The acting Chairman of the Economic and Financial Crimes Commission (EFCC), Ibrahim Magu, has disclosed that the agency is collating comprehensive data on the Nigerians indicted in the recently busted money laundering and cybercrime offences investigated by the Federal Bureau of Investigation (FBI) in the United States. The fraudsters used a variety of cyber fraud methods to attempt to steal $40 million in total from victims in 10 countries as well as the US.
While 14 arrests have been made, a 252-count federal grand jury indictment unsealed on August 23, named 80 defendants charged with defrauding victims of up to $10 million in one of the “largest cases of its kind in US history.” Beyond the arrests that have already been made, the US is working with foreign counterparts to arrest 57 more indicted subjects. And citing previous success with extraditing Nigerian citizens to the US in the past, US district attorney Nicola Hanna says the US will seek to extradite indicted defendants believed to be in Nigeria. The defendants face charges ranging from money laundering to identity theft and will likely face “decades in federal prisons” if convicted.
Eighty suspects, most of them Nigerians, were allegedly involved in the crimes in the US, and Magu said their Nigerian-based accomplices will be arrested and extradited to the US to face justice. Magu, who spoke through the Head of the Ibadan zonal office, Friday Ebelo, at a press conference in Ibadan, Oyo State, said the massive data collection was part of the collaborative activities between the EFCC and FBI to ensure criminal elements are exposed and made to pay for their crimes. Journalists at the event were held spellbound when Ebelo drilled them through the intricate connections between the local “Yahoo Boys” and their offshore criminal collaborators.
According to him, the essence of the data mining exercise was to establish any form of relationship the indicted individuals may have with the Nigeria-based suspects, and how this could help in furthering the fight against economic and financial crimes in the country. He said information earlier collected have led to the arrest of many internet fraudsters, adding that one of the kingpins was nabbed during a recent raid in Ado-Ekiti, Ekiti State.
The kingpin, Ajayi Gbenga Festus, he added, was found to be deeply involved in many internet-related frauds from which he had benefited up to N75 million in the last eight months. “We were able to establish a number of illicit transactions through his Nigerian bank account amounting to over N223 million. Ajayi serves as conduit pipe through which proceeds of crime reach members of the syndicate,” he stated. Ebelo also disclosed that in the course of the year, the zone arrested 263 suspects for cybercrimes. Of this number, 111 were convicted. Apart from landed properties, vehicles, laptops and other valuables forfeited on the order of the court, huge sums of money in local and foreign currencies traced to internet fraud were also recovered.
The FBI’s Nigerian email scam ring bust shows how the billion-dollar global fraud has evolved, sources tell Huhuonline.com. The unsealed indictment shows the evolving tactics of online fraudsters which has seen them continue to dupe unwitting victims despite numerous awareness campaigns about the online scams. In the past, internet scams associated with Nigerians (known locally as “Yahoo Boys”) were dominated by romance scams through dating sites as well as phony email business proposals from infamous “Nigerian princes,” but their current tactics appear now to be more sophisticated.
Through business email compromise scams (BEC), fraudsters use hacked email accounts to convince businesses or individuals to make payments that are either bogus or similar to actual payments owed to legitimate companies. As part of the scam, fraudsters learn about key personnel in companies who are responsible for financial transactions as well as the protocols necessary to perform wire transfers in various companies and then target businesses that regularly perform wire transfer payments, Paul Delacourt, FBI assistant director in charge of the case said in a press briefing.
The scams have become so rampant that in the first seven months of 2019 alone, the FBI received nearly 14,000 complaints reporting BEC scams with a total loss of around $1.1 billion; a figure that nearly matches losses reported for all of 2018. In another recent high profile case, following a 13-month long investigation, the FBI arrested Nigerian Obinwanne Okeke in an $11 million BEC fraud case. Before his arrest, Okeke had posed as a successful entrepreneur and was featured on Forbes 30-under-30 list as well as profiled on BBC Focus on Africa program.
With long-running romance scam tactics through dating websites already well-known, fraudsters have gone as far as impersonating US soldiers and then seeking lovers on social media, particularly Facebook. Invariably, victims who fall for impostors are asked to make “repeated and ever escalating payments,” US officials say. In some cases, rather than being asked to send money, victims of romance scams are deployed as money mules whose banks accounts are used to move illicit funds or are talked into opening accounts on behalf of criminals. US law enforcement have recently received complaints of such scams in all 50 states, authorities also say.
The high profile arrests have also triggered extreme reactions among Nigerians at home and abroad, many of whom, daily experience the cost of the national stereotyping that comes with the global media coverage of the online fraudsters, particularly with the wide spread of email scams. These costs range from increased scrutiny for visa processes; a lack of trust when attempting to do business internationally and being restricted from using international payment platforms. But the bigger challenge is with the country’s law enforcement and justice systems which lack the requisite capacity to tackle the problem or are perceived as unwilling to do so.
US officials say the busted ring was led by US-based operatives who facilitated the scams by opening US bank accounts where victims were directed to deposit money. Operatives then laundered the stolen funds through these accounts, ultimately funneling them to Nigeria and pocketing the proceeds. The lead operatives received and laundered at least $6 million in stolen funds, US officials say.
