Affinity Fraud XI

Some more ways to avoid affinity fraud include:

1.  As always, be extremely cautious of any investment that is billed as a "once in a lifetime opportunity."  Affinity fraudsters use their connections within the network to try and bypass people's "fraud detectors" by saying this "once in a lifetime opportunity" is for group members only.

2.  If members of the group are told to keep the investment "confidential," this should be another red-flag. 

3.  If you are told to avoid seeking professional advice from a neutral third party, once again this is another sign that something may be up.

We will wrap up this discussion in the next few posts. 

NOTE - information in this article is taken from an article in the March/April 2013 issue of Fraud Magazine by Frank Perri and Richard Brody.

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.

                           

http://www.tauskvega.com

 

Affinity Fraud X

OK - we have spent the last few posts discussing what is affinity fraud and how it works.  Like any other type of fraud, the most important question is: how can affinity fraud be prevented?

     The first way to defeat affinity fraud is the most basic lesson - don't let your guard down just because someone is appealing to the group as a member of the group or through a group leader.  Group leaders and group members, unfortunately, cannot be held to a different level of trust than other individuals.  The same type of skepticism and doubt should be applied to investment schemes within the group. 

    Further, if a member of the group that is offering an investment cannot take the time to reduce the offer to writing for further analysis, this should be a clear red flag.

NOTE - information in this article is taken from an article in the March/April 2013 issue of Fraud Magazine by Frank Perri and Richard Brody.

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.

                           

http://www.tauskvega.com

 

Affinity Fraud IX

It should be obvious now that affinity fraud is difficult to stop because it takes advantage of very real human emotions.  When a person is a part of a group, whether it be a religious group, social group, recreational group, etc., there is a level of trust between the individuals.  After all, the person essentially wants to spend time with the other members of the group, otherwise they would not be there in the first place.  Therefore, when a person is committing affinity fraud, many of the doors are already open for him since all he needs to do is simply take advantage of the group connections which already exist.

     This means that a common thread in many of these schemes is that investors within the group do not do any research (or little research) on their own concerning the "investments" that are made available to group members through the fraudster.  Sad to say, but it is clear that a fraudster who infiltrates a group to commit affinity fraud is already "pre cleared" to take advantage of group members.

NOTE - information in this article is taken from an article in the March/April 2013 issue of Fraud Magazine by Frank Perri and Richard Brody.

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.

                                             

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Affinity Fraud VIII

    Fraudsters who perpetuate affinity fraud use the emotional bonds between the group members to help advance the fraud.  Remember, it is the bonds between the group members that make the group special in the first place.  A good fraudster knows how to take advantage of these bonds.

     Fraudsters move the affinity fraud forward with the group by several means.  Among them are:

1.  telling the group members that reporting the frauds will prohibit any possible returns on the investment;

2.  persuading investigators not to cooperate with investigations by referring to signed confidentiality agreements.

NOTE - information in this article is taken from an article in the March/April 2013 issue of Fraud Magazine by Frank Perri and Richard Brody.

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.

                                             

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Affinity Fraud VII

There are other reasons that a group which is caught up in affinity fraud may not want to involve the police.

1.  Many times members of the group that are themselves the victim of affinity fraud do not believe that a member of the group would steal from them.  This type of "groupthink" is common in cults, but occurs throughout other groups as well and should not be confused solely as cult behavior.

2.  This also leads into the fact that many times members of a group simply cannot accept the fact that "one of their own" would engage in such behavior.

NOTE - information in this article is taken from an article in the March/April 2013 issue of Fraud Magazine by Frank Perri and Richard Brody.

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.

                                             

http://www.tauskvega.com

----------à>>>>>>>>>>>>>>>gene tausk

Affinity Fraud VI

   Some of the other factors that prevent a group from going to law enforcement when a fraud is going on within the group also include:

1.  A group generally desires to solve the problem within the group.  Going to an outside source, even if it is to the police or a 3rd party investigator, can be seen as a failure of the group.

2.  The group may desire not to have a member of the group prosecuted, even if the person has broken the law or done something wrong.  Once again, this has to do with the internal dynamics of the group.

3.  The group may have a desire to have the person who committed the malfeasance "repent," not be prosecuted.

NOTE - information in this article is taken from an article in the March/April 2013 issue of Fraud Magazine by Frank Perri and Richard Brody.

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.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk

Affinity Fraud V

It can be seen from the previous posts that affinity fraud works much like other fraud with the defining characteristic of working within a group (normally a close-knit group).  Breaking affinity fraud, however, creates some special issues.

     First, because the fraud occurs within a close-knit group, it is difficult to get within the group.  The group dynamics usually means that there is an issue in dealing with outsiders, if not outright distrust.  In breaking affinity fraud, therefore, the main issue at first is to convince the group members to work with outsiders.

NOTE - information in this article is taken from an article in the March/April 2013 issue of Fraud Magazine by Frank Perri and Richard Brody.

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.

                                             

http://www.tauskvega.com

 

----------à>>>>>>>>>>>>>>>gene tausk