From the National Post, August 21[quote]Paul Blazev admits he has thrown away $500,000. He has lost his life savings, his marriage and his tile business. He is in trouble with Revenue Canada. Still, over coffee in a Calgary hotel, he dials his cellphone and sends off another $2,500.
“I’m just having fun now,” he says. “I’m playing with his head now,” Mr. Blazev insists. “It’s like losing money at the casino. It’s fun. It’s a done deal now, it’s too late to worry about the money. But I don’t care about the money.”
According to police, Mr. Blazev is a victim of an ongoing Nigerian scam – a version that has taken $10-million from Westerners, including $2-million from a dozen people in Moose Jaw, Sask. They say it is a form of the Nigerian advance fee fraud, a scheme that arrives by e-mail to thousands of computer users each day.
“It’s all gibberish,” says Detective Sergeant Mark Simchison of the Hamilton Police fraud squad. “I’ve told him [Mr. Blazev] and everyone else that they will never see a penny of it.”
The fraud usually follows a pattern, promising riches from the frozen estates of dead businessmen in Nigeria, crown princes of Nepal or Afghan drug lords. In return for paying fees to unlock the estate, victims are promised quick returns ranging from 20% to 300% on their investments.
Every day, fraud artists send out thousands of e-mails in a mass-marketing campaign designed to net the occasional sucker. Most people trash the e-mails and snort derisively, but the pitch is not always so obvious or clumsy.
If the police are right, personal connections and old-fashioned salesmanship – along with a strangely sincere middleman – are helping the current version of the scheme ruin an assortment of Canadian farmers, small businessmen and retirees.
The middleman is Henry “Jerry” Statz, who works out of a Hamilton motel room. Mr. Statz is a true believer, convinced he is rescuing the son of an African businessman and securing his fortune. Despite repeated warnings from police, people continue to contribute and Mr. Statz delivers the money by wire to Africa and Europe.
Mr. Statz is the broker between investors in Canada and men in Europe and Africa who, police say, are the true scam professionals. Police estimate about 70% of the money has ended up in Nigeria, with the rest going to fraud artists in Europe. Mr. Statz insists this is false.
He has lived in Calgary and Moose Jaw and has a son and grandchildren there. He snarls at the notion that he is helping to defraud his former neighbours. Police confirm there is no evidence Mr. Statz has made much money from this.
Mr. Statz wears tinted prescription glasses, golden chains and has tattoos. Dressed all in black, he speaks with the zeal of a televangelist. Mr. Statz believes he is on a crusade to save a young African heir from murderous relatives and thieves out to steal his fortune.
“These kind of derogatory comments get people into a lot of trouble. Do you think if there was any possibility that this was a scam, that I would be living in this hotel room for a year? Would I be talking to you? We detest anyone who questions this, and we’re tired of having to defend something that’s real,” he says.
Mr. Statz has provided some evidence that he genuinely believes he is doing nothing wrong: Twice he has complained to police that investors within the scheme have tried to defraud him. No charges have been laid.
The decades-old Nigerian advance fee scam has adapted to advancing technology and an increasingly savvy public. During the 1970s, the fraud was conducted through telephone and letter. In the 1980s, fax machines were the tool of choice. Today, Web users are bombarded by e-mail.
Experts say most of the schemes are run by organized crime gangs in Nigeria, where the corrupt government refuses to crack down. Last year, U.S. authorities received a few hundred complaints totalling about $1-million in losses. However, they estimate hundreds of millions are actually squandered. Most victims remain silent in the hope of cashing in some day. Others hide because they feel stupid.
While most losses are financial, the FBI has confirmed one death and several disappearances among people who have travelled to Africa in search of a return on their investment. According to Canadian investigators, at least one Ontario man has committed suicide after losing money on a Nigerian fraud.
In the $58-a-night motel room he shares with his girlfriend, Mr. Statz, who says he was once an international cement broker and electrical generator salesman, explains his mission to rescue a young African heir.
Mr. Statz was in London, England, on business in May, 1997, when associates introduced him to a young man from Ghana named Charles Kofi. Mr. Statz and Mr. Kofi became friends over a number of weeks. One night, Mr. Kofi broke down and shared the story of his father’s murder.
Elijah Kofi was a successful businessman from Ghana, he said, who was killed by his brother Augustus, a malevolent warlord. The elder Kofi left behind a $25- million fortune, Mr. Kofi said at first. As the scheme moved forward, the estate grew, eventually amounting to billions in gold, cash, mines, yachts and real estate.
However, young Mr. Kofi explained he faced a huge obstacle. Under the arcane rules of Ghana’s estate law, Mr. Kofi’s inheritance had fallen under the control of secret branches of the banking system. Expensive fees needed to be paid, and he was broke. Mr. Kofi was also hiding in Europe from the murderous operatives of Uncle Augustus.
“He looked like a scared little boy. He didn’t trust anyone. I told him it was a nice story, but it was just a story at that point. I told him that it wasn’t that I didn’t believe him, but I needed more,” Mr. Statz recalls.
Mr. Statz says he travelled to Ghana, where he met relatives of Mr. Kofi. He was shown properties said to form part of the Kofi estate. Finally convinced, Mr. Statz returned to Canada and convinced former associates to pay a few thousand dollars in fees to move the fortune and Mr. Kofi to the safety of Canada.
In Calgary, Mr. Blazev had finished a successful season building swimming pools when Art Ibuki, a trusted business associate, brought the offer to him. Mr. Blazev would invest $360,000, triple his money within a month and become a millionaire.
“Between me and Art, there were no questions asked. We had done business together before with no problem,” Mr. Blazev, a Bulgarian immigrant, says about the friend who introduced him to Mr. Statz. Mr. Blazev was familiar with black-market deals from his native land. “I also knew Art had put in some money of his own, so I didn’t think there was a problem. It sounded pretty good. Greediness. You know how it gets you.”
In the autumn of 1997, Mr. Blazev borrowed money, withdrew a sum from an account intended to pay GST to Revenue Canada for the swimming pool jobs, and packed bags with $360,000 in cash. In London, England, he met Mr. Statz and his African associates in a pub. The cash was passed. Within days, Mr. Blazev had doubts.
“It comes down to this: Business like that is done in banks, not hotel rooms or pubs,” he says.
Over the next two years, in a pattern consistent with Nigerian advance fee fraud, Mr. Blazev received near-daily solicitations for more money through Mr. Statz. Fees were required to transfer Mr. Kofi’s “consignment” to Canada from Europe. Thousands were required to settle Mr. Kofi’s immigration problems, including
