Con-men who prey on the gullibility and greed of ordinary people have been around as long as history and are to be found in every corner of the earth. Africa has its own share and African con-artists have developed their own unique and sometimes ingenious con-tricks. Tom Nevin explains how the scams work.

The fact that Africa is seen as a continent of wars, corruption and con-men has a lot to do with why investors are reluctant to commit their funds to it. While corruption and theft are rife in Africa, the perception, according to US assistant Secretary of State, Chester Crocker, exceeds the reality.

"Nowhere else in the world do investor perceptions lag behind reality as badly as they do in Africa," he says. And what makes matters worse is that the negative perception of Africans is not merely held by investors from the developed world, they are held by Africans themselves who have spirited abroad an estimated 40% of the continent's accumulated wealth, he added.

The chronicle of dishonesty in Africa is a lengthy one. Although scams of every conceivable kind proliferate, they are perpetrated by a minuscule fraction of a basically honest population. And therein lies the problem that Crocker so neatly puts his finger on: the majority must suffer for the sins of a few.

To hope that the flood of confidence tricks and scams will be stemmed is unrealistic. However, to help you from adding to the long list of victims, here's a sampling - by no means complete - of what to look out for. The best advice we can offer is keep your wits about you, remember that there is no such thing as easy money, beware the silver tongue and trust absolutely nobody.

Instances of fraud are cropping up that call into question the security of companies and institutions with which we entrust sensitive personal information, the kind of detail which, if it fell into the wrong hands could be used to wreak great financial harm. How safe is our confidential information in the files and on the databases of government ministries, credit rating agencies and tax services? Can they be tapped into and the knowledge used to steal?

It happened to Mary Walker (not her real name) when a fraudster had her declared dead and then attempted to take over her assets in a South African bank.

Mary smelled a rat when she received a credit card statement which showed no transference of funds. She called her bank to discover that all her accounts had been frozen because according to the bank's records she had died. An investigation brought to light a bizarre train of events.

It transpired that about a month earlier a bearded man had presented himself at Mary's bank bearing an official death certificate stating that she had died of natural causes on 2 September 1999. The certificate bore the seal of the Department of Home Affairs and appeared genuine in every way. The man was also able to produce a stamped certificate signed by Acting Assistant Magistrate in suburban Alberton, appointing him administrator of the estate.

What saved Mary's bacon was the vigilance of the bank. He was unable to produce a letter of executorship from the Master of the High Court when the bank demanded it. The would-be thief promised to return with the document and has not been seen since.

The scam may have worked, however, if the estate had been valued at under R50,000, in which case a letter of executorship is not required.

Two troubling questions arise from the incident; the first is the apparent ease with which con-artists are able to obtain personal information and produce authenticated documents. The other is that it is once again the poor who are more exposed to victimisation and less protected by prevailing legislation.

The ways con-artists and thieves find to deprive their victims of their money and other valuables is endlessly inventive. Often it does not pay to be a good Samaritan. Police report the following incidents.

A tourist strolling along a Cape Town street sees a man trying to wrestle a baby from a distraught woman. Gallantly he tries to help her and joins in the tussle. The attacker runs off after a few minutes and the woman tearfully thanks her rescuer and she too disappears. Later, the man finds his wallet has disappeared and he is R4,000 poorer.

Other versions proliferate: a man intervenes to save a small child from a bully, another goes to the aid of an 'injured' woman in the street, yet another tries to help a gasping 'heart attack' victim. In all cases it's the rescuer who becomes the victim and emerges from his heroism minus his valuables.

Police are now issuing the message to Capetonians and visitors alike: don't help, no matter how desperate the situation may seem.

So deeply ingrained and widespread has insurance fraud become that it was only a matter of time before it attracted the attention of the underworld. Now more pressure has been brought to bear on the insurance industry and legitimate policy holders, sending premiums spiralling upwards.

According to the South African Insurance Association (SAlA), anything between 8% and 35% of all claims lodged are fraudulent. About R1.2bn is paid out in scam claims every year. Take the average of 21% and the losses jump to R3.2bn. If SAIA's worst fears are accurate then R5.25bn falls into dishonest hands.

So what has any of this got to do with the mafia? Simply put, it's such a lucrative business that crime syndicates are increasingly offering their services to cash-strapped consumers who need a job done on their cars, homes or other insured possessions so they can collect on their policies.

Instances cited by insurance company investigators include car owners, especially those who can't afford the hire-purchase instalments, arranging with a mobster to 'steal' the car, the torching of home or business premises, burgling homes or businesses and the 'hijacking' of private cars and company trucks carrying valuable merchandise.

Perpetrators who submit bogus claims are often caught out because they are not experienced criminals and are inept at covering their tracks. Insurance sleuths probing a fire that destroyed an upmarket home in Johannesburg found that virtually everything had been lost, but were tipped off by a neighbour that the family photograph albums and other items of sentimental value had miraculously survived the inferno.

Investigators also note that the number of claims tends to rise in November and December as consumers face the expense of the Christmas season and need to get their hands on extra cash.

New software being introduced in the US and Europe and now on its way to Africa promises to cut down on fraudulent insurance claims. Smart software being introduced by Policy Management Systems Corporation (PMSC), a New York outsourcing service to the global financial services sector is able to monitor customers world-wide with a history of excessive claims and spot duplicate claims.

In several markets around the world PMSC acts as a policeman by downloading and checking claims information from all institutions, wherever they may be. Security features keep the information confidential. The software is able to identify similarities in millions of records in disparate databases across thousands of companies. Even if fraudsters constantly change names and addresses, the system is smart enough to pick up technique 'fingerprints' and find matches.

Some apparent con tricks can turn out simply to be sales gimmicks that are too smart for their own good. Take the case of Margaret Mungalu of Lusak?, Zambia. Her husband William responded to an advertisement placed by a Cape Town-based direct mail company and subsequently received a letter from them which was headlined: "OFFICIAL STATEMENT". Beneath were the words: "You are a winner of R50,000 in cash!" The Mungalu's was the only winning number, the statement said and it warned, "Last chance to reply to this R50,000 cash notification".

The letter went on to say they had to send R150 with an order form in the promotional material. A problem arose when the Mungalus found there was no facility at the post office to send the R150 in postal orders. It was decided that Margaret would travel to Cape Town to deliver the R150 personally and collect the R50,000 at the same time. The airfare to Johannesburg, bus fare on to Cape Town and other travel expenses totted up to R6,000, a mere drop in the bucket compared to what was waiting. They scraped the money together by borrowing from family and friends and Margaret set off on her odyssey.

But it was all in vain. When she arrived at the offices of the mail order firm to collect her prize, she was told that her husband was merely one monthly qualifier whose names are entered in the bumper draw at the end of the year for which the prize was R50,000.

Had the Mungalus studied the material carefully, they would have noticed the smallprint. What convinced them, and what sent Margaret off on an expensive wild goose chase, was the bold statement that shouted "You are a winner of R50 000 cash!"

Propositions by smooth talkers that sound too good to be true, are usually just that. Walk away from them no matter how tempting they may be. However, it's sometimes difficult to resist a man in uniform.

Amazingly, this fraudster's area of operations was outside police headquarters. Dozens of South Africans were taken for big sums by the smooth-talking ex-police reservist. In uniform, he would approach his victims (normally on-the-fringe traders) and tell them of a huge auction of confiscated goods, such as cars and tyres coming up in the police pound.

For a deposit, however, he could arrange a special deal at rock-bottom prices before the auction date. The suckers would pay up around R5,000 and the 'policeman' would disappear.

What made his story all the more plausible is that he selected his victims outside the police complexes where the cars and tyres or any other confiscated goods could be seen from the road through the wire mesh fence. After taking the money, he would saunter brazenly into the charge office and then sneak out through a back door. Incredibly, he was able to pull the same trick over and over again for five years.

This story does have a happy ending, however. Having moved from one police headquarters to another around the country, his luck finally ran out. The con-man tried the ruse on a plain-clothes detective and was nabbed on the spot. He is now in jail, where he'll stay for a long time.

If you've ever been duped by a con-man, do not think it is because you are stupid. Even the brainiest have been stung. Brilliant scientist Sir Isaac Newton lost the equivalent of today's $lm in an 18th century stock fraud known as the South Sea Bubble. Mark Twain, one of the 19th century's greatest authors, was caught time and again in very questionable investments.

If you enjoy a punt on the ponies, don't be caught by the shyster who may sidle up to you at the race track with a 'can't lose' proposition. He'll inform that you he's putting together a small syndicate of 10 astute investors to pull off the horse-racing coup of the century. He already has nine and you could be the lucky tenth. It works like this.

He tells you he can fix a race so a rank outsider will win and you can make a million by betting on the sure thing. However, he needs $100,000 slush money to make it happen. $10,000 from each syndicate member. He'll mention the horse, the race and the odds and it all makes perfect sense to you, so you hand over the money Not surprisingly, the horse runs nowhere, costing you even more in the big bet you took.

Con-artists operate with the law on their side, in a converse sort of way. Most of the scams they pull draw the victim into an activity that is outside the law, so they cannot complain to the police without incriminating themselves. Some criminologists estimate that only a fraction, possibly as low as one-in-a-hundred of fraud cases ever come to light.

'Beware the green', is a phrase that is circulating throughout southern Africa, especially in the emerald mining countries of Zambia and Zimbabwe and a gullible market in South Africa. A golfer in Zambia paid a small fortune for shards of a green soft drink bottle. A Cape Province farmer was duped of R70,000 when he bought a satchel full of genuine emeralds only to lose them in an elaborate switch minutes after he had handed over the cash. A Zimbabwe farmer paid Z$1m for a bag of emeralds that later turned out to be common quartz painted green. When he took them to a Johannesburg jeweller, the gem dealer scratched the emeralds with his thumb-nail and the paint came off.

In a neat double twist in Durban, South Africa, one con-man sold fake emeralds to another who paid for them with counterfeit R200 notes.

The dream of joining the ranks of the rich and famous can become a nightmare, as hordes of would-be actors who were blinded by the stars in their eyes found out. Hundreds of men, women and children responded to an ad in a daily newspaper placed by a TV casting agency. It didn't matter whether or not you were beautiful or ugly, fat or thin, young or old, black or white; there was big money waiting for character roles on the small screen - R10,000 for a day's work was not uncommon. They flocked in droves to the casting agency where they were required to pay around R300 for their portfolio shots. Then all they had to do was go home and wait for the phone to ring.

They're still waiting, but by now most have stopped holding their breath.

The moral remains true. Investigate each and every ad you intend responding to. Make absolutely sure of what you're in for, find out everything there is to know, before parting with your hard-earned cash.

Con-men will do anything to get their hands on your used cheques, especially company ones.

"Individual con-artists or syndicates may use any one of a number of techniques to defraud customers," according to Mario Fazek?s, marketing manager of Conti Print in Johannesburg. "The so-called hot cheque sandwich where signatures are traced is quite popular."

Fazek?s says he's amazed at the lax security around used cheques. He estimates the black market value of a used corporate cheque to be in the region of R30,000 to R40,000, depending on the profile of the company.

'Cloned' cheques can be manufactured from scratch once the scam artist has bank details and signatures. Claire Gebhardt-Mann, GM of strategy and communications at the South African Banking Council, says cloning now accounts for more than 20% of fraud cases. "Criminals duplicate bank cheques and use their own encoding machine to put on the magnetic strip," she explains. "The result is that the cheques are accepted and go through the system up to the point they are returned to the legitimate issuer, who then rejects them."

Police report that syndicates specialising in bank fraud of this type often have recruits inside the bank who have access to information on the transaction records. "There may be collusion between some bank officials and syndicates operating," says Gebhardt-Mann, "But this usually involves only one or two people on the inside."

The Nigerian letter-scam is now old and tired news but, believe it or not, it still succeeds in soaking up millions in sucker money every month. Hundreds of 4-1-9 letters are still circulating in South Africa and throughout the world, preying on the greedy and gullible by promising enormous amounts of easy money.

The con is called 4-1-9 after the section of the Nigerian penal code dealing with obtaining money by deception. The scam now doing the rounds is basically unchanged except for the fact the source of the funds to be plundered is no longer Nigerian, but South African, as this letter detailed by journalist William Boot demonstrates:

"I am Dr Willson K. Mbeki, former chairman of the Trust Fund Committee of the South African National Congress (ANC) where I served for eight years before retiring with Nelson Mandela's administration," says the letter. "Personally, my colleagues and I have secured the sum of $60 million currency kept in a security firm, as we desire to transfer it abroad through your banking facilities."

Says Boot in an investigative article in the Mail and Guardian weekly newspaper, "The fax was clearly a fraud. The letterhead was not the ANC's and the English was atrocious. "Dr Mbeki's missive was one of a flood of letters out of South Africa purporting to be from relatives of the famous and the powerful. They are part of an international fraud scam that Interpol estimates nets the con-artists more than a billion dollars a year."

The long arm of the con-man will reach out to you from the most exotic locations around the world as the global village makes offshore banking an everyday thing for millions of new investors.

An article in the Johannesburg weekly, Finance Week, prompted a number of readers to call about their difficulties after investing large sums with offshore brokers. They had all received either a telephone call from a broker in some faraway place, or a personally addressed flier in the mail encouraging them to invest in some hot new property. "But, after depositing the cash for the investment, the litany of difficulties begins," reports the magazine. "The share certificates seldom arrive and the relevant broker is usually in a meeting or an important telephone call when the worried investor calls to check up on his investment. If the broker is available, the certificates are always in the post."

Trying to liquidate the investment is also well nigh impossible. Investors discover that in many cases the stock is not listed on any exchange.

Finance Week advises, "The four main culprits are operations called Mendes Prior, Equity Management Group, Fullerton Financial Corporation and Strategic Capital."

All are being investigated by the South African Financial Services Board.

Whether the following falls into the scam category is hard to say because the victims, if that's what they are, hardly ever complain. A Nigerian traditional healer who prefers to call himself 'the super-science doctor' placed the following advertisement in a Lagos newspaper. All prices were quoted in naira, with one naira worth about one US cent.

"Snake bite medicine: 25; Medicine to gain employment: 60; Elong short organ: 205; For exams problem; 40; For girls follow me: 45; Hyena [hernia?]: 47; For disappearing during accident: 200; To free from court case: 200; In the working place for not allow anyone to sack you: 220; Prevent you from your enemies: 65; Magic biro for success: 100."

So there it is, a glimpse into the can of worms that's giving the African continent the kind of image that sends serious investors scampering.

What can be done?

Quite a lot. For starters, resist the temptation to blindly jump into easy-money schemes. If they're offered, check them out thoroughly and get an opinion from the commercial section of the police and do what you can to expose confidence tricksters. The battle has only just started.