In retrospect, he would even agree. As soon as he heard the deal had a Nigerian connection, Pedras should have walked away, considering all the scams originating from that West African nation in recent years.

But he didn't.

And now Pedras says he's out $135,000 -- more money than most Hawaii residents make in two or three years.

"I was a fool," the Kailua nightclub owner admits. "Now I'm paying the price. But at least someone else in the state doesn't have to get cooked by this fraud."

As Nigerian scams go, Pedras' tale is unusual because of its Hawaii connection. Two local businessmen, he claims, solicited money from him last year for a Nigerian refinery construction project involving an American Samoan contractor.

In more typical cases, shadowy figures from Nigeria solicit money via mail and fax, dangling the promise of millions of dollars in return. Hawaii residents have been getting such pitches for years. Some residents have succumbed to the schemes, losing thousands of dollars.

Investigators say such long-distance operations are difficult to squelch because the perpetrators are in a country where fraud has become a cottage industry and where, some officials believe, the government condones and even participates in the schemes.

But Pedras' case appeared to be different. And the prospect of a Hawaii connection attracted the interest of law enforcement authorities, including a high-ranking FBI official in Washington, D.C.

The agency last month launched a formal investigation into the case after the Star-Bulletin started making inquiries about it.

If nothing else, Pedras' tale serves as a warning to Hawaii residents who have been getting Nigerian letters in recent weeks. About a letter a day is being turned over to local postal inspectors by suspicious residents, according to one inspector.

In most cases the would-be victim is asked to provide bank account information so that millions of dollars in purported overpayments for Nigerian construction projects can be wired out of that country and temporarily held in the victim's account.

"The best advice we can give people who get these letters is immediately be suspicious," said Douglas Gibb, a First Hawaiian Bank vice president who recently received one at home. "I would say 10 times out of 10 it will be a scam."

Until Pedras became a victim, he said he wasn't aware of the repeated warnings that state and federal agencies have issued about such frauds in recent years. But just like other deals he invests in, Pedras said he did his homework to check the legitimacy of this one.

He called Nigeria, England, Germany, France, American Samoa, Switzerland and Australia to verify information about the construction project, participating contractors, financial details and Nigerian government agencies purportedly involved. Everything, he said, seemed legitimate, right down to the Nigerian government seals on the contracts.

In late October, Pedras even flew to London with a financial adviser to do further checking and try to meet with principal figures in the transaction.

"We went over there very skeptical," said Charlie Clark of C&E International Financial Consultants in Santa Ana, Calif.

Repeated attempts to contact the Nigerian principals in England failed. Pedras learned from the Nigerian National Petroleum Co.'s London office that the contracts were bogus. The government seals, though at one time official, were no longer valid.

Pedras realized he had been conned -- and faxed such a message to his Hawaii contacts. But by then, Pedras said, he already had sunk $135,000 into the deal.

Pedras said he notified London police but investigators held out little hope of recovering any money. A London detective confirmed that police met with Pedras and Clark, but because no money changed hands in England, authorities there were unable to help. "This was a classic advance-fee fraud," said London detective Andy Thackwray.

Police told Pedras his calls to Nigeria likely were routed to a central location where the scammers manned a phone bank. Each phone would have a different phone number and be labeled according to the business or government agency allegedly participating in the deal. That way the perpetrators knew which script to follow when answering a call, Pedras said.

Phone calls to countries besides Nigeria were answered by legitimate businesses with legitimate connections to the oil project. The scammers simply used insider knowledge of the project to pull off the fraud, Pedras said.

Pedras said he was introduced to the deal by two Oahu businessmen, LaMarr Hardy and Pete Lakatani. The two deny that.

Pedras said the pair initially was trying to raise $35,000 on behalf of American Samoan contractor Jack Liu, whose company Pedras was told handled a portion of the construction project. Liu, reached in American Samoa, said he couldn't verify anything.

The $35,000 was needed to pay an insurance premium that would enable the Nigerian government to release a $32 million payment to Liu's company, Pedras said he was told. After he wired the money to Nigeria, Pedras said, Hardy and Lakatani eventually came back to him, saying a snag had developed and another $100,000 was required to get the payment released.

Pedras said he eventually transferred the additional $100,000 to a bank account purportedly in London. For his help, Pedras said, he was guaranteed a low-interest $1 million loan, something he couldn't secure through conventional lenders.

Pedras said he didn't know whether Hardy and Lakatani were duped along with him or were part of the con. The two men, however, said they never solicited money for the deal, and disputed Pedras' account of what happened.

Hardy said Pedras came to him seeking advice on a Nigerian investment, and Hardy simply referred Pedras to Liu. Hardy said he made the referral because he knew that Liu, an associate of Lakatani's, had experience working in Nigeria.

"I had absolutely nothing to do with anything" pertaining to the Nigerian deal, Hardy said.

Pedras' "facts are way off in left field," Lakatani said in a separate phone interview. Lakatani said his only involvement was as a Honolulu liaison between Liu and Pedras.

This isn't the first time Hardy and Lakatani have been accused of participating in a Nigerian deal gone awry.

They are both named as defendants in two Honolulu lawsuits filed in September by Kentucky resident J. Alan Derting.

Derting accused Hardy, Lakatani and several other defendants of stealing more than $180,000 of the roughly $500,000 that Derting turned over to the defendants for a trust account, according to the lawsuits and Derting's local attorney, Riccio Tanaka.

The money disappeared after Derting refused Hardy's request to invest $180,000 in a Nigerian deal, Tanaka said. Derting later was told by Richard Terwilliger, another defendant in the case, that the money was diverted to the Nigerian deal, Tanaka said.

Terwilliger's attorney, Owen Hellekson Jr., declined comment.

Hardy and Lakatani denied Derting's accusations.

"These are allegations, and there's no fact or substantiation behind them," Hardy said.

Lakatani said he had nothing to do with the Derting dispute and was named in the lawsuit because of his association with Hardy.

He also said Liu's Nigerian transaction is still pending and that $20.5 million -- not $32 million as Pedras claims -- will be released once another $135,000 payment is made to the Nigerian government.

Law enforcement officials say the elaborate lengths that the Nigerians appear to have gone to in conning Pedras is not unusual.

But in most scams the perpetrators stay outside the United States, believing that will decrease their chances of getting caught, said Chuck Owens, chief of the FBI's financial crimes section in Washington.

Owens said he was aware of only four or five Nigerian scam cases in which federal prosecutions resulted.

Even with the FBI's investigation into his case, Pedras said he doesn't expect to see his money again. He said he was mainly interested in warning others.

"If I lost the money, I lost it," he said. "Big deal."