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New bill intended to curb Jamaica lottery scams

Friday - 3/15/2013, 4:20am  ET

DAVID McFADDEN
Associated Press

KINGSTON, Jamaica (AP) -- Jamaican officials said Thursday that they are hopeful new legislation will finally result in a stream of convictions and lengthy sentences for fraudsters behind a multimillion-dollar lottery scam that has swindled mostly elderly Americans out of their retirement savings for years.

National Security Minister Peter Bunting told reporters that the law reform act will result in a "vastly accelerated number of successful prosecutions" of swindlers who have made the island a center for cross-border telemarketing fraud.

The bill was recently passed by Jamaica's House of Representatives. It will be taken up Friday by the Senate. Justice Minister Mark Golding said he expects enforcement of the law to begin by the end of this month.

The scam begins with a phone call that informs the target that he has won millions in an international lottery, but he needs to wire a payment to cover taxes. Victims who fall for the trick and send payments then begin getting endless calls seeking more money.

The Jamaican lottery scammers were the focus of a Wednesday hearing by the U.S. Senate Special Committee on Aging, which is co-chaired by Sen. Susan Collins of Maine, just one of the U.S. states where numerous seniors have been cheated out of vast sums of money by aggressive swindlers from the island. Collins blasted Jamaica for not doing more to rein in the problem in recent years.

"I think they are finally taking it seriously, but it has taken a number of years for them to do so and I would like to see them put the effort in this, in stopping this scam, as they put into enticing Americans to come vacation in Jamaica. A lot of money is spent on that," Collins said at the hearing in Washington.

The U.S. is Jamaica's biggest trade partner and source of tourists. But at least 30,000 calls are made into the U.S. from Jamaica attempting to defraud people every day, authorities say.

Authorities have seized bundles of cash, hundreds of computers and more than 120 cars in various operations to dismantle Jamaica's lottery scam rings, Bunting said.

Hundreds of people have been arrested and some have been convicted on lesser offenses. But substantial convictions of Jamaican cheats have been remarkably few, largely due to big gaps in the country's laws.

"We recognized this activity (raids and seizures) was largely disrupting the lotto scam activities but we were not getting the convictions," Bunting said.

To solve this dilemma, the Justice Ministry crafted a bill targeting advanced fee fraud, identity theft and dishonest use of technology for accessing financial accounts. It also prohibits making threats and coercing victims over the phone. Beefed-up penalties could result in 20-year sentences in some cases.

Justice Minister Mark Golding said the People's National Party, which won December 2011 general elections after four years in opposition, had to draw up the new legislation "from scratch" since taking power in January 2012. He said the former Jamaica Labor Party-led government never tried to legislate against lottery scamming.

The Jamaican and U.S. governments set up a task force in 2009 to stop the schemes. But the problem has gotten worse. Complaints in the U.S. have increased dramatically every year and even the most conservative estimates put the yearly take from Jamaican scams at $300 million, up from some $30 million in 2009.

Lottery fraud is an old con, but experts say Jamaicans have proven very adept at the swindle. Charm is employed until payments stop getting wired. Some Jamaican criminals using fake identities and disposable phones that can't be traced have threatened to burn down elderly victims' homes or rape their grandchildren if they don't wire payments.

Vance Callender, a Homeland Security official and a former attache at the U.S. Embassy in Kingston, said the Jamaican scammers are mostly articulate and involve a number of partners to defraud victims.

Scammers have "been known to repeatedly bombard their victims with non-stop calls, even employing verbal abuse to coerce victims to comply. Intimidated, confused and exhausted, victims yield to the telemarketer's demands," Callender told the U.S. Senate committee on Wednesday.

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David McFadden on Twitter: http://twitter/com/dmcfadd


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