Event Contract Scam Warning: How to Protect Yourself

Internet scams and schemes are unfortunately nothing new. According to Norton’s Cyber Security Insights Report, in the past year alone, cyber crime victims have spent $126B globally and lost on average almost 20 hours of time dealing with cyber crime.¹

Advance fee schemes including talent booking contract fraud have also existed within the entertainment industry for some time. Earlier this year, Barbara Corcoran disclosed a phishing attempt within her business that nearly cost her $400,000. Back in 2019, Dog the Bounty Hunter went public with a contract scam attempt that his team narrowly avoided. Many other celebrities have likely fallen prey to scams like these. In fact, we had a few close calls last year.

Elements of This New Event Contract Scam

In recent months, we have seen a rise in scam attempts targeting not just celebrities, but the keynote speakers that we work with. These new fraudulent contract offers have all had consistent elements:

• The organization was positioned as a non-profit and requested a donation  be presented by the talent with funds provided by the organization.
• Claiming to be sponsored by billionaires, dignitaries, or foreign entities (sheikhs) in remote locations (i.e. Dubai, Hong Kong.)
• Appearance fees offered were well above market or quoted value for the speaker requested. In addition, many side perks were tossed in to sweeten the deal. (like $10k for a makeup allowance.)
• A review of the organization’s website looks real, but the website was only launched in the past month or so. (TIP: you can check when a website was launched using WhoIs. If it just launched, that’s a problem.)
  

Following the (Bogus) Money Trail

The scam attempt is becoming more sophisticated on the financial side. We’ve played along with a couple of these fraudsters in order to share their playbook with you.  Here are the steps that we’ve seen happen:

1. Money (speaker’s deposit) is sent by wire transfer into an account.
2. Scammer requests the “donation” portion be sent back to them (per the phony contract.)
3. The money sent by wire transfer never clears and disappears from the account.
4. Scammer tries to extract more money from the account now that they’ve verified the account details.

In another example, a speaker shared with us a check they received in the amount of $93,000 for fees for an event in Hong Kong. The check was watermarked and at first glance looks valid, right?  

But, something still seemed off about this one. We took a deeper look.

Once you connect the dots here and realize that this check for an event in Hong Kong was drawn on a small bank in Poplar Bluff, Missouri and mailed from California, you know that you’re dealing with a fraud attempt.

Our advice: if anything feels off about an offer or contract, trust your instinct and ask for a second opinion from a booking agency or legal counsel.

Why are these happening now? We believe it’s due to the decline of paid live event opportunities as a result of COVID-19. An increased number of new, fraudulent contract offers are currently circulating within the talent community. These fake offers are sent by email in an attempt to capitalize on a desperate economic situation for the event industry. We’ve personally seen more than a few of these scam offer letters sent to our speakers recently.

Scammers are getting increasingly more sophisticated and even using industry terminology in their phony contracts. These scams are both on the rise and increasingly harder to spot.

It’s our corporate responsibility in this industry to raise awareness of these event contract schemes. We hope to protect both the individual speakers we work with and the integrity of the speaker booking process as a whole.

How to Identify a Fake Event Contract Offer

When you receive a questionable offer, especially from a new client or an agency you have not engaged with before, you’ll want to ask yourself the following:

• Is this offer from a domestic or international source? It’s more common that talent booking scams come from a foreign organization, typically falsely representing themselves as led by billionaires. 
• Are the fees being offered above my typical speaking range? Be realistic. An offer that seems to be too good to be true probably is too good to be true. 
• Is the organization asking for a kickback or donation to a charitable organization? While this might feel altruistic, this is also a red flag for fraud and is a consistent element of the fraudulent talent booking contract requests we’re seeing.

  

• Are they rushing you into an agreement? Often, scam contract offers will include a sense of urgency, implying immediate action or the offer will expire. Don’t fall for that.

What do you do if you think an offer might be fraudulent?

If you’ve evaluated the flags above, or if something just seems a bit off, trust your instinct, and take these steps:

• Research the organization. How long has this organization been in business? If you do a little bit of digging on the company extending the invitation, you may discover the answers you need.You’ll want to make sure the business has been established for some time, has a verified physical (not mailing) location, has reviews or employees online, and does not raise any flags when searching online for them.
• Ask yourself: Do the facts line up? Do the answers you found when researching the organization make sense to you? For us, this was a big red flag when the geography simply didn’t add up. If the company claims to be in business for a decade, make sure that their domain registration or other sites support that. 

HOT TIP: When was their website registered? A great tip from our team is to check the registration date of the web domain. Use sources like whois.net or other domain registrars to check. If the site launched in the past few weeks, you’re likely dealing with a scammer.

• Ask for help. If you think you may have received a fraudulent offer, get a second opinion from a trusted source.  We have had speakers reach out to us and ask our advice on some of these fraudulent offers. Our agents here are happy to help review an agreement and help you find ways to determine if it is valid or fraudulent.

You’ve Received a Fake Event Contract Offer. Now What?

The FBI’s Internet Crimes Complaint Center (IC3) recommends that you first review their FAQs before you report your suspected cyber crime. The IC3 sends complaints on to local, federal or international authorities with jurisdiction, so they will not provide any status updates directly. Instead, you may hear from the other authorities should they want more information or have questions.

This time has been challenging for a lot of reasons, but cyber crime should never be one of them. Please do your part by alerting the authorities and industry associations of fraud when it happens. You are not likely to be the first or the last target of these scams and schemes, and increasing awareness is how they are ultimately defeated.

If you think you’ve been the victim of cyber crime or received a phony event contract offer, please report it to the authorities and help us protect the integrity of the booking process.

We can help. If you’re not sure if an event contract offer you’ve received is valid or phony, please contact our agents for help.

1 https://us.norton.com/internetsecurity-emerging-threats-personal-impact-cybercrime.html