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10/28/2008
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Yahoo, Microsoft Combine To Fight Net Lottery Scams

One of every 44 Internet users across Europe has lost money to fraudsters, according to research.

Microsoft and Yahoo have joined forces to fight Internet lottery scams.

The companies said Tuesday that they have joined with Western Union and the African Development Bank to combat the growing problem.

Recent research commissioned by Microsoft shows that one of every 44 Internet users in Denmark, France, Germany, Italy, the Netherlands, Spain, and the United Kingdom have lost money to Internet fraud in the last 12 months. Individual losses ranged from under 100 euros to more than 7,000 euros, according to the poll of 4,930 people.

"It's a common perception that only naive and extremely gullible people fall victim to lottery scams," Christopher Fischer, senior counsel EMEASA, Western Union Financial Services, said in a statement. "However, it can happen to anyone, especially those who are experiencing financial pressure. Our goal is to help consumers protect themselves by helping them understand how our service operates and how Internet lottery scams work."

Twenty-seven percent of respondents said they believe they are likely to become victims of Internet lottery fraud and lose money. Fifty-one percent said that lottery scam e-mail made them more reluctant to buy goods from the Internet. Thirty-six percent of respondents said they were more reluctant to use the Internet because of lottery scams.

Internet lottery scams persuade victims to pay money for a fictitious gift or cash prize. Investigators fear the fraud will increase because people are fearful or desperate due to the global economic downturn.

"This online threat differs from those that try to exploit software code or attack computers," Tim Cranton, associate general counsel for Worldwide Internet Safety Programs at Microsoft, told an audience at the 6th German Anti Spam Summit. "Lottery scammers prey not on software, but on the hope of their victims -- and with scams that can be so creative and plausible, Internet users simply don't know whom they can believe."

Microsoft Corp, Yahoo, Western Union, and the African Development Bank members plan to educate Internet users and raise global awareness.

George Hadjigeorgiou, general manager of communication and community products for Yahoo Europe said that his company's reach puts it in a unique position to educate consumers and increase online safety.

"At Yahoo, we've long told our users that if it sounds 'too good to be true,' it probably is," he said in a statement. "But as internet fraudsters continue to get more creative in their approaches, consumers continue to be deceived."

Fischer said that Western Union warns consumers not to send money to strangers using cash-to-cash money transfer services.

"Evidence shows that consumers themselves are the first, last and best line of defense against fraud," he said. "Consumers that are educated, well-informed and skeptical are better able to protect themselves and their hard-earned money."

Lottery fraudsters often use credible brands to make their e-mail messages appear authentic.

William Godbout, chief security officer at African Development Bank, said criminals are increasingly using his bank's trademark for fraud.

"Although there is no financial loss to the bank, these crimes impact our reputation and image," he said in a statement. "The reputation of African banking, of African development institutions, and of the African continent in general, is significantly jeopardized by the explosion in cybercrime falsely using African entities."

Victims of lottery scams involving any coalition company brand or service can report the crime to local police, and Interpol will notify national authorities. Victims can send copies of the police report to the company for in-house investigation aimed at spotting trends.

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