Advance Fee Fraud

Advance fee frauds ask for payment up front before the deal can go through. The advance payment may be described as a fee, tax, commission, or incidental expense that will be repaid later. Some advance fee schemes target investors who already purchased underperforming securities and offer to sell those securities if an “advance fee” is paid.

One example is the so-called Nigerian advance fee fraud, where someone pretending to be a Nigerian official or businessperson promises high profits for help moving money out of Nigeria. This scam is so prevalent that the U.S. Secret Service has a task force devoted to it. For more information, read the alert on the Secret Service's website.

Other advance fee frauds try to fool investors with official-sounding websites and e-mail addresses. These addresses may contain ".gov" and end in “.us” or “.org.” U.S. government agency websites or e-mail addresses end in “.gov,” “.mil,” or “” Be wary of a website or correspondence claiming to be from a U.S. government agency whose e-mail address does not end in “.gov”, “.mil”, or “”.

Additional Information

Fake Seals and Phony Numbers

Fake Form W-8BEN Used in IRS Tax Scams

Updated Investor Alert: Investor Warning Regarding Possible Advance Fee Fraud Targeting Deaf Investors