US Pursues Scammers in $5.3 Million Fraud Case, Traces Funds to Hong Kong, Nigeria, and Other Locations

The US government has initiated a civil forfeiture action to reclaim $5.3 million associated with a business email compromise (BEC) scheme that targeted a Massachusetts workers union.

In January 2023, a spoofed email led the union to transfer $6.4 million to a fraudulent account. The funds were subsequently routed through various international banks and cryptocurrency exchanges.

US authorities have seized funds from seven domestic accounts linked to the scheme. These details were outlined in a press release from the United States Attorney’s Office, District of Massachusetts, on Thursday.

Acting U.S. Attorney Joshua S. Levy stated, “BEC fraud schemes pose a serious threat, causing significant financial and emotional harm to victims by exploiting trusted communication channels. Today’s civil forfeiture action demonstrates our commitment to recovering stolen funds and providing justice for fraud victims.”

The press release also encouraged victims of cybercrimes, including cryptocurrency scams and BEC fraud, to contact USAMA.CyberTip@usdoj.gov for assistance.

According to the complaint, the fraudulently obtained funds were transferred through intermediary bank accounts, with some funds redirected to cryptocurrency exchanges or bank accounts in Hong Kong, China, Singapore, and Nigeria.

The complaint alleges that the workers union received an email in January 2023, purportedly from an investment consulting firm, requesting a change in payment information. However, the email was spoofed, and the union unknowingly transferred funds to a fraudulent account controlled by the perpetrators.