Three Sentenced in Cyber Fraud Schemes Involving More Than $17 Million

https://www.justice.gov/usao-wdwi/pr/three-sentenced-cyber-fraud-schemes-involving-more-17-million

Department of Justice
U.S. Attorney’s Office
Western District of Wisconsin

FOR IMMEDIATE RELEASE
Tuesday, November 21, 2017

Three Sentenced in Cyber Fraud Schemes Involving More Than $17 Million

MADISON, WIS. – Jeffrey M. Anderson, Acting United States Attorney for the Western District of Wisconsin, announced that three individuals involved in an international romance fraud scheme were sentenced this week.
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The defendants were also ordered to pay restitution to the victims, although it is unlikely victims will be repaid because most of the fraud proceeds were either spent on luxury goods or directed to individuals and accounts overseas.

From approximately October 2013 to August 2015, the defendants participated in a scheme to defraud victims in the United States and Canada out of more than $12.9 million. Co-schemers targeted victims by creating fake profiles on internet dating services. Once they gained the victims’ trust, co-schemers got victims to pay so-called “inheritance taxes” on non-existent inheritances, and to send money in exchange for checks that turned out to be fraudulent. Although Judge Peterson found that the intended loss in the romance fraud scheme was $12.9 million, he noted that the amount was likely understated given the scope of the scheme and the number of victims.

In a related case, Judge Peterson also sentenced Ugbah to 12 years in prison for conspiracy to commit wire fraud, in connection with his role in a business email compromise (“BEC”) scheme. Judge Peterson ordered that the sentence was to be served concurrently with his sentence in the romance fraud case. The BEC case was originally filed by the U.S. Attorney’s Office in Los Angeles, but transferred to the Western District of Wisconsin for the guilty plea and sentencing.
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In the BEC scheme, co-conspirators sent “spoofed” emails that appeared to come from company owners or employees and asked other employees to wire transfer money into bank accounts, purportedly for company business. The wire transfers went into accounts belonging to romance fraud victims who had been tricked into acting as unwitting money launderers. As part of the scheme, the online suitors directed the romance fraud victims to Ugbah, who admitted posing as a financial advisor who used the name “David Sanders” and obtained the victims’ bank account information and instructed those victims to forward the money to other accounts controlled by co-conspirators. This conspiracy targeted at least 53 businesses across the United States, and the businesses cumulatively suffered losses of just over $1.5 million, with an intended loss of more than $4 million. Ugbah communicated with more than 100 romance fraud victims in connection with the BEC case.
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