Steps in a con game 19

We are continuing our discussion as to how the con artists are trying to separate the mark from his money - the real money.  We discussed how the mark can be pressured by the inside man telling him that "the window is closing on this opportunity" and to "get in now."

     Another way to get the mark to cooperate has been with us since kindergarten - peer pressure.  The inside man and/or the con artist is not above using peer pressure to work on the mark.  Remember Bernie Madoff - he had everyone and his brother trying to get in on his "investments."  Madoff would often point out that "with so many people investing in my interests, how can it not be legitimate?"  In other words - everyone else is doing it, why not you?

     Surprising as it seems, peer pressure is alive and well among adults.  It doesn't take much to put pressure on full grown adults to try and get them to cooperate.  The line "everyone else is doing it" can be a powerful incentive when the underlying cause is to make money.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 18

So, how does the con artist get you to invest the "real" money?  He already demonstrated that you can make money, and make money quickly and with a higher rate of return than normal investments.  This alone is enough to get the mark interested.  But - now they have to get you to take the real bait.

     One of the most common attempts to get the mark to get your money now is that "the time to invest is closing."  Once again, using Bernard Madoff as an example.  Madoff had people lining up to join his investment scheme.  He could pick and choose (at least, until the entire thing came crashing down).  So, when a person had a chance to invest with Madoff, it was made clear that the window of time to invest was only for a limited time.  The mark was lucky enough to be "chosen" to invest and people like Madoff did not have all day.  So - you either took the opportunity or you let it slip by.

     This type of "time pressure" should always be a red flag that something is wrong, especially if you are not give a chance to do your research.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 17

Sorry for not posting yesterday.  Here in Houston the "Event of the Year" is usually the Houston Livestock Show and Rodeo and I had VIP passes to the event.  Best BBQ I have ever eaten in my life.  I was in no shape to write even a semi-coherent post and did not want to inflict my ramblings upon my readers.  So, let's move on to the next step in a con game - and the most important one.  How does the con artist get ALL or a good portion of your money?

     Well, at this point, the con artist has succeeded, or is well on his way to succeeding, to show you that he can give you a great return for your money. Far more than just some investment you can get anywhere.  Now - you can get a great deal of money from a small investment.  He has already shown you this as demonstrated by the previous steps.  Now, having been convinced, you are enticed to part with even more money.

   The con artist is set to show you that you need to invest money NOW.  Not just a few bucks here and there, but a REAL set of money.  Now, this is where you are shown that you can start raking in the real money, but only for "real" investors like yourself.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Interludes

Some stories are just too good.  Semi-repeat of a post from yesterday.  This is too good!

http://www.todaysgist.com/2012/02/australian-woman-turns-tables-on.html

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Interludes

Some stories need no comment and just write themselves.  This is one of them.

http://news.yahoo.com/blogs/sideshow/australian-woman-turns-tables-nigerian-scammers-175755518.html

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 16

Keeping on the topic of getting and keeping the investor interested - one of the best giveaways that the entire scheme is a con game occurs when the payoff is made.  Remember - this payoff is only designed to whet the appetite of the investor so he redirects his profits directly back into the scheme.  This is the part and parcel of the whole game.

     Therefore, when the investor gets his money back, and as he is thinking "what a great deal," there is a large amount of pressure put on him by the con man and the third person (and anyone else in this scheme) to reinvest. Most of these appeals will be direct appeals to mark's desire to make money ("Wow - you're already making money.  Just think of how much more you can make with more money").  This is, of course, a powerful incentive.  Another basic appeal is to the mark's vanity ("remember -this investment is only for smart/special/unusual people like yourself that can spot a great deal").

    Come-ons such as these are dead giveaways that something is not right.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 16

Let's stick with the topic of allowing the investor to get some money for a minute.  Keep in mind that not all scams work this way.  For example, the infamous Nigerian 419 scam (sent out via email) does not actually pay off any money at all - it just keeps enticing the mark to send more and more money by using a greater variety of excuses for not paying each time.  The difference between the Nigerian 419 scam, however, and other scams, is that the 419 scam relies on many potential marks (remember from earlier posts that "phishing" emails are sent out by the hundreds of millions).

     For the most part, however, an fraudulent investor scheme will have to rely on having to pay the mark some money to get him interested and get him coming back to the table.  Only through this method can the mark begin to believe that the entire scheme is legitimate.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 15

Remaining on the theme of how much money to invest.  Remember, the con artists want to make the mark invest as much money as possible.  But, most people will not invest 100% until some level of trust is established.

     So, it is not uncommon for the con artists to get the mark to invest money in the scheme, and since the initial investment is not what the con artists want, to get a return on the investment for the mark.  This is a scheme, of course, to get the mark to invest even more money in the scheme.

     Remember, even Bernie Madoff paid investors initially.  The pyramid scheme that he ran did not just take the money and run - the investors were paid back their money and then some - in an attempt to get the investors to invest even more money in the scheme.

     This creates a self-perpetuating loop - the mark will invest money in the scheme, then get a payoff, and then invest more money in the scheme.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 14

Once the "inside man" has the attention of the mark, the next step is to get the mark to determine how much money he will invest.

     All the parties to this con game want the mark to invest as much money as possible.  After all, the entire purpose of a con game is to entice the mark to give all his money to the con artists.  No matter how much money is invested, however, it is all going to enrich the con artists, not the investor.

     One of the more common ploys to get the mark to invest the most money is the simple enticing question: "how much money do you want to earn?  The more you invest, the more you can earn."  It is a basic come-on scheme.

     If the mark is convinced that he will make a lot of money from a little investment, then of course the normal mark will only invest a little at first.  After all, the mark has to make certain that the investment really will make a return.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 13

OK - so we have met the "inside man."  Now what?

     The purpose of the inside man is to show the mark how he can make money.  The inside man is the one who will tell the mark everything he needs to know AND wants to hear about how he can make an insane amount of money with the investment.

     Don't forget - the entire purpose of confidence schemes is to entice the mark into playing the game, and the only real way to get the mark to play the game is to convince him that by investing with the inside man, such insane amounts of money can be made.  After all, if the mark is just looking to get an "average" return on his investment, there exist plenty of natural and safe investments, such as CD's, investments into bonds or conservative investments into the stock market.  All the parties in the con game are betting, however, that the mark is looking for fantastic returns, hence the interest in the game.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 12

OK - the mark has met the "inside man" or the third man (with all due respect to Orson Wells).  Now, the third man has to do his job - he has to tell the mark how he can make money.  This is the next step.

     The whole point of a con game is to "con" the mark - to gain the mark's CONfidence so that he will trust the con man and his associates and give them money.  Well, the mark is not going to give money over to another party without the expectation that more money will be gained from the transaction (for the mark).  The third man needs to show the mark how the money will be made.  From this, the mark needs to be convinced that this is a legitimate "investment" opportunity and that it is not only OK to turn over his money, he would be foolish not to do so.

     Remember Bernie Madoff - Madoff is the third man in all of this and Madoff is the one who convinced the mark to turn over their money to him.  Now - in Madoff's case, he had an enormous advantage in that his reputation was so secure that he really did not have to "sell" his product.  But, the concept is the same.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 11

Remember our discussion from yesterday - the next step in the con game is to get the mark introduced to the "inside man" - the man who has all the information, who is the heart of the scheme to earn money for the mark.

     Why is this step necessary?  Well, unlike all the steps we are discussing, this step is not mandatory.  This element is not essential for the entirety of the con game.  Sometimes the person who introduces himself to the mark is the "inside man."

     Yet, for the psychology of the situation, it is often better to have a third person involved.  First, this helps to lessen any anxiety the mark may have about the situation.  Obviously, if more people are involved, then there is less the chance that the whole thing is a scam.  Further, if a third person is involved, then it appears to the mark that other people have made money from this scam.  Also, a third person provides a different "view" of the scam to the mark, which also provides reinforcement.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 10

Now, let's move onto the next step.  Now that the con man has identified his mark and has sized him up, it's time to up the ante.  Now, the con man must introduce him to the "inside man" who can let the mark into the scheme.

     By "inside man," I mean the person who is behind the entire scheme.  Now, this can be the con man himself, or it can be a third party who is a "friend" of the con man who is doing the con man a favor by letting the mark into the scheme.

     Remember what we discussed about Bernie Madoff, arguably the architect of the most successful Ponzi scheme of all time.  People were begging to get involved in this scheme.  Madoff did not just open the door to anyone - you had to have some special connection to even talk to Madoff.  Madoff, in this instance, was the "inside man" (or one of Madoff's close associates).  Madoff was the man who could make it all happen, but he did not have to hang out his shingle or do any advertising; rather, Madoff had other people bring him marks who, when introduced to Madoff, felt that they were becoming part of a special world.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 9

Before we leave this topic, let's talk about once again how a con man uses his own understanding of psychology to his benefit.

     Everyone on this planet will have some time in his life when he is emotionally vulnerable.  It is at these times when our "guard" is down, when we are more vulnerable to sales pitches and "investment" schemes.  Con men, the ones that are good at it anyway, can spot these emotional downturns and use it to their advantage.

     How can we guard ourselves from such emotional states?  There is no simple answer.  We have a hard enough time recognizing when we are emotionally vulnerable, much less when someone is trying to take advantage of us when we are in such a state.  The best advice I can give (other than the obvious - always check "investment" schemes with a qualified attorney, CPA, Certified Fraud Examiner or other professional), is to always remember that if something sounds too good to be true, it generally is.

     That and always have good friends who can help you through such bad periods of our lives.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 8

Let's discuss another method by which a con man gets his mark - exploiting the mark when he is psychologically vulnerable.

     Con men, at least the good ones, have been doing this for a while.  In their own way, good con men are expert psychologists who can spot human weaknesses.  In addition, good con men do their research.  They research their marks before a move is made.  If inside information can be discovered, such as that a mark's close relative died, or the mark is suffering from some sort of disease, or even if the mark is going through a mid-life crisis, this only helps the con man in his job.  A good con man will therefore even use private investigators, corporate spies or, as the situation demands, prostitutes or criminals to obtain the information necessary about the mark.

     If a mark is psychologically vulnerable, he is more apt to listen to the con man's proposals.  And, half the battle is already over for the con man.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 7

Let's stick for a few minutes on the use of flattery to get the mark interested in the con and in the con game.

     As we discussed, most people like to think that they are part of some "secret" cabal or have access to "privileged" knowledge.  It's how cults keep their membership going and it is also how some people are led to believe that they can develop "super" powers.  Government agencies that clear people for Top Secret clearances have to be certain that the people who are cleared for such high-level work are psychologically balanced individuals since they will be gaining access to classified information.  They have to learn to separate themselves from the information (ah, yes, my younger days, when I had a Top Secret clearance and was working for the Federal Government....)

     Con artists know that many individuals will fall prey to this kind of thinking.  By making the mark believe that "this game or money making idea" is not for everyone BUT "you" are one of the chosen few, it is much easier to separate the mark from his money.  Just another psychological trick that can pay enormous dividends in the end.

Steps in a con game 6

There is an old saying that "flattery will get you everywhere."  This is very true in con games.

     Another way to get the mark interested in the con man is the age-old technique of flattery.  The mark is told that the money-making scheme is "not for everyone," only for "unique" or "special" people.  Perhaps the most basic way to get the mark interested is to make him feel that he is lucky to get in on the con game.  The scheme is only open to a few people and the  mark is one of the "lucky ones."
 
     Perhaps the most famous person to get away with this was Bernard Madoff.  He had people begging to get in on his money making scheme.  There was a waiting list to get in and it took special connections just to get an interview with Madoff.  Those who finally were able to "convince" Madoff to let them into the scheme, more specifically, to Madoff's funds, felt privileged.

     There is nothing more effective than to let someone believe that they are special and privileged.  This is especially true when a con man is trying to get a mark interested.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 5

OK - how does a con man get his mark interested?

     Well, obviously one of the easier ways is to show the mark that the mark can make some money through interaction with the con man.  After all, that is the entire point of the con - getting the mark to believe that he can make money through the con artist.

     Remember - the con artist, from start to finish, is only interested in taking the money from the mark.  Paradoxically, this means that the con artist needs to "hook" the mark by demonstrating or making the mark believe that the mark can make some profit from the con artist.  The easiest method, therefore, is to get the mark interested in the con artist by the temptation of a profit.

     Once the mark is hooked through the promise of making money, the next steps can follow.

    We will give some more examples of making the mark interested tommorrow.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 4

After the con artist has found his mark, the next step is the most obvious - he must gain the confidence of the mark.  After all, the whole point of a con game is a "confidence" game - where the entire crime is the ability for the con artist to gain the mark's confidence, his belief, his hopes, so that the actual crime can be committed.

     We will spend the next few posts talking about the various ways in which the con artist gains the confidence of the mark.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 3

What are the identifying characteristics of a "mark" that attracts the person to a con artist?  We went over a few of the characteristics yesterday.

     A good analogy is to remember that a con artist is somewhat like a shark on the prowl for food.  Although sharks are "apex" predators, they are more often than not looking for prey that are easy targets.  Sharks are not going to expend any more energy than they have to in order to eat and find prey.  The same is true for con artists - they are looking for marks that meet the requirements discussed yesterday but, in addition, they are looking for people that they know, or feel, are exploitable.

     Some of the characteristics of these marks are: (1) are they recently widowed, divorced or become single which makes them emotionally vulnerable; (2) has the mark come into a great deal of money [through inheritance or lottery]; (3) has the mark suddenly moved to a new,unfamiliar location?

    In other words, people that are having life-changing experiences are often more malleable and more vulnerable.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game 2

So - the first step in a con game is to identify the mark.  This is probably the most important part of the entire scam.  If the con artist tries to play a con on a mark that is too intelligent or savvy, then the game will not work and the con artist may find himself in jail at the end.  Likewise, the mark cannot be too stupid either.  A con game requires an interaction between the mark and the criminal.  The mark has to make some affirmative steps for it to work.

    There are a few characteristics of a mark that will grab the attention of a con artist.  First, of course, the mark must have money.  How much money depends on the scam the con artist is trying to perpetuate.  Obviously a low-level "street" hustle requires less capital than a multi-billion dollar Ponzi scheme.  But, the mark must have some cash available.

     Second, the mark must be able to be attracted to the scheme.  The mark must have some psychological tick that can be exploited by the con artist.  Once again, remember, the mark will eventually have to take some affirmative steps for the con to work.

More tommorrow.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Steps in a con game

No con game is operated without a plan.  Every con job has a beginning, middle and an end.  Of course, the ending (for the operator of the con) has one goal in mind - to take money from the mark (victim).  Every step along the way is part of this linear plan to separate the mark from his money.  Every step is designed to push the mark to achieving this goal.

     But, as we stated from the very beginning - con games and fraud operations are not simple "bash and grab" violent crimes.  They take planning, execution and the psychological knowledge (or assumed knowledge) of their victims.  The con artists do not operate without a goal.

     So, in this next series of postings, we will be examining the steps involved in a con job/con operation.  And, the first step is the most obvious: identifying the mark/the victim.

NOTE: THE INFORMATION IN THIS BLOG IS NOT LEGAL ADVICE NOR IS IT INTENDED TO BE LEGAL ADVICE.  IF THE READER HAS ANY LEGAL QUESTIONS, PLEASE REFER TO AN ATTORNEY.

Have a great and fraud-free day.

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk