The rapid growth of the internet as well as the movement of globalization, triggered a rapid expansion of online and offline cross-border scams. Such scams can include advance fee fraud, credit card fraud, securities fraud, bank fraud, market manipulation and even identity theft. Sophisticated bank failures and investment fraud often leave passive creditors with limited recovery payments. Victims of global scams can form a group to fight for justice and reclaim their deposit, investment or assets. This private action can result in more efficient recovery.
In global scams, financial crime and fraud, the main problem is often to locate the hidden assets of the fraudster. Upon careful consideration of global scams, the involvement of offshore companies, tax havens and complicated corporate structures often complicates the asset tracing and discovery process that can only be followed by securing the assets and collecting on orders once it is clear where the money is.
During recent years, collective action against investment bank Lehman Brothers, Ponzi fraudster Bernie Madoff and several European and US based financial institutions provided investors with higher loss recovery potential compared with traditional liquidation efforts. For private action against boiler rooms, investment fraud and other unregulated scams, the difference between an active and passive attitude can mean a full loss of the investment.