Fraud in the Wild: The Strangest Cases You Should Know

Fraudsters are nothing if not creative. Over the years, they’ve devised schemes so unusual that they belong in a YouTube skit. But behind the humour and audacity of these cases lies a serious lesson for businesses: creativity in fraud prevention is just as important as detecting the obvious threats.

Case 1: Gregor MacGregor’s Poyais Scheme

In the early 1820s, Scottish adventurer Gregor MacGregor convinced hundreds of investors and settlers to support a fictitious Central American country named Poyais. His imaginary country had an honours system, landed titles, and a coat of arms. He fabricated elaborate details about its prosperity, including false maps and official-looking documents, leading many to embark on a perilous journey to a non-existent destination.

Dozens of settlers died attempting to reach the fake utopia, and MacGregor profited handsomely from their investments. Despite being exposed, he continued to promote fraudulent ventures throughout his life.

Takeaway: The audacity of fraud can be its most powerful weapon. Ensure your business takes extra precautions in verifying any claim – no matter how impressive it may sound.

Case 2: The Fake CEO Call

In 2019, a major European energy firm lost nearly $250,000 after receiving what appeared to be a direct phone call from their CEO. The “CEO” instructed an employee to transfer funds to a Hungarian supplier, but it was a deepfake of the CEO’s voice created using AI.

This type of fraud, known as Business Email Compromise (BEC), has evolved significantly with the advent of AI technology. Fraudsters no longer rely solely on written communication; they can now replicate voices and even mimic facial movements in video calls. In this case, the fraudsters also used urgency and authority to bypass the employee’s usual caution.

Takeaway: Fraud isn’t just about what’s said, but how it’s said. Train employees to question requests that seem out of the ordinary, even if they appear to come from trusted sources.

Case 3: Perkin Warbeck’s Impersonation

In the late 15th century, Perkin Warbeck claimed to be Richard of Shrewsbury, Duke of York, one of the “Princes in the Tower.” His impersonation aimed to seize the English throne, causing significant political turmoil before his eventual capture and execution.

Warbeck’s success in convincing European monarchs to support his claim shows the power of a well-constructed narrative and the willingness of people to believe a compelling story, even without conclusive evidence.

Takeaway: Strong storytelling can manipulate even the most discerning individuals. Businesses should scrutinise any claims to authority and verify their legitimacy before acting.

Case 4: The Fake Fabergé Egg

A man browsing online thought he had stumbled upon the deal of a lifetime: a genuine Fabergé egg listed at a fraction of its value. Upon arrival, he discovered the “egg” was a potato with earrings stuck into it to mimic ornate decorations.

Howie Feltersnatch, 59 said: ‘I wanted to get Betty something special and whilst I was sceptical at the £59.99 price tag, I never dreamed I would be stuck with a Maris Piper potato. They’ve ruined our marriage’. While odd, this case highlights the growing risks of online shopping & marketplaces where physical inspection is often impossible.

Takeaway: When the product can’t be physically inspected, ensure that sellers are reputable and registered.

Case 5: The Brooklyn Bridge Fraud

In the late 19th and early 20th centuries, con artists attempted to sell the Brooklyn Bridge to unsuspecting buyers, convincing them that they could collect tolls from the bridge’s traffic. These fraudsters would approach individuals, often newcomers to New York, and offer them the “opportunity” to purchase the bridge. Using forged documents and false authority, they convinced victims to part with large sums of money, only for them to later discover they had been deceived. One of the most famous frauds was perpetrated by George C. Parker, who successfully sold the bridge multiple times before being caught.

Takeaway: When a deal sounds too good to be true, it usually is. Relying on third-party verification and doing due diligence could save you from a costly mistake.

Case 6: The Bear Attack Insurance Fraud

In a bizarre scam, four individuals in California staged fake bear attacks on cars in order to claim insurance money. They dressed in bear costumes and used vehicles to simulate collisions, submitting fraudulent claims for damages to their insurance companies. The fraudsters made a significant profit before their scheme was uncovered and they were arrested.

Takeaway: Fraudsters are continually finding more creative ways to exploit vulnerabilities. It’s critical to thoroughly investigate claims, especially those that seem out of the ordinary.

From bear suits to AI voice manipulation, these strange fraud cases show that fraudsters are willing to go to extreme lengths to deceive. The key takeaway from these examples is that fraud can take many forms, often blending sophistication with absurdity. Businesses should avoid complacency, constantly evaluating and updating their verification processes to account for both traditional scams and emerging threats. In the end, effective fraud prevention isn’t just about recognising the obvious risks, but also about anticipating the unexpected.

By investing in the right tools, maintaining a culture of vigilance, and ensuring that every claim, transaction, or communication is verified, we can protect our customers from even the most unusual scams.

How can we help?

Here at TMT we are very proud of the role we play in stopping fraud and spotting things that may not be quite what they seem online. Our global Mobile Number Intelligence provides real-time insights into possession, association, verification and trustworthiness of mobile numbers around the world – whether you are logging into apps, verifying sign-up’s, confirming age or deciding whether it’s a bot or not, we are with our customers every step of the way.

Drop us a message now to learn more.