What's behind the flood of scam Nigerian emails
Author Daniel J. Smith portrays a country steeped in corruption
It sounds too good to be true: A letter or email arrives from the financial representative of a wealthy Nigerian widow, heir or government official who wants to deposit a jaw-dropping sum of money into your bank account to get it out of the country. Your split for participating could set you up for life.
But of course, the so-called Nigerian 419 scam, named after the fraud section of the Nigerian penal code, never turns out that way.
Invariably, unforeseen circumstances require money to "temporarily" move out of your account to pay bribes, fines or fees, never to be seen again. And that's a best-case scenario; some gullible Americans have actually been lured to Nigeria, where they've been robbed, beaten and even killed chasing this pipedream.
Daniel Jordan Smith , author,
'Culture of Corruption'
Ever have a down-on-his-luck potentate offer you a huge reward if you'd only you'd lend a hand? Then you've probably had a 419 scam email. Anthropologist Daniel J. Smith, who spent years in Nigeria, explains how the African nation became a scam incubator in his book, "A Culture of Corruption."
The 419 scam reached such epidemic proportions in recent years that Congress proposed legislation, the State Department issued travel warnings and the Secret Service launched "Operation 419" to fight a scourge that has cost Americans at minimum $100 million.
Daniel J. Smith, associate professor and chair of anthropology at Brown University, spent years in Nigeria observing the 419 scam up close, insights he shares in his book, "A Culture of Corruption: Everyday Deception and Popular Discontent in Nigeria."
How does this outrageous scam continue to prey on the unsuspecting?
Here's the 411 on the 419.
CreditCards.com: "Culture of Corruption" paints a disturbing picture of a society gone haywire, largely for financial reasons.
Daniel J. Smith: Yes, while I wasn't writing about credit specifically, certainly everything I wrote about has implications for why there are no credit cards in Nigeria and why people have difficulty accessing both global and national credit.
CreditCards.com: You've seen this dysfunction up close. How long have you been going to Nigeria?
Smith: I first started working in Nigeria for a public health program in 1989 and then eventually got a Ph.D. in anthropology. If you add up all the time I've been living and working there over the last 23 years, it probably adds up to about seven years of living in Nigeria, most of it spent as an anthropologist doing research.
CreditCards.com: Can we pinpoint when the Nigerian 419 problem started?
Smith: Certainly there was corruption and fraud going back as far as British rule, but the email scams and credit card fraud that people associate with 419 really took off in the mid- to late-'80s and was very much enabled by a series of military governments that either looked the other way or, in most cases, were actually officials in some levels of government colluding with it.
CreditCards.com: Was there a cultural acceptance of cons and scams?
Smith: It's not just an acceptance. What's so interesting is that it's sort of simultaneously participation, victimization and critical awareness of it, all at the same time. You have a society where most people realize that corruption and fraud and 419 aren't good for society and aren't good for them, that ordinary people are the primary victims of the system, and yet because the system is so entrenched, most people feel like either you play ball or your don't.
CreditCards.com: For example?
Smith: Helping your niece get into secondary school through connections. Or illegally, in a nontransparent process, awarding a contract to your townsmen or your kinsmen. All of those things, even though they may be illegal and unethical in some formal way, have a dimension to them that can actually seem quite moral and quite ethical.
CreditCards.com: What defies logic is that citizens of Nigeria, the fifth largest foreign supplier of oil to the United States, would need to defraud for dollars.
It's not just an acceptance. What's so interesting is that it's sort of simultaneously participation, victimization and critical awareness of it, all at the same time.
Smith: That's actually part of why it happens. It would be pretty hard for folks in Sierra Leone or the Central African Republic, some desperately poor country, to pull this off because the narrative has to be compelling: trying to trap someone into giving money (to release) a bunch of money stuck in a bank account or an unpaid contract or the dead dictator's wife who has $100 million stored in a Swiss bank. Those wouldn't be credible stories in a lot of places but they are in Nigeria, where some of the real stories are no less fantastic than the made-up ones.
CreditCards.com: It's as if residents of Dubai were dealing three-card Monte.
Smith: Why is Nigeria the epicenter of 419? Part of it is that it's simultaneously a poor and unequal enough place so that it's a strategy on the part of some people at both high and low levels. It's also a viable strategy because Nigeria has the resources that it does. And a third factor is, Nigeria has a tremendous human capital capacity; there's enough education, enough bandwidth and enough talent, enough entrepreneurship, all of which are characteristic of Nigerian culture. The same people who can manage to carve out legitimate entrepreneurial endeavors in an extremely challenging environment have also mastered this 419 thing.
CreditCards.com: Does the stigma follow Nigerians who immigrate to the United States?
Smith: Yes, unquestionably. My wife is Nigerian, and over the years we've gotten visas for various friends and family. Her brother is about to immigrate to the U.S., I just bought his air ticket on Delta, and before he can get on a plane, I have to, in person, go to a Delta desk here in Providence with my credit card and verify that I, in fact, bought that ticket with my credit card. Otherwise, even though the ticket is paid for -- Delta processed it, they've taken my money -- they won't let him on a plane if I don't go do that. That doesn't happen to people from other countries. Nigerians are subject to inordinate scrutiny. The vast majority of them aren't contributing to the problem, but they're branded by it.
CreditCards.com: Do Nigerians themselves fall for the Nigerian scam?
Smith: Absolutely. One of the things one sees all over the place in Nigeria is, people have painted on the side of their houses, "This house is NOT for sale!" It's a sort of fraud prevention message that people put on their houses because there is a huge fraud industry of unscrupulous folks trying to sell your property out from under you. Somebody will come to your house with a potential buyer and say, "This is my house. I'm selling it for my uncle." That's just one example. There are all kinds of 419 that go on in Nigeria, and Nigerians themselves are definitely the biggest victims. That kind of stuff just doesn't make the international press the way a defrauded Texas oil man would.
CreditCards.com: You've hung out in the Internet cafes in Lagos where young people conduct this online fraud assault. What's the vibe like?
Smith: These tend to be kids in their early 20s who either finished secondary school or are going to university. The people who are actually acquiring the big lists of email addresses and fiddling around with these generic letters they send around and are actually pressing the buttons are mostly young men in urban places who have at least some degree of education. At one level, the letters seem completely absurd to a discerning, intelligent person, but at another level, what's in those letters is in some sense just a caricature that these kids have appropriated of the reality. Even though the actual thing that they're saying isn't true, parallel things are happening all the time that are true: generals stealing hundreds of millions of dollars, misappropriated contracts where $10 million disappears into a governor's or commissioner's bank account.
CreditCards.com: Is there much credit card ownership or use in Nigeria?
Smith: You can probably use a credit card at the fanciest establishments in Lagos or Abuja, but no Nigerians have credit cards unless they obtained them outside the country, say if they have citizenship in Britain, for example. There is no credit card system in Nigeria. They now have ATMs, so you have cash machines, and there are places in the biggest cities where you can pay with your debit card but there is no widespread middle-class access to credit cards. Ordinary people find it very difficult to get access to credit at banks, which runs the way a lot of other things do in Nigeria, which is by connections and who has the power to make it happen. There has been scandal after scandal about all these powerful people getting access to major lines of credit and then never paying them back, so you constantly have this cycle of bank failures and bank consolidations.
Even though the actual thing that they're saying isn't true, parallel things are happening all the time that are true: generals stealing hundreds of millions of dollars, misappropriated contracts where $10 million disappears into a governor's or commissioner's bank account.
CreditCards.com: Do Nigerians have trouble getting credit cards in the U.S.?
Smith: That's a good question. I'm not aware that they are discriminated against. Our credit card system is just so voracious in its willingness to sign people up. All of the Nigerians I know who are here legally seem to get credit cards.
CreditCards.com: Do residents of other African nations suffer 419 stigma?
Smith: There's definitely a little of that. That's related to the ignorance or lack of awareness in America that there are 50-plus African countries and they're not all the same place or people. Other Africans also hold these negative perceptions of Nigeria and are quick to try to distinguish themselves from Nigerians.
CreditCards.com: How are Nigerians viewed by other Africans?
Smith: They're viewed as aggressive, overly materialistic and arrogant. They view Nigerians in the same way that Europeans think of Americans as the "ugly Americans," the bully on the block who doesn't realize how others perceive them.CreditCards.com: What would solve the 419 problem?
Smith: It's a complex array of things, all of which I would connect with an improving economy, greater development, less inequality and more access to jobs. The roots of 419 are the combination of growing expectations, exacerbated inequality and the frustrations of the failures of the promises of development. While 419 is a desperate strategy, it's a desperate strategy of people who are already far enough along that they know that the world can and should be different, not the desperate strategy of the most abject poor people in the world. It's the strategy of people who are just sort of peeking over the edge and can see what the world is like in some places and ought to be like for them and have the wherewithal and skills to try to find some way to get into a world to which they haven't been allowed yet. If people could have good jobs and make good livelihoods and fulfill their aspirations in legitimate, honest, non-fraudulent ways, they would certainly choose to do that.See related: Credit cards around the world: Nigeria
- Bobbi Rebell's money moguls' 'Financial Grownup' moments – ShreShrewd money managers reveal their financial 'aha' moments in Rebell's new book ...
- ‘Loaded’ author Sarah Newcomb: Call them loan cards, not credit cards – In a new book, the behavioral economist talks about the role credit cards play in the financial tales we tell ourselves ...
- Q&A with David Carlson: How side hustles can pare debt – Millennials struggling with student debt can take on extra work to get out of the red, blogger turned author David Carlson says. It worked for him ...