29 October 2008, 16:36

Microsoft and Yahoo join the banks to curb email lottery fraud

According to a report presented at the Eco anti-spam congress, Microsoft, Yahoo, Western Union and the African Development Bank are setting up complaints panels for victims and will be passing information to the police about cases of fraud worldwide. The four companies explained the joint initiative by saying they had all suffered damage to their image because of online fraud and spam, especially that advertising fraudulent lotteries.

Online fraud continues to increase and in the last year a particularly lucrative form has been to email people telling them that they have won prizes in online lotteries. The scam works by telling the victim that before their prize can be paid, they are told they must pay a fee. Remarkably, one in every 44 people fell victim to an Internet swindler last year, according to a survey of over 5,000 users in seven countries, presented by Microsoft on Tuesday. Damage varies from case to case, from around one hundred to several thousand Euros.

More than one-third of those questioned said that, as a consequence of their experience of fraud, they were now more cautious when using the internet, but for them, it's too late. According to the members of the initiative, accounts with Western Union and the African Development Bank are often used by the fraudsters. The phenomenon is damaging the reputations of these companies and indeed of all the countries of Africa.

It is the intention of the initiative that people who are thus defrauded should report the case to their local police and then pass the resulting documentation to the new complaints panels set up by the four companies. The partners plan to anonymise the data, then assess it in order to find out, for example, where the spammers are sending their email from. Their findings would then be made available to the police in the country concerned, said Tim Cranton, who is responsible at Microsoft for cooperation with the authorities.

The initiative would be ineffective if the responsible authorities on the spot didn't follow through, Cranton admitted, and the initiative could not prevent lottery swindles, but it could certainly make them more difficult. Professor Norbert Pohlmann of Gelsenkirchen University of Applied Sciences said spammers could exploit the fact that the international crime-fighting authorities were poorly networked, adding that these criminals were active mainly in countries with lax criminal prosecution systems. One example he cited was that of a spammer sitting in Russia but using servers in Korea. Another factor he mentioned was the ability of criminals to capture the computers of many unsuspecting victims and use them to send spam. Using such a botnet, he said, millions of emails could be put into circulation within minutes.

The Anti-Spam Congress is hosted by Eco, the association of the German internet industry, and has brought together industry representatives and public authorities from 46 countries to discuss how to combat unwanted emails. The consensus is that only international cooperation can help fight the internationally active spam gangs.

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