This story was written by Keith Dawson for the Industry Standard's Media Grok email newsletter. It is archived here for informational purposes only because The Standard's site is no more. This material is Copyright 1999-2001 by Standard Media.

Cyberscammers Help FBI's Image

May 24 2001 07:49 AM PDT

A big Internet bust is just what the bureau needed to repair its reputation - it charges 90 people in 61 alleged online fraud schemes.

Everyone has been giving the FBI the hairy eyeball lately, so the agency had to be delighted to release details of a successful 10-day sweep targeting Internet fraudsters and scammers. Apparently the press release was just dripping with statistics, because each press account picked different numbers to zoom in on. Depending on which account you read, you would learn that the FBI charged 90 (or 88) people in 61 separate cases, resulting in 62 (or 57) arrests and/or pleas, and that more than 56,000 consumers lost more than $117 million over the last year. On the Internet, it seems, there's a sucker born every 10 minutes.

The outfit putting together the national picture on Internet fraud, the Internet Fraud Complaint Center, is a cooperative venture begun last year between the FBI and the National White Collar Crime Center. MSNBC's Mike Brunker (with help from the AP) turned in one of the more comprehensive looks at the stats. According to Brunker, the year-long investigations of Operation Cyber Loss were "coordinated by 28 FBI field offices in cooperation with the U.S. Postal Service, the IRS, the Securities and Exchange Commission, the U.S. Customs Service and local law enforcement agencies in at least 10 states."

The San Jose Mercury News pulled out a detail that might have come straight from the lips of an FBI profiler: "The typical perpetrator of an Internet auction fraud is a male auctioning off videotapes, laptop computers or Beanie Babies, who often only gives an e-mail address as a contact or a post office box located in California, Colorado, Florida or New York."

Auction fraud represented a sizeable chunk of the total dollar losses - 64 percent, according to MSNBC. The Merc, CNET and InternetNews all chose different aspects of auction fraud to spotlight. The Financial Times noted the biggest-ticket scams, such as a case in which 36 victims paid $800,000 to two perps promising to help them raise venture capital. Does this mean the dot-com fraud bubble has burst, too?

90 arrested on Net fraud charges
The Industry Standard

90 arrested in Net fraud crackdown

Net fraud costs consumers $117 million

FBI cyber sweep produces 61 fraud cases
Silicon Valley

Series of Internet-Fraud Probes Results in Arrests of 62 People (AP)
Wall Street Journal
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IFCC Charges 90 in Internet Fraud Cases

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