Citibank Taken to the Cleaners By…Nigerians!
There’s an interesting story in the New York Times showing that when it comes to bilking people and institutions out of money, Nigerians have cornered the market on creativity and ingenuity. It’s also proven something about one of our largest financial institutions, Citibank. Like maybe how dull-witted foolishness has been getting it into trouble since people over there decided to throw out normal rules of banking along with the requirement that you need at least a room-temperature credit score if you want to buy a million-dollar lakeside home out in the countryside. Plenty of people walked into that little mortgage trap, by the way, and Citi almost went down because of it. No wonder credit’s so tight, these days. And also why the hole in a basement wall is at least as trusted as a big-city bank, when you come right down to it.
Just how the U.S. bank was fooled into doling out over 25 MILLION dollars of the National Bank of Ethiopia’s money is a simple story of sharp thinking by a group of Nigerian nationals, combined with an utter lack of curiosity and a vapidity on the part of more than several Citibank bureaucrats. It seems these Nigerians, who’d spread out to several countries around the world (including the U.S.) set up a deceptively simple scam. For starters they courier-mailed a packet of what Citibank said was “official looking” documents from the Ethiopian institution to whichever office it is at Citi designated to handle these large foreign depositors. The phony letters gave a set of instructions to bank officials for future wire transfers and withdrawals by the Ethiopian bank. They came complete with stamps, signatures, important sounding titles…the works.
Of course, the contact persons in these fake documents were all Nigerian crooks and scam artists, and all the phone numbers to call for authorization for requested money transfers went to cellphones controlled by the gang. Within weeks, directives from the Ethiopian national bank began coming in, telling Citibank to transfer millions of dollars to this or that bank or institution. Several verification calls — to those cellphones, naturally — were made, you know…just in case something wasn’t quite right. But that was about the extent of it, for a while. In all, nearly twenty-seven million dollars of Ethiopian money made its way from Citi’s New York branch to who-knows-where. It was weeks before somebody at the New York office finally called in the FBI and the transfers finally exposed as a scam. Subsequently, a couple of the conspirators were arrested, one of whom was nabbed coming into the U.S. through Los Angeles.
Leaving aside the fact nobody would ever believe Ethiopia had that kind of money in the first place, the story should serve as a cautionary tale. Nigerian crooks seem to have come to the realization little old ladies in Peoria no longer seem so willing to hand over their life savings in an attempt to get back ten or fifteen times the amount if only they’d let “The Honorable Leicester C. Indikwe,” or some other highly-placed Nigerian government official use their bank as a depository for the Indikwe family fortune. Rather, they’ve come to the realization that some of the most foolish people in the world seem to work for U.S. banks.
Citibank later made good on the theft of Ethiopian money, which is the right thing to do, under the circumstances. But, ALL of us probably chipped in a few bucks, when you consider how much federal bailout money the bank’s received these last few months.
Mary "Peg" Heying
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