The black hole of personal finance for many is greed.

Darwinism fails to account for why there are still so many stupid people in the world. By now the gene pool should be in better shape than it is, but instead it seems to become more diluted with every generation. I just ran across a scam that evidently is not new, but is quite prevalent in Thailand. I’d think you’d have to be brain-dead to fall for it, but then scammers rely as much on greed as they do stupidity so maybe it’s just that there are more greedy than stupid people in the world. Or maybe it’s that greedy people are stupid. Or is it that stupid people are greedy?

Recently, I was reading Stickman’s column. He covers the straight gogo bar scene in Thailand, has been around for years, and while he seldom delves into the gay bars the similarities in the two worlds are so prevalent it’s always an interestingly read. Hearing the money the bars and girls charge make the fees the gay bars charge seem dirt-cheap too. When same sex marriage is legalized, I think every gay man headed to Thailand should be required to read a year’s worth of the Stick’s columns as a warning. Not that that will stop those who shouldn’t from falling in love with a Thai boy and marrying him, but it’s always nice to be able to say I told you so when gazing down at the bloody carcass of some fool who failed to heed the warnings. But then that’s not about greed. It is about stupidity to some degree, but more about matters of the heart. In that we are all a bit stupid. Matters of the wallet are a different subject.

The dangers of scams in Thailand are numerous and well known. And just as many people continue to fall for them anyway. In those cases too you get to say I told you so when gazing down at the bloody carcass of some fool who failed to learn from the experiences of others. This week Stick wasn’t writing about scams though. He was interviewing escorts. It was an interesting read to see what they thought about their customers.

Pursuit of a quick buck opens you to a quick loss.

One of the girls he was talking to made a comment that trying to open a business with money made from escorting never worked because you were using ‘black money.’ I’d never heard that phrase used before, but the sentiment rang true. Especially from a Thai. They tend to be a superstitious lot, and it kinda had a karma ring to it. I thought it may be one of those well-known Thai phrases that I’d not yet run across so I Googled it. And instead was introduced to the Black Money Scam.

Locals, more than visitors, seem to be the willing victims in this scam. And it seems to include locals throughout SE Asia, not just Thailand. But in my internet research on the scam I found instances where it was reported being used in Great Britain and the U.S. too, so it’s nice to know stupidity is a world-wide phenomenon. Sometimes also know as the ‘wash wash scam’ the black money scam is a variation on the always popular advance fee fraud scheme. In this one, the victim is lured by a trunk full of money that has been dyed black to avoid detection by customs. With the victim’s help (that’d be money) special chemicals are purchased to wash the black money to remove the dye and then the victim gets part of the profits.

Initial contact is often made via email, though many locals in Thailand have fallen for this scam after being approached in person. The basics are always the same: someone died, there’s a large trunk full of cash involved, moving the currency over the border risks taxes and governmental fees so it has been dyed black to fool customs inspectors, and if the lucky winner pays for the pricey solutions needed to clean the cash he’ll soon be rich. But even before the washing part of the scam takes place, the idiot victim is often asked to pay for a host of associated costs and fees.

Treasure chests, in whatever form they take, lure thousands to an early financial grave.

After being swindled for large chunk of cash, the financial wizards who’ve fallen for the scam often demand to see the trunk full of money. And in many times have to travel to whichever foreign country the money is being held in, usually Ghana or Nigeria, but often India plays host too. When he arrives, he’s shown the loot which includes authentic bills that have been coated with a protective layer of Elmer’s glue, and then dipped into a solution of tincture of iodine. The bills, when dried, look and feel like black construction paper. The trunk full of notes are real construction paper; when the victim picks a “note” for cleaning, it is switched with the iodine coated bill. And then miraculously cleaned before his very eyes, usually with a “magic cleaning solution” which is actually crushed Vitamin C tablets dissolved in water. Now all the victim has to do is purchase more of the magic cleaner and the clean money will be his.

You’d think that anyone even considering allowing their greed to run wild would check the internet these days to make sure they are not being offered the chance to play in a well known scam. But then like fans of FOX news, most people only read what already fits in their minds. There are numerous sites warning about this scam. And there are just as many offering the magic cleaning solution for sale. There is even a YouTube video demonstrating the correct way to clean black money. I even ran across one forum devoted to warning people about this scam on which every other posts was a link to where you could buy the ‘real’ cleaning solution as opposed to the fake stuff.

For the truly stupid, after they have purchased the cleaning solution and still have not been sent their payola, additional fees are added by the scammer until the victim is either broke or suddenly finds an active brain cell. Most victims do not report the crime to the police; the scammers cover this early on warning potential victims that by participating in the scam they are violating local and international laws. Too frightened of facing jail time, the victims go broke quietly.

The black money scam is a new twist on money laundering.

Some victims do go to the police. And make public just how stupid they are. At the beginning of this year, Mr. Thep Jantornvattana, the 68-year-old is the owner of the Cozy Villa hotel in Bangkok contacted the Boys In Brown after handing over 200,000 baht to a pair of scammers, a Liberian and Sierra Leone citizen, who’d lured him with a promise of black money totalling 5 million U.S. dollars. He wised up just before he was supposed to pay another 300,000 baht to the criminals.

The police arrested the swindlers who were in possession of two fake passports, papers coated with liquid, two small safes, a bottle of water and counterfeiting equipment to produce fake U.S. dollars. The pair had been staying at the victim’s hotel. After their arrest, the police found the Liberian had been previously arrested in 2009 charged with advanced fee fraud, having scammed two Thai nationals, a Malaysian, and a Singaporean with the black money scam.

The idea that you could get rich off of a trunk load of money that has been dyed black that only requires you pay for washing it is obviously ridiculous. Savvy financial wizards know the real path to instant wealth is through sound investment strategies. Like picking up tons of undervalued Iraqi dinar.

There are better uses for your money than participating in get rich quick schemes.

A year ago in October, a friend called having finally decided that I was worthy of being let in on how to make millions investing in dinar. She’d been busy stocking up herself and had already shared her secret with several others, all of whom daily poured over the latest news coming out of Iraq that sounded the date that the dinar would once again be an actively traded monetary unit. Payday was only a week or so away.

She’d learned of the investment opportunity through an anonymous email. Being no dummy though, she’d done due diligence, checking to see what Google had to say. And sure, there were numerous sites warning that this was a scam. But there were just as many offering to sell dinar and tons where savvy investors decried the idea this golden opportunity was a scam; naysayers were those who just didn’t want the general public to know about this quick route to becoming a millionaire.

I was noncommittedly dubious, tried to be supportive of her venture, didn’t mention the stupidity in opening email from foreign banks you’ve never dealt with and those whose subject line promises a share in recently found riches, and went on-line as soon as I hung up the phone. She was right. Those bastard naysayers were everywhere. The fools!

The idea behind this scam investment opportunity is that Blackwater alone shouldn’t be making a killing off the war in Iraq. It uses the reference of what happened with the dinar in Kuwaiti following the first Gulf War where the undervalued currency took off when peace broke out. According to those offering dinar for sale, Iraqi dinar are valued today at about 1,000 to the U.S. Dollar. So they are cheap to buy. When the war is over, the dinar will be actively traded once again and the rate for the investor will increase to 1,000,000 to one. At least.

Foolish investment decisions based on greed usually result in watching your money go up in smoke.

For those who want to believe, the logic offered behind this scam is hard to argue with. When Iraq starts rebuilding its economy will boom, its money will go up in value, and we’ll all be rich. When you want to believe, it’s easy to ignore that the more likely scenario will be that the Iraqi government will lower the value of their currency. Allowing the value of their money to skyrocket while the country pays off its debts, rebuilds its infrastructure, and attempts to recapture its export base requires a stable dinar, not a wildly fluctuating one. The Iraqi dinar is not the sleeper investment of the decade. Unless you are one of those selling the worthless money.

I called my friend back and explained what I had found and why she may be better off not investing in dinar. I was as successful as trying to convince a right-wing nut case that President Obama is not a Muslim. She instead went with the in for a penny in for a pound adage and picked up several more thousand dollars of dinar. And is still waiting for the pay-off. The scary thing is she is still bragging about the money coming her way and still trying to convince others that they too can become rich by investing in dinar.

Maybe it’s not greed. Maybe it’s not stupidity. May be she is more savvy than I when it comes to international money investments. Maybe I should pick up a few thousand dollars worth of dinar. But instead I’ve been banking my extra cash in an easily liquidated account. Dead water buffalo are not cheap to replace, and I’m sure to be buying a few in the near future.