EP7: Who are the cybercriminals? how they utilise sales and marketing techniques and digital platforms to their advantage and what does it really take, to take them down? with IFW Global's Ken Gamble

THE INTRO 

Beverley gets payback this episode by getting to interview Ken – although she does have a background in eCrime so Louisa is happy to let her have this one!

THE CHAT​

  • Ken Gamble is co-founder and current executive chairman of IFW Global https://www.ifwglobal.com/about/our-team/

  • Ken talks about how he started his career in 1988 as a fraud investigator and that it was actually 2002 when he started to investigate a very large online spamming case for AOL in America. They had a judgment for six million dollars against the notorious American and he was asked to track him down and he found him in the Philippines had him arrested and served the judgment on him when he was in custody. From that point forward he knew that that criminal activity on the Internet was going to become a massive and he decided that he was going to pursue cybercrime as a career. 

  • Ken explains his connection to the Philippines and why he loves working with the Philippines police because they are so delightful to work with professional and committed. 

  • Beverley asks ken about what he does on a day to day basis today at IFW Global and Ken explains that he spend his days working either in the office or in the field depending on what he’s doing at the time which also includes managing a team of investigators. He has operations managers in various countries the U.K. the Philippines and the US and they basically coordinate investigations across the world in various different time zones mostly criminal groups that use Internet and telephones as their main platform for committing crime usually large scale investment fraud either over the telephone or over the Internet. he also spends a lot of time with clients working out strategies on how to recover their money. And he works closely with the police in various different countries law enforcement agencies. He also sometimes speak at major events and has chaired the National Fraud summit for the past four years and that he enjoys making those appearances at these events and promoting awareness for cyber crime cyber security and investment fraud 

  • Beverley thinks Ken’s organisation description reads a little bit like a Jason Bourne script and wants to know how on earth Ken recovers money.. 

  • Ken explains that Recovery can be expensive of course because you have to retain law firms, freeze bank accounts and pursue money trails usually in the largest scale fraud cases it's worthwhile investing a certain amount of money into trying to pursue the people behind those schemes. But it can be complex. These criminals are hiding behind the Internet and the telephone. 

  • Beverley comments on the major barrier being finding out where they're from whether it’s where they're calling from or where they're actually sitting. 

  • Ken talks about howhe and his team have developed the art of being able to do that through various different means and methods of being able to track them down into their foreign countries and take the fight right to the front line which is what they’ve become known for. 

  • Beverley mentions the fantastic documentary ‘Swindle kings of Manila’ (link in the research section below) where Ken tracked down a major investment scam and why it was so interesting to watch but that she felt for Ken as there was a hit out on him during the investigation so it got her wondering, what drives ken to continue doing what it's doing despite those personal risks involved

  • Ken explains that he will never back down to criminals and nor would his team and that he’s not fazed by those types of threats. He and his team have a job to do when they hear about people trying to do that, it makes them even more determined more relentless in order to take them down and put them behind bars where they belong So it doesn't actually deter him, It actually encourages him.

  • Ken also mentions that they do take precautions that we have to take they travel etc. and he’s been doing this for three decades so he’s used to what he needs to do and is aware of the risks involved. To Ken, it's a second nature. 

  • Beverley concludes that just water off a duck's back and that Ken is clearly a seasoned professional and welcomes the criminals to ‘come get me’

  • Ken agrees and confirms they love it when they want to bring the fight to them. it's happened a few times when they’ve had some notorious criminals come try and put out hits . Of course the most public one was Peter Foster the notorious Australian con man who tried to put a hit out on Ken in the Philippines and was subsequently raided by the police over it. So there has been some controversial cases in the media about it and there's certainly been lots of threats that he’s had in the Philippines and that particular story on Swindle kings that guy was told to do whatever it takes to get rid of Ken even if that that meant killing him. Ken explains that unfortunately, in the Philippines it's something that happens every day in the criminal world. 

  • Beverley thinks he (the criminal mastermind in Swindle Kings of Manila) was quite submissive in the end when he knew the game was over 

  • Beverley wants Ken to tell us a little bit about the typical profile of an average fraudster and scammer and whether they are just opportunistic seeing an opening in the market and they just pin it open with good tactics or whether we are seeing a massive big enterprise working behind it. 

  • Ken explains there are different profiles for different types of groups. 

  • the typical online scammer that that does stocks and shares for example selling the dream The Wolf of Wall Street talk guys - a lot of those guys down and out as they're drug addicts they're alcoholics they're convicted criminals they've been in prison in their home country then they are now living the life in the Philippines when they arrest these guys they're quite sad cases. They're not really the high flying broker that they would let their client believe they are. And a lot of them are down and out and they get recruited into these gangs to do the telephone sales. 

  • Their profile is quite different to for example the profile of the masterminds who are the ones that you'd never see the ones that make all the and they are a little bit more hardcore possibly a lot more involved in the criminal world  

  • as a general rule these people have a lack of remorse. They they're very very confident. They have egos. They are driven by greed you know and they are generally not very nice people. You know a lack of emotion lack of remorse for their victims. There's kind of a disconnection between them and the people that they scam while a massive. 

  • Beverley thinks It sounds like they're the strategists and then they've got all these grants working to a script. 

  • Ken agrees - these people that are running these scams are very clever. These are intellectually clever people who have developed scripts and they've developed ways to convince people to part with their money. They study all of these techniques such as e-mail and NLP and high pressure sales techniques on how to get people to say yes and how to get them to come across on a telephone call and agree with them that something is too good to be true and it's almost like black magic – they cast a spell on some of the victims and some of the victims have said to Ken they were in this spell and they just gave them or sent all this money and then afterwards realized just what they had done. 

  • Ken says it's quite extraordinary what they're able to do. And a lot of them work from a script initially until they get so good at it that they start to rattle off the top of their heads.  They seem to be able to find someone who wants something and they seem to have a really good methodology for detecting whether it's a relationship scam or an investment scam. They seem to know that button to press is probably the best way to describe it. And then they start just working on them 

  • Beverley You know those sort of tactics so other tactics because we also want this to be a bit educational as well for our cyber security listeners. So are there other things that you can tell us about why they're so successful. 

  • Ken explains it's all in the opening pitch if you're talking about telephone scammers. It's all in the opening pitch the first five to 10 questions is going to secure them the deal or not. They're either going to hang up or they're going to trigger something inside that victim's mind that's going to get them to engage. Now that same philosophy also works over whether it's over the Internet whether it's somebody clicking on a site whether it's a text message. A lot of scammers these days are sending text messages to people's phones. 

  • Ken mentions that we may be surprised that some of the groups they're chasing are very very large scale organized crime networks from Israel who are running fraudulent platforms and that they’ve recently done some very interesting undercover work on a particular group that purports to be based in Switzerland. They're actually based in Cyprus and they planted a seed with a fake name and a fake person and a fake phone number to see how many times that number would be shared amongst the community of these scammers. They’ve already obtained 14 different companies now from this one call and that's text messaging you know emails 14 different and distinct trading platforms all that look completely different to one another. Yet, they all Stemmed from one one engagement with with one with one call centre card. 

  • Beverley is amazed by the reconnaissance work and how this helps us to understand their modus operandi. 

  • Ken agrees and states that it was a good exercise  - they set up one number. We contacted one agency one sort of platform and then we left it. they didn't invest obviously but what happened was that number suddenly was shared around all these different platforms and it was amazing as they’re still getting calls and texts and emails from different brand new platforms are opening up all the time and this name has now on the list. So we keep getting this phone kept ringing off the hook with all these different scammers ringing So you know we're monitoring and we're doing a bit of a sort of a white paper a bit of study on this as to how these people work now that text message. They've been sending text messages to us to our secret phone and and saying look I've got this incredible opportunity today. Now the average person that receives that will not realize that. And that takes that platform that they connect with from that text. They click the link they get sent to a platform they connect on a trading platform and all of a sudden they're in for two hundred dollars. And all of a sudden it goes up and up and up and suddenly they've done their life savings within six months. And what is behind those platforms is is a multimillion dollar criminal industry in fact it's a billion dollar criminal industry run by Israeli criminals. They used to run the binary options scams for 10 years until it was outlawed in 2017. But these are large scale organized crime groups. More than 1000 members some of the gangs that they’ve been investigating are the guys actually behind these text messaging that are coming in on an ISIS link. 

  • Beverley wants to understand the economic model. 

  • Ken explains the idea is to attract people to the platform which is a trading of a foreign exchange trading platform. And they'll use all sorts of incredible marketing across all sorts of platforms including Facebook. They've seen major advertisements in the middle of Facebook. They're using Facebook commercial ads to link to draw people to their platforms and doing extensive digital marketing across the world in all sorts of publications all sorts of websites forums blogs they're popping up everywhere on the Internet on your phone on your Facebook. And the idea behind that digital marketing is to attract you to their platform. And once you get onto that platform it may be a forex trading platform you know promising all sorts of get rich you know formulas and of course they get you into trading but the platform itself is fraudulent and the people behind it are scammers and don't they look so authentic in one of the cases that I think we also recently to look at. 

  • Ken explains the Web site look legitimate. They used someone who was very credible. 

  • Beverley wants to understand a few of the fundamentals here that we can leave people with e.g. is it just our proximity to these regions that Australia is so attractive to cyber criminals. 

  • Ken confirms the proximity actually it doesn't make any difference whether they're calling from South East Asia or Eastern Europe. He explains there's the way they work in the digital world across the Internet media platforms like social media. It doesn't really matter where they're based. The reason Australia is targeted is because we are probably one of the most lucrative places in the world for these for these scammers to target because of the fact that where we're reasonably wealthy country you know most people here even people that have 9 to 5. Jobs and could afford to lose a few hundred dollars here and there. Some can't. But most of us can. It's not going to break the bank. 

  • Australians were not aware of what what's really going on out there on the Internet and how all these organized crime groups work with respected investment fraud. Ken observes that the average Aussie is actually a pretty honest hardworking person. You know Aussie is a down to earth where you know we're pretty good honest community and those honest people are the ones that fall victim because they have never experienced somebody being dishonest to them to this degree luring them into something that seems so exciting and so amazing when it's actually a scam – they can’t comprehend that someone would ever do that. And that's the problem. 

  • Beverley comments on the fact We've got a trust problem. 

  • Ken confirms We've got a trust problem born out the greatness of our community it's not a bad thing. It's unfortunately because we're so trusting - that's what's got so many Australians into so much trouble. 

  • Beverley asks Ken to tell us a little bit about one of the most interesting and challenging recoveries he has done. 

  • Ken has one particular case which he thinks is worthy to mention which was an investment fraud a boiler room sharemarket fraud. 

  • The victim was a Sydney architect who lost one point eight million dollars his entire superannuation he invested with a company in the states where he thought it was in the states and only to find out that it was actually a group of criminals operating out of the Philippines. So he lost his entire life savings.

  • He went to the media he went to the police nobody would help him he came to Ken in 2012 who investigated and chased them all over the world.

  • They chased them in Israel in England in Belgium and shook them all up a little bit and threatened them with fraud charges and we end up actually at somebody. 

  • One of the Israeli bankers came forward and did a deal to provide the name of the mastermind of this gang -  a 39 year old British man. 

  • Ken and his team ended up arresting him in October of 2014. He was carrying bank statements on him in his briefcase with two point two million U.S. dollars in his bank account in Hong Kong. 

  • They subsequently froze that money and put him in jail. 

  • whilst he was in jail they basically made sure that the funds were seized and then ended up doing a deal with this mastermind of this gang to hand over the two point two million - the case itself was extraordinary 

  • Ken had death threats during the case from the Philippines and in fact not a death threats but that threats of being charged with other horrific crimes up in the Philippines. He had heavies visiting his hotel room. They had found out where he was living in the Philippines. 

  • It was the subject of a story in a book called Dirty Rotten Scoundrels by Matthew Benz at the Daily Tele. 

  • They went against the odds and continued and continued until they had this guy in prison and they got two point two million off him. He agreed to sign the money over it in return for dropping the case. So we actually got the two point two million back. 

  • Beverley is curious whether he gave up the loose change to hold on to a bigger amount. 

  • Ken is sure he gave up what he had – he had this two point two million put away into his into one of his bank accounts in Hong Kong and he was going back to England to buy a house - he was actually on his way back there when they arrested him at Manila International Airport.  He subsequently got out of the business and went into real estate and he stayed in touch with Ken and continued to cooperate with him in relation to other matters - the only one that actually helped Ken because Ken put him in jail and also got him out which Ken said was a bit weird. 

  • Beverley so the architect that handed over the money – Beverley wants to know if it is greed driving that behaviour. 

  • Ken does think that greed has to play a part in all of these investments you know. But going back to the average honest hardworking Aussie who just wants to make a better life for his family it's questionable whether greed is the main motive. Sometimes they they're driven by the desire to want to have a better life. 

  • Ken was on the phone to a client this morning whose two sons have a disability a severe disability that's going to cut their life drastically short. And he had two point seven million his entire life savings taken from him in an investment scam and it was devastating to hear his story you know and people that are left in that kind of financial ruin can't often cannot get back on their feet again. it's a devastating crime. 

  • Beverley wants to know what can the cyber security industry do more of to help protect Australians from cyber crime. You know given the size of the problem are there's some tangibles Ken could give us -  those stories help us when we're running awareness programs. If it's too good to be true it's it's not real?

  • Ken agrees.  He also believes the cyber security community in Australia doing a pretty good job. 

  • Ken travels a lot in foreign countries and thinks the cyber security community in Australia is quite strong and doing quite a lot more than a lot of other countries.  

  • Ken would like to see fake investment trading platforms these websites these fake financial advisory firms all of these massive amount of scams that are targeting Aussies he’d love to see the websites blocked.  Ken talks about an example overseas with a boxing fight and that he knows the Australian Government is quite capable of blocking websites and it would be nice to see the government get in on the act and actually start to do this to block some of these sites that are targeting Australians and stealing their life savings. 

  • Beverley mentions the ACC report she ploughed through the 258 page report that had 23 major recommendations and coming back to Ken’s point Google and Facebook have no regulation about what they advertise. One of the recommendations is that we've got to put some rigour in discipline and compliance around there advertisements -  there's a whole piece of work that needs to be done there – there are seventeen point two million people on Facebook every day in Australia. So there is some work to do there.

  • Beverley congratulates ken for Kennedy media award which Ken clarifies was for Liam Bartlett and Joel Tozer the producer of the 60 minutes story Ken featured in and that they have picked up the Kennedy Award for Excellence in relation to that story in the Philippines. 

  • Beverley confirms how we can contact Ken (details in the notes below)  

  • Ken confirms that IFW global have been publishing a number of e-books which have been very helpful to a lot of a lot of victims of scams who don't know what to do. They're able to go on to the Web site and have a look around and see what's going on. Ken also mentions their new podcast which features voices of real scammers (links also listed below).

  • Beverley asks Ken it there is anything he would like to say to our cyber security community and reminds Ken he can’t get them to join cyber crime because we need them in cyber security!

  • Ken clarifies that it isa different industry in the sense that cyber security is very much defensive. Building walls. Whereas a lot of his work is quite offensive - actually taking the fight and going after these people on the other side of the world but Ken notes that the cyber security industry is impressive in Australia and that there's a lot of world class professionals in this country. We should be very proud of them. They're doing a great job and Australia is at the forefront of many countries in the world in relation to our cyber security. Here we have our problems but overall, he thinks we're ahead of the game

  • Beverley is grateful for the lovely compliment for our community and comments that for those of us that have worked across threat intelligence, these are threat actors and they're no different really. The only difference is that we're not doing the chase, Ken and his team are.  There are a lot of organisations around the world trying to aggregate that threat intelligence to help us as a community.  Beverley thanks Ken for all his lovely compliments and his time and confirms that we really appreciate him sharing all those insights with us. 

How to follow Ken 

 

IFW Global LinkedIn page: https://www.linkedin.com/company/ifw-global

IFW Podcast ‘Scammers Caught in action’ where you can listen to the boiler room con artists in action and learn how to avoid falling victim.  https://soundcloud.com/ifwglobal/scammers-caught-in-action

 

IFW Global website: https://www.ifwglobal.com

Twitter: @ifwglobal

 

CREDITS

 

Guest: Ken Gamble https://www.ifwglobal.com/about/our-team/

Hosts: Beverley Roche and Louisa Vogelenzang https://www.cybersecuritycafe.com.au/co-hosts

Producer/Editor: Louisa Vogelenzang

Sound Producer: Darcy Milne (Propodcastproduction.com)

 

RESEARCH 

 

Aljazeera documentary featuring Ken Gable ‘Swindle Kings of Mainla’

https://www.aljazeera.com/programmes/101east/2018/09/swindle-kings-manila-180913064446101.html

 

Link to the 60 minutes documentary ‘How IFW Global led 60 Minutes to one of the biggest boiler room busts ever seen’

https://blog.ifwglobal.com/blog/60-minutes-ifw-global-take-down-boiler-room-operation

 

Outstanding Consumer Affairs Reporting (sponsor Godfrey Wines) Liam Bartlett, Joel Tozer (60 Minutes, Nine)http://kennedyawards.com.au/

 

Australian Competition and Consumer Report 2018 https://www.accc.gov.au/publications/targeting-scams-report-on-scam-activity/targeting-scams-report-of-the-accc-on-scam-activity-2018

 

 

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louisa@cybersecuritycafe.com.au

beverley@cybersecuritycafe.com.au

 

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