As alleged the defendants participated in a nationwide scheme to defraud duping victims who responded to fake internet advertisements designed to resemble advertisements posted by legitimate merchants The defendants then allegedly created dozens of shell companies to receive victim payments and withdrew the funds and sent them out of the country
25 defendants were charged in Manhattan Federal Court last week with a multimillion-dollar wire fraud and money laundering scheme that alleged the co-conspirators posted fake advertisements for cars and tricked victims nationwide into wiring more than $4.5 Million into fraudulent accounts. The majority of the defendants resided in Brooklyn, NY, but 2 of the defendants charged were residents of Delray Beach and another defendant was arrested in Miami.
According to the allegations in the Indictment and statements made during court proceedings in this matter: From November 2016 through July 2018, the defendants carried out a wide-ranging fraudulent scheme that typically involved impersonating legitimate sellers of cars, tricking victims into providing payment for those cars, withdrawing the funds from banks around the country using efforts designed to evade scrutiny, and wiring the proceeds outside the United States.
The fraud most commonly operated as follows: first, co-conspirators impersonated automotive dealers and collectors and claimed to be selling classic cars on various well-known internet auctions and trading websites. Victims responding to the ads were, in fact, corresponding with a fraud scheme participant. After the victims and co-conspirators came to terms on a sale price, including down payment and shipping costs, victims were next directed to purported automotive transportation companies and were told that these companies would accept payment and transport the cars. These companies were in fact shell corporations established by the conspiracy to help perpetrate the fraud, whose corporate bank accounts were established and controlled by the defendants, awaiting wired funds from the fraud's victims. After victims had wired payment, the defendants went to the banks to drain the victim's funds, often starting the same day payment had been transmitted. The defendants would draw money from different bank branches in numerous withdrawals on the same day, in denominations that were varied and often kept to an amount they believed would prevent the financial institutions from recording and reporting the fraud. The co-conspirators then sent the fraud proceeds outside the United States to Eastern European countries, from where many of the conspirators originated. Victims never received the goods they believed they had purchased, and many were unable to recover their money or were left paying loans for cars that were never truly for sale. The defendants' scheme defrauded victims of more than $4.5 million.
Each of the defendants is charged with one count of conspiracy to commit wire fraud, which carries a maximum statutory sentence of 30 years in prison, and one count of conspiracy to commit money laundering, which carries a maximum statutory sentence of 20 years in prison.