Members of the Military: Beware of Affinity Fraud

By Dylan Donley, Spring 2014 Graduate Research Assistant

militaryYesterday we told you about some despicable frauds committed against service members.  While it is unclear whether the wrongdoer we introduced you to was actually a member of the military, scammers often seek to benefit from relationships and ties to groups to gain access to their victims, using a technique called affinity fraud.

Scammers using affinity fraud seek to manipulate the “esprit de corps” and trust that is instilled and emphasized in military personnel from the first day of basic training, and use it to their advantage.  They prey on the fact that it can be human nature to trust those that we know or that share characteristics with us.  In one particularly egregious case, scammers went so far as to use military officers as sales people to sign on their subordinates, manipulating the trust and faith held between military service members in order to steal the military service members’ money.  You can learn more about that fraud here.

Other current examples include a Black Hawk helicopter pilot using fake real estate investments to con fellow officers out of $125,000, a Navy veteran embezzling over $50,000 by convincing a Long Island American Legion post that he was a financial advisor and offering to help straighten out the post’s finances, and an Army Staff Sergeant allegedly running a Ponzi scheme and stealing half a million dollars from nearly 100 fellow soldiers, many of whom he served with in Iraq. This soldier is currently awaiting trial.

For tips on recognizing the signs of affinity fraud and avoiding becoming a victim based on your military status, see Michael McLaughlin’s blog post My Two Sense:  They Fought for Our Future, Let’s Help Them Protect Theirs.