Hard-hitting investigations. A special investigation into mail fraud scammers who conned an elderly Northern Ireland woman out of thousands of pounds.
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A Spotlight investigation sparks a raid by armed
fraud investigators in Holland.
It's a move to close down a link in a global mail fraud
taking millions every year.
Their actions prompted by our story
of an elderly scam victim from Northern Ireland.
I just felt devastated completely,
because...I knew all the money was gone.
Spotlight follows the money trail to Holland.
What do you do with the money?
Our investigation uncovers links to the United States.
Make no mistake, these operations are serious business.
They're massive in scale and global in scope.
It leads us to Switzerland.
Hi, my name's Chris Moore, I'm from the BBC in Northern Ireland,
and I'm looking for Mr Spaar.
And we go to the Isle of Man...
Mr Davis, could I have a word?
'..to confront an executive of a chain of companies the US
'government describes as a criminal money-laundering organisation.'
Do you not think the elderly people in Northern Ireland
-who've lost money are deserving of an explanation?
Mail scam is a lucrative business that rakes in millions every year.
A year ago we exposed one of the key players of an international scam.
But what we want to know now is where does all that money end up?
Our starting point is the story of Elizabeth.
Last December we told how she lost her life savings to scammers,
a staggering £180,000 in a 12-month period.
Most of her money was taken in elaborate telephone scams,
but for the rest of it, Elizabeth became a victim of mail-fraud scams.
How much do you think you were spending in a week?
How much were you sending away?
Well, I'd keep enough for the petrol for the car
and some for my food for myself.
But the rest I...spent on...
..on that there.
The letter scams began after her husband died.
She felt isolated and depressed,
factors that can make people vulnerable to scams.
Letters started to come, you know, the Netherlands.
I thought, well, it's international and it must be OK.
Elizabeth was getting unsolicited letters like these
offering big cash rewards for an advance-fee payment.
You're guaranteed thousands of pounds in return for
a relatively small sum of between £25 and £30.
But in fact, every time you're asked to send money off first for
what is supposed to be a guaranteed prize, you become a victim of fraud.
It's called an advance-fee fraud, and very simply, they make
a very attractive proposition to you
that they are going to give you a certain amount of money
but you have to pay a certain amount of money up front.
That WILL be a fraud.
Fall for it just once and you go on a list prepared, maintained
and shared by the criminals who've conned you into paying up front.
This is known as the suckers list.
It's just like being hypnotised.
You're going to win this big amount of money and you'll be able
to buy what you want when you get it.
But...nothing ever appeared.
It was just like a drug.
The scammers buy the so-called suckers lists from each other.
Once your name is on a suckers list your name and your address
never comes off.
Your details are continually shared between scammers right around
the world. So the scam mail's not going to stop.
Scam phone calls isn't going to stop.
You will be repeatedly targeted.
Most of those targeted are elderly.
From my experience,
the bulk of people responding to scam mail would be older persons.
Many pensioners like Elizabeth are unfamiliar with social media
and online banking.
They're retired and most likely to still use cheques.
The Trading Standards fraud team use the suckers list to identify
those at risk, and part of Beverley Burns' job is to call in with them.
Today she's on her way to Newry to speak to a victim.
-Hello, Beverley. Nice to see you again, love.
Lovely to see you. How are you keeping?
'I will look through post that he's getting and try to identify
'or if there's information that I can gather from him which will be
'of use to the national scams team.'
I see this letter here has an address in the Netherlands, Charlie.
I would see a lot of scam post with addresses in the Netherlands,
you know, so you just need to be really, really careful that,
you know, you don't pick up the pieces and start responding again.
Oh, no, I won't.
I mean, I thought I was savvy, coming from London and that,
but I wasn't, I was stupid.
Charlie says he has stopped replying to unsolicited mail since
Beverley first called to see him.
You know, it's music to my ears whenever I hear that someone
has stopped sending money off,
cos it's important that people realise that these are
-out-and-out criminals who are just out to take your money.
Elizabeth was not so fortunate.
When did you first realise that...
that you'd been involved in scams?
When the police came to the house and told me that this is all a scam.
You know, different things like that and...
I just felt devastated completely,
because...I knew all the money was gone.
The sheer number of scam letters asking Elizabeth to send money
to post office boxes in Holland needs to be seen to be believed.
A year ago we went to Holland to track down the owner of some
of those PO boxes.
We discovered that many belonged to this man, Erik Dekker,
a Utrecht businessman and owner of
a mail-packaging company called Trends.
Erik Dekker had at least 150 PO boxes.
In sifting through Elizabeth's scam mail,
one particular box number of his appeared again and again.
This is postbox 1225.
It's on the white envelope here.
Erm, this is one of the postboxes
that belongs to Erik Dekker's company.
And this is where Elizabeth would have sent some of her
hard-earned pension and her savings.
Mijn naam is Erik Dekker.
We went to Trends to speak to company director Erik Dekker.
He wasn't there.
And he wasn't interested in telling me what he did with our
victim's money as he drove off from his home in a Porsche.
-Could we have a word, please? We want to talk to you about...
-We don't want to talk.
We want to talk to you about these letters
that you receive with money in them.
These are letters that have money taken fraudulently
and you use them, distribute them and manage them in your company.
Can you talk to me about them, please?
Can you tell me what you do with the money?
The reason Erik Dekker is free to operate as an apparently
legitimate businessman is because none of those sending money
to his PO boxes lives in Holland.
It was only after the broadcast of our Spotlight programme
a year ago that the Dutch authorities became aware of
Elizabeth and were able to launch an investigation.
I'm now returning to Holland.
I'm catching up with Cees Schep, who helped us last year.
A former Dutch detective who now specialises in exposing fraud,
he says finding a victim is vital to a successful investigation.
-That's the hard part with this kind of crime.
The fraud is committed in other countries
and in the Netherlands you rarely receive reports of the fraud,
because it's very rarely reported.
Victims often don't even know that they are a victim of fraud.
Elizabeth's story was therefore crucial to the raid on
Erik Dekker's company.
Armed fraud investigators arrive in numbers at Trends' offices
in Utrecht and gain access with a search warrant.
The Dutch investigators take staff by surprise.
We see them tell one member of staff to stop work and put his
mobile phone on the desk.
They begin to confiscate anything of value.
This portrait painting of Dutch football legend Johan Cruyff,
The evidence of scam-mail fraud is everywhere.
Here they find not only the cash the victims put in envelopes
but some messages as well.
One telling them to stop sending "this junk".
Another a note of misplaced gratitude.
The searches at Trends uncover
half a million euros in cash and banknotes in 60 different
currencies, including Bank of England notes
and, as it happens, Bank of Ireland notes as well.
The armed fraud investigators also confiscate
Erik Dekker's latest Porsche.
Newspaper reporter Roeland Franck
tells us the searches at Trends and Erik Dekker's home
stunned the local community.
Many people were surprised, shocked.
Er, well, criminal activities are everywhere,
we don't want to be naive, but seeing that something like
this is happening in our backyard, well, that surprised people.
And in this huge amount of letters which were sent from Utrecht,
this is nothing to be proud of!
His newspaper carries a revealing insight from
a former Trends employee.
He told us really detailed about his experience inside the company.
He saw how envelopes, many thousands of envelopes came in and were
opened by tens of people, just opening envelopes, counting,
sorting the money, counting the money.
Day after day he could see this happening, going on,
and he saw also armoured cars
to pick up the money at the end of the day.
Cees Schep says that as well as making the Dutch authorities
aware of Elizabeth and our Spotlight programme, he also brought it
to the attention of investigators in Britain and America.
-When the Dutch authorities decided to start investigating,
I brought them in contact with the US Postal Service
and National Trading Standard fraud team in the UK.
Those organisations started working together,
which led to the raid on June 1st,
with house searches and the shutting down of over 300 postal boxes.
The searches here in Utrecht were not conducted in isolation.
At exactly the same moment, the US government was taking
a civil action in a Washington court against Trends and Erik Dekker.
America takes mail fraud very seriously,
as is evident from this statement
by the US Attorney General, Loretta Lynch.
Make no mistake, these operations are serious business.
They're massive in scale and global in scope and they bring in
hundreds of millions of dollars.
Several million Americans have been harmed by these predatory schemes.
Erik Dekker is one of those the Americans have had suspicions about.
I believe that the evidence that led us to conclude just how much
Mr Dekker's fraudulent activity was reaching into
the United States really came to our attention only recently,
and once we had the evidence and facts to support
enforcement actions against Mr Dekker we moved swiftly.
Leading investigator Clayton Gerber
says America has long been aware of the huge amount of
fraudulently-obtained money leaving the United States for Holland
on a massive scale.
Were you surprised to discover the volume, not only of the mail
that was going to the Netherlands, but the volume of cash that
was going there as well?
The volume was breathtaking. We were astounded.
We did some initial mail observations
here in the United States
and we identified something in the order of 60% to 70%
of the letter mail from the United States to the Netherlands
each day was these fraudulent remittances from victims.
The numbers were staggering - 150,000 to 180,000 pieces a month.
The lawyer from the US Attorney General's Office who brought
the civil action against Erik Dekker says the fraudulently-obtained money
sent to his company alone runs into several millions.
The evidence that we have suggests that in the United States
the effects of his fraudulent activity was in the magnitude
of 18 million or so.
What we were able to do was to bring civil actions in coordination
with the United States Postal Inspection Service,
have shut down the mail services for Trends and for Mr Dekker.
The question for us is, what happened to Elizabeth's money?
As part of the case against Erik Dekker,
the US Attorney General's Office
set out the key elements of how a mail scam works.
At one end of the chain you have a victim who's conned into
sending money, often to a foreign country.
The money goes to what the Americans call a caging company.
In this case it's Erik Dekker's company Trends.
The caging company's job is to open the envelopes,
count the money, take a cut and then send the cheques to
the next link in the chain, the payment processor.
Sometimes the payment processor is one of the crooks and other times
the processor is being duped by the crooks,
who hide behind it to launder the money.
What we have found is that the fraudulent actors are engaged
in a very complicated international scheme, so there are caging services
like Mr Dekker who are essentially the entities that collect the mail
and open the mail for the other fraudulent actors,
but in addition to that fraudulent conduct
there are also the people who send out the mail
and then people who process the payments.
I'm back in Utrecht in the Netherlands on the money trail,
in pursuit of a man who has been providing scam-mail fraudsters with
facilities to collect and distribute
the cash they've taken from victims like Elizabeth in Northern Ireland
and also from victims all over the world.
The actions of the American and Dutch investigators have had
the effect of putting Erik Dekker and his companies out of business.
His offices in Utrecht are up for sale.
But I still want to know what he's done with Elizabeth's money.
When I catch up with him, he's no longer driving a Porsche.
Mr Dekker? Chris Moore from the BBC.
Mr Dekker, I'd like to ask you about how you've managed and processed
some money that's been sent to you from old ladies in Northern Ireland.
-Can you go away from the car?
Can you go away from the car?
-Yeah, I want to talk to your... to Mr Dekker here.
Mr Dekker, would you please answer my questions?
What do you do with the money you receive in envelopes
that come to your premises, to your PO boxes?
There's money that's been taken fraudulently
from old ladies in Northern Ireland.
What do you do with the money?
That's it, he doesn't want to talk, obviously.
So, Erik Dekker won't tell us where the money has gone.
But can we find out more about the network?
In particular, who at the end of the scam chain directly benefits
from taking Elizabeth's money.
They're still calling, but...
It's nonstop. I thought maybe, you don't reply to the things, they would give up, but...
So you're surprised there's so much?
I am, yes, I am. There's quite a bit now.
'Elizabeth has travelled to Belfast to meet up with me
'and I'm horrified to learn that she's still receiving scam mail.'
Well, this is where we've been working on your case.
'With Elizabeth's permission, we decide to see if we can
'trace where her cheques have actually been cashed.'
Elizabeth, this is quite a collection of mail...
-..that keeps coming through your...
That's just unbelievable.
'It's not going to be easy,
'because there are almost 100 cheques involved,
'and even where they've been sent to the same PO box
'they're all made out to different names.'
And they're made out to strange... little companies.
I mean, if you look,
I've just written the names on the front of some of these envelopes,
and what you have is, like, there's OTO...
I don't know where that's to.
RSG, does that mean anything?
Eh...yes, some of them do.
We take some of the cheques she sent to Erik Dekker,
all made out to different names,
and look at the sort code stamped on the back.
And amazingly, when we put that number into a search engine,
we discover that Elizabeth's cheques have gone from
Northern Ireland to Holland and have ended up back in the UK,
being cashed in a high-street bank in England -
the NatWest bank at Chorley in Lancashire.
Further research reveals that alongside the cheques
sent via Erik Dekker,
a total of 38 of Elizabeth's cheques have ended up in this bank.
All of Elizabeth's cheques were what's known as crossed cheques,
which means they should only be cached into the account
of the person they're made out to.
But incredibly, despite being made out and crossed to
over 30 different names, they all went into the same account.
Financial journalist Paul Lewis of the BBC's Money Box programme
says that just shouldn't happen.
That's not how it's supposed to work.
Particularly if a cheque is crossed,
it should only go to the named payee on the account.
That is how it should work.
If this is a UK bank, which it is,
that's how it should work in this country, certainly.
So you would be concerned if that's happening?
I'd be very concerned.
I've come to Chorley in Lancashire because nearly half of
Elizabeth's cheques were cashed in a bank here.
It says a lot about how carefully scammers plot their schemes
when they come to small towns like Chorley here in Lancashire
and open up bank accounts to clean up the money they've taken
fraudulently in mail scams.
Muthupandi Ganesan is a barrister specialising in fraud cases,
particularly mail scams and money laundering.
In many cases fraudsters do target regional branches of big companies,
and the reason being is that they do not want to get noticed,
they don't want to bring attention to themselves
as much as they would do if they are in a very big city branch
with lots of transactions,
with a high number of staff looking at the account-opening procedures.
But even when dealing with a small branch, how can fraudsters
cash cheques made out to different people in the same account?
The answer very often is a payment processor, who tells the bank
it's holding accounts for a number of mail order clients.
There have been cases where payment processors,
third-party payment processors,
their facilities have been abused by fraudsters because it enables them
to receive cheques from different names
and cheques coming from different locations
but all being put through to one particular account.
We asked the NatWest to tell us the name of the payment processor
into whose account they'd paid all of Elizabeth's money.
The bank declined to tell us on the grounds of data protection.
Without the name of the payment processor,
we can't for the time being take the money trail past the NatWest.
But those are not the only cheques of Elizabeth's
we are able to follow.
We traced 24 to a branch of Barclays Bank in London.
But these cheques contain an even more important clue, because stamped
on the back is the name of a payment processor, Cambridge Mercantile.
We have here a number of the cheques that you sent -
-I think there was 24 of them went into a Barclays Bank.
When you look at the back of the cheques
there's a clue about who received the money,
-because on these it tells you, if you look through there...
Take the magnifying glass and have a look. You see here it tells you...
-Can you see my finger?
-Yes, I do.
-It's got the name Cambridge Mercantile.
-I see that.
You didn't make a cheque out to Cambridge Mercantile?
No, no. Definitely not.
Now, it's important to remember that the vast majority of payment
processors are legitimate businesses that are themselves being
duped by criminals.
And that is what Cambridge Mercantile tell us
has happened on this occasion.
In a statement, the company says that while the account in question
had been set up properly, red-flag issues soon emerged, and that
they closed the account and launched some form of investigation.
But once again, very frustratingly, on the grounds of data protection
neither Cambridge Mercantile, the payment processor,
nor Barclays would tell us who the money was going to.
But Elizabeth's cheques are not the only ones we follow.
-And here we have GDS.
-Yes, I do remember them.
Familiar with those?
Yes, you made the cheque payable to GDS.
'We ask Elizabeth if we can send six of our own bank drafts to
'addresses the fraudsters previously tricked her into sending money to,
'including this one offering £66,000
'in exchange for £30 sent in advance.'
-One of the people we want to send our money off to is GDS.
-And this is the letter that we're going to use.
-You see what it's promising?
And that means we should get 66,000 back.
-If you get it.
I don't think so. Don't get up your hopes, son.
I just purchased these six bank drafts
made payable to companies we've already identified
as having scammed Elizabeth two years ago.
Now we're going to send this money off to those same companies,
and we're using mail that they've delivered to her home
since the start of the year.
That's six envelopes on their way to Holland with our money in them.
It'll be interesting to see where it ends up.
One of the bank drafts we sent off was made out to GDS.
12 cheques belonging to Elizabeth also made out to GDS
ended up, according to our searches,
being paid to another payment processor
called Payment Solutions.
We contacted Payment Solutions to ask them where the money was going.
And remarkably, this time,
there's no attempt made to hide behind data protection,
because they say they believe their client, GDS,
is a legitimate mail order company.
They say their client runs a mail order business
selling costume jewellery and religious medals.
Payment Solutions tell us there's no evidence so far
of the cheques being fraudulent.
But we have that evidence.
We know that GDS were not selling any actual items
when they cashed our cheque.
Here's what prompted us to send it to them -
a letter promising £66,000.
So, where's the money I was promised?
£66,000 for a small advance payment?
We need to find out more.
And, remarkably, Payment Solutions e-mail us
with an address in Switzerland for GDS,
which they call Grino Direct Sarl.
Our destination is Geneva,
the fourth most expensive city in the world.
It's a place for those with lavish tastes,
but also the hiding place for the GDS scammers
who've taken Elizabeth's money, and our money as well.
This is a very interesting e-mail from Payment Solutions
because they finally tell us who was taking the money
from Elizabeth's cheques that were made out to GDS,
and it turns out that it's Grino Direct Sarl.
But they give us the address.
It's care of Ace International
at Place de St-Gervais, Geneva, in Switzerland.
But as ever, when investigating mail fraud,
you can never be sure you've got to the end of the chain.
Company records show the owner of GDS
is a Mr Herbert Rudolf Spaar.
I'm looking for Mr Spaar. Would he be available, please?
We leave several voice messages and write to him twice,
but get no response.
Do you know if he'll be in this week to his office?
We're not the only people
who've had difficulty in contacting Herbert Spaar.
Swiss journalist Dr Oliver Zihlmann,
of the International Consortium of Investigative Journalists,
helped to reveal the Panama Papers
where companies were engaged in elaborate tax avoidance schemes.
He made enquiries about Herbert Spaar on our behalf.
One would expect in Switzerland when you contact a business
that you would be able to get someone.
This is not the case here,
so that makes this person a bit of a ghost.
Also, we didn't find him in any other database
or phone book or registry,
so he is a person who really escapes the eye.
So the question is,
does Mr Spaar really exist or is he a faceless ghost?
The faceless man of Geneva.
So, I'm now on my way to knock the door of the company GDS,
and I've got their address here
and I'm hoping that Mr Spaar will be available.
He hasn't been available on the telephone up to now,
but let's see what happens when we actually knock the front door.
So, there's no GDS button,
but their office is care of Ace International, so...
..I'll press this button and see what happens.
They're opening the door for me,
so I'll take the opportunity to go in
and speak to whoever's there.
See you in a moment.
'On my way up to the office,
'I notice a letterbox with the initials GDS.'
So, here we have Ace International.
They provide accommodation for this company down here,
Grino Direct Sarl.
This is the company that has taken money from Elizabeth's cheques.
That's the company we want to talk to today.
My name's Chris Moore. I'm from the BBC in Northern Ireland.
I spoke to someone here yesterday. I'm looking for Mr Spaar.
Along with my producer, we're shown into a conference room.
The door's closed behind us.
The receptionist won't confirm
whether she has ever met GDS owner Herbert Spaar.
She tells us she is not allowed to say whether or not
we're sitting in the offices of GDS.
HE CHUCKLES It's... It's...
It's hardly surprising we're getting the runaround here.
No-one seems to, obviously, want to talk to us.
No-one wants to be able to explain why...
they send this kind of literature out
and scam letters promising large amounts of cash -
134,000 here, 32,000 here -
for small payments made payable to GDS.
Elizabeth lost thousands
in sending money to Holland to these addresses,
because these all come from PO boxes in Holland,
and the money then comes to England.
And then we find out that it's transferred to GDS at this address,
this very office, in Geneva.
And it's quite a posh office.
No-one in here is prepared to talk to us
and to explain what kind of a business it is that they're running
and what have they done with Elizabeth's money.
It's just... It's just unbelievable. Unbelievable.
After half an hour waiting with no-one prepared to speak to us,
it's time to leave.
We never found out whether Mr Spaar was real or whether he was a ghost.
After our visit, Ace International wrote to us
insisting that it and GDS are two separate legal entities.
But we had already established
that the two companies have a lot in common.
A quick look at their accounts shows a most remarkable coincidence.
Based in the same building,
they both have exactly the same annual turnover.
Oliver Zihlmann is deeply suspicious.
One would be surprised.
When you look a bit closely at this company,
you see that it is using an address of another company
who incorporates offshore companies,
shell companies, in jurisdictions like the British Virgin Islands,
and this is a very shadowy business, let's say it like that.
The chief executive officer of Ace International
is Ariane Slinger.
Ace is a company that provides business and tax advice.
Ariane Slinger has been linked to over 1,800 entities
listed in the Panama Papers,
her company appearing to help them keep one step ahead of the law.
What we have in Geneva
is companies like the one that uses the address of your company
setting up shell companies
in places like Panama and British Virgin Islands
and using scam directors.
If they make that, then law enforcements cannot touch them.
We never discovered to what extent the ghostly Mr Spaar of GDS
is connected to Ariane Slinger of Ace.
As we know, she insists Ace and GDS
are entirely separate legal entities.
This is pretty serious stuff,
and normally you see those companies set up in Liberia and other places.
That it's operating out of Switzerland is really embarrassing.
And do you think that the Swiss authorities
might at some point have an interest in this,
that they might want to look at this?
I would say if you have an operation like that
with a company actually incorporated in Switzerland
they would have to go after it, yes, absolutely.
What Switzerland underlined, as we found elsewhere,
is that again and again,
it is really difficult to follow the money trail in mail fraud.
But in September,
the American action against Erik Dekker's company, Trends, in Holland
led them to name a payment processor called PacNet
as a transnational criminal organisation...
..to which Erik Dekker was sending fraudulently-obtained money.
One of the principal payment processors
that Mr Dekker and Trends worked with was an entity called PacNet.
PacNet is what we call a payment processor,
which means that it receives the money
and then makes sure that the money
gets to the people who are engaged in the fraudulent scheme.
To put it another way,
when Mr Dekker and his corporation open the mail,
they send the cheques to PacNet.
The fraudsters needed someone to open the envelopes
and handle the paper and do the data entry.
That's what Mr Dekker's company did.
And they needed someone like PacNet to process the payments
and deal with the cheques and credit cards and the like.
US investigators say PacNet have a 20-year history
of knowingly laundering the proceeds of mail frauds.
Last year, Clayton Gerber supervised the closure
of one scheme involving PacNet
which took 184 million from victims in a five-year period.
Here, he supervises the interception of envelopes containing cash.
Andrew Saks-McLeod specialises in research on financial technology.
PacNet's been around for quite some time,
and it has a series of other sister companies
and members of its same group underneath it.
It's a Canadian company.
It originates from Vancouver, British Columbia.
In the case of the Netherlands,
the US authorities established that tens of millions of dollars
fraudulently obtained in America
were being sent to Erik Dekker's Trends company
and then on to PacNet.
That's why they stopped first Trends and then PacNet
from using the US Postal Service.
What's happened is, the US government
hasn't been able to have any jurisdiction
over those particular companies
because they're not American companies,
so they cut off the payment source,
therefore there's no possibility
that those companies can solicit using PacNet.
The Americans traced US dollars going to Trends
and then on to a PacNet account at a Barclays Bank in London,
and from there through an American bank
to PacNet's headquarters in Canada.
But did any of Elizabeth's money pass through the hands of PacNet?
The answer to that can be found
back at this branch of the NatWest Bank in Chorley.
As we already know, we traced 38 of Elizabeth's cheques,
several of which had gone through Erik Dekker's PO boxes in Holland,
to a single account in this branch.
Now Spotlight can reveal that a source in the banking industry
has shown us evidence that proves the account belonged to PacNet.
According to the US Treasury Department,
these are some of the people behind the PacNet group.
The man at the top is Robert Paul Davis,
commonly known as Paul Davis.
When not helping to run what the American government calls
a transnational criminal organisation,
Mr Davis is a farmer
and a director of a RareBridge company based on the Isle of Man.
Here he's being interviewed for a BBC programme on his farm.
I've heard anecdotally
that some of the locals refer to us as Jurassic Park.
Although none of our animals have actually been extinct,
we are doing pretty much the same thing.
We're preserving the heritage of animals.
As well as being a farmer, Mr Davis has many other talents.
He's a pilot -
here he is in the uniform of PacNet Air -
and an expert on international financial payments.
He frequently attends conferences
and, ironically, gives talks on protection against fraud.
He told the 8th European Gaming Summit
that his life is governed is by the four Fs -
family, finance, flying and farming.
He didn't mention whether PacNet helps fraudsters.
We wrote to Paul Davis about the alleged involvement of his companies
in laundering fraudulent cheques.
We mentioned PacNet Services Ltd
and other companies with similar names.
Paul Davis wrote back
categorically denying any involvement in fraud.
He claims PacNet operates strict compliance procedures
and it denies it ever knowingly processed payments
for fraudulent mail companies.
PacNet also told us they will defend the US government allegations,
which they claim are inaccurate and biased.
They also told us they'd stopped processing payments
for direct mail companies altogether.
In closing PacNet down in America, the US authorities recognised
that the group operates behind a hugely complex web
of similarly-named companies and individuals.
Paul Davis relied on this
when failing to address some of our questions.
Today, we took action to protect America's most vulnerable
by designating the PacNet Group
as a significant transnational criminal organisation.
With operations in Canada, Ireland and the United Kingdom
and subsidiaries or affiliates in 15 other jurisdictions,
PacNet is a third-party payment processor of choice
for perpetrators of a wide range of mail-fraud schemes.
The 24 companies designated by Ofac today
comprise of PacNet Group
and/or are entities owned or controlled by PacNet executives
or other PacNet-linked companies.
In our letter to Mr Davis,
we told him about 74-year-old Elizabeth
and the money she'd lost.
In his reply, he said PacNet was sorry to hear about people
who have lost the capacity to look after their money.
-You sent a lot of money to these mail scams.
-Yes, I did. I did.
-And you lost your life savings.
-Yes, I did. Uh-huh.
How difficult has it been
to survive without that money that you had safely stashed away?
Well, it was difficult
to know that I'd made of a fool of myself, for starters,
and was difficult...
I had plans for that money,
but I thought if I had a little bit more, I'd be able to...
..succeed in my dream of what I was going to do with it.
But it wasn't to be,
because I had no money to do what I wanted to do.
What was your dream? What did you need the extra cash for?
I wanted a nice house,
a better house than the one I lived in.
And a nice dry house and...
You know, nice and comfortable for the rest of my days.
But it didn't work out like that.
We also asked Mr Davis about PacNet's dealings
with Erik Dekker and Trends.
He told us PacNet and Trends have no business relationship.
But Elizabeth's cheques showed that there is some connection.
By allowing us to track her cheques from Northern Ireland
through the caging services of Erik Dekker in Holland
and then on to the PacNet account at the NatWest Bank,
Elizabeth has enabled us to prove
that Mr Davis' PacNet is the next link in the chain.
Surprisingly, that link isn't too far from our own shores.
We've come to the Isle of Man on the trail of PacNet's Paul Davis,
the man the US government has placed
on the transnational criminal organisation list.
We want to ask him how some of the cheques Elizabeth sent
to Erik Dekker's PO boxes in Holland
ended up in a PacNet account in Chorley.
We start by visiting Mr Davis' Manx Rare Breeds farm.
But there's no-one at home.
We want to put our questions to Mr Davis on PacNet's behalf.
Mr Davis, could I have a word?
'We catch up with him...' How are you doing?
'..as he is delivering meat to a local restaurant.'
-Who are you?
-Chris Moore from the BBC in Northern Ireland.
Just wanted to have a word with you
about the cheques that went into the PacNet account
-in Chorley in Lancashire.
-You know, a 74-year-old lady lost...
-..thousands of pounds.
-Can you tell me what you did with her money?
Can you give me some reaction, then,
to what the Americans have alleged against PacNet,
-that you're a transnational criminal organisation?
Do you not think that the elderly people in Northern Ireland
who've lost money are deserving of an explanation?
-I mean, you did say in response to our letters...
-You have said...
-..that PacNet will defend the allegations
against the government in the United States.
-How will you do that, please?
-Could you tell me?
We've given you this opportunity to talk to us
and we'd like to know what happened to the money
that a 74-year-old widow was scammed out of.
-Why can't you tell us...?
'We want Mr Davis to explain PacNet's position.'
And we would like to know what you did with that money.
-Who did you give it to? Cos this lady was defrauded.
OK. Thank you very much for your time. Thanks.
PacNet did subsequently point out
they've never been charged with any criminal wrongdoing
and claim regularly to report suspicious transactions
and to cooperate with the authorities.
It's time to find out what Elizabeth thinks.
We've tried to take the story of your money
-and where it disappeared to.
-We started with you, obviously, here.
We followed the trail of your cheques
-to the PO boxes in Holland.
And to this man. He owned quite a few of the PO boxes in Holland
-that you were sending your money to.
-He provides a caging service.
-That means that in this scam...
..he collects the money, counts it,
and then sends it out to the next person.
He was caught recently in America.
They took action as a result of your information to the Dutch,
the Dutch, the Americans combined,
and Mr Dekker's been put out of business.
-What do you think?
It's good enough for him.
He was taking 18 million a year from people in the United States.
Oh, my goodness me.
-It does. Really surprises me.
But I'd like to meet that man and give him a piece of my mind.
But I'm glad he's getting his punishment.
If he's put out of business and so forth,
let him know what it's like to be left penniless.
I'm going to tell you the next bit on the trail of your money.
-And it brings us over... to this gentleman.
And his company is called...
It's a payment processor
who makes sure that the proceeds reach the principals involved
in the criminal actions.
Well, there you are. That's a surprise.
Mr Davis, we asked him about your situation,
we asked him about money
that was taken from an elderly woman in Northern Ireland
and what he had to say about it,
and he said that PacNet were sorry
that people were unable to manage their own affairs,
to manage their money properly.
What do you...? What do you think about that comment?
Well, I think he didn't care.
Need a good telling off and let him know what...
what it's like to take your money and send it to criminals.
Elizabeth was caught in a global mail scam
that saw her money travel to Holland,
where it was collected and opened by Trends caging services...
..who sent her cheques to banks in England
and into the accounts of payment processors
who, if not knowingly involved,
were unwittingly being used by the crooks hiding behind them
to launder the cash taken fraudulently.
The key part of the scam
is to trick banks into cashing fraudulently-obtained cheques.
Paul Lewis is not optimistic
that the system will change any time soon.
The crooks are cleverer and faster than the banks
who they're using in their crimes,
and I think that will probably continue to be the case.
They know how the systems work and they know how to exploit them.
A crucial part of the scam
is the use crooks make of payment processors.
Muthupandi Ganesan says, like banks,
payment processors have obligations to fight fraud.
Absolutely, because they are also a financial provider,
a financial remedy provider, if I can put it like that.
They are also under a duty
to ensure that they are not allowing their mechanisms
to be used by fraudsters for money laundering
or washing up of illegal proceeds of crime.
The body charged with regulating payment processors in the UK
is the Financial Conduct Authority, the FCA.
Despite recent evidence from America
where, as we now know, PacNet have been designated
as a transnational criminal organisation,
the FCA say they continue to authorise parts of the PacNet Group
to operate in the UK.
They say they are considering what action to take.
Andrew Saks-McLeod finds this astonishing.
Bearing in mind that the US Department of the Treasury
considers PacNet to be...
and all of its subsidiaries, to be a fraudulent criminal organisation
and a money-laundering organisation,
the Financial Conduct Authority's payment services provider register,
just a few days afterwards, actually held its hand out and said,
"We're aware of the US Treasury sanctions on the company,
"we don't stand by that and, actually,
"we consider to uphold the regulatory status of PacNet
"and its subsidiaries in Britain,"
which is quite astonishing, in my opinion.
In the United States, it was the actions of the US mail
that led to the closing down of Trends and PacNet in America.
We asked the FCA if they would appear in this programme
and explain the actions they're taking
to help people like Elizabeth.
They were not prepared to take part.
I think the Financial Conduct Authority
should certainly talk to you.
Fraud is one of the very few crimes that's growing,
and around half of all crime is fraud,
and I use the word fraud, which technically is what it is,
but as far as this lady's concerned, it is theft
as much as if someone came and took her handbag in the street.
As Elizabeth continues to rebuild her life,
the investigation she helped trigger
continues in Europe and the United States,
where more payment processors are being investigated.
Spotlight can reveal that a multi-force investigation
is currently ongoing in the United Kingdom
and it's codenamed Operation Nuncio.
As one source close to the investigation told Spotlight,
this is being seen as an all-out effort
to stamp out the scourge of scam mail once and for all.
Until then, people in Northern Ireland will remain at risk
of falling victim to scams
that net an estimated £100 million here every year.
A special investigation into mail fraud scammers who conned an elderly Northern Ireland woman out of thousands of pounds. Chris Moore follows the money trail to Holland, England, the United States and Switzerland to uncover an international criminal enterprise raking in millions every year.