250 Arrested Due to Fake University

Posted on November 27, 2019November 27, 2019 by Denise Simon

The University of Farmington in Michigan is fake. The sting operation was called Paper-Chase. We have all kinds of channels on this one. Recruiters from India, visa fraud and lots of money and no classes to attend. The school had an estimated 600 students, where are the rest of them? All the enrolled students were foreign. The Federal government concocted the school.

Federal agents used a fake university in Farmington Hills to lure alleged phony foreign students who were trying to stay in the United States illegally.

The University of Farmington had no staff, no instructors, no curriculum and no classes but was utilized by undercover Homeland Security agents to identify people involved in immigration fraud, according to federal grand jury indictments unsealed Wednesday.

The University of Farmington’s headquarters was in this office building on Northwestern Highway north of Inkster Road in Farmington Hills. (Photo: Google Maps)

Eight student recruiters were charged with participating in a conspiracy to help at least 600 foreign citizens stay in the U.S. illegally, according to the indictments, which describe a novel investigation that dates to 2015 but intensified one month into President Donald Trump’s tenure as part of a broader crackdown on illegal immigration.

Most of the recruiters and students involved are originally from India, according to prosecutors.

“It’s creative and it’s not entrapment,” said Peter Henning, a Wayne State University law professor and former federal prosecutor. “The government can put out the bait but it’s up to the defendants to fall for it.”

Those charged include:

• Bharath Kakireddy, 29, of Lake Mary, Florida.
• Aswanth Nune, 26, of Atlanta.
• Suresh Reddy Kandala, 31, of Culpeper, Virginia.
• Phanideep Karnati, 35, of Louisville, Kentucky.
• Prem Kumar Rampeesa, 26, of Charlotte, North Carolina.
• Santosh Reddy Sama, 28, of Fremont, California.
• Avinash Thakkallapally, 28, of Harrisburg, Pennsylvania.
• Naveen Prathipati, 29, of Dallas.

“These suspects aided hundreds of foreign nationals to remain in the United States illegally by helping to portray them as students, which they most certainly were not,” said Steve Francis, special agent in charge of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations office in Detroit.

The eight defendants have all been arrested.

Starting in 2015, the university was part of an undercover operation dubbed “Paper Chase” and designed to identify recruiters and entities engaged in immigration fraud, according to the indictment. Homeland Security agents started posing as university officials in February 2017.

Immigration crimes alleged in the indictment continued until this month and involved Homeland Security agents posing as owners and employees of the university. The university had a professional website, a red-and-blue coat of arms, a Latin slogan meaning “knowledge and work” and a physical location at a commercial building on Northwestern Highway.

“… the university was being used by foreign citizens as a ‘pay to stay’ scheme which allowed these individuals to stay in the United States as a result of foreign citizens falsely asserting that they were enrolled as full-time students in an approved educational program and that they were making normal progress toward completion of the course of study,” the indictment reads.

The recruiters helped foreign citizens fraudulently obtain immigration documents from the university and helped create phony student records, including transcripts, according to the government.

“We are all aware that international students can be a valuable asset to our country, but as this case shows, the well-intended international student visa program can also be exploited and abused,” U.S. Attorney Matthew Schneider said in a statement Wednesday.

The recruiters didn’t know the university was fake, however, and operated by federal agents.

The recruiters helped hundreds of foreign citizens fraudulently maintain non-immigrant status as students and stay in the U.S. illegally, prosecutors allege.

In February 2017, Sama called the university and inquired about enrolling as a student “without attending classes in order to fraudulently maintain his immigration status,” according to the indictment. During the phone call with an undercover agent, Sama also requested a tuition reduction for bringing students to the university.

Within weeks, Kandala, Kakireddy and Thakkallapally contacted undercover agents with identical requests, according to the government.

In late 2017, the recruiters started getting paid for recruiting the phony students.

Sama and Kandala met with an undercover agent at the university in January 2018 to collect $20,000 for recruiting students, prosecutors allege.

Sama collected another $20,000 in June 2018, according to the indictment.

The fake university is a new chapter in a long history of federal agents creating phony entities to thwart crime.

In the late 1970s, the FBI ran an investigation code-named ABSCAM that utilized a phony company in Long Island to crack down on public corruption and organized crime. And the 2012 film “Argo” was inspired by the work of a Central Intelligence Agency operative and involved a phony science-fiction movie.

The Farmington case isn’t the first time federal agents have used a phony university.

In 2016, Homeland Security agents used the fake University of Northern New Jersey to charge 21 people with student and work visa fraud.

Federal agents deployed several tactics to make the University of Farmington appear to be a legitimate school.

The main photo of University of Farmington students on the school’s website is nearly identical to a commercially available picture on the stock photograph website Shutterstock.

The University of Farmington has its own Facebook page, too, with a calendar of events, including one scheduled for next week with non-existent university officials.

But after The Detroit News revealed the indictment Wednesday, the university’s Facebook page started featuring memes, including one of Admiral Ackbar from “Return of the Jedi” shouting “It’s a trap.”

As part of the alleged Farmington scheme, recruiters intended to help shield and hide the students from immigration authorities, according to the indictment.

Those charged included recruiters who collectively received $250,000 in cash and kickbacks to find students to attend the university, the government alleges.

The University of Farmington operated out of the basement of the North Valley office complex on Northwestern Highway, north of Inkster Road.

The office is across the hall from a café for people who worked in the complex.

The entrance to the University of Farmington. (Photo: Matt Friedman)

Matt Friedman, co-founder of the Tanner Friedman strategic communications firm, works in an adjoining building and was puzzled by the university’s name and office.

There were no classrooms and the university’s name seemed peculiar, he said.

“I was like ‘what is this?'” Friedman said Wednesday. “I’d never heard of it before and never saw anybody there. The whole thing was just odd.”

He posted a joke on Facebook in April 2017 with a snapshot of the entrance to the university’s office suite.

“Just because I’m now in the same office complex, it doesn’t mean I can suddenly get you tickets to the rivalry games against West Bloomfield Tech or Southfield State,” Friedman wrote.

It is Bigger than Burisma and the Bidens, Trump Knows

Posted on November 14, 2019November 15, 2019 by Denise Simon

Speaker Pelosi held a press conference after the first day of the open impeachment inquiry hearing declaring that she is the smartest when it comes to intelligence and she will defend and protect the whistle-blower with all her might. HPSCI Chairman Adam Schiff said at least twice that he does not know nor has he spoken to the whistle-blower. Sheesh really? REALLY?

Pelosi and Schiff are for sure covering for something much larger and it is in Ukraine and likely at least a few other countries. There was a historic theft from PrivatBank a few years ago that was in excess of $5 BILLION. Then Ukraine was forced to nationalize the bank until such time the monies were tracked, found or recovered, which still has not happened. The country was financially suffering and the reputation of corruption in Ukraine continued to fester.

Seems our own U.S. State Department was enlisted to step up operations in Ukraine using several government agencies and non-government agencies known as NGO’s.

The matter of the whistle-blower is but one piece of all things Ukraine even while 2 State Department officials, George Kent and William Taylor provide testimony in the first round of the public hearing. (BTW, Kent’s wife is of Crimean-Tatar ancestry) Kent and Taylor are in the thick of all things Ukraine and beyond even while responding in open testimony they were unaware of key political events stateside.

Our not so favorite nefarious operator George Soros is very much at the center of much of the chaos in Ukraine, the Hillary Clinton/John Kerry State Department and some of those NGO’s.

List below are some bullet items for reference. It is difficult to piece together the whole mess but the facts below may help the reader with the long game plot against President Trump because his handful of phone calls with Ukraine President Zelensky regarding investigations into corruption(s) has struck a nerve that the power-brokers in DC are driven to stop and protect.

To boost legitimacy of Ukraine and Burisma, the Obama administration partnered Burisma with USAID.
USAID was enlisted to prepare for a new generation of Ukrainian politicians.
From the U.S. Ukraine Business Council: Briefing by Vadym Pozharskyi, Advisor to the Board of Directors, Burisma Holdings Ukraine’s largest independent gas producer, 30% market share by gas output volume in 2015
Vadym Pozharskyi currently serves as an Advisor to the Board of Directors at the Burisma Holdings. He is also in charge of the Holding’s overseas expansion, GR & PR block. Prior to that, he worked for 4 years in the public sector, inter alia, on positions of the Head of the International Relations Department at the Ministry of Ecology and Natural Resources of Ukraine and the Deputy Head of the State Environmental Investment Agency of Ukraine.

During these engagements he extensively cooperated with international organizations, led the negotiations group to UNFCCC on the restoration of Ukraine’s status in Kyoto protocol. From 2010 until 2014, Mr. Pozharskyi was the Global Environment Facility (GEF) Focal point in Ukraine.

Burisma Holdings, www.BURISMA.com, since its launch in 2002, has rapidly become the largest gas producer in Ukraine. Burisma Holdings consists of 4 operating companies, engaged in exploration and production of hydrocarbons (dealing with hydrocarbon production). Burisma Holdings has expanded its operations beyond Ukraine and now operates in Germany, Mexico, Italy, and Kazakhstan.

Burisma Geothermal is a new branch of Burisma Holdings. It is a 100% owned subsidiary which specializes in geothermal energy development and electricity production from renewable and environmentally friendly energy sources in Europe. Burisma Holdings has purchased equipment and technologies from such USA companies as Halliburton and Caterpillar.
Several U.S. government agencies were tapped to provide financial assistance to Ukraine and President Trump is right to ask harder questions as there is no Inspector General assigned to Ukraine to track that spending for legitimacy. Remember the legacy of corruption in Ukraine and Trump has a duty to see if he can trust a brand new leader in Zelensky who was never a politician.

William B. Taylor is the executive vice president at the U.S. Institute of Peace. Earlier, he was the special coordinator for Middle East Transitions in the U.S. State Department. He oversaw assistance and support to Egypt, Tunisia, Libya and Syria. He served as the U.S. ambassador to Ukraine from 2006 to 2009. Ambassador Taylor became chargé d’affaires ad interim for Ukraine in June 2019. In picking through some of the other names in the membership of The American Academy of Diplomacy (NGO) which includes Taylor, they are: Madeleine Albright, Hillary Clinton, Jon Huntsman Jr., John Kerry, Victoria Nuland, Thomas Pickering, Susan Rice, Wendy Sherman, Strobe Talbott and Kent Volker.
Willam Taylor as part of the U.S. Institute of Peace, not only was USAID a deeper partner in Ukraine but Google is also. USAID was/is a sponsor of RADA. RADA and the USAID program that launched in November of 2013 collectively took to the streets in Ukraine for what is known as the Revolution of Dignity coordinating with Members of Parliament and civil society organizations and other international experts.
President Trump mentioned Crowdstrike in the phone call. Crowdstrike was hired by Perkins Coie to investigate the hacking of he DNC server. Perkins Coie was the law firm of record for the DNC and hired Fusion GPS. Trump has the notion that Crowdstrike also may have operated out of Ukraine that clues point to Crowdstrike was part of foreign interference into our 2016 elections. It should be noted that a independent group of journalists based in Britain are seeking a UK report of Russian/Ukraine interference their Britain’s election. As a matter of fact, Crowdstrike has an office in London.

With all this political power and international resumes, how was it that Russia was allowed to annex Crimea and invade Ukraine in the first place? Where was Taylor, Nuland, Kerry, Rice or Obama? Too busy with the Iran nuclear deal it seems. The United States needed Russia’s cooperation with the Iran JCPOA so Obama did not grant the request of Ukraine for military aide other than to ship MRE’s and blankets. Congress (read Democrats) never complained until President Trump was in a phone call and approved the eventual shipment of real military aide.

So, back to the beginning, where does this whistle-blower fit in? Seems he was/is the Ukraine expert assigned to VP Biden who was assigned by Obama to be the leader of the envoy for all things Ukraine. At least 6 emails obtained from a FOIA list the Ciaramella in the email chain. Others include Victoria Nuland, George Kent and Kathleen Kavalec. There are other names in the email discussion(s) dated June 2016.

This is a larger operation that has a genesis in Ukraine. There are known quantities of moving parts but it is clear that Pelosi, Schiff and perhaps many others at NGO’s, the State Department, the previous members of the Obama White House are in fact just a little nervous that Trump and his lawyer Rudy Giuliani are treading in waters made dark by operatives they are working to hide, defend and protect.

US Intel Tips Forced China to Prosecute Fentanyl Operation

Posted on November 7, 2019November 7, 2019 by Denise Simon

A trial continues as fentanyl drug traffickers are sentenced in court, Thursday, Nov. 7, 2019, in Xingtai, north China’s Hebei Province. The court sentenced at least nine fentanyl traffickers Thursday in a case that was a culmination of a rare collaboration between Chinese and U.S. law enforcement to crack down on global networks that manufacture and distribute lethal synthetic opioids. (Jin Liangkuai/Xinhua via AP)

XINGTAI, China (AP) — A Chinese court sentenced nine fentanyl traffickers on Thursday in a case that is the culmination of a rare collaboration between Chinese and U.S. law enforcement to crack down on global networks that manufacture and distribute lethal synthetic opioids.

Liu Yong was sentenced to death with a two-year reprieve, while Jiang Juhua and Wang Fengxi were sentenced to life in prison. Six other members of the operation received lesser sentences, ranging from six months to 10 years. Death sentences are almost always commuted to life in prison after the reprieve.

Working off a 2017 tip from the U.S. Department of Homeland Security about an online drug vendor who went by the name Diana, Chinese police busted a drug ring based in the northern Chinese city of Xingtai that shipped synthetic drugs illicitly to the U.S. and other countries from a gritty clandestine laboratory. They arrested more than 20 suspects and seized 11.9 kilograms (26.2 pounds) of fentanyl and 19.1 kilograms (42.1 pounds) of other drugs.

In form, the enterprise resembled a small business, with a perky sales force that spoke passable English, online marketing, contract manufacturing, and a sophisticated export operation, according to U.S. and Chinese law enforcement.

But the business had grave implications. Police photographs of the seizure show a dingy, chaotic scene, with open containers of unidentified chemicals and Chinese police in rubber gloves and breathing masks.

Liu and Jiang were accused of manufacturing and trafficking illicit drugs. The others were accused of trafficking.

Chinese officials said the Xingtai case was one of three fentanyl trafficking networks they are pursuing based on U.S. intelligence, but declined to discuss the details of the other cases, which are ongoing.

Austin Moore, an attaché to China for the U.S. Homeland Security Department, said the Xingtai case was “an important step” showing that Chinese and U.S. investigators are able to collaborate across international borders.

Moore said Chinese police identified more than 50 U.S. residents who tried to buy fentanyl from the Xingtai organization. Those leads prompted over 25 domestic investigations and have already resulted in three major criminal arrests and indictments in New York and Oregon, he said.

Scrambling to contain surging overdose deaths, Washington has blamed Beijing for failing to curb the supply of synthetic drugs that U.S. officials say come mainly from China. In August, President Donald Trump lashed out at Chinese President Xi Jinping for failing to do more to combat illicit opioid distribution in China’s vast, freewheeling chemicals industry. U.S. officials have reportedly moved to link Beijing’s efforts on fentanyl to U.S. trade talks.

Yu Haibin, deputy director of the Office of China National Narcotics Control Commission, on Thursday called allegations that Chinese supply is at the root of America’s opioid problem “irresponsible and inconsistent with the actual facts.”

“Drug crime is the public enemy of all humankind,” he added. “It’s about the life of human beings. It should not be related with the trade war or other political reasons.”

Chinese officials have been at pains to emphasize the efforts they have made to expand drug controls and crack down on illicit suppliers, even though synthetic opioid abuse is not perceived to be a significant problem in China.

But prosecuting cases against a new, rising class of Chinese synthetic drug kingpins has remained a challenge. Profit-seeking chemists have adroitly exploited regulatory loopholes by making small changes to the chemical structure of banned substances to create so-called analogs that are technically legal.

U.S. officials have been hopeful that China’s move earlier this year to outlaw unsanctioned distribution of all fentanyl-like drugs as a class will help constrain supply and make it easier to prosecute Chinese dealers.

According to the U.S. Centers for Disease Control and Prevention, more than 500,000 Americans died of drug overdoses in the decade ending in 2017 — increasingly, from synthetic opioids like the ones sold by the Xingtai network.

The American opioid crisis began in the 1990s, when the over-prescription of painkillers like OxyContin stoked addiction. Many people who became hooked on pain pills later moved to heroin. Fentanyl — an even more potent lab-made drug that raked in profits — then entered the U.S. illicit drug supply, causing overdose deaths to spike.

***

The question of what, if any, responsibility China should bear for fuelling a deadly opioid crisis in the United States has been a bitter source of contention between the two superpowers.

China’s jailing of nine people Thursday for trafficking and selling fentanyl to US buyers following a rare joint probe with US law enforcement would suggest Beijing is moving to address the problem.

But experts warn that while the case is a big step, it is not enough to stop the drug from pouring into the United States — from China and increasingly from Mexico as drug cartels pick up the slack.

Here is a look at the opioid crisis and the tensions it has caused between China and the United States:

What’s fentanyl?

Fentanyl was introduced to the US market in the 1960s as an intravenous anaesthetic to manage severe pain. It is used for cancer patients or those receiving end-of-life care.

The drug is 50 times more potent than heroin, with only a few milligrammes — equivalent to a few grains of sand — enough to kill someone.

It is trafficked into the United States, primarily from China and Mexico, in the form of powder or tablets, and is sometimes mixed with heroin and cocaine.

Fentanyl and other synthetic opioids killed 32,000 people in the US last year according to government data.

The drug can be bought online and shipped to the United States via regular mail, posing a major challenge for postal inspectors sifting through mountains of packages.

What’s China doing about it?

Trump has long urged China to crack down on fentanyl.

It has even become a bargaining chip in the trade spat between the world’s two largest economies.

“High-level officials continue to blame China for the failure to stem the flow and that might be impacting the trade negotiations,” Bryce Pardo, a policy researcher at RAND Corporation, told AFP.

When Trump and President Xi Jinping declared a trade war truce at a summit in Argentina in December 2018, the Chinese side said it would designate all variants of fentanyl as controlled substances.

Trump hoped the move would be a “game changer” because China applies the death penalty against drug dealers.

It was not until five months later, in May, that China finally designated all fentanyl analogues as a controlled substance.

Before the ban, smugglers could skirt the law by changing the formula to make fentanyl-like drugs.

But three months later, Trump complained that China was still not doing enough.

Then came the news on Thursday that a court in northern Hebei province had handed a suspended death sentence to a smuggler and jailed eight others for terms ranging from six months to life after the first successful joint US-China investigation against a fentanyl operation.

Is it enough?

“It’s one case. You can count it as a success and it is,” Mike Vigil, a former head of international operations at the US Drug Enforcement Administration (DEA), told AFP.

“But there is much more to be done. That’s a very tiny tip of the iceberg,” Vigil said.

Experts say China lacks the manpower to inspect all laboratories that produce fentanyl.

“The big problem is that there are so many laboratories and they have about 2,000 inspectors, which is not nearly enough,” Vigil said.

Scott Stewart, a security analyst at US intelligence consultancy Stratfor, said the flow of fentanyl and its precursor chemicals will not stop until China addresses “deeper problems” such as going after “powerful players” and lifting tax credits companies get for selling certain chemicals.

Is the ban working?

While the US welcomed China’s ban on all types of fentanyl, the move appears to have shifted production to Mexico, where drug cartels have quickly adapted to new law enforcement actions.

Chinese labs also produce the chemicals needed to make fentanyl and Mexican drug traffickers are importing them to produce the narcotic themselves, Vigil said.

“Precursor chemicals are fuelling the rise in the manufacture of fentanyl in Mexico by the major drug cartels,” Vigil said.

The DEA said Monday the cartels were making “mass quantities” of fentanyl-laced drugs.

China, for its part, continues to deny it is the source of the problem.

Following Thursday’s court case, Yu Haibin, a Chinese anti-drug official, pointedly said American deaths from overdoses had continued to rise after Beijing cracked down on all types of fentanyl.

CA Prop 47 Made Theft out of Control

Posted on November 4, 2019November 4, 2019 by Denise Simon

Clean out your cars every night, watch shoplifters with calculators and stop UPS deliveries to your home.
Swell huh? Speaker Pelosi must be proud…same with Senator Dianne Feinstein.

Overview

Proposition 47 implemented three broad changes to felony sentencing laws. First, it reclassified certain theft and drug possession offenses from felonies to misdemeanors. Second, it authorizes defendants currently serving sentences for felony offenses that would have qualified as misdemeanors under the proposition to petition courts for resentencing under the new misdemeanor provisions. Third, it authorizes defendants who have completed their sentences for felony convictions that would have qualified as misdemeanors under the proposition to apply to reclassify those convictions to misdemeanors.

Felony convictions resentenced or reclassified as misdemeanors under the proposition are considered misdemeanors for all purposes, except that such relief does not permit the person to own, possess, or have in his or her custody or control any firearm.

Early Impacts of Proposition 47 on the Courts

California superior courts received more than 200,000 petitions for resentencing or applications for reclassification during the first 13 months after voters approved Proposition 47. A report prepared by Judicial Council staff, highlights the impacts of the ballot measure on the courts during the first year of implementation.

***

Since the passage of the infamous Prop 47 five years ago, then marketed by California Democrats as the “Safe Neighborhoods and Schools Act,” theft has increased across the state, as organized crime rings have transformed ordinary shoplifting into a lucrative and sophisticated operation. It’s likely no coincidence that San Francisco now has the highest rate of property crime of America’s twenty largest cities.

Passed in 2014, Prop 47 was allegedly designed to emphasize rehabilitation and keep non-violent offenders out of the state’s already packed prisons by reducing certain non-violent felonies to mere misdemeanors. For instance, a thief can now steal twice as much as he or she formerly could before facing a felony charge. But thieves and organized crime gangs capitalized on this loophole. In other words, Prop 47 is now a mechanism for gangs to immunize themselves from felony charges. In cities like Vacaville, CA, just outside of the state’s capital, theft has more than doubled, and police believe Prop 47 is to blame.

According to the National Retail Federation’s 2018 survey on Organized Retail Crime (ORC), this jump is in petty theft as a result of relaxed laws is common (and given its ubiquity, should now be expected).

In states where the felony threshold has increased, over half report an increase in ORC case value. None reported a decrease. It appears that ORC criminals understand the new threshold and have increased their thefts to meet it.

Rachel Michelin, who currently serves as President of the California Retailers Association, explained to Fox News the crude savviness of the latest generation of shoplifters. “[Shoplifters] know what they’re doing. They will bring in calculators and get all the way up to the $950 limit.” She continued. “One person will go into a store, fill up their backpack, come out, dump it out and go right back in and do it all over again.”

The relaxation of penalties, combined with selective enforcement to focus on more “serious” crime, has seemingly been disastrous for the state’s larger cities. Although Prop 47 was championed by the state’s Democratic overlords, as well as by the American Civil Liberties Union (ACLU), many attribute California’s growing property crime problem to lax initiatives like this one.

As Del Seymour of the non-profit Code Tenderloin emphasized to Fox News, the theft patterns in the city are a mix of international gangs, usually from Mexico or Guatemala, as well as homeless addicts looking to secure enough money to finance their next fix. The stealing and handoffs often take place in broad daylight and ironically, right in front of San Francisco City Hall. When I lived in San Francisco, City Hall was infamous for being a beehive of illicit activities and an area best avoided at all times of day.

Oddly enough, unrelated measures, like the additional charge for plastic bags, have made it more difficult for store owners to spot theft, given the frequency with which shoppers now simply throw items into their purses or backpacks after purchase. As Michelin noted, this type of behavior now allows shoplifters to “fit in” with the paying customers. Michelin predicts that stores will increasingly turn to locking up their products for fear of theft.

The jump in retail theft is just one part of the picture when it comes to property theft in the state. According to the San Francisco Police Department, there is a car break-in every 22 minutes in the city, resulting in the formation of neighborhood “vigilantes” devoted to stopping break-ins. A 2018 study from the Public Policy Institute found evidence that Prop 47 was a contributing factor in the almost 20 percent-increase in car break-ins from 2014 to 2016. It seems the rampant property crime in the city is creating a dystopian hellscape that the cops haven’t been awarded the authority to address.

California voters may have had enough. In 2020, California residents will vote on whether to rollback the reforms implemented under Prop 47 in the hopes of reinstating the deterrents that fell by the wayside under the auspices of the state’s Democratic leadership.

When I lived in San Francisco’s fabled Bernal Heights, I was instructed to empty my car each night to discourage thieves from smashing my windows. There were some evenings I would forget after a long commute home, and I would hold my breath walking to my vehicle in the morning, always relieved to see that the windows were still intact (I detail my San Francisco trials here). If California voters are smart, perhaps San Francisco’s next generation of residents won’t have to feel terrorized by the constant barrage of petty crime. Hat Tip Federalist

281 Arrested Worldwide in Business Email Compromise

Posted on September 12, 2019September 12, 2019 by Denise Simon

Operation ReWired:

Federal authorities announced today a significant coordinated effort to disrupt Business Email Compromise (BEC) schemes that are designed to intercept and hijack wire transfers from businesses and individuals, including many senior citizens. Operation reWired, a coordinated law enforcement effort by the U.S. Department of Justice, U.S. Department of Homeland Security, U.S. Department of the Treasury, U.S. Postal Inspection Service, and the U.S. Department of State, was conducted over a four-month period, resulting in 281 arrests in the United States and overseas, including 167 in Nigeria, 18 in Turkey and 15 in Ghana. Arrests were also made in France, Italy, Japan, Kenya, Malaysia, and the United Kingdom (UK). The operation also resulted in the seizure of nearly $3.7 million.

Operation WireWire - Law enforcement arrested 74 ... photo

BEC, also known as “cyber-enabled financial fraud,” is a sophisticated scam often targeting employees with access to company finances and businesses working with foreign suppliers and/or businesses that regularly perform wire transfer payments. The same criminal organizations that perpetrate BEC also exploit individual victims, often real estate purchasers, the elderly, and others, by convincing them to make wire transfers to bank accounts controlled by the criminals. This is often accomplished by impersonating a key employee or business partner after obtaining access to that person’s email account or sometimes done through romance and lottery scams. BEC scams may involve fraudulent requests for checks rather than wire transfers; they may target sensitive information such as personally identifiable information (PII) or employee tax records instead of, or in addition to, money; and they may not involve an actual “compromise” of an email account or computer network. Foreign citizens perpetrate many BEC scams. Those individuals are often members of transnational criminal organizations, which originated in Nigeria but have spread throughout the world.

“The Department of Justice has increased efforts in taking aggressive enforcement action against fraudsters who are targeting American citizens and their businesses in business email compromise schemes and other cyber-enabled financial crimes,” said Deputy Attorney General Jeffrey Rosen. “In this latest four-month operation, we have arrested 74 people in the United States and 207 others have been arrested overseas for alleged financial fraud. The coordinated efforts with our domestic and international law enforcement partners around the world has made these most recent actions more successful. I want to thank the FBI, more than two dozen U.S. Attorney’s Offices, U.S. Secret Service, U.S. Postal Inspection Service, Homeland Security Investigations, IRS Criminal Investigation, U.S. Department of State’s Diplomatic Security Service, our partners in Nigeria, Ghana, Turkey, France, Italy, Japan, Kenya, Malaysia, and the UK, and our state and local law enforcement partners for all of their hard work to combat these fraud schemes and protect the hard-earned assets of our citizens. Anyone who engages in deceptive practices like this should know they will not go undetected and will be held accountable.”

“The FBI is working every day to disrupt and dismantle the criminal enterprises that target our businesses and our citizens,” said FBI Director Christopher A. Wray. “Cooperation is the backbone to effective law enforcement; without it, we aren’t as strong or as agile as we need to be. Through Operation reWired, we’re sending a clear message to the criminals who orchestrate these BEC schemes: We’ll keep coming after you, no matter where you are. And to the public, we’ll keep doing whatever we can to protect you. Reporting incidents of BEC and other internet-enabled crimes to the IC3 brings us one step closer to the perpetrators.”

“The Secret Service has taken a multi-layered approach to combating Business Email Compromise schemes through our Global Investigative Operations Center (GIOC),” said U.S. Secret Service Director James M. Murray. “Domestically, the GIOC assists Secret Service Field Offices and other law enforcement partners with analysis and investigative tactics to enhance the impact of local BEC investigations. Internationally, the GIOC targets and identifies transnational organized crime networks that perpetrate these cyber-enabled financial fraud schemes. Through this approach, the Secret Service continues to strive to protect the citizens of the United States and our financial infrastructure from these complex crimes.”

“Homeland Security Investigations (HSI), together with its law enforcement partners, has proven once again, that cyber-enabled financial fraud will not be tolerated in the United States,” said Acting Director Matthew T. Albence of U.S. Immigration and Customs Enforcement (ICE). “Operation reWired sends a clear message to criminals, that no matter how or where crimes are committed, we will do everything within our means to dismantle criminal enterprises that seek to manipulate U.S. institutions and taxpayers.”

“The consequences of this type of fraud scheme are far reaching, affecting not only people in the United States, but also across the world,” said Chief Postal Inspector Gary Barksdale. “This investigation is just another example of how effective law enforcement agencies can be when they join forces. By working together, we can keep our communities and our vulnerable populations safe from financial exploitation. The U.S. Postal Inspection Service is proud to be at the forefront of the fight against fraud and Postal Inspectors will continue to adapt to the ever changing landscape to stop the scammers and protect our customers.”

“In unraveling this complex, nationwide identity theft and tax fraud scheme, we discovered that the conspirators stole more than 250,000 identities and filed more than 10,000 fraudulent tax returns, attempting to receive more than $91 million in refunds,” said Chief Don Fort of IRS Criminal Investigation. “We will continue to work with our international, federal and state partners to pursue all those responsible for perpetrating this fraud, preying on innocent victims and attempting to cheat the U.S. out of millions of dollars.”

“The investigation of these crimes crossed international borders,” said Director Todd J. Brown of the U.S. Department of State’s Diplomatic Security Service (DSS). “Today’s charges are another successful example of our commitment to working together with both foreign colleagues abroad as well as local, state and federal law enforcement partners here at home in the pursuit of those who commit cyber-related financial crimes.”

A number of cases involved international criminal organizations that defrauded small to large sized businesses, while others involved individual victims who transferred high dollar funds or sensitive records in the course of business. The devastating effects these cases have on victims and victim companies affect not only the individual business but also the global economy. According to the Internet Crime Complaint Center (IC3), nearly $1.3 billion in loss was reported in 2018 from BEC and its variant, Email Account Compromise (EAC), nearly twice as much as was reported the prior year. BEC and EAC are prevalent scams and the Justice Department along with our partners will continue to aggressively pursue and prosecute the perpetrators, including money mules, regardless of where they are located.

Money mules may be witting or unwitting accomplices who receive ill-gotten funds from the victims and then transfer the funds as directed by the fraudsters. The money is wired or sent by check to the money mule who then deposits it in his or her own bank account. Usually the mules keep a fraction for “their trouble” and then wire the money as directed by the fraudster. The fraudsters enlist and manipulate the money mules through romance scams or “work-at-home” scams, though some money mules are knowing co-conspirators who launder the ill-gotten gains for profit.

BEC scams are related to, and often conducted together with, other forms of fraud such as:

“Romance scams,” where victims are lulled into believing they are in a legitimate relationship, and are tricked into sending or laundering money under the guise of assisting the paramour with an international business transaction, a U.S. visit, or some other cover story;

“Employment opportunities scams,” where victims are convinced to provide their PII to apply for work-from-home jobs, and, once “hired” and “overpaid” by a bad check, to wire the overpayment to the “employer’s” bank before the check bounces;

“Fraudulent online vehicle sales scams,” where victims are convinced they are purchasing a nonexistent vehicle and must pay for it by sending the codes of prepaid gift cards in the amount of the agreed upon sale price to the “seller;”

“Rental scams,” where a scammer agrees to rent a property, sends a bad check in excess of the agreed upon deposit, and requests the overpayment be returned via wire before the check bounces; and

“Lottery scams,” where victims are convinced they won an international lottery but must pay fees or taxes before receiving the payout.

Starting in May 2019, this coordinated enforcement action targeted hundreds of BEC scammers. Law enforcement agents executed over 214 domestic actions including arrests, money mule warning letters, and asset seizures and repatriations totaling nearly $3.7 million. Local and state law enforcement partners on FBI task forces across the country, with the assistance of multiple District Attorney’s Offices, also arrested alleged money mules for their role in defrauding victims.

Among those arrested on federal charges in BEC schemes include:

Following an investigation led by the FBI’s Chicago Division, Brittney Stokes, 27, of Country Club Hills, Illinois, and Kenneth Ninalowo, 40, of Chicago, Illinois, were charged in the Northern District of Illinois with laundering over $1.5 million from proceeds of BEC scams. According to the indictment, a community college and an energy company were defrauded into sending approximately $5 million to fraudulent bank accounts controlled by the scammers. Banks were able to freeze approximately $3.6 million of the $5 million defrauded in the two schemes. Law enforcement officials seized a 2019 Range Rover Velar S from Stokes and approximately $175,909 from Stokes and Ninalowo.

As a result of a joint investigation by the FBI, HSI, and DSS, Opeyemi Adeoso, 44, of Dallas, Texas, and Benjamin Ifebajo, 45, of Richardson, Texas, were arrested and charged in the Northern District of Texas with bank fraud, wire fraud, money laundering, and conspiracy. Adeoso and Ifebajo are alleged to have received and laundered at least $3.4 million. In furtherance of their scheme, they are alleged to have assumed 12 fictitious identities and defrauded 37 victims from across the United States.

As part of a larger investigation by the FBI and the USSS in Miami, Yamel Guevara Tamayo, 36, of Miami, Florida, and Yumeydi Govantes, 39, of Miami, Florida, were charged in the Southern District of Florida with laundering more than $950,000 of proceeds of BEC scams. The two individuals were also responsible for recruiting approximately 18 other individuals to serve as money mules, who laundered proceeds of BEC scams for an international money laundering network. The victims of the BEC scams included title companies, corporations, and individuals. The individuals were indicted June 18, 2019 and arrested June 20, 2019. The change of plea for both individuals is scheduled for Sept. 16.

In an investigation by FBI Atlanta, two individuals were charged in the Northern District of Georgia for their involvement in a Nigeria-based BEC scheme that began with a $3.5 million transfer of funds fraudulently misdirected from a Georgia-based health care provider to accounts across the United States. Two Nigerian nationals, Emmanuel Igomu, 35, of Atlanta, Georgia, and Jude Balogun, 29, of San Francisco, California, have been arrested on charges of aiding and abetting wire fraud for their part in receiving and transmitting monies derived from the BEC.

Following an investigation by the FBI, Cyril Ashu, 34, of Austell, Georgia; Ifeanyi Eke, 32, of Sandy Springs, Georgia; Joshua Ikejimba, 24, of Houston, Texas; and Chinedu Ironuah, 32, of Houston, Texas, were charged in the Southern District of New York with one count of conspiracy to commit wire fraud and one count of wire fraud for their involvement in a Nigeria-based BEC scheme that impacted hundreds of victims in the United States, with losses in excess of $10 million.

An indictment is merely an allegation and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The cases were investigated by the FBI, U.S. Secret Service, U.S. Postal Inspection Service, ICE’s Homeland Security Investigations (HSI), IRS Criminal Investigation and U.S. Department of State’s Diplomatic Security Service. U.S. Attorney’s Offices in the Districts of Arizona; Central, Eastern and Southern California; Colorado; Delaware; Southern Florida; Northern Georgia; Northern Illinois; Kansas; Eastern Louisiana; Massachusetts; Nebraska; Nevada; Southern New York; Middle North Carolina; Northern Ohio; Oregon; Northern, Western and Southern Texas; Western Tennessee; Eastern Virginia; Eastern Washington, and elsewhere have ongoing investigations some of which have resulted in arrests in Nigeria. The Justice Department’s Computer Crime and Intellectual Property Section, Money Laundering and Asset Recovery Section, and Office of International Affairs of the Criminal Division provided assistance. District Attorney’s Offices of Harris County, Texas; Fort Bend County, Texas; and Washington County, Arkansas are handling state prosecutions. Additionally, private sector partners and the Nigerian Economic and Financial Crimes Commission, Ghana Police Service (GPS) and Economic and Organized Crime Office (EOCO), Turkish National Police (TNP) Cyber Department, Direction Centrale de la Police aux Frontieres (PAF) of France, Squadra Mobile Di Caserta and Italian National Police, National Police Agency of Japan, Tokyo Metropolitan Police Department (TPMD), Royal Malaysian Police, Directorate of Criminal Investigations (DCI) of Kenya and the National Crime Agency (NCA), North Wales Police, Metropolitan Police Service and Hertfordshire Constabulary of the UK provided significant assistance.

This operation serves as a model for international cooperation against specific threats that endanger the financial well-being of each member country’s residents. Deputy Attorney General Rosen expressed gratitude for the outstanding efforts of the participating countries, including law enforcement actions that were coordinated and executed by the Economic and Financial Crimes Commission (EFCC) in Nigeria to curb business email compromise schemes that defraud businesses and individuals alike.

The Justice Department’s efforts to confront the growing threat of cyber-enabled financial fraud led to the formation of the BEC Counteraction Group (BCG), which assists U.S. Attorney’s Offices and the Department with the coordination of BEC cases and the centralization of related expertise. The BCG facilitates communication and coordination between federal prosecutors, serves as a bridge between federal prosecutors and federal agents, centralizes and manages institutional knowledge and training, and participates in efforts to educate the public about protecting themselves and their organizations from BEC scams.

The BCG draws upon the expertise of the following sections within the Department’s Criminal Division: the Computer Crime and Intellectual Property Section, which regularly investigates and prosecutes cases involving computer crimes, including network intrusions; the Fraud Section, which manages complex litigation involving sophisticated fraud schemes; the Money Laundering and Asset Recovery Section, which brings experience in seizing assets obtained through criminal activity; the Office of International Affairs, which plays a central role in securing international evidence and extradition; and the Organized Crime and Gang Section, which contributes strategic guidance in prosecuting complex transnational criminal cases.

Operation reWired was funded and coordinated by the FBI and the Justice Department’s International Organized Crime Intelligence and Operations Center (IOC-2) and follows “Operation Wire Wire,” the first coordinated enforcement action targeting hundreds of BEC scammers. That effort, announced in June 2018, resulted in the arrest of 74 individuals, the seizure of nearly $2.4 million, and the disruption and recovery of approximately $14 million in fraudulent wire transfers.

Victims are encouraged to file a complaint online with the IC3 at bec.ic3.gov. The IC3 staff reviews complaints, looking for patterns or other indicators of significant criminal activity, and refers investigative packages of complaints to the appropriate law enforcement authorities in a particular city or region. The FBI provides a variety of resources relating to BEC through the IC3, which can be reached at www.ic3.gov.