Two men who allegedly became involved in a Nigeria-based fraud were caught after they tried to cash a bogus banker's draft for $30.5 million in Dublin, Liverpool Crown Court was told yesterday,
Mr Wallace Ornstein (60) and Mr Harold Morton (61) were arrested after leaving the ferry from Ireland at Holyhead, having tried unsuccessfully to open an account at two banks in Dublin, Anglo-Irish and Irish Intercontinental, so they could cash the draft.
Mr Ornstein, of Mill Hill, London, and Mr Morton, of Hightown, near Crosby, Merseyside, have both pleaded not guilty to conspiring to defraud the two banks of $30.5 million.
They also deny conspiring to have a false instrument in their possession with intent, namely a cheque in the amount of $30.5 million which they knew or believed to be false with intent to induce another to accept it.
They have also pleaded not guilty to a lesser alternative charge of conspiring to have a false instrument.
The two and another man, who has not been arrested, went to Irish Intercontinental Bank in Dublin on March 29th, 2000, with the draft drawn against funds held in the account of the Nigerian federal government and Central Bank of Nigeria at a branch of the Chase Manhattan Bank in White Plains, New York.
Suspicious bank officials in Ireland had alerted the police, and when documents found on the men and at their homes were examined it became clear they were involved in an "advance fee" fraud, Mr Andrew Loveridge, prosecuting, said.
Such frauds originated in Nigeria , he said. "An advance fee fraud starts with a person receiving unsolicited communication inviting them to become involved in the removal of a huge amount of funds, usually millions of dollars, to safe banking institutions away from Africa.
"In return for assistance a percentage is offered as a reward," explained Mr Loveridge.
Excuses for the funds include overinvoicing by a government agency and money being skimmed off the top.
Mr Loveridge told the jury that after the initial unsolicited correspondence letters are then received by the recipients asking for money. Reasons given include taxes, commission, insurance, courier costs or legal fees.
They are also invited to travel to Africa to meet "these unknown fraudsters" with a view to taking possession of the large contract sum, but various excuses are then given about why it is not available.
"By this stage thousands of dollars may have been paid by the receipient of the unsolicited letter to the instigator of the proposed deal and one cycle of the fraud is complete.
"Those who instigate it very often carry on by offering to resurrect the failed deal in return for the payment of further fees," Mr Loveridge said. A particular strategy used in the enterprise was called "black money", which was money that did not exist.
The recipient of the letter was told the contract sum of money had been coded black so as to prevent its identification in transit. An advance fee was then requested to pay for a chemical to clean the money.
Mr Loveridge told a Liverpool Crown Court jury yesterday that the prosecution alleged that both men had to differing degrees and playing different roles agreed to do what was required in order to secure possession of the banker's draft and having obtained it tried to cash it.
The case continues.