This is a sample from the lesson

You can take this lesson in its entirety by creating an account. You pay for your lessons/exams either before or after taking them. Your CEU's will only be valid after you pay for the lesson.




Swindles, Confidence Tricks, Cons, and Scams
You may print this lesson, or you may open the exam in another tab or window to reference this lesson during the exam.

Swindles, Confidence Tricks, Cons, and Scams

A “confidence trick” is an attempt to defraud a person or group by gaining their confidence. A confidence artist is an individual working alone or in concert with others, who exploits characteristics of the human psyche, such as greed, both dishonesty and honesty, vanity, compassion, credulity, irresponsibility, naivety, and the thought of trying to get something of value for nothing or for something far less valuable.

The confidence trick is also (non-exhaustively) known as a con game, con, scam,
grift, hustle, bunko, swindle, flim flam, gaffle, or bamboozle. The intended victim(s) are known as “marks.” The perpetrator of a confidence trick is often referred to as a confidence man/woman, con man/woman, con artist, or grifter. When accomplices are employed, they are known as “shills” (someone who helps a person or organization without disclosing that he or she has a close relationship with that person or organization).

In David Mamet’s film “House of Games,” the main con artist gives a slightly different description of the "confidence game." He explains that, in a typical swindle, the con man gives the mark his own confidence, encouraging the mark to, in turn, trust him. The con artist thus poses as a trustworthy person seeking another trustworthy person.

History

The first known usage of the term "confidence man" in English was in 1849. It was used by American press during the United States trial of William Thompson. Thompson chatted with strangers until he asked if they had the confidence to lend him their watches, whereupon he would walk off with the watch. He was captured when a victim recognized him on the street.

Vulnerability to Confidence Tricks

Confidence tricks exploit typical human characteristics such as greed, dishonesty, vanity, honesty, compassion, credulity, irresponsibility, desperation, and naivety. The common factor is that the victim (mark) relies on the good faith of the con artist.

Just as there is no typical profile for swindlers, neither is there one for their victims. Virtually anyone can fall prey to fraudulent crimes. Certainly victims of high-yield investment frauds may possess a level of greed which exceeds their caution as well as a willingness to believe what they want to believe. However, not all fraud victims are greedy, risk-taking, self-deceptive individuals looking to make a quick dollar, nor are all fraud victims naïve, uneducated, or elderly.


A greedy or dishonest mark may attempt to out-cheat the con artist, only to discover that he or she has been manipulated into losing from the very beginning.


Shills, also known as accomplices, help manipulate the mark into accepting the con man's plan. In a traditional confidence trick, the mark is led to believe that he will be able to win money or some other prize by doing some task. The accomplices may pretend to be strangers who have benefited from performing the task in the past.

List of Confidence Tricks and Scams

This list of confidence tricks and scams should not be considered complete, but covers some of the most common examples. Confidence tricks and scams are difficult to classify, because they change often and often contain elements of more than one type. Throughout this list, the perpetrator of the confidence trick is called the “con artist” or simply “artist”, and the intended victim is the “mark.”

Get-Rich-Quick Schemes

Get-rich-quick schemes are extremely varied. These include fake franchises, real estate “sure things,” get-rich-quick books, wealth-building seminars, self-help gurus, sure-fire inventions, useless products, chain letters, fortune tellers, quack doctors, miracle pharmaceuticals, Nigerian money scams, charms and talismans. Variations include the pyramid scheme, the Ponzi scheme, and the Matrix sale.

Count Victor
Lustig sold the “money-printing machine,” which he claimed could copy $100 bills. The client, sensing huge profits, would buy the machines for a high price (usually over $30,000). Over the next twelve hours, the machine would produce just two more $100 bills, but after that, it produced only blank paper, as its supply of hidden $100 bills would have become exhausted. This type of scheme is also called the “money box” scheme.

Salting

Salting, or “salting the mine,” are terms for a scam in which gemstones or gold ore are planted in a mine or on the landscape, duping the greedy mark into purchasing shares in a worthless or non-existent mining company. During gold rushes, scammers would load shotguns with gold dust and shoot into the sides of the mine to give the appearance of a rich ore, thus “salting the mine.” Examples include the diamond hoax of 1872 and the Bre-X gold fraud of the mid-1990s. This trick was popularized in the HBO series Deadwood, when Al Swearingen and E.B. Farnum trick Brom Garret into believing gold is to be found on the claim Swearingen intends to sell him.

Spanish Prisoner

The Spanish Prisoner scam and its modern variant, the advance-fee fraud, or “Nigerian scam,” take advantage of the victim’s greed. The basic premise involves enlisting the mark to aid in retrieving some stolen money from its hiding place. The victim sometimes believes they can cheat the con artists out of their money, but anyone trying this has already fallen for the essential con by believing that the money is there to steal. Note that the classic Spanish Prisoner trick also contains an element of the romance scam (see below).

Many conmen employ extra tricks to keep the victim from going to the police. A common ploy of investment scammers is to encourage a mark to use money concealed from tax authorities. The mark cannot go to the authorities without revealing that they have committed tax fraud. Many
swindles involve a minor element of crime or some other misdeed. The mark is made to think that they will gain money by helping fraudsters get huge sums out of a country (the classic advance-fee fraud/Nigerian scam); hence, marks cannot go to the police without revealing that they planned to commit a crime themselves.

In a recent twist on the Nigerian fraud scheme, the mark is told they are helping someone overseas collect debts from corporate clients. Large checks stolen from businesses are mailed to the mark. These checks are altered to reflect the mark's name, and the mark is then asked to cash them and transfer all but a percentage of the funds (his commission) to the con artist. The checks are often completely genuine, except that the "pay to" information has been expertly changed. This exposes the mark not only to enormous debt when the bank reclaims the money from their account, but also to criminal charges for money laundering. A more modern variation is to use laser-printed counterfeit checks with the proper bank account numbers and payer information.

Televised Infomercial

Certain infomercials feature enthusiastic hosts and highlights of satisfied customers’ testimonies extolling the benefits of get-rich-quick methods such as Internet auctioneering, real estate investment and marketing, for-profit toll phone businesses, classified advertising, and unique products of questionable value requiring active marketing by the paying customers. Infomercials which fall under the aforementioned descriptions are highly likely to be scams devised and engineered to “bamboozle” the unsuspecting viewers for the express purpose of enriching the scheme inventors who produced the infomercials, which often grossly exaggerate their claims, in conjunction with the clips of satisfied customers' over-excited testimonies with the superimposed captions of the alleged profits made.

Don
Lapre, creator of "Money Making Secrets," "The Ultimate Road to Success,” "The Greatest Vitamin in the World," and other schemes, was reported by Internet customer watchdog organizations Ripoff Report, Better Business Bureau, and Quackwatch, plus alternative newspaper publications such as Phoenix New Times as one of the premier confidence artists whose characteristic traits of overly-positive attitude and over-enthusiastically cheerful and charismatic personality depend on the gullibility of the infomercial viewers to purchase the essentially useless products to gain substantial sums of profit by deception.

Wire Game

The wire or delayed-wire game, as depicted in the movie “The Sting,” as well as the “King of the Hill” episode The Substitute Spanish Prisoner, trades on the promise of insider knowledge to beat a gamble, stock trade, or other monetary action. In the wire game, a "mob" composed of dozens of grafters simulates a "wire store," i.e., a place where results from horse races are received by telegram and posted on a large board, whi...