Police have arrested 1,003 individuals across 22 jurisdictions in the last few months as part of an Interpol-coordinated operation against online financial crimes, including the business email compromise (BEC) scams.
Law enforcement across 20 nations made the arrests between June and September which involved various forms of online fraud crime, including romance scams, investment fraud and money laundering linked to online gambling. Some 2,350 bank accounts were seized as part of Interpol’s Operation HAECHI-II.
“Far from the common notion of online fraud as a relatively low-level and low stakes type of criminality, the results of Operation HAECHI-II show that transnational organized crime groups have been using the Internet to extract millions from their victims before funneling the illicit cash to bank accounts across the globe,” the international criminal police organisation said.
The operation specifically targeted BEC, or email fraud, which involves tricking staff into wiring large sums to supposed suppliers or contractors, often by using emails that appear to be sent by someone more senior in the organisation.
The FBI estimated that BEC scams cost US businesses $1.8 billion in 2020, dwarfing the reported $29 million in losses attributed to ransomware. The scammers have also taken a leaf from the ransomware business by moving to a services-based model where components are rented out to different parties.
Interpol highlighted a case in Colombia where a textiles company lost more than $8 million to a BEC scam.
“The perpetrators impersonated the legal representative of the company, giving the order to transfer more than $16 million to two Chinese bank accounts. Half of the money was transferred before the company uncovered the fraud and alerted the Colombian judicial authorities, which in turn quickly contacted Interpol’s financial crime unit through their National Central Bureau in Bogota,” Interpol said.
To freeze the transferred funds, Interpol worked with its bureaus in Beijing, Bogota and Hong Kong.
“Intercepting the illicit proceeds of online financial crimes before they disappear into the pockets of money mules is a race against time, and we have worked closely with the Attorney General’s Office to move as decisively as possible,” said General Jorge Luis Vargas Valencia, Director General of the Colombian National Police.
BEC is an international banking problem that is difficult for law enforcement to address across jurisdictions. The FBI set up the IC3’s Recovery Asset Team (RAT) in February 2018 to handle communications between banks and FBI field offices to freeze funds in cases where victims transferred funds to domestic accounts. However, IC3 has worked with US consulates in foreign territories, such as Hong Kong, to freeze multimillion-dollar transfers headed to bank accounts in China.
Interpol notes that in another case, a company in Slovenia transferred $800,000 to money mule accounts in China. The transfer was stopped after Slovenian Criminal Police contacted Interpol and connected with peers at Interpol in Beijing.
Operation HAECHI-II involved law enforcement from Angola, Brunei, Cambodia, Colombia, China, India, Indonesia, Ireland, Japan, Korea (Rep. of), Laos, Malaysia, Maldives, Philippines, Romania, Singapore, Slovenia, Spain, Thailand, and Vietnam.