Soft targets of an African sting

Charities are losing precious cash to fraudsters based in Nigeria. Paul Gosling finds out how the con-trick works

A leading charities accountancy firm has warned its clients against a sophisticated fraud that has nearly caught out several of Britain's biggest charities. The fraud emanates from Nigeria, and is similar to a confidence trick that is thought to have already cost many British businesses large sums of money.

David Selwyn, head of forensic accounting at HW Fisher, says: "This is one of a number of scams that are doing the rounds. They are targeting non-commercial organisations, whose financial controls tend to be weaker than in businesses, often using volunteers, with not the same separation of duties. Controls may be the last thing charities think about, making it much easier to perpetrate deception with large sums of money passing through the organisation."

Charities are being asked by the fraudsters to supply bank account details to supposedly enable banker's drafts to be raised, for a large bequest to be paid to the charity. As Mr Selwyn points out, this seems a reasonable request, made more plausible by the letter coming from an apparently legitimate legal practice in Nigeria.

But the fraudsters use the bank account details to forge withdrawal authorisations from the account, copying the signature on the letter in the expectation that the sender is a bank signatory.

The fraudsters exploit the poor postal and telephone links with Nigeria, making it difficult to check whether the senders are a legitimate legal firm. They usually ask for all communications to be conducted by fax. The gang has also forged letters purporting to be from the Central Bank of Nigeria to give the fraud apparent validity.

Mr Selwyn says that smaller charities are now being targeted, after previous criminal campaigns had focused on larger charities and businesses. Oxfam, Christian Aid and Cafod were each approached in an earlier campaign, being asked to pay comparatively small administrative fees to allow much larger legacies to be paid over. Christian Aid was asked to send pounds 7,500 to unfreeze a bequest of pounds 150,000.

A Cafod spokeswoman admits that it "just missed being taken in" by the fraud. Richard Miller, the deputy director, says: "The clever thing was that the sum of money asked for was plausible." The charity actually received a banker's draft for pounds 150,000, but found on presentation that it contained fictitious account details and was worthless.

Canadian and American churches have lost thousands of pounds in the fraud. The Fraud Intelligence Unit at the British Bankers' Association is aware of at least two charities that had been duped into providing bank details to the fraudsters.

One American lost $4m in a related fraud, and many of the largest losses have been incurred by businesses in Britain and other western countries. Companies have been approached for help with avoiding Nigerian exchange controls by processing payments through their own bank accounts, while taking a generous commission. In the event they make the payments out of their accounts, but no legitimate payments are ever received.

The fraud is an embarrassment not only to the organisations that lose money, but also to the Nigerian government and the Central Bank of Nigeria. The Central Bank last month went to the extraordinary lengths of placing a large advertisement in the Financial Times warning British organisations of the "advance fee fraud/telefax scam", and of the fraudulent use of Central Bank officials' names to give false credibility to proposals. The Central Bank's statement added that victims were themselves to blame, "driven by greed and the urge for quick money".

No one in Nigeria's High Commission was available to comment on why the country was so popular with fraudsters, who may not be Nigerian but who use the country as the criminal equivalent of a flag of convenience in shipping. David Selwyn suggests: "Nigeria's controls are not that well developed."

The fraud is no longer exclusive to Nigeria, with similar correspondence now being received from elsewhere in Africa. But it is still predominantly associated with Nigeria, and has been watched for some years by the Nigeria desk at the Department of Trade and Industry. A DTI spokeswoman says: "There are a number of different types of technique being used of getting people to pay money out."

Scotland Yard says that although it is a continuing problem, only a comparatively few naive people have been caught out. A spokeswoman adds: "We have no jurisdiction in Nigeria, so our role here is crime prevention."

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at

general electionThis quiz matches undecided voters with the best party for them
Arts and Entertainment
Keira Knightley and Matthew Macfadyen starred in the big screen adaptation of Austen's novel in 2005
tvStar says studios are forcing actors to get buff for period roles
Prince William and his wife Catherine, Duchess of Cambridge show their newly-born daughter, their second child, to the media outside the Lindo Wing at St Mary's Hospital in central London, on 2 May 2015.
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Trainee Consultant - Surrey/ South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Ashdown Group: Trainee Consultant - Surrey / South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Recruitment Genius: Claims Administrator

    £16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

    Recruitment Genius: Senior SEO Executive

    £24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

    Day In a Page

    Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

    Fishing is on Nigel Farage's mind

    Ukip leader casts a line to the disaffected
    Who is bombing whom in the Middle East? It's amazing they don't all hit each other

    Who is bombing whom in the Middle East?

    Robert Fisk untangles the countries and factions
    China's influence on fashion: At the top of the game both creatively and commercially

    China's influence on fashion

    At the top of the game both creatively and commercially
    Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

    The man known as GOD has a reputation for getting the job done

    Lord O'Donnell's three principles of rule
    Rainbow shades: It's all bright on the night

    Rainbow shades

    It's all bright on the night
    'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

    Bread from heaven

    Dutch survivors thank RAF for World War II drop that saved millions
    Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

    How 'the Axe' helped Labour

    UK will be 'run for the wealthy and powerful' if Tories retain power
    Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

    The price to be paid for challenging the rule of extremists

    A revolution now 'consuming its own children'
    Welcome to the world of Megagames

    Welcome to the world of Megagames

    300 players take part in Watch the Skies! board game in London
    'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

    Charlotte Gainsbourg on 'Nymphomaniac'

    Starring in one of the most explicit films ever
    Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

    Robert Fisk in Abu Dhabi

    The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
    Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

    Vince Cable exclusive interview

    Charging fees for employment tribunals was 'a very bad move'
    Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

    Iwan Rheon is returning to his Welsh roots

    Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
    Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

    It's time for my close-up

    Meet the man who films great whites for a living
    Increasing numbers of homeless people in America keep their mobile phones on the streets

    Homeless people keep mobile phones

    A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before