In a time of crisis, we often see the best in people. Even before COVID-19 was officially classified by the World Health Organisation (WHO) as a global pandemic, citizens and government leaders were praising the selfless sacrifice of doctors, nurses, first responders and others putting themselves in harm’s way to help treat and limit the spread of the disease. Unfortunately, a crisis can also bring out the worst in some people. Fraudsters who prey on people’s fear and confusion tend to waste no time when a global disaster strikes. COVID-19 is relatively new and still spreading, yet fraud schemes are multiplying like the virus itself as criminals look for vulnerabilities among a fearful population.

Interpol issued a warning on March 13 that fraudsters are “exploiting the fear and uncertainty” around COVID-19 through several different schemes utilising different approaches. These include telephone fraud, through which “victims receive calls from criminals pretending to be medical officials, claiming a relative has fallen sick with the virus and then requesting payment for their treatment;” and phishing, in which “victims receive emails from criminals pretending to be from health authorities, or legitimate companies, using similar looking websites or email addresses” (Euronews, 2020).

While the public might be surprised to see an uptick in shameless fraud schemes during such a time, investigators are not. Disaster fraud is a common scourge of law enforcement and regulatory bodies everywhere. For example, in 2012, Hurricane Sandy devastated the Caribbean and eventually wreaked havoc upon the U.S. eastern seaboard. More than a hundred individuals in New Jersey alone were prosecuted for filing fraudulent applications for relief funding. Investigators in the southern U.S. launched similar actions after Hurricane Harvey in 2017.

Fraud that preys on the fearful or vulnerable is even more insidious. That’s what investigators are seeing right now as COVID-19 continues to spread. The Food and Drug Administration (FDA) and the Federal Trade Commission (FTC) recently issued warning letters to seven companies for selling fraudulent COVID-19 products. “These products are unapproved drugs that pose significant risks to patient health and violate federal law. The warning letters are the first to be issued by the FDA for unapproved products intended to prevent or treat “Novel Coronavirus Disease 2019″ (COVID-19)” (FDA, 2020). The FDA and FTC are taking this action as part of their response to protecting Americans during the global COVID-19 outbreak.

The FDA and FTC issued warning letters to Vital Silver, Quinessence Aromatherapy Ltd., Xephyr, LLC (doing business as N-Ergetics), GuruNanda, LLC Vivify Holistic Clinic, Herbal Amy LLC, and The Jim Bakker Show. In some cases, colloidal silver was being fraudulently peddled as a successful treatment for preventing and/or curing COVID-19.

An article in New York Magazine provides an insightful look at various herbal and homeopathic “cures” that become a hot commodity at times of widespread illness. As the article points out, useless treatments aren’t simply harmless. They can have a seriously detrimental effect when they replace actual science: “Even without the looming threat of a pandemic, pseudoscientific cures can pose a real threat to the public. No scientific evidence supports the claim that homeopathy has curative properties, for example, and relying on unproven treatments without the assistance of conventional medicine can put a person’s health at risk. Some popular treatments, like colloidal silver, can actually be dangerous if consumed in enough quantities. Nevertheless, alternative medicine is a big market in the U.S. Americans spent $30 billion on alternative medicine in 2012; by the time COVID-19 appeared, people were already primed to trust dubious cures” (New York Magazine, 2020).

So how can the general public avoid frauds and phishing schemes during a crisis? Here are some things to keep in mind:

  • Be suspicious of emails that are peddling cures or medical devices. Don’t click links or open attachments.
  • When searching for information online, be aware of fake websites impersonating legitimate organisations. Check the web address carefully and don’t provide any personal information.
  • Follow the same rule for unsolicited phone calls – under no circumstances should you reveal any personal or financial information.
  • If you believe you have fallen for a scheme, contact your bank or credit card provider immediately.

Remember, fraudsters take advantage of a sense of panic among their victims that they have to take action immediately. Anyone (other than a legitimate government or medical official) who tries to pressure you to make a decision, especially a financial one, may try to scam you. Keep a cool head, do your research, and don’t panic. Businesses are not immune to such frauds, either. If you think your business has fallen prey to a scam, contact CRI® Group immediately. Our investigators are standing by to help prevent and detect such schemes.

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If you have any further questions or are interested in implementing compliance solutions, please contact us.

About us…

Based in London, CRI® Group works with companies across the Americas, Europe, Africa, Middle East and Asia-Pacific as a one-stop international Risk ManagementEmployee Background ScreeningBusiness IntelligenceDue DiligenceCompliance Solutions and other professional Investigative Research solutions provider. We have the largest proprietary network of background screening analysts and investigators across the Middle East and Asia. Our global presence ensures that no matter how international your operations are, we have the network needed to provide you with all you need, wherever you happen to be. CRI® Group also holds BS102000:2013 and BS7858:2019 Certifications is an HRO certified provider and partner with Oracle.

In 2016, CRI® Group launched the Anti-Bribery Anti-Corruption (ABAC®) Center of Excellence – an independent certification body established for ISO 37001:2016 Anti-Bribery Management SystemsISO 37301 Compliance Management Systems and ISO 31000:2018 Risk Management, providing training and certification. ABAC® operates through its global network of certified ethics and compliance professionals, qualified auditors and other certified professionals. As a result, CRI® Group’s global team of certified fraud examiners work as a discreet white-labelled supplier to some of the world’s largest organisations. Contact ABAC® for more on ISO Certification and training.

 

MEET THE CEO

Zafar I. Anjum is Group Chief Executive Officer of CRI® Group (www.crigroup.com), a global supplier of investigative, forensic accounting, business due to diligence and employee background screening services for some of the world’s leading business organisations. Headquartered in London (with a significant presence throughout the region) and licensed by the Dubai International Financial Centre-DIFC, the Qatar Financial Center – QFC, and the Abu Dhabi Global Market-ADGM, CRI® Group safeguard businesses by establishing the legal compliance, financial viability, and integrity levels of outside partners, suppliers and customers seeking to affiliate with your business. CRI® Group maintains offices in UAE, Pakistan, Qatar, Singapore, Malaysia, Brazil, China, the USA, and the United Kingdom.

Contact CRI® Group to learn more about its 3PRM-Certified™ third-party risk management strategy program and discover an effective and proactive approach to mitigating the risks associated with corruption, bribery, financial crimes and other dangerous risks posed by third-party partnerships.

CONTACT INFORMATION

Zafar Anjum, MSc, MS, CFE, CII, MICA, Int. Dip. (Fin. Crime) | CRI® Group Chief Executive Officer

37th Floor, 1 Canada Square, Canary Wharf, London, E14 5AA United Kingdom

t: +44 207 8681415 | m: +44 7588 454959 | e: zanjum@crigroup.com

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