Darrah told the court. "Frank Castaldi abused that trust and had a horrific impact on victims," he said.
The slight, mustachioed Castaldi, who will begin serving his sentence on Nov. 15, also gained the trust of some by helping do their income taxes for years, prosecutors said.
Dozens of victims packed into the courtroom to speak at the sentencing hearing. Others were forced to stand in the doorway, straining to listen to often gut-wrenching testimony.
Reading from letters, Darrah cited one woman who said Castaldi persuaded her to invest $300,000 shortly after her husband had died, assuring her he would help her out.
"Instead, like a vulture, he prayed on my weakness," Darrah said, reading from the letter.
Frank Cesare, 72, said he had come from Italy and saved money all his life so he could help his children and grandchildren. Now, he said, he has lost all his savings to Castaldi.
Recommended reading:
* Thomas Petters admitted $3.5 billion Ponzi scheme
* Billionaire Stanford arrested for Ponzi Scheme fraud
* Allen Stanford Accused Of Multi-Billion Dollar Ponzi Scheme
The federal judge rejected prosecutors' recommendation of a 12 1/2 year sentence for Frank Castaldi – in part because he had reported the two-decade scam himself – saying that would let the 57-year-old accountant and businessman off too easy, given the lives he ruined.
Castaldi, once a respected member of the Chicago-area Italian community himself, sometimes targeted the elderly, widows and immigrants from Italy – many of whom were close friends of Castaldi who trusted him, U.S. District Judge John Darrah said.
"This is an offense of a huge magnitude," Darrah told the court. "Frank Castaldi abused that trust and had a horrific impact on victims," he said.
The slight, mustachioed Castaldi, who will begin serving his sentence on Nov. 15, also gained the trust of some by helping do their income taxes for years, prosecutors said.
Dozens of victims packed into the courtroom to speak at the sentencing hearing. Others were forced to stand in the doorway, straining to listen to often gut-wrenching testimony.
Reading from letters, Darrah cited one woman who said Castaldi persuaded her to invest $300,000 shortly after her husband had died, assuring her he would help her out.
"Instead, like a vulture, he prayed on my weakness," Darrah said, reading from the letter.
Frank Cesare, 72, said he had come from Italy and saved money all his life so he could help his children and grandchildren. Now, he said, he has lost all his savings to Castaldi.
Recommended reading:
* Thomas Petters admitted $3.5 billion Ponzi scheme
* Billionaire Stanford arrested for Ponzi Scheme fraud
* Allen Stanford Accused Of Multi-Billion Dollar Ponzi Scheme
Nigel Woodforth and Ricky Gage earned 250,000 pounds through illegal sperm donor agency
Two men earned 250,000 pounds online through an unlicensed fertility company matching sperm donors with women trying to conceive, a court heard on Monday. I can't believed it that some women are willing to buy sperm online without going to a physical and authorized sperm banks.
Under the Human Fertilization and Embryology Act, a license is needed by anyone wanted to "procure, test or distribute" any sperm or eggs.
The two defendants are the first to be prosecuted under the Act, the Press Association reported.
Nearly 800 women had signed up to use the online service provided by the company, operating under various names including Sperm Direct Limited and First4Fertility, Southwark Crown Court in London heard.
Nigel Woodforth, 43, ran the firm from the basement of his home in Reading, Berkshire, with 49-year-old Ricky Gage.
Philip Bennetts, prosecuting, said: "In short, the website introduced men who wished to supply sperm to women who wished to use the sperm to impregnate themselves in order to have a child."
After paying an 80-pound joining fee and 300 pounds to use the service, the women would then choose from a list of men before the sperm was delivered to their homes through a courier company at the price of 150 pounds per delivery.
Gage and Woodforth face two charges of procuring gametes intended for human application, both of which they deny.
They had been warned by the Human Fertilization and Embryology Authority (HFEA) that they would need a license to operate the company under new rules introduced in July 2007.
The law was brought in to ensure that both donors and women wanting to conceive had access to information and counseling, and to help protect against the risks of diseases including HIV.
Gage and Woodforth were arrested in April 2009 after an undercover police investigation.
A male officer posed online first as a potential sperm donor, and then as a woman called Angie Williams, seeking a donor.
The court heard that the pair's website promised women a "life-changing opportunity."
A message to potential clients read: "You have taken the first step toward letting us help you try to fulfill your dreams of the baby you have always longed for.
"We offer women a life-changing opportunity toward motherhood."
Women were allowed to choose the ethnicity, height, hair color and even hobbies of the sperm donor they wanted to use.
They could then contact the donor themselves and arrange for the delivery of his sperm to their home, either for self-insemination or through IVF. Recipients were advised to negotiate the payment of expenses to the donor, and to arrange medical tests, themselves.
Both defendants claim they operated an introduction service and did not need a license as stipulated by the HFEA Act.
The trial continues.
Under the Human Fertilization and Embryology Act, a license is needed by anyone wanted to "procure, test or distribute" any sperm or eggs.
The two defendants are the first to be prosecuted under the Act, the Press Association reported.
Nearly 800 women had signed up to use the online service provided by the company, operating under various names including Sperm Direct Limited and First4Fertility, Southwark Crown Court in London heard.
Nigel Woodforth, 43, ran the firm from the basement of his home in Reading, Berkshire, with 49-year-old Ricky Gage.
Philip Bennetts, prosecuting, said: "In short, the website introduced men who wished to supply sperm to women who wished to use the sperm to impregnate themselves in order to have a child."
After paying an 80-pound joining fee and 300 pounds to use the service, the women would then choose from a list of men before the sperm was delivered to their homes through a courier company at the price of 150 pounds per delivery.
Gage and Woodforth face two charges of procuring gametes intended for human application, both of which they deny.
They had been warned by the Human Fertilization and Embryology Authority (HFEA) that they would need a license to operate the company under new rules introduced in July 2007.
The law was brought in to ensure that both donors and women wanting to conceive had access to information and counseling, and to help protect against the risks of diseases including HIV.
Gage and Woodforth were arrested in April 2009 after an undercover police investigation.
A male officer posed online first as a potential sperm donor, and then as a woman called Angie Williams, seeking a donor.
The court heard that the pair's website promised women a "life-changing opportunity."
A message to potential clients read: "You have taken the first step toward letting us help you try to fulfill your dreams of the baby you have always longed for.
"We offer women a life-changing opportunity toward motherhood."
Women were allowed to choose the ethnicity, height, hair color and even hobbies of the sperm donor they wanted to use.
They could then contact the donor themselves and arrange for the delivery of his sperm to their home, either for self-insemination or through IVF. Recipients were advised to negotiate the payment of expenses to the donor, and to arrange medical tests, themselves.
Both defendants claim they operated an introduction service and did not need a license as stipulated by the HFEA Act.
The trial continues.
Victory Miracle Centre church scam its own members
A pentecostal church has allegedly fleeced its own members of more than $4 million.
The Victory Miracle Centre in south-west Sydney came under fire from Liverpool MP Paul Lynch in State Parliament last week.
He said a number of his constituents, including an elderly man dying of bowel cancer, had become victims of the church, which promised ''multiple blessings'' and healthy financial returns in exchange for cash loans.
Three elders of the church are accused of having promised followers they would ''experience miracles'' in return for money for property deals in Australia and Fiji that churchgoers claim were never paid back.
Victory Miracle Centre's congregation is largely ethnic Indians from Fiji.
Mr Lynch named Victory's pastor George Mani, former Liverpool Council Liberal candidate Neil Lal and Anand Prasad in State Parliament on Tuesday in a stinging attack on their history of persuading followers, many of whom are migrants, to hand over money or equity in their homes.
Mr Mani denies he promised miracles. ''No one was asked to give money to the church. The money they gave was for an investment into properties in Fiji,'' he said. ''We never promised a miracle. I only preach the gospel.''
The Sun-Herald has obtained a statement to the Australian Securities and Investments Commission from another churchgoer claiming he was persuaded to hand over $63,000 in superannuation accumulated by him and his elderly mother, which he was told would bring a 10 per cent return from investments in Fiji.
Federal Court documents show that Mr Mani, Mr Lal and Mr Prasad were made bankrupt on July 5. The trio, who are behind the company Ephraim Investments, are the subject of findings against them brought by Rams Home Loans.
Rams is pursuing the trio in relation to a home owned by church member Sam Kumari Prasad (no relation of Anand Prasad). The lender has released Mrs Prasad and the estate of her husband from any obligation under a loan in which the family remortgaged their home for $412,000 and handed the loan to the church. ''They made our lives hell,'' Mrs Prasad said.
She and her late husband, Arnuch Prasad, joined the church in 2004, after he was diagnosed with bowel, liver and lung cancer.
By the time Mr Prasad died in 2007, the church directors had borrowed another $80,000 on top of the $412,000, allegedly telling them it would be used to invest into properties through Ephraim.
''It still hurts, and I want to go public because I don't want other people to go through what I have gone through,'' Mrs Prasad said.
Another former church member, Lonesh Govind, told ASIC he and his elderly mother had given the three church directors $70,000 to start up Ephraim Investments.
They were then asked to roll their super, amounting to $63,000, into a self-managed super fund.
When Mr Govind began investigating where his money had gone, he was told by the Australian Taxation Office there was no documentation of the fund ever existing.
''Our life savings have gone and we thought they were godly people, we trusted them,'' Mr Govind said.
Mr Lal and Mr Prasad did not respond to requests for a comment.
A Liberal Party spokeswoman confirmed Mr Lal had run for Liverpool Council as an endorsed candidate but would not comment on whether he is still a party member.
via SMH.COM.AU
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The Victory Miracle Centre in south-west Sydney came under fire from Liverpool MP Paul Lynch in State Parliament last week.
He said a number of his constituents, including an elderly man dying of bowel cancer, had become victims of the church, which promised ''multiple blessings'' and healthy financial returns in exchange for cash loans.
Three elders of the church are accused of having promised followers they would ''experience miracles'' in return for money for property deals in Australia and Fiji that churchgoers claim were never paid back.
Victory Miracle Centre's congregation is largely ethnic Indians from Fiji.
Mr Lynch named Victory's pastor George Mani, former Liverpool Council Liberal candidate Neil Lal and Anand Prasad in State Parliament on Tuesday in a stinging attack on their history of persuading followers, many of whom are migrants, to hand over money or equity in their homes.
Mr Mani denies he promised miracles. ''No one was asked to give money to the church. The money they gave was for an investment into properties in Fiji,'' he said. ''We never promised a miracle. I only preach the gospel.''
The Sun-Herald has obtained a statement to the Australian Securities and Investments Commission from another churchgoer claiming he was persuaded to hand over $63,000 in superannuation accumulated by him and his elderly mother, which he was told would bring a 10 per cent return from investments in Fiji.
Federal Court documents show that Mr Mani, Mr Lal and Mr Prasad were made bankrupt on July 5. The trio, who are behind the company Ephraim Investments, are the subject of findings against them brought by Rams Home Loans.
Rams is pursuing the trio in relation to a home owned by church member Sam Kumari Prasad (no relation of Anand Prasad). The lender has released Mrs Prasad and the estate of her husband from any obligation under a loan in which the family remortgaged their home for $412,000 and handed the loan to the church. ''They made our lives hell,'' Mrs Prasad said.
She and her late husband, Arnuch Prasad, joined the church in 2004, after he was diagnosed with bowel, liver and lung cancer.
By the time Mr Prasad died in 2007, the church directors had borrowed another $80,000 on top of the $412,000, allegedly telling them it would be used to invest into properties through Ephraim.
''It still hurts, and I want to go public because I don't want other people to go through what I have gone through,'' Mrs Prasad said.
Another former church member, Lonesh Govind, told ASIC he and his elderly mother had given the three church directors $70,000 to start up Ephraim Investments.
They were then asked to roll their super, amounting to $63,000, into a self-managed super fund.
When Mr Govind began investigating where his money had gone, he was told by the Australian Taxation Office there was no documentation of the fund ever existing.
''Our life savings have gone and we thought they were godly people, we trusted them,'' Mr Govind said.
Mr Lal and Mr Prasad did not respond to requests for a comment.
A Liberal Party spokeswoman confirmed Mr Lal had run for Liverpool Council as an endorsed candidate but would not comment on whether he is still a party member.
via SMH.COM.AU
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Kautilya Nandan Pruthi masterminded £115 million Ponzi scam
A businessman appeared in court today accused of masterminding a sprawling £115 million scam that claimed a series of high-profile victims.
Kautilya Nandan Pruthi, 39, is charged with 30 fraud offences including running a bogus business, money laundering and obtaining money by deception.
He is also accused of participating in a fraudulent business, fraud, obtaining money by deception, unauthorised regulated activity and concealing criminal property from his base in Knightsbridge, central London, between August 2005 and June 2009.
He was charged in July following an investigation into a gang suspected of cheating at least 600 people around the world.
People were persuaded to invest in an apparently high-yield fund, but the money was allegedly siphoned off to fuel the lavish lifestyles of those behind it.
Victims are believed to include a 1960s pop star, a household name from television and the cricketer and Strictly Come Dancing champion Darren Gough.
The swindle is said to be one of the biggest "Ponzi" frauds, a crime made famous by disgraced Wall Street broker Bernard Madoff, yet detected in Britain.
Pruthi appeared at City of London Magistrates' Court. A court official said his bail had been renewed and he would appear at the court again on October 29.
Recommended reading:
* Billionaire Stanford arrested for Ponzi Scheme fraud
* How to make money with Ponzi Scheme
* Madoff rich and famous Ponzi scheme victims
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Kautilya Nandan Pruthi, 39, is charged with 30 fraud offences including running a bogus business, money laundering and obtaining money by deception.
He is also accused of participating in a fraudulent business, fraud, obtaining money by deception, unauthorised regulated activity and concealing criminal property from his base in Knightsbridge, central London, between August 2005 and June 2009.
He was charged in July following an investigation into a gang suspected of cheating at least 600 people around the world.
People were persuaded to invest in an apparently high-yield fund, but the money was allegedly siphoned off to fuel the lavish lifestyles of those behind it.
Victims are believed to include a 1960s pop star, a household name from television and the cricketer and Strictly Come Dancing champion Darren Gough.
The swindle is said to be one of the biggest "Ponzi" frauds, a crime made famous by disgraced Wall Street broker Bernard Madoff, yet detected in Britain.
Pruthi appeared at City of London Magistrates' Court. A court official said his bail had been renewed and he would appear at the court again on October 29.
Recommended reading:
* Billionaire Stanford arrested for Ponzi Scheme fraud
* How to make money with Ponzi Scheme
* Madoff rich and famous Ponzi scheme victims
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How to identify a check scam
Do you think you may have received a scam or have received something that makes you suspicious? Here's are three questions to ask to keep you from losing your hard earned money and give you some direction on what to do.
How to identify a check scam:
1. You received an unexpected cashier’s check or an offer of a large payment from a company that may or may not be posing as a mystery shopping company. Mystery shopping is a common front; however, it could be any type of company.
2. You are asked to send some of the proceeds to someone else.
3. The offer seems too good to be true. The scammers are counting on your willingness to take the chance their offer is real.
If I can get the cash, doesn’t that mean the check or money order is good?
Federal law requires banks and credit unions to make the funds you deposit available quickly, usually within five days, depending on the type of check or money order. Just because you can withdraw the money doesn’t mean the check or money order is good. It can take weeks, even months, for counterfeits to be discovered. And the bank will demand their money back.
Interesting reading:
* Don't Believe Your Bank When it Reports a Check has Cleared
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How to identify a check scam:
1. You received an unexpected cashier’s check or an offer of a large payment from a company that may or may not be posing as a mystery shopping company. Mystery shopping is a common front; however, it could be any type of company.
2. You are asked to send some of the proceeds to someone else.
3. The offer seems too good to be true. The scammers are counting on your willingness to take the chance their offer is real.
If I can get the cash, doesn’t that mean the check or money order is good?
Federal law requires banks and credit unions to make the funds you deposit available quickly, usually within five days, depending on the type of check or money order. Just because you can withdraw the money doesn’t mean the check or money order is good. It can take weeks, even months, for counterfeits to be discovered. And the bank will demand their money back.
Interesting reading:
* Don't Believe Your Bank When it Reports a Check has Cleared
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How people counterfeit check from Internet source
Think of it as one more reason not to write checks. Hackers believed to be operating out of Russia have figured out a high-tech way to carry out the decidedly low-tech crime of check fraud, a computer security company says — writing at least $9 million in fakes against more than 1,200 legitimate accounts.But these hackers got the account information in an unusual way: They broke into three websites that specialize in a little-known type of business — archiving check images online.
Check counterfeiting is a crime that savvy Internet criminals usually pass up. After all, it's far easier for them to make money by stealing credit cards and online banking passwords.
The scam was discovered by SecureWorks Inc., an Atlanta computer security company. The organization says it is working with the FBI and says the hackers have not been caught.
Retailers and other businesses use the sites to store records of all the checks they write. Check-cashing operations use them to sock away images of checks they receive. And some banks pay them to store images of customers' checks, so the customers can see them when they log in to their online banking accounts.
The criminals downloaded all the images they could find, grabbing bank routing numbers, names and addresses and even signatures of legitimate account holders. They used the information to create their own checks using easy-to-acquire software and printers.
Because all the account information is real and the victims don't know their accounts have been compromised, the odds of the checks going through are high.
SecureWorks notified the three sites and said they have closed their security holes, but warned that the scam is ongoing and targeting other, similar sites.
"It's not the standard kind of criminal operation," Joe Stewart, director of malware research for SecureWorks' Counter Threat Unit, told The Associated Press ahead of the report's scheduled release Wednesday.
"Check counterfeiting is kind of old school, but these guys have figured out how to make it highly automated," he said. "They can get all this data and use that to write counterfeit checks all day long."
The research was being released in conjunction with the Black Hat computer security conference in Las Vegas, which runs Wednesday and Thursday and draws security professionals from around the world to hear about the latest vulnerabilities and attacks and ways to thwart criminals.
Notable presentations this year are to include a demonstration of how to break into widely used ATMs, a talk that was pulled last year by the researcher's employer after complaints from the ATM maker. Researchers are also expected to discuss vulnerabilities in smart phones and in the technology used to secure online transactions.
A consistent theme at Black Hat, and at the related DefCon conference this weekend in Las Vegas, is that most Internet criminals are now motivated by money rather than mayhem. And they're getting more clever in their approaches as banks and other valuable targets tighten their security, as SecureWorks' three-month investigation into the check-counterfeiting ring found.
Dan Clements, a computer security expert who wasn't involved in SecureWorks' research, said the scheme represents a "very significant" escalation of the abilities of online crooks.
He said people should watch for small test charges that criminals make to figure out which accounts are still active, and avoid writing their driver's license numbers and other personal details on checks. He said the attackers were shrewd in their choice of targets.
"I think it's brilliant — it's where the data is," he said. "It's a way to get into these accounts and they don't need to be in the country."
It's unclear how much of the $9 million in that scam the criminals actually got to keep.
The main bottleneck lies with the "money mules" — people recruited from online job sites to launder the money.
They were sent the bogus checks — via overnight shipping paid for with stolen credit cards — and asked to deposit them into their own bank accounts. They were then supposed to wire a portion to accounts in Russia.
Stewart said the six "mules" he was able to reach all told him they hadn't wired any money to the criminals because either they or their banks got suspicious. Many more likely did wire the money, however.
Stewart uncovered the scam while investigating malicious software that steals banking passwords.
In eavesdropping on one criminal group's communications, which he was able to do by infecting his own computer with the malicious program the group was using, he noticed that they were doing something unexpected: collecting massive amounts of images of checks.
He found a file logging all of their transactions, which revealed that 3,285 checks were written against 1,280 accounts since June 2009. Most checks were written for less than $3,000 to evade banks' anti-fraud measures. Overall, he saw about 200,000 stolen check images — suggesting the criminals have only exploited a fraction of the accounts on which they have information.
SecureWorks isn't identifying the hacked sites.
What is a fake check scam?
It's a fast-growing fraud that could cost you thousands of dollars. There are many types of fake check scams, but it all starts when someone gives you a realistic-looking check or money order and asks you to send cash somewhere in return. It's phony, and so is the person's story, but that may take weeks to discover. Now your bank wants the money back. However, just because you can get the cash doesn't mean the check or money order is good. Ultimately, you are responsible for the checks or money orders you deposit or cash. That's how the scam works.
Related link:
* Don't be a victim of fake check scams. Get info here.
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Blood Nest - Fake Bird Nest
“Blood nest” – a much sought after variety of bird’s nest – is actually tainted with dangerous chemicals to deceive consumers into paying double the price for a premium grade.While the normal bird’s nest, which is ivory in colour, can fetch up to RM10,000 a kilo, the reddish “blood nest” fetches up to RM20,000 a kilo in Malaysia.
Traders justify the exorbitant price by claiming the “blood nest” is a premium grade of the Chinese delicacy.
In exposing this scam on Saturday, Deputy Agriculture and Agro-based Industries Minister Chua Tee Yong said these tainted bird’s nests were dangerous to health and may even be fatal when consumed by humans.
He said the nests were either sprayed with iodine or stored at premises where there was high ammonia content to give them a uniform bright-red colour.
“Some also use karya gum (from a soft wooded tree) to give the bird’s nest its reddish colour,” he told The Star.
Chua advised the public against purchasing bird’s nest from dubious traders and urged the industry to practise self-regulation to ensure the quality and safety of the product.
He said that all bird’s nests must have a Veterinary Service Department health certificate before they could be exported.
Federation of Bird’s Nest Merchants Asso ciations chairman Datuk Beh Heng Seong said the term “blood nest” was coined by conmen and that there was “no such thing”.
“Bird’s nest is made up of the saliva of swiflets and is ivory in colour. It is impossible for bird’s nest to be red in colour.
“The so-called blood nests have high levels of nitrates from the artificial red colouring added to it,” Beh said, admitting that many consumers had been deceived into paying a high price for the dangerous product.
He said a kilo of bird’s nest costs between RM8,000 and RM10,000 in the market depending on the grade while a kilo of the “blood nest” was between RM15,000 and RM20,000.
Beh said Malaysia produced some 240 tonnes of bird’s nest worth RM1bil a year and 90% of it was exported to China.
Asked whether the federation, comprising 19 associations and 10,000 members nationwide, had tried to rein in those who were cheating consumers, he said they were looking at educating consumers on bird’s nests and coming up with guidelines for the industry.
Meanwhile, Fomca secretary-general Muhd Sha’ani Abdullah urged the Health Ministry to issue guidelines on what a genuine bird’s nest was and to warn consumers of bird’s nests with added colouring.
He said so far, they have not received any complaint from consumers on the so-called “blood nest” but added that could be because consumers were unaware of tainted products in the market.
He suggested that the Health Ministry issue certificates for untainted products.
“Traders should also be responsible by making sure no harmful chemicals are used in their products,” said Muhd Sha’ani.
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Daniel Tzvetkoff charged for laundering $US500 million
Fallen Australian IT entrepreneur Daniel Tzvetkoff, who filed for bankruptcy early this year, has been arrested in Las Vegas on charges that he helped gamblers and illegal internet gambling companies launder $US500 million (A$540 million).
In a case unsealed in New York, prosecutors accused Mr Tzvetkoff, 27, of processing gambling proceeds and making them appear legal to banks, starting in early 2008.
He created dozens of so-called shell companies in a scheme that he once wrote was "perfect," prosecutors said.
Mr Tzvetkoff was charged on four counts, including bank fraud, money laundering, and conspiracy to operate and finance an illegal gambling business.
If convicted, he could face up to 75 years in prison.
Prosecutors said Mr Tzvetkoff stopped processing transactions in March 2009 after leading gambling websites accused him of stealing $US100 million.
Mr Tzvetkoff, who had a penchant for exotic cars and mansions, has also been sued by a former business partner for failing to keep accurate financial records.
He was forced to sell his share of Brisbane nightclub Zuri Lounge after his financial collapse in 2009.
His former lavish lifestyle included the acquisition of Queensland's most expensive home, on the Gold Coast; a 98-foot super yacht and a 2008 spot on the BRW Young Rich List.
In a case unsealed in New York, prosecutors accused Mr Tzvetkoff, 27, of processing gambling proceeds and making them appear legal to banks, starting in early 2008.
He created dozens of so-called shell companies in a scheme that he once wrote was "perfect," prosecutors said.
Mr Tzvetkoff was charged on four counts, including bank fraud, money laundering, and conspiracy to operate and finance an illegal gambling business.
If convicted, he could face up to 75 years in prison.
Prosecutors said Mr Tzvetkoff stopped processing transactions in March 2009 after leading gambling websites accused him of stealing $US100 million.
Mr Tzvetkoff, who had a penchant for exotic cars and mansions, has also been sued by a former business partner for failing to keep accurate financial records.
He was forced to sell his share of Brisbane nightclub Zuri Lounge after his financial collapse in 2009.
His former lavish lifestyle included the acquisition of Queensland's most expensive home, on the Gold Coast; a 98-foot super yacht and a 2008 spot on the BRW Young Rich List.
ABACUS 2007-AC1 fraud
The U.S. Securities and Exchange Commission is accusing Goldman Sachs Group Inc of committing fraud in a complicated transaction involving securities known as collateralized debt obligations. The particular deal that Goldman entered into with Paulson and others was called ABACUS 2007-AC1.
Here's how the ABACUS 2007-AC1 deal worked, according to the SEC's complaint:
1) Hedge fund manager John Paulson tells Goldman Sachs in late 2006 he wants to bet against risky subprime mortgages using derivatives. The risky mortgage bonds that Paulson wanted to short were essentially subprime home loans that had been repackaged into bonds. The bonds were rated "BBB," meaning that as the home loans defaulted, these bonds would be among the first to feel the pain.
2) Goldman Sachs knows that German bank IKB would potentially buy the exposure that Paulson was looking to short. But IKB would only do so if the mortgage securities were selected by an outsider.
3) Goldman Sachs knows that not every asset manager would be willing to work with Paulson, according to the complaint. In January 2007, Goldman approaches ACA Management LLC, a unit of a bond insurer.
ACA agrees to be the manager in a deal, and to help select the securities for the deal with Paulson. In January and February 2007, Paulson and ACA work on the portfolio, coming to an agreement in late February.
Goldman never tells ACA or other investors that Paulson is shorting the securities, and ACA believes that Paulson in fact wanted to own some of the riskiest parts of the securities, according to the complaint.
4) Goldman puts together a deal known as a "synthetic collateralized debt obligation" designed to help IKB and Paulson get the exposure they want. IKB takes $150 million of the risk from subprime mortgage bonds in late April 2007. ABN Amro takes some $909 million of exposure as well, and buys protection on its exposure from ACA Management affiliate ACA Financial Guaranty Corp in May 2007.
Goldman's marketing materials for the deal never mention Paulson's having shorted more than $1 billion of securities. Goldman receives about $15 million in fees.
5) Months later, IKB loses almost all of its $150 million investment. In late 2007, ABN is acquired by a consortium of banks including Royal Bank of Scotland. In August 2008, RBS unwinds ABN's position in ABACUS by paying Goldman $840.1 million. Most of that money goes to Paulson, who made about $1 billion total.
Here's how the ABACUS 2007-AC1 deal worked, according to the SEC's complaint:
1) Hedge fund manager John Paulson tells Goldman Sachs in late 2006 he wants to bet against risky subprime mortgages using derivatives. The risky mortgage bonds that Paulson wanted to short were essentially subprime home loans that had been repackaged into bonds. The bonds were rated "BBB," meaning that as the home loans defaulted, these bonds would be among the first to feel the pain.
2) Goldman Sachs knows that German bank IKB would potentially buy the exposure that Paulson was looking to short. But IKB would only do so if the mortgage securities were selected by an outsider.
3) Goldman Sachs knows that not every asset manager would be willing to work with Paulson, according to the complaint. In January 2007, Goldman approaches ACA Management LLC, a unit of a bond insurer.
ACA agrees to be the manager in a deal, and to help select the securities for the deal with Paulson. In January and February 2007, Paulson and ACA work on the portfolio, coming to an agreement in late February.
Goldman never tells ACA or other investors that Paulson is shorting the securities, and ACA believes that Paulson in fact wanted to own some of the riskiest parts of the securities, according to the complaint.
4) Goldman puts together a deal known as a "synthetic collateralized debt obligation" designed to help IKB and Paulson get the exposure they want. IKB takes $150 million of the risk from subprime mortgage bonds in late April 2007. ABN Amro takes some $909 million of exposure as well, and buys protection on its exposure from ACA Management affiliate ACA Financial Guaranty Corp in May 2007.
Goldman's marketing materials for the deal never mention Paulson's having shorted more than $1 billion of securities. Goldman receives about $15 million in fees.
5) Months later, IKB loses almost all of its $150 million investment. In late 2007, ABN is acquired by a consortium of banks including Royal Bank of Scotland. In August 2008, RBS unwinds ABN's position in ABACUS by paying Goldman $840.1 million. Most of that money goes to Paulson, who made about $1 billion total.
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