WASHINGTON D.C.
Federal authorities disrupted a significant coordinated effort to disrupt Business Email Compromise schemes designed to intercept and hijack wire transfers from businesses and individuals, including senior citizens, officials announced Monday.
Operation Wire Wire, a coordinated law enforcement effort by the U.S. Department of Justice, U.S. Department of Homeland Security, U.S. Department of the Treasury and the U.S. Postal Inspection Service, was conducted over a six month period.
The arrests conducted over two weeks resulted in 74 arrests in the United States and overseas, including 29 in Nigeria and three in Canada, Mauritius, and Poland, according to officials.
The operation also resulted in the seizure of nearly $2.4 million, and the disruption and recovery of approximately $14 million in fraudulent wire transfers.
BEC, also known as “cyber-enabled financial fraud,” is a sophisticated scam often targeting employees with access to company finances and businesses working with foreign suppliers and activities that regularly perform wire transfer payments.
The same criminal organizations that perpetrate BEC also exploit individual victims, often real estate purchasers, the elderly, and others, by convincing them to make wire transfers to bank accounts controlled by the criminals.
This is done by impersonating a key employee or business partner after obtaining access to that person’s email account or sometimes done through romance and lottery scams.
BEC scams may involve fraudulent requests for checks rather than wire transfers; they may target sensitive information such as personally identifiable information (PII) or employee tax records instead of, or in addition to, money; and they may not involve an actual “compromise” of an email account or computer network.
Foreign citizens perpetrate many BEC scams. Those individuals are often members of transnational criminal organizations, which originated in Nigeria but have spread throughout the world.
“This operation demonstrates the FBI’s commitment to disrupt and dismantle criminal enterprises that target American citizens and their businesses,” said FBI Director Christopher A. Wray. “We will continue to work together with our law enforcement partners around the world to end these fraud schemes and protect the hard-earned assets of our citizens. The public we serve deserves nothing less.”
“The Secret Service remains committed to aggressively investigating and pursuing those responsible for cyber-enabled financial crimes,” said U.S. Secret Service Director Randolph “Tex” Alles. “Although the explosive expansion of the cyber domain has forced us to develop innovative ways of conducting these types of investigations, our proven model remains the same.”
“FinCEN has been a leader in the fight against BEC and other cyber-enabled crime,” said FinCEN Director Kenneth A. Blanco. “Since 2014, working with our domestic and international partners, our Rapid Response Program has helped recover over $350 million stolen from innocent Americans…”
Many cases involved international criminal organizations that defrauded small to large sized businesses, while others involved individual victims who transferred high dollar funds or sensitive records in the course of business.
The devastating effects these cases have on victims and victim companies, affect not only the individual business but also the global economy.
Since the Internet Crime Complaint Center or IC3 began keeping track of BEC and its variant, Email Account Compromise or EAC, as a complaint category, there has been a loss of over $3.7 billion reported to the IC3.
BEC and EAC is a prevalent scam, and the Justice Department along with our partners will continue to aggressively pursue and prosecute the perpetrators, including money mules, regardless of where they are located.
Money mules may be witting or unwitting accomplices who receive ill-gotten funds from the victims and then transfer the funds as directed by the fraudsters.
The money is wired or sent by check to the money mule who then deposits it in his or her bank account.
Usually, the mules keep a fraction for “their trouble” and then wire the money as directed by the fraudster. The fraudsters enlist and manipulate the money mules through romance scams or “work-at-home” scams.
Starting in January 2018, this coordinated enforcement action targeted hundreds of BEC scammers. Also law enforcement agents executed over 51 domestic operations including search warrants, money mule warning letters, and asset seizure warrants totaling nearly $1 million.
Local and state law enforcement partners on FBI task forces across the country, with the assistance of multiple District Attorney’s Offices, charged 15 alleged money mules for their role in defrauding victims.
These money mules were employed by the fraudsters to launder their ill-gotten gains by draining the funds into other accounts that are difficult to trace.
Among those arrested on federal charges in BEC schemes include:
Following an investigation by the FBI and the U.S. Secret Service, 23 individuals were charged in the Southern District of Florida with laundering at least $10 million from proceeds of BEC scams, including eight people charged in an indictment unsealed last week in Miami.
These eight defendants are alleged to have conspired to launder proceeds from numerous BEC scams, totaling at least approximately $5 million, including approximately $1.4 million from a victim corporation in Seattle, as well as various title companies and a law firm.
Following an investigation led by the FBI with the assistance of the IRS Criminal Investigation, Gloria Okolie and Paul Aisosa, both Nigerian nationals residing in Dallas, Texas, were charged in an indictment filed on June 6 in the Southern District of Georgia.
According to the indictment, they are alleged to have victimized a real estate closing attorney by sending the lawyer a spoofing email posing as the seller and requesting that proceeds of a real estate sale of $246,000 be wired to Okolie’s account. They are charged with laundering approximately $665,000 in illicit funds. The attorney experienced $130,000 in losses after the bank was notified of the fraud and froze $116,000.
Adeyemi Odufuye aka “Micky,” “Micky Bricks,” “Yemi,” “GMB,” “Bawz” and “Jefe,” 32, and Stanley Hugochukwu Nwoke, aka Stanley Banks,” “Banks,” “Hugo Banks,” “Banky,” and “Jose Calderon,” 27, were charged in a seven-count indictment in the District of Connecticut in a BEC scheme involving an attempted loss to victims of approximately $2.6 million, including at least $440,000 in actual losses to one victim in Connecticut.
A third co-conspirator Olumuyiwa Yahtrip Adejumo, aka “Ade,” “Slimwaco,” “Waco,” “Waco Jamon,” “Hade,” and “Hadey,” 32, of Toledo, Ohio, pleaded guilty on April 20 to one count of conspiracy to commit wire fraud.
Odufuye was extradited from the United Kingdom to the United States and on Jan. 3, pleaded guilty to one count of conspiracy to commit wire fraud and one count of aggravated identity theft. Nwoke was extradited to the United States from
Mauritius on May 25, marking the first extradition in over 15 years from Mauritius. His case is pending.
Richard Emem Jackson, aka Auwire, 23, of Lagos, Nigeria, was charged in an indictment filed on May 17 in the District of Massachusetts with two counts of unlawful possession of a means of identification as part of a larger fraud scheme.
According to the indictment, on two occasions in 2017, Jackson is alleged to have possessed the identifications of two victims with the intent to commit wire fraud conspiracy.
In another case being prosecuted in the District of Massachusetts, a 25-year-old Fort Lauderdale, Florida man was indicted in federal court in Boston on June 6 on one count of money laundering conspiracy.
According to the indictment, the individual was part of a conspiracy that engaged in wire fraud.
It is alleged that in early 2018, the defendant’s co-conspirators gained access to email accounts belonging to a Massachusetts real estate attorney and sent emails to recipients in Massachusetts that “spoofed” the real estate attorney’s account.
This is an attempt to cause the email recipient to transfer nearly $500,000, which was intended to be used for payment in connection with a real estate transaction, to a shell account belonging to a money mule recruited and controlled by the defendant, according to officials.
The BEC scam is related to other forms of fraud such as:
“Romance scams,” which lull victims to believe that their online paramour needs funds for an international business transaction, a U.S. visit or some other purpose.
“Employment opportunities scams,” which recruits prospective employees for work-from-home employment opportunities where employees are required to provide their PII as new “hires” then are significantly overpaid by check whereby the employees wire the overpayment to the employers’ bank;
“Fraudulent online vehicle sales scams,” which convinces intended buyers to purchase prepaid gift cards in the amount of the agreed upon sale price and are instructed to share the prepaid card codes with the “sellers” who ignore future communications and do not deliver the goods;
“Rental scams” occur when renters forward a check in excess of the agreed upon deposit for the rental property to the victims and request the remainder be returned via wire or check and back out of the rental agreements and ask for a refund; and
“Lottery scams,” which involves persons randomly contacting email addresses advising them they have been selected as the winner of an international lottery.