BALTIMORE - An investigation spearheaded by Homeland Security Investigations (HSI) Baltimore’s Mid-Atlantic El Dorado Task Force (EDTF) and in conjunction with the Environmental Protection Agency – Office of the Inspector General (EPA-OIG) and the Internal Revenue Service – Criminal Investigations (IRS-CI) resulted in a state-wide operation to break up an alleged Maryland-based financial fraud network. During the operation, which took place throughout the state of Maryland on Feb. 7, the task force executed 3 federal search warrants and arrested ten individuals.
“Criminal organizations are growing more sophisticated when it comes to executing financial fraud schemes,” said Special Agent in Charge James C. Harris of HSI Baltimore. “Our investigation revealed that this criminal organization was using confusingly similar email addresses and company names to steal money from individual people as well as private and public sector organizations. HSI Baltimore, will continue to work with our law enforcement partners on the Mid-Atlantic El Dorado Task Force, and across law enforcement to disrupt these networks and crippled their ability to operate in Maryland.”
The Mid-Atlantic El Dorado Task Force is comprised of Special Agents from HSI Baltimore, EPA-OIG, the United States Postal Inspection Service (USPIS), Maryland Department of Public Safety and Correctional Services (DPSCS), the Anne Arundel County Police Department, Prince George’s Police Department, and the Montgomery County Department of Police.
During the course of the investigation, HSI Baltimore and its partners identified a sophisticated criminal network of individuals allegedly engaged in various forms of financial fraud. This network utilized more than 50 bank accounts to launder and disperse proceeds obtained through various fraud schemes, including romance scams, lottery scams, and Business Email Compromise (BEC).
“Rooting out sophisticated program fraud that threatens the integrity of the EPA is one of our investigative priorities,” said EPA Office of Inspector General Special Agent in Charge Nic Evans. “We worked with law enforcement partners to put a stop to multiple email schemes intended to steal millions of dollars from a court ordered trust fund under EPA’s oversight.”
The state-wide operation was part of a multi-jurisdictional, multi-agency, HSI-led investigation that to date has identified seventeen alleged co-conspirators, seized assets worth more than a million dollars, to include luxury vehicles that were attempted to be exported from the Port of Baltimore, and stopped millions of dollars before they could be stolen from victims.
The alleged movement of fraudulent proceeds in this case was pervasive and expansive, with much of the fraudulently obtained proceeds moving through the US Banking System to foreign countries such as Nigeria and China.
To date this investigation uncovered tens of millions of fraudulent proceeds allegedly being laundered through this criminal organization as well as twenty-nine victims including individual citizens, government agencies, hospitals, and other critical infrastructure entities that have been cheated out of millions of dollars.
The investigation revealed that the conspirators allegedly created and used limited liability companies and other shell businesses to open bank accounts on which the shell entities were listed as the account holders. Members of the conspiracy had signature authority for the bank accounts, at times using aliases or stolen identities. The alleged conspirators used the bank accounts to receive money obtained from the fraud victims.
The victims included government agencies, organizations, and companies, such as an environmental trust, an urban redevelopment program, a medical center, a transportation and logistics company, a school district, a college, and a county government, among others. Some of the alleged co-conspirators obtained and used forged and counterfeit identification documents, including documents bearing the names of individual identity theft victims.
The investigation illustrated how the victims were deceived into sending money to the alleged conspirators’ bank accounts based on false pretenses, such as being provided with false bank account information for legitimate vendor payments and false wire transfer information for legitimate transactions. After the fraudulently obtained funds were received in the bank accounts, the conspirators allegedly engaged in financial transactions to conceal and disguise the nature and source of the money through cash withdrawals, the purchase of cashier’s checks, debit card transactions, and by transferring funds to other bank accounts controlled by the conspirators.
According to the investigation, the alleged offenders obtained and used a portion of the fraud proceeds for themselves. The conspirators allegedly used some of the fraud proceeds to purchase vehicles, some of which were shipped or attempted to be shipped outside the United States. They also allegedly engaged in international financial transactions and caused fraud proceeds to be sent outside the United States.
If convicted, the defendants each face a maximum sentence of 20 years in federal prison for the conspiracy and for each count of money laundering.
HSI Baltimore would like to thank the Environmental Protection Agency – Office of the Inspector General (EPA-OIG); the Internal Revenue Service – Criminal Investigations (IRS-CI); Maryland Department of Public Safety and Correctional Services (DPSCS); the Department of Defense, Office of Inspector General, Defense Criminal Investigative Service (DCIS) Cyber Field Office; the Anne Arundel County Police Department; Prince George’s Police Department; and the Montgomery County Department of Police for their partnership and collaboration.
The case is being prosecuted by the U.S. Attorney’s Office for the District of Maryland.
*This press release was issued by the Department of Homeland Security’s Homeland Security Investigations—Baltimore Field Office.
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