12 Jul 2012

Loan-Fraud Scheme Claims $2.7 million; More Than 2,000 Loan Applicants Lured with Fake Ads


Some $2.7 million filled the pockets of a cybercrime ring in a massive online loan-fraud operation that started in 2005, according to a networkworld.com report.

The scheme relied on fake ads created under the names of real financial organizations which took applicants through a series of websites and search engines to persuade them their loans had been approved. To access the loans, victims were supposed to make an initial security deposit through Western Union which actually went straight to the crooks.

Ten of the 32 members of the gang are under arrest on charges of conspiracy to commit wire fraud and of money laundering, with each individual looking at 20 years in prison or more, plus a $250,000 fine and other penalties. Several Canada-based people involved in the criminal operation are also expected to be seized under international treaties.

"As a result of this investigation by Homeland Security Investigations, a major international criminal network has been disrupted," said John Morton, director of U.S. Immigration and Customs Enforcement, as quoted by networkworld.com.

According to the 2011 Internet Crime Report issued by the Internet Crime Complaint Center, out of a total of 314,246 complaints received, 27,892 were related to Advance Fee Fraud. The FBI defines this as “criminals convincing victims to pay a fee to receive something of value, but not delivering anything of value to the victim”.