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To: KLN who wrote (4741)	11/25/1999 1:52:00 PM
From: Janice Shell	Read Replies (1) \| Respond to of 7056

Just another Thursday here, but Happy Thanksgiving to the rest of you.

To: KLN who wrote (4741)	11/26/1999 1:21:00 PM
From: TideGlider	Respond to of 7056

Great reading. Scary similarities of other orgs may come to mind. A site to follow to be certain. s ccsd.cc.state.az.us Affinity Fraud: The Ultimate Confidence Game The Arizona Corporation Commission disclaims responsibility for any private publication or statement by any of its employees. The views expressed herein are those of the author and do not necessarily represent the views of the Arizona Corporation Commission. Article Date: 11-01-99 In today's investment climate, an ever-increasing number of Americans are putting their money in the financial markets. While this is good for the economy and often lucrative for individuals, many pitfalls remain. Stories of fabulous short-term gains may have created an atmosphere of unrealistic expectations. No one wants to miss the golden opportunities of the great bull market, but determining where to invest is often difficult. As a short cut,people may rely on friends and persons like themselves for investment advice. This is where affinity fraud comes into play. “Affinity fraud” involves con artists who target members of their own race, nationality or religious affiliation and exploit their status as members of the group to solicit investments in fraudulent schemes. In one way or another, everyone is connected to a group or ssociation. Our ethnicity, interests, backgrounds and other factors will naturally lead to such organizations or affiliations. Our cultural and religious beliefs contribute to this allegiance to groups that we often come to trust--sometimes to our detriment. Because the average person does not have the time or resources to research investment opportunities, they are vulnerable to affinity fraud. Since the swindler is a fellow group member, he or she appears a natural match for sharing information, resources and entrusting funds. The hook is the affiliation to the group members who are the potential investors. The scam artist plays up the association that he or she and the investor have in the hopes of lowering the investor's guard and exploiting a natural trust. Affinity fraud is a successful tool for scam artists. Once a victim realizes that he or she has been scammed, often the response is not to notify the authorities, but to try and solve the problem within the group. This intergroup loyalty is an aspect that swindlers play upon, especially among people of color and ethnic minority groups. A desire to find an amicable resolution “among ourselves” allows the swindler to continue his scam undetected by regulators, and if necessary, plan a discrete escape or cover his tracks. New immigrants may be particularly vulnerable. Since new immigrants may be isolated from the larger community,their access to information is restricted. Swindlers who claim to provide “safe” alternatives to banks or have “no-risk” investments can take the funds of these persons and disappear, dashing hopes and dreams of starting a new life in this country. The fact that these immigrants are not familiar with the laws and ways of American society and are reluctant to call authorities greatly increases the swindler's success. Similarly, members of long-established ethnic groups that have amassed savings and achieved certain standards of living often have a desire to “give back” to their communities. Affinity fraud artists of the same ethnicity often try to appeal to such sentiments. Con artists also use this tactic in the increasing number of religious affinity fraud cases. Swindlers who prey upon their co-religionists come in all denominations.