Economic Effects and Cost Implications of Internet Fraud on the Nigerian Economy

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CHAPTER ONE INTRODUCTION 1.0 OVERVIEW Since the emergence of the Internet, the manner in which things i.e. business, records, research, etc have been going on world has been made very smooth. On the contrary, however, the Internet has become a source of income for fraudulent money earners. Issues like spam mails hacking, Trojan horses are so paramount among Internet users globally. The term “Internet Fraud” refers generally to any type of fraud scheme that uses one of more components of the internet – such as chat rooms, e-mail, message boards, or websites – to present fraudulent transactions, or to transmit the proceeds of financial institutions or to others connected with the scheme (US Department of Justice, 2001:1). Countries like Nigeria lot of money to Internet Fraud, as many companies and financial institutions like Bank-one in the United States of America (US) have been rendered bankrupt because of this. On the other hand, efforts have been made by the Nigerian government to tackle this problem, leading to the establishment of the federal Anti-Graft Agency; “EFCC” (economic and financial crime commission) as a watchdog to Internet frauds; Internet fraudsters. 1.1 BACKGROUND OF STUDY The “419” fraud originated in the early 1990s as the oil-based economy of Nigeria went downhill. Several un-employed students first used this fraud as a means of manipulating business visitors interested in shady deals in the Nigeria oil sector before targeting businesspersons in the west, and later the wider population. Early variants were often sent via letter, fax or over telex. The Encyclopaedia Wilipedia – Advance fee fraud (2006:3) state that while various figures have widely claimed that Advance fee fraud schemes employs as many as 250,000 people in Nigeria, in reality it has been often linked to small-organized gangs often working in concert in western cities

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