Federal Grand Jury Charges 4 SoCal Defendants in Project to Launder Targeted Gift Cards Purchased by Victims of Scams | USAO-CDCA

LOS ANGELES – Federal authorities this morning arrested two people named in an indictment alleging a scheme to launder the proceeds of scams sent to fraudsters via Target gift cards.

Bowen Hu, 26, of Hacienda Heights, and Tairan Shi, 27, of Diamond Bar, both Chinese nationals, were arrested today and are due to stand trial this afternoon in US District Court. United in downtown Los Angeles.

Two other defendants named in the indictment – Blade Bai, 33, of El Monte, a US citizen, and Yan Fu, 58, of Chino Hills, also a Chinese national – will be summoned to appear in court federal next month.

The single indictment released today accuses the four defendants of conspiracy to launder electronic fraud proceeds stored on gift cards issued by Target. Indictment Alleges Bai, Hu, and Shi Obtained Over 5,000 Gift Cards From A Group Called The “Magic Lamp” And Sold Information About The Gift Cards Through A Messaging App in line.

Bai, Hu, and Shi oversaw the distribution of gift cards to “runners,” including Fu, who used the funds on the cards at Target stores primarily in Los Angeles and Orange counties to purchase electronics. general public, other gift cards and other items, according to the indictment. Through purchases and other transactions at several Target stores, the defendants and their co-conspirators sought to cover up the fact that the gift cards were originally funded with fraudulent products.

The indictment alleges that the perpetrators of fraudulent schemes tricked victims across the United States into purchasing Target gift cards. Then, defendants indicted in Southern California conspired to launder the proceeds. The victims, who were often elderly, were tricked into purchasing the gift cards on the basis of various fraudulent schemes, including:

  • Scams by government impostors, in which fraudsters pose as government officials, such as Social Security Administration officials or local police officers, and falsely claim that victims need to buy cards -gifts to solve a problem, such as a pending arrest warrant or a problem with the victims’ social security number; and
  • Tech support scams, in which fraudsters trick victims into believing that there is a serious problem with their computer or with account access that can only be resolved by paying substantial amounts through gift cards.

“This case reminds consumers that gift cards are for friends and loved ones – they should never be used for payments to a government or business,” said the Acting State Counsel. United, Tracy L. Wilkison. “Don’t be fooled by callers claiming to be from a government agency, bank or any other institution requiring you to purchase gift cards. There is no reason to buy a gift card to resolve an issue with an account, your social security number, or a suspected criminal matter.

“The Department of Justice and its law enforcement partners are committed to tackling fraud schemes from all angles,” said Acting Deputy Attorney General Brian M. Boynton of the Civil Division of the Ministry of Justice. “Individuals who knowingly facilitate the victimization of American consumers make fraud possible, are criminally guilty of the offenses, and should be expected to be held accountable.”

“The case against these defendants is the result of the impressive work of the El Camino Real Financial Crimes task force led by Homeland Security Investigations (HSI) in Los Angeles,” said Special Agent in Charge David A. Prince for HSI Los Angeles. “These types of crimes have devastating effects on the victims. Through the coordinated investigative efforts of law enforcement and our prosecution partners, HSI will continue to aggressively investigate those who prey on our elderly population.

According to court documents, Bai, Hu, and Shi obtained the Magic Lamp Group gift card numbers, often on the same day the fraud victims purchased the gift cards under the direction of a phone con artist. Fu visited 17 Target stores in a single day to complete gift card transactions, and Bai resold the purchased consumer electronics, using part of the proceeds to pay for the Magic Lamp Group, according to court documents.

Investigators cautiously estimate that the defendants laundered more than $ 2.5 million in gift cards between approximately June 2019 and November 2020.

An indictment is only an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in court.

The four defendants are charged with conspiracy to commit money laundering, a crime punishable by a legal maximum of 20 years in prison. A federal district court judge will determine any sentence after taking into account US sentencing guidelines and other statutory factors.

Bai and Fu were initially arrested in this case on November 17, 2020 following criminal complaints. Bai was released on bail and was later named in a criminal investigation accusing him of conspiracy to commit money laundering. Bai pleaded not guilty to the charge contained in the information. The indictment announced today replaces criminal information. The complaint against Fu was dismissed in December 2020 to further the investigation that resulted in the indictment.

This case is the product of an investigation by HSI and the FBI. The investigation was conducted under the auspices of HSI’s Los Angeles-based El Camino Real Financial Crimes Task Force, a multi-agency task force made up of federal and state investigators focused on financial crimes in Southern California.

The Social Security Administration, Office of the Inspector General also provided assistance during the investigation, as did the following: Brea Police Department (California), Police Department of Glynn County (Georgia), Fontana Police Department (California), Charlotte Police Department – Mecklenburg Police Department (North Carolina), Streamwood Police Department (Illinois), Cleveland (Ohio), Madera County Sheriff’s Office (California), New York Police Department, Norwood Police Department (New Jersey), Loudon County Sheriff’s Office (Virginia), Department Waukesha County Sheriff (Wisconsin), Fremont Police Department (California), Marin County Sheriff’s Office (California), Hawaii County Police Department, Henderson Police Department (Nevada) ), Wilmington (Massachusetts) Police Department, Las Vegas (Nevada) Metropol itan Police Department, Lewisville (Texas) Police Department, Gardena (California) Dept. Police, Des Moines (Iowa) Police Department, Cobb County (Georgia) Sheriff’s Department, Millburn (New Jersey) Police , Wauwatosa Police Department (Wisconsin), San Angelo Police Department (Texas), City of Fairfax (Virginia) Police Department and Virginia Beach (Virginia) Police Department.

U.S. Deputy Attorney Monica Tait of the Major Fraud Section and Department of Justice Trial Lawyer Wei Xiang of the Consumer Protection Division of the Civil Division sue. ‘case.

The United States Attorney’s Office and Consumer Protection Branch are part of the Transnational Aging Fraud Force, which investigates and prosecutes scams carried out by transnational criminal organizations, including mass mail scams. , by telemarketing and by technical support.

If you are the victim of a gift card scam, immediately call the gift card issuer and ask them to freeze the affected gift card numbers – and keep your receipt and the gift card. Then report the crime to the FBI Internet Crime Complaint Center at www.ic3.gov, to the Federal Trade Commission at https://reportfraud.ftc.gov/#/ or 877-382-4357 , and your local police department.

About Anne Wurtsbach

Check Also

As devices turn into services, what is ownership?

November 27, 2021 San Francisco ATHE PURPOSE OF PPLE has always been to empower the …