Hamilton florist reeled in by global e-mail fraud scheme
January 29, 2009 By Steve Buist Hamilton Spectator
Jan. 29, 2009, Hamilton, Ont. — The first e-mails arrived at Westdale
Florists on Friday, Jan. 2. They were from Rev. Benjamin Wallace,
pastor at Christ the King Cathedral in the west African country of
Jan. 29, 2009, Hamilton, Ont. — The first e-mails arrived at Westdale Florists on Friday, Jan. 2. They were from Rev. Benjamin Wallace, pastor at Christ the King Cathedral in the west African country of Ghana. His church was celebrating its anniversary and he wanted to order 50 gift baskets and wreaths from the small Hamilton flower shop and have them shipped to Ghana. What’s more, the good reverend provided all the money up front – around $6,700, including shipping fees.
The funds went into the store’s bank account without a hitch. Wow, thought store owner Rosanna Yeomans, what a great start to the new year.
And the news got even better over the next four days. The congregation had collected more money and the reverend had ultimately gathered enough funds to buy 500 wreaths and 300 gift baskets.
Without fail, every e-mail and every phone call ended with a “God bless you” from Rev. Wallace.
You can probably guess where this story is headed. There was no Rev. Wallace, no church in Ghana and by the time an Amsterdam bank realized the credit card numbers given by the pastor had been stolen from its computer system, Westdale Florists had been scammed out of $22,000.
It’s a cautionary tale that highlights the growing global nature of fraud in an electronic age. Weeks later, with only a slim chance of recovering any of her lost money, Yeomans is struggling to keep her store afloat.
“Every day I wake up and think, ‘What’s going to happen today?’’’ said Yeomans. “I had my little pity party and nights of crying myself to sleep. This isn’t going to stop me.”
Yeomans knows what you’re thinking. With the benefit of hindsight, she said, it’s a lot easier to spot the signs of the scam.
“I know,” Yeomans says sheepishly. “Now I know. Everyone is looking at me and wanting to give me a slap on the back of the head, like ‘Didn’t you know?’ Well, no, I didn’t.”
She’s still smiling, although it’s a bit difficult these days. Even though she’s the victim in this story, Yeomans is embarrassed. She’s also not being treated like the victim by the financial agencies that she thought were supposed to protect her from fraud. The store’s bank account has been frozen, credit card companies have red-flagged her shop and she says Paymentech, the payment processing company for credit card providers, is threatening to send a collection agency after her.
“In spite of the fact that they approved everything,” said Yeomans. “In spite of the fact that I did everything I was supposed to do. That’s what’s frustrating,” she added. “Now the banks don’t want to deal with me even though it’s not my fault, and the credit card companies aren’t going to deal with me.”
A spokesperson for Paymentech did not respond to requests for an interview.
Hamilton police have launched an investigation but with little hope of success. Even if they tracked down the fraudster, Hamilton police have no jurisdiction in Ghana. “This kind of fraud is so easily done,” said Det.-Const. Randy Drumm of the major fraud unit. “She has not benefited in any way. In fact, she went so far as to wait until the money was in her account.’’
Rev. Wallace’s first order was a little unusual, but not unprecedented for a flower shop. Westdale Florists is part of a wire service and has an Internet presence, so orders come in from around the globe or get shipped to overseas destinations routinely. What’s not typical, however, is for an order to originate in a far-off destination and also get shipped back there.
But one of Yeoman’s suppliers here told her that the cost of product is so high in Africa that it can be cheaper to purchase something in Canada or the U.S. and then pay for the shipping. The first order came to about $6,700, including about $1,500 for shipping. The gift baskets would include chocolate, cookies, pretzels, candy, all wrapped in cellophane with a bow on top.
Wallace said he’d forward the shipping fees to Yeomans and then she had to transfer the shipping money by Western Union to John Freeman, owner of a company called ATS Shippers in Ghana. Freeman indicated in an e-mail to Yeomans that the shipping fees had to be sent from Canada because, “due to technical problems that we’re facing in our credit card department, we only accept payments via Western Union and it is our company policy that a full payment must be made before pickup can be scheduled.”
The reverend sent Yeomans half a dozen credit card numbers, along with their expiry dates. Most important, he also sent the three-digit security codes that appear on the backs of credit cards, a key feature that financial institutions require to establish that the card numbers are legitimate. He told Yeomans each card had a $1,500 limit, so he needed to split the payment among several cards. The transactions all went through and the money appeared in the store’s bank account.
Yeomans then wired the shipping fees via Western Union to ATS Shippers. She was startled to discover that she needed to provide two pieces of picture identification to Western Union to transfer anything over $1,000, but at the other end the money could be picked up by someone just using a code word that had been agreed upon by the two sides.
Drumm, the detective, has managed to track down the Western Union depot in the Ghanian capital of Accra where the money was transferred, with no luck. “They had nothing for me,” said Drumm. “The person who picked up the money showed no ID, no nothing.”
The reverend then expanded his order, adding another 150 wreaths and 250 gift baskets. That added about $16,000 to the order, including $2,650.09 for shipping. Once again, the credit card numbers were approved, once again the money was deposited, and once again Yeomans wired the shipping fees to ATS Shippers.
She even contacted her bank manager because she had noticed that all of the credit card numbers started with the same 12 digits, with only the final four differing. She was told that was typical for an organization that might have multiple cards attached to one expense account.
Yeomans began purchasing the products needed to make the baskets, then worked through the weekend. At home, she made 300 bows in the evenings. By the close of business Tuesday, Jan. 6, the reverend’s order had grown to 500 wreaths and 300 gift baskets worth $44,000, including shipping – all of it paid up front.
That night, however, she received a call at home from her bank manager. Some red flags were starting to show up. He’d done some checking and he couldn’t find a Christ the King Cathedral in Ghana, nor could he find any evidence of a Rev. Wallace.
When Yeomans arrived at her shop the next morning, there was an e-mail waiting for her from the fraud detection branch of Amsterdam-based banking giant ING Direct. The credit card numbers being provided by Wallace had been hacked from ING’s computers. The transactions were fraudulent.
“This is kinda when I got hit in the stomach,’’ said Yeomans.
“Reverend” Wallace did not respond to an e-mail request for an interview. Yeomans ultimately lost $16,000 in shipping fees that she wired to Ghana, as well as another $6,000 that was spent on products that can’t be returned. And Paymentech wants all $44,000 back – even though it allowed the credit card transactions in the first place.
She’s now turned the fight over to a lawyer, and hopes her shop can stay in business. “If I come out even – no further ahead, no further behind – I’m happy with that,’’ said Yeomans. “And lesson learned.”
(The Canadian Press)
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