Advance Fee Fraud

Introduction to Advance Fee Fraud

Advance fee fraud is a type of scam where victims are persuaded to pay money upfront (an “advance fee”) with the promise of receiving a significantly larger sum later, which never materializes. This confidence trick has evolved over centuries but gained particular notoriety in the digital age.

History and Origins of Advance Fee Fraud

Advance fee fraud dates back centuries, with early versions appearing in the form of the “Spanish Prisoner” scam in the late 16th century. In this historical version, victims were contacted by someone claiming to be a wealthy person imprisoned in Spain who needed funds for bribes to secure their release, promising a share of their fortune in return.

The modern incarnation gained global prominence in the 1980s and 1990s with the rise of Nigerian advance fee fraud, commonly known as “419 scams” (named after the relevant section of the Nigerian Criminal Code). These typically involved letters and faxes, and later emails, claiming to come from Nigerian officials or businesspeople seeking help to transfer large sums of money out of the country.

With the advent of the internet, advance fee fraud has proliferated globally, adopting countless variations while maintaining the core premise of requesting upfront payment for a larger future return.

Common Types

419 Scams/Nigerian Prince Scams

Letters or emails claiming to be from Nigerian officials, businesspeople, or royalty who need help transferring millions of dollars out of the country, offering a percentage as compensation.

Lottery Scams

Notifications that the victim has won a foreign lottery, requiring payment of taxes or fees to release the winnings.

Romance Scams

Development of online romantic relationships followed by requests for money to help with emergencies, travel costs, or medical expenses.

Investment Scams

Offers of high-return, low-risk investment opportunities requiring upfront fees or initial investments.

Employment Scams

Job offers that require payment for training, equipment, or background checks before starting work.

Inheritance Scams

Claims that the victim is the beneficiary of a large inheritance from a distant relative, requiring payment of legal fees or taxes.

How Advance Fee Fraud Works (ELI5)

Imagine someone tells you they’ll give you $100 if you first give them $10. They come up with a convincing story about why they need your $10 first – maybe they need to pay for an envelope to send you the $100, or they need to pay a fee to access their bank account. Once you send the $10, they either disappear or come up with another reason why they need more money from you. This cycle continues, but you never get the promised $100.

That’s advance fee fraud. Scammers promise you something valuable (money, prizes, jobs, relationships) but claim they need you to pay something first. The promised reward never comes, and they often try to get more and more money from you.

Red Flags

1. Unsolicited contact – Being approached out of the blue about money or opportunities
2. Requests for upfront payment – Any requirement to pay before receiving promised benefits
3. Secrecy requirements – Pressure to keep the arrangement confidential
4. Urgency – Creating time pressure to act quickly without thoroughly investigating
5. Poor grammar and spelling – Many scams originate from non-native English speakers
6. Too good to be true – Offers of unusually high returns or unlikely windfalls
7. Unusual payment methods – Requests for wire transfers, gift cards, or cryptocurrency
8. Personal information requests – Seeking banking details or identity information
9. Official-looking but incorrect documents – Letters with fake letterheads or logos
10. Changing stories – Details of the offer evolve or change when questioned

How to Protect Yourself from Advance Fee Fraud

1. Remember the golden rule: If it sounds too good to be true, it probably is
2. Never send money to someone you haven’t met in person, especially overseas
3. Research thoroughly any business or opportunity before committing funds
4. Verify identities of people or organizations requesting money
5. Consult others before making financial decisions based on unsolicited offers
6. Check official sources for lottery or inheritance claims
7. Be skeptical of romantic interests who quickly develop financial problems
8. Report scams to relevant authorities like the FBI’s Internet Crime Complaint Center
9. Use secure payment methods that offer fraud protection
10. Protect personal information and never share financial details with unverified contacts

Alternative Names

• 419 Fraud (referring to the Nigerian Criminal Code section)
• Nigerian Prince Scam
• Confidence Trick/Con
• Upfront Fee Scam
• Payment-Transfer Fraud
• West African Letter Scam
• Advance-Payment Scam
• Fee-Forward Fraud
• Foreign Money Exchange Fraud
• Black Money Scam (a specific variant)

Impact and Statistics

Advance fee fraud costs victims billions of dollars annually worldwide. The FBI’s Internet Crime Complaint Center (IC3) regularly ranks these scams among the most financially damaging types of internet fraud. Beyond financial loss, victims often experience emotional trauma, shame, and in some cases, become unwitting participants in money laundering schemes.

Senior citizens are particularly vulnerable targets, with studies showing they lose more money to scams per capita than younger demographics. Businesses are also targeted through more sophisticated versions of these schemes.

Global Response

Law enforcement agencies worldwide collaborate to combat advance fee fraud, though prosecution can be challenging due to the international nature of many scams. Organizations like the Financial Action Task Force (FATF) work to develop policies against money laundering and fraud.

Many countries have established dedicated cybercrime units to investigate these cases, and financial institutions have implemented various security measures to detect suspicious transactions.

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This page was last updated on March 24, 2025.

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