Headlines that Matter for Companies and Executives in Regulated Industries
Trio Sentenced to Eight to 15 Years in Prison for Laundering Proceeds of Telephone Scam
Following a jury trial, three individuals were convicted of a money laundering conspiracy and sentenced to eight, 10, and 15 years in prison for laundering Target gift cards purchased by the victims of a telephone fraud scheme.
According to prosecutors, Blade Bai, Bowen Hu, and Tairan Shi participated in a network of individuals who laundered the proceeds of a fraud scheme stored on gift cards. Those orchestrating the scheme would induce victims to purchase Target gift cards by falsely claiming to be police, other government personnel, or retail and technical support offering to fix non-existent issues with the victims’ online accounts or computers. After purchasing the gift cards, often valued at $500 each, the victims would provide the card numbers and access codes to those participating in the scam.
The gift cards were then sent to “runners,” who would liquidate the cards at Target stores in California. Per prosecutors, the defendants directed the runners to purchase high-value consumer electronics and conduct other rapid transactions, which prevented Target from recouping the value on the cards for the victims.
The sentenced defendants participated in this money laundering conspiracy from approximately June 2019 to November 2020 and acquired more than 5,000 gift cards.
The US Department of Justice’s (DOJ) press release is available here.
Massachusetts Man Sentenced to More Than Three Years in Prison for Romance Scam
Last week, Chukwunonso “Douglas” Umegbo was sentenced to 42 months in prison, followed by one year of supervised release, for his part in a romance scam from 2018 to 2019.
Earlier this year, Umegbo pleaded guilty to six counts of making a false statement to a bank, two counts of wire fraud, and one count of money laundering. Umegbo used fake identity documents to open bank accounts, which received funds obtained from victims of the romance scam. As part of the scam, individuals utilized fictitious online personas to develop romantic relationships with the victims and deposit the victims’ money in the accounts controlled by Umegbo. These fraudulent accounts received more than $568,000 from the victims. As part of his sentence, Umegbo was also ordered to pay restitution and forfeiture of $578,954.78.
DOJ’s press release is available here.
Unsealed Indictment Reveals Defendants Charged in $2 Million Loan Fraud Scheme
On April 9, the federal government announced the unsealing of an indictment against two individuals for running an advance-fee loan fraud scheme.
According to prosecutors, Yisroel Heber and Yechiel Meshi-Zahav participated in an advance-fee loan fraud scheme from approximately March 2021 through December 2021. Heber and Meshi-Zahav utilized several purported lending companies to induce victims to provide their bank account information and make payments related to promised loans. According to prosecutors, Heber and Meshi-Zahav then defrauded the victims by withdrawing funds from their bank accounts without ever issuing the loans.
All told, the defendants allegedly defrauded dozens of victims out of at least $2 million. Heber and Meshi-Zahav are each charged with one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison.
DOJ’s press release is available here.
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