MacKenzie Scott gave away billions
But her generosity gives scammers an in to prey on victims
Danielle Churchill needed help. She was raising five children in Wollongong, on the Australian coast south of Sydney, and had to cover thousands of dollars in special therapy fees for her 10-year-old son, Lachlan, who has autism. She tried crowdfunding on the site GoFundMe, but raised a tiny fraction of what she had hoped for.
Late last year, she received the message that seemed to solve her financial problems. It was purportedly an email from billionaire philanthropist MacKenzie Scott, a novelist best known as the ex-wife of Jeff Bezos, the Amazon founder, saying that she was giving away half her fortune and that Churchill had qualified for a grant.
Churchill searched Google for Scott’s name and the word “scam.”
Instead of warnings, she found numerous news articles describing how Scott’s representatives had emailed hundreds of nonprofit groups out of the blue with offers of monetary support.
“People were thinking they were scams, but then they came true,” Churchill, 34, recalled thinking.
Over the course of 2020, Scott announced gifts totaling nearly $6 billion. Her unconventional model of giving was widely praised for its speed and directness. But some of the seeming advantages — no large, established foundation, headquarters, public website or indeed any way to reach her or her representatives — are what made her ripe for impersonation by scammers, as Churchill would soon find out.
To receive the money, Churchill had to fill out a “membership form” sent by an organization calling itself
the MacKenzie Scott Foundation and set up an online account with Investors Bank and Trust Co. She could see that the foundation had transferred $250,000 into the account in her name, but because she was in Australia, she was told that she had to apply for a tax number and pay some associated fees before she could get access to the money and begin spending it on speech and occupational therapy for Lachlan.
“I was doing my research, looking up everything they were telling me,” Churchill said.
She added that her grandmother had looked things over and thought it was legitimate.
“Everything you ask, they send you proof. The online bank says everything is secure.”
What Churchill did not know was that there is no MacKenzie Scott Foundation. The Investors Bank
and Trust Co., once based in Boston, had been folded into State Street Corp. more than a decade ago.
And Churchill was not dealing with Scott and her team but a sophisticated group of scammers adept at preying on vulnerable people.
In Churchill’s case, the scam involved not just the fake bank portal but counterfeit Facebook pages, WhatsApp messages and the use of a Bitcoin cryptocurrency app to whisk the money away, roughly $7,900 in all, so she could not reclaim it with the help of a bank or credit card company.
An email security company in Israel, Ironscales, said messages purporting to be from representatives for Scott had targeted roughly 190,000 email accounts belonging to its customers. The company began seeing the scam after Scott’s announcement on
Dec. 15 of nearly $4.2 billion in donations.
Now, months after she set up an account at a bank that does not exist, Churchill is aware of other apparent victims. She continued to watch the Facebook pages purporting to belong to Scott, and would notice people asking for help in the comments. Then the comments would disappear. One man posted photographs of his debit card. “Snap its back and front and the location of the bank,” read the instructions next to a smiling photo of Scott.
And on Scott’s Medium post from December announcing her latest grants, one man posted a comment asking about the same supposed business manager who solicited funds from Churchill.
Marti DeLiema, a professor at the School of Social Work at the University of Minnesota, Twin Cities, said the method that Scott
used, notifying groups of a grant essentially out of the blue, was ripe for scammers to exploit.
“What a gift she’s given them by this crazy way of giving that she’s developed,” DeLiema said.
Scott gives to institutions — universities, food banks, other front-line charities — not individuals. She has no accounts on social media like Facebook and Instagram, only her Medium page and a verified Twitter account with just three tweets. Her organization would never request fees upfront from grant recipients, a person with knowledge of her giving said. The person declined to comment directly on online deception taking place in Scott’s name or what actions she might take to help prevent it.
After a few weeks, Churchill went to the local police. They told her that she had been conned and that there was no way to get her money back.
“This experience has ruined my life, to be honest,” she said.
When she was first approached, Churchill didn’t see any warnings from anyone else who had been scammed. The only web presence she found that appeared to be for Scott was a Facebook page filled with pictures of the billionaire and news articles about her generous giving.
Churchill sent a Facebook message to the administrator of this page, inquiring whether the email she received was real. Someone claiming to be Scott herself answered promptly, telling Churchill that the initial messages were from scammers pretending to be her but that she could help Churchill now that they were directly in touch.
Churchill was directed to a website for Investors Bank and Trust. It looked like a professionally designed site with slick photos, an email address, a phone number with an area code in New Jersey and an address in Los Angeles. Churchill set up an online profile, choosing a user ID and password, agreeing to the terms of service. The money quickly showed up, $250,000 in what she believed was her Investors Bank and Trust account.
The purpose of the phony bank site is to convince victims that the money is already theirs. Experts who track scams call it “flashing.” Membership fees, account fees, tax codes, transfer fees — there was a succession of payments that Churchill had to make to unlock the $250,000 in the account.
The scammers told Churchill how to download the Bitcoin Wallet app to send them the money. Whereas a bank could have tried to help her recover the funds, once she hit “send” on the cryptocurrency, her money — Bitcoin transfers totaling 10,400 Australian dollars — was gone for good.