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E-gold Scams And How To Protect Yourself

In the past one year e-currencies especially egold have become very popular in Nigeria. E-gold is an electronic currency backed by real gold stored up in a bullion somewhere in the United States and accounted for by weight. E-gold was established by Douglas Jackson in 1996.

E-gold is used as a medium of exchange on the net. Many businesses now accept e-gold as a form of payment for their services or products all over the world. Our very own Nigeria caught the bug about a year ago with people using it especially to fund their forex trading accounts, hyip programs and muli-level marketing programs.

The main attraction perhaps for Nigerians is the fact that the process of opening and operating an e-gold account takes just a few minutes and verification is never required unlike payment systems like paypal.

Another controversial feature of the egold system is their non-repudiation policy which regards all spends as being final. There are no charge-backs with egold. To fund an egold account, all a user has to do is find an Independent exchanger whom he pays cash in exchange for his egold account to be funded.

The two features of e-gold stated above has made it a preferred medium of operation by fraudsters. The fact that no verification is needed and that once the egold gets into their account, it can’t be retrieved makes the system a perfect one for fraudsters. These limitations notwithstanding, millions of people all over the world have continued to use the system.

With its growing popularity in Nigeria, the egold system gradually became a target of fraudulent activities by criminally minded Nigerians. Today, egold fraud in Nigeria has become an issue. Perhaps it is the next level of internet fraud in Nigeria.

How Egold Fraud Is Perpetuated

  1. The most common method is for the criminal to gain access illegally into your egold account, lock you out and then move out the funds from your account. This is done in a variety of ways.

The criminal may send out an email to unsuspecting egold users, pretending that the mail was sent from the real e-gold system. He may claim that your account needs to verified and you need to click on a link inside the mail to verify your account. That link then leads you to a page that appears to be on the egold site but which in fact has nothing to do with egold. You will then be asked to fill in your egold account number, passphrase, email address and email address password. The moment you that, you can as well kiss your money goodbye because they will use all the information you supplied to gain access to your account and steal your money.

The criminal may again have installed a keylogger software on the system you are accessing your egold account with. The software captures you account number and passwords which the criminal retrieves later and uses to access your account. This mostly happens if you use a public computer to access your account.

  • Just recently a more advanced and organized egold fraud scheme was discovered here in Nigeria. Here the criminal put up a website (www.vedanix.com) and claimed to be able to sell egold at N138 ( which in fact is impossible). They he looked for reputable egold exchangers and placed their account numbers on his own website.

    • When people called to buy egold from him, he simply gave out the exchanger’s account number. As soon as the unsuspecting victim made a payment into that account he requested and colleted all the payment information. He then visited the website belonging to the reputable exchanger to order for egold using the information earlier supplied by his victim but using his own egold account to receive the egold.

    It was really easy for him since he already had all the payment information including payer name, bank branch where payment was made, and bank teller number. This is all that is required for the reputable egold exchanger to confirm a payment and conclude an egold funding transaction. Once the egold had been sent to the vedanix criminal’s account, he simply disappeared and switched off his phones while waiting for the next victim.

    The criminal according to information on his website, www.vedanix.com has been arrested in Jos. Before he was caught, he had used account numbers belonging to Global Errands Limited (Graphcard Representatives) and Cyberkonsults ( owners of GoldNairaExchange ) to perpetrate his fraud. Both companies have stated strongly that they have never met him and they know nothing about him and his business.

    In order to protect yourself from egold fraud, you are advised to observe the following security measures:

    1. Always logout from your account after use.

  • When you use a public computer, always clear your passwords, cookies and stored files.

  • Never ever click on a link in any message supposedly sent to you by egold. Egold will never send you such.

  • Never disable the ascent pin security settings in your egold account.

  • In order to avoid the vedanix model fraud, always use services of reputable and trusted egold exchangers. If the offer is too good to be true, it can’t be true. Don’t lose your hard earned money to greed by patronizing exchangers who offer ridiculously low rates.

  • If you want to try a new exchanger, it is advisable to test with a very little amount the first few times, $5 maybe.

    • Observing these measures should protect you from egold fraud.

    Oyeleke Toye is the CEO GoldNairaExchange (http://www.goldnairaexchange.com), the number one egold exchange in Nigeria. He is also the administrator of the IgoldForum (http://www.igoldforum.com). Join the IgoldForum for tips on how to grow wealthy with the Gold Economy.

    Source: www.articlesbase.com