US traces $6.4 million email scam to China, Nigeria, others, seizes $5.3 million

The United States has filed a civil forfeiture action to reclaim approximately $5.3 million, which are believed to be proceeds from a business email compromise (BEC) scheme.

This scheme targeted a workers’ union in Dorchester, Massachusetts, defrauding them of $6.4 million through a sophisticated email spoofing attack.

A statement on Wednesday by the United States Attorney’s Office, District of Massachusetts, stated that in January 2023, the union received an email, appearing to be from their investment consulting firm, requesting a change in payment information. The email, however, was from a spoofed address, altered by one letter to mislead the recipient.

Consequently, the union transferred $6.4 million to an account controlled by the fraudsters.

“The complaint alleges that in January 2023, a workers union located in Dorchester received an email requesting a change of payment information from someone it believed worked at an investment consulting firm.

“The complaint also alleges that the email came from what initially appeared to be the consulting firm’s true email address but was in fact a spoofed email address that had been changed by one letter.

“The spoofed email instructed the workers’ union to make a $6,400,000 transfer to a different bank account than had been previously arranged, which the workers union did, in fact, do.

“The spoofed email, however, was a fraudulent communication intended to mislead the workers union into unwittingly transferring funds to an account controlled by someone other than the intended recipient,” the statement said.

The fraudulently obtained funds were then moved through multiple intermediary accounts and partially transferred to a cryptocurrency exchange, according to the press statement.

Some funds were routed to various bank accounts in Hong Kong, China, Singapore, and Nigeria. US investigators successfully traced the funds to seven domestic bank accounts, which were subsequently seized.

Acting US Attorney Joshua S. Levy highlighted the severe impact of BEC schemes, stating that these frauds cause significant financial and emotional distress by exploiting trusted communication channels.

He emphasised the importance of reporting such crimes, as authorities can sometimes recover stolen funds and bring justice to victims.

This action marks one of several recent efforts by US authorities to combat fraud schemes involving cryptocurrency.

In a related case, approximately $500,000 worth of Bitcoin was seized from a Binance US account, believed to be linked to a similar BEC scheme targeting another Massachusetts resident.

Nigerian authorities are closely monitoring the situation, given the international transfer of funds involved in these schemes. The Nigerian government has been urged to cooperate with international investigations to curb such fraudulent activities originating from the country.

The civil forfeiture process allows third parties to assert claims to the seized property before it is officially forfeited and potentially returned to the victims. This ongoing effort reflects the broader global challenge of tackling cybercrimes and financial frauds facilitated by digital currencies.

For those who suspect they might be victims of such cybercrimes, including cryptocurrency scams and BEC frauds, they are encouraged to contact the US Department of Justice via their dedicated cybercrime email: USAMA.CyberTip@usdoj.gov.

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