Baker Fraud Report

Top Stories

FBI warns of potential for foreign actors to try and affect voting; stress no evidence of this so far

FTC announces nationwide effort to tackle “phantom” debt collectors; collect money that is not owed

• This scam often targets people in real financial difficulties
• Over 50 actions by FTC and state/local partners
• Three new FTC cases; settlements of three previously filed
• Two CFPB cases
• Criminal cases announced as well
• Chart of cases filed here

Plans to expand and improve UK Action Fraud hotline

Virus benefit theft

• Riverside, California: Police investigating 200 cases of theft of unemployment benefits
• Pittsburgh:  20 inmates and accomplices charged in theft of unemployment benefits; 10,000 inmates nationally engaged in this scam
• UK watchdog agency warns of dangers in virus relief payments
• Massive problems and fraud in Ohio virus benefits
• Georgia loses $4 million to virus relief fraud
• Police in Burbank, California arrest six for theft of unemployment benefits
• North Carolina man charged with PPP fraud; sought $6 million; got $1.7 million
• Rhode Island: Man pleads guilty to PPP fraud

Full report here

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BBB releases my new study today on online sales of cars, RV’s and other vehicles that are never delivered

Advertise on Craigslist and other online platforms

Claim must sell quickly and cheap because of divorce, deployment overseas, or that car belonged to dead son or husband

Have people do bank to bank wire transfer to supposed third party escrow company; really goes to crooks

Largely the work of Romanian organized crime gangs

FBI warns of dangers from foreign disinformation on election results

FTC sending $147 million in refunds to victims from settlement with Western Union

Thousands of Suspicious Activity Reports (SARs) leaked from FinCEN to Buzzfeed; highly confidential investigation records

Europol announces worldwide effort to disrupt sales of illegal items on the dark web; 179 arrested

The rise and fall of Nigerian Instagram star Hushpuppi; in jail for laundering BEC money

Virus benefit theft

• Thieves using stolen unemployment benefit cards spending big in Beverly Hills stores; 44 arrested
• Ohio: Three from Florida indicted for stolen identity refund fraud for tax refunds; also got stimulus payments
• Albany, New York: Man arrested for PPP fraud; got nearly $5 million
• Montana man charged with PPP fraud
• Miami: Houston man charged with PPP fraud; got $1.2 million
• California stops unemployment claims for two weeks to deal with fraud issues
• Rhode Island: Man previously convicted of bank robbery charged with PPP fraud; got $4.7 million

Coronavirus

• Police in Indonesia arrest three who sold $4.3 million of PPE to Italian organization but never delivered
• Ottawa Public health warns of scam callers impersonating them and asking for money to perform COVID tests

Phishing, BEC fraud, spyware all peaked during the pandemic

Full Report here

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New York Times on rise in money mules during pandemic; reshipping scams, romance fraud, and others

Montreal police arrest 12 in massive romance fraud; expect six more arrests in the Ivory Coast; at least 50 victims and $2.3 million losses

US indicts four, including two Canadians, for mass mailings claiming victims had won and needed to send back a small payment to get prize money; tens of millions in losses; also violated Postal consent decrees

Virus benefit theft

• Maryland has frozen unemployment benefits of thousands over concerns about fraud
• DOJ announces it has now filed criminal charges against more than 50 people over PPP fraud
• South Carolina: Seven charged with laundering money for PPP fraud; at least $2.1 million involved
• Miami:  Jets wide receiver, nine others charged in $24 million PPP fraud scheme
• Buffalo: Two brothers arrested for PPP fraud; sought $7 million
• Man in Detroit pleads guilty to PPP fraud; got $590,000

Coronavirus

• Customs seizes 500,000 counterfeit N95 masks at O’Hare
• Full report here

Virus benefit theft

• Florida: Roofer arrested for PPP fraud; got $2 million and bought a $700,000 boat
• New Jersey:  Lawyer arrested who got $9 million in PPP loans
• Salt Lake City:  Man pleads guilty to PPP fraud
• Virginia: Woman pleads guilty to PPP fraud
• Ohio: 3 from Florida charged with stolen identity refund fraud and stimulus payment fraud; took in at least $1 million; stole PII on the dark web and used IRS e-verify system to make sure it was good

Coronavirus

• At request of Interpol, Nigeria arrests two for defrauding German company of €14.7 million in nonexistent PPE

History review and recommendation of the week:  American Lion, a biography of Andrew Jackson, by John Meacham.  Once the hero of the New Deal, he is now vilified.  But the story is far more complex, and he is far more interesting, than the detractors know. He adopted an Indian boy as his son.  He saved the Union from the first secession attempt.  And of course winning the Battle of New Orleans was hugely important for the infant United States.

BBB studies: They can all be found here. There are links below to several topic areas, and there are also studies on puppy fraud, tech support fraud, romance fraud money mules, apartment rental, crooked movers, government imposters and rental fraud

Fraud News From Around the World

• CFTC sues five Canadians, others for $165 million binary option fraud operating around the world
• India arrests man for defrauding US and Canadian victims by claiming to be tax or immigration official
• India arrests two Nigerians for hacking into a bank
• Puppy scams soar during pandemic
• Twitter hack of India PM Modi to push bitcoin investments
• Waterloo, Ontario: Woman arrested for puppy scam
• North Carolina: Money mule gets five years prison; handled funds for BEC scams, romance fraud, and account take overs; sent most money to west Africa
• Nigeria arrests 13 yahoo boys in Lagos for cyber fraud
• Police in Milton, Ontario investigating moving scam
• Man convicted of laundering money in the UK over text messages that seemed to come from victim’s bank
• Washington State: Attorney General wins $10 million fine against duct cleaning company that made millions of robocalls
• East St. Louis: Four charged for fraud; used ID theft to buy new cell phones and resell them
• Philippines arrests four Nigerians for hacking banks

Full report here

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US Agencies warn of North Korean hacking group that is hacking and robbing banks around the world

Jamaican Police Superintendent in charge of lottery scam task force shot and killed

Herbalife resolves SEC and criminal charges under the Foreign Corrupt Practices Act for business in China; to pay $123 million

Virus benefit theft

• DOJ has brought 41 criminal cases against 60 people so far for PPP fraud; small business administration hotline got 800 calls on fraud last year, 42,000 so far in 2020
• Miami: Two with fake identities arrested for PPP fraud
• Florida: Two neighbors charged with fraud; got 1 million in PPP loans; pretended to be farmers
• Useful statistics on the extent of bogus unemployment scams in the US; about ¼ of all claims in Washington State
• Chicago: Owner of already closed suburban restaurant indicted for PPP fraud
• Congress investigation finds over $1 billion in PPP fraud
• Michigan: Man arrested for PPP fraud

Coronavirus

• University of California Santa Barbara medical school finds over 2000 bogus posts on social media for virus treatments, etc.
• North Carolina: Man pleads guilty to virus fraud schemes; offered virus loans to both small business and individuals; also sold goods online he never delivered
• DOJ shuts down 300 websites from Viet Nam that “sold” hard to get virus products but never delivered

History review and recommendation of the week:  Undaunted Courage, by Stephen Ambrose.  How Thomas Jefferson decided to send an expedition to explore the West.  The incredible trek of Lewis and Clark over two years or more.

Full report here

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Texas: Nigerian living in Canada extradited over Toronto-based scam sending sweepstakes mailings containing counterfeit checks; elderly victims lost at least $900,000: also did stolen identity refund fraud

Virus benefit theft

• Pennsylvania: 33 inmates and accomplices charged in unemployment benefit scam
• Detroit: Man indicted for fraud in getting unemployment benefits from Michigan and Pennsylvania
• Illinois unemployment benefit site suffers data breach; identities of 32,500 gone; social security numbers stolen
• Minnesota man charged with fraud in applying for PPP loans; got $841,000; spent money on motorcycle and golf
• UK arrests woman for fraud in applying for virus small business loans; freeze £115,000 in bitcoin proceeds
• Michigan: Two charged with fraud in getting virus unemployment benefits; took in $1.8 million
• Massachusetts charges man with fraud in seeking unemployment benefits
• Virginia man pleads guilty to PPP fraud
• North Carolina: Man charged with seeking $414,000 in virus relief benefits

Full report here

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Los Angeles: Criminal charges against Nigerian man, Ray Huspuppi, who was expelled from the UAE

• Laundered hundreds of millions from BEC scams
• Social media influencer; flaunted wealth; famous in Nigeria

Las Vegas woman pleads guilty in fraud that sent mailings to seniors telling them they had won sweepstake and needed to send back a fee to claim money; took in $10 million

Ukraine arrests 20 over ransomware scam; laundered $42 million

First ransomware prosecution in years?

Virus benefit theft

• Los Angeles: Man indicted for $1.7 million PPP small business loan fraud; he has fled the country for Belarus
• Las Vegas woman charged with $1million in fraud in small business loan scam
• Washington DC man arrested after fraud in obtaining $2 million in PPP loans; used money to buy a yacht
• UK arrests woman for fraud in trying to get virus small business loans; seize £115,000 in bitcoin
• Salt Lake City: Man charged for fraud in applying for small business PPP loan
• San Mateo County, California:  21 arrested at county jail using ID theft to apply for unemployment benefits; took in at least $300,000
• New York: Taiwanese man charged with fraud in applying for small business PPP virus loans; took in $7 million
• Arizona investigating more than a million unemployment applications for possible fraud
• Ohio stopping $200 million/week in fraudulent unemployment payments; Nigerian Scattered Canary group involved in such fraud there and in 14 state; criminal investigation underway
• Coronavirus
• Isis terror group sold counterfeit N-95 masks to finance their efforts
• Australia finds 55% increase in identity theft during the pandemic
• FTC  finds identity theft is now #1 scam in the US during pandemic
• Free trial offer scams now claim to be selling virus prevention/cure products

Full report here

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Update to 2018 BBB study of prize/lottery/sweepstakes scams finds 80% of the money lost is from victims over 65

Appeals court rules police do not need a search warrant for bitcoin transaction records

Check that Zoom invite: Phishing scams now pretending to be schedulers

Minnesota: Third person arrested in magazine scam; he was fleeing to Canada; called elderly to “renew” magazine subscription and charged them; at least $100 million in losses; call centers in Florida and southern Missouri; two others have pleaded guilty

Virus benefit theft

• Illinois suffers 121,000 cases of theft of unemployment benefits
• Criminal charges against nine for fraud in PPP small business virus aid
• Maryland may have $500 million in fraud with virus unemployment benefits; 47,000 fake claims identified
• DOJ charges five more people with fraud in efforts to get small business PPP loans; took in $4 million
• Arkansas man pleads guilty to bank fraud in seeking $8 million in PPP loans
• Ohio virus unemployment fraud losses may be $200 million every week
• Miami:  Nine charged with PPP fraud; defendants from Florida and Ohio
• Many getting letters with California virus benefits they did not apply for
• New Phishing campaign pretends to be from Small Business Administration; seeks banking details
• At least 700 in Canada have had ID thieves apply for CERB virus benefits in their names

Coronavirus

• ACCC in Australia investigating travel agencies for misleading customers about refund policies during pandemic

History review and recommendation of the week:  One of the best things I’ve read in a long while is Guns, Germs, and Steel by Jared Diamond.  Where did civilization first develop and why? Why did European diseases ravage native Americans instead of their diseases wiping out new settlers? Fascinating.

BBB studies: They can all be found here. There are links below to several topic areas, and there are also studies on puppy fraud, tech support fraud, romance fraud money mules, apartment rental, crooked movers, government imposters and rental fraud

Read full report here

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California:  Three arrested for celebrity twitter hack; two from Florida, one from UK

People across the US and Canada are getting seeds in the mail from China – that they didn’t order. 

• What gives?  It’s possible that this is something that is being called “brushing.” 
• They send you goods and then post a positive online review in your name for some other product;
• BBB alert on brushing scams

Virus benefit theft

• Chicago Heights police find theft of Nevada unemployment benefits during a traffic stop
• Scammers use name of Arkansas governor to apply for unemployment benefits
• US has 30 prosecutions so far for bogus small business PPP loans

Coronavirus

• Los Angeles settles with company that sold radish paste as a virus cure
• Hackers tied to Chinese government try to get Moderna vaccine research

Tip of the week: Paypal woes/glitch.  The BBB warns that it continues to see online orders where goods are never delivered but the victim does get a tracking number – where the goods were actually shipped somewhere else. Because the item was actually delivered (to someone else) Paypal (at least initially) won’t cover losses.  There are hundreds of complaints about this.

Full report here

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BBB releases my new study on government imposter scams

• Claim to be calling from Social Security, IRS, US Marshalls about jury duty, etc. and threaten to arrest you
• Tens of thousands of complaints; $450 million lost 2105-2019
• Threaten immediate arrest; study details what happens in calls
• Want people to buy gift cards; changing now to want cash by mail
• Calls mainly from India; country can do much more to help
• DOJ efforts to block VoIP calls coming into the US effective; robocall complaints in the US are way down; no decrease in Canada
• 91 US prosecutions of those laundering money for this scam

Virus benefit theft

• US losses to fraud in unemployment may be $26 billion; amount usually paid out legitimately in a normal year
• Dozens in Chicago get virus unemployment relief cards in the mail they did not apply for; crooks apparently failed to get mail forwarded to them
• Illinois Attorney General himself receives benefit card he did not apply for
• 185,000 bogus unemployment benefits claims filed in Nevada
• People in Arkansas report getting unemployment benefits they didn’t apply for
• North Carolina suffering from fraudulent unemployment claims
• Unemployment fraud also a problem in California
• Rhode Island:  Feds nab man who faked his death after being charged for fraud in getting virus small business loans
• Two in Tulsa arrested for fraudulent small business loans
• Guam: bogus unemployment claims delay getting money out to people that need it
• Florida man arrested for getting $3.9 million in bogus small business PPP loans; bought himself a Lamborghini
• National Consumer’s League warns of theft of unemployment benefits

Coronavirus

• Survey finds 27% of consumers worldwide have seen phishing attacks with a virus theme
• Over half of counterfeit virus goods coming from China

Quote:  Dr. Robert Kirkpatrick: “Civilization is maintenance”

Full report here