Baker Fraud Report

Chen Zhi, head of massive scam operation in Cambodia the Prince Group, arrested and extradited to China; US had been indicted him and DOJ froze $12 billion in crypto from his operation

FBI report the victim’s lost $333 million at bitcoin ATM’s last year; double the year before

Small Business Administration suspends thousands of accounts in Minnesota over PPP fraud

Thoughts on fraud stealing government benefits.  Fraud is fraud.  Stealing money from the government simply spreads the losses among everyone, and takes money from those who have a legitimate need for those funds. Apparently 100 million people have now seen the Nick Shirly video on X.  The US Attorney’s office there says that they expect at least $9 billion in fraud against these programs.  And this is quickly expanding to many other states.  Not all of the fraud can be attributed to immigrants, of course, but anyone engaged in fraud should be prosecuted, and those in charge of these programs must do a better job of screening for fraud. 

Full report here

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NO FRAUD REPORT NEXT WEEK. WE’RE GOING ON VACATION

In joint operation Interpol announces 574 arrests across Africa for cybercrime; including BEC gang in Senegal and ransomware operation in Ghana

Financial Times video program on spies, scam compounds, online gambling, transnational crime and triads (30minutes)

Georgia: DOJ seizes stolen password database used to take over bank accounts; at least $28 million stolen; gang used fake websites of real banks and harvested log in information

FTC releases new Data Spotlight on home rental fraud

• Since 2000 65,000 rental frauds reported to the FTC
• Losses of $65 million; median loss $1000
• Those 18-29 three times more likely to lose money
• See my in depth study of this issue for the BBB in 2019

Wired: Chinese crypto scammers on Telegram are fueling the biggest darknet markets ever

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An in depth look at unpaid highway toll scams; WSJ Video (4.42); 1 billion lost over last three years to Chinese gangs; they get credit card numbers and use US helpers to buy goods, sometimes ship to China

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An in depth look at unpaid highway toll scams; WSJ Video (4.42); 1 billion lost over last three years to Chinese gangs; they get credit card numbers and use US helpers to buy goods, sometimes ship to China

Is the term “scam” helpful?  We often use the term scam as a synonym for fraud.  “Fraud,” is, of course, a legal term.  The authors of a new article suggest that for several reasons use of the term scam is inapposite. They contend that use of the term “scam” downplays the seriousness of the conduct, and can suggest that it is somewhat the fault of the victim.  A thoughtful piece.

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FTC issues annual report to Congress on fraud against older people (60+)

• Losses from fraud for this group up from $600 million in 2020 to $2.4 billion last year
• Tech support, lottery and crypto romance top the list
• Older people less likely to be victims but lose more money

FBI’s IC3 warns of a big increase in complaints about bank impersonators who get log in information from victims and then steal from their online accounts; since January victims lost $262 million

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CFPB to furlough most employees at the end of the year and transfer remaining cases to DOJ

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US forms scams task force to tackle organized crime and fraud from Southeast Asia

China says the $13 billion in Bitcoin that the US seized from indicted scam compound leader Chen Zhi was money stolen from Chinese investors in a bitcoin mining operation

Fraud-related industries:  The Southeast Asia scam compounds apparently began as online casinos.  What do we know about organized crime involvement.  Would there be many consumer complaints?  And what of the pornography industry?  We did a case while I was at the FTC against a porn company that asked for credit cards for a free trial, promising that credit cards would not be charged. We initially had only 16 complaints, but this grew into a huge multi-million dollar fraud, run by an organized crime family.  People just rarely complained.  I fear that these are areas of massive consumer fraud that we simply don’t hear about from victims.   One thing they seem to have in common is that they have found a way to get access to the credit card system.  Let me know if you can if my suspicions are correct – or not.

Full report here

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Meta made $16 billion from scam ads in 2024; 10% of its income; internally estimates that its platform is involved in one third of scams in the US

Myanmar military demolishes 150 building in scam compound on the Thailand border

Password for the security camera system at the Louvre was “louvre”

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Google says its new AI powered defenses block 10 billion scam calls and texts on Android each month

China sentences five to death for operating scam compounds

Europol takes down three large credit card fraud operations; 18 arrested; used stolen card numbers to launder fraud money; over €300 million in losses

Digital Arrest Scams.  There is much angst in India about this type of fraud. But from reading articles about this, I’m not sure there is agreement about just what this consists of. It does seem to begin with a call from a law enforcement impersonator, claiming that the victim has been involved and threatening arrest. Beyond that I’m not sure if this is actually a different pitch than the scams we see that tell victims that they need to move their money to the caller to keep it “safe.”  So it may be just a new term for a fraud that we already see. But I’m be interested in hearing from anyone that knows more than I.

Full Report here

Meta takes down 8 million scam accounts on Facebook and Instagram

Full report here