‘Fake CEO’ scammers steal & launder millions


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Money-laundering scammers target European firms

It’s a story that sounds more like Hollywood fantasy: Scammers pose as CEOs of global companies and smooth-talk employees out of millions of dollars. All from telephone conversations originating in Israel that targeted companies like Kia, Hugo Boss, and Chanel.

According to the New York Times, the FBI deems these types of operations as “fake CEO” or “fake president” frauds, and their prevalence has escalated greatly over the last two years to the tune of nearly $2 billion in successful theft.

In the most recent instance, several European immigrants to Israel set up shot there and are alleged to have defrauded companies in several European nations. They have since been arrested and are awaiting trial as the investigations continue.

According to the Times report, the alleged perpetrators “telephoned employees in charge of finances, presented themselves as the CEO, sought information about vendors owed money, and convinced the company representatives to send money to bank accounts in Europe.” The false phone calls were augmented with forged documents, false logos and emails, and so on. Authorities believe this particular group of scammers netted about $12 million.

Numerous questions still remain, including where and how the money laundering of proceeds is occurring. Gilbert Chikli, famous in Israel and Europe for a similar scam, acknowledged using bank accounts in China, which according to the Times is “emerging as an international hub for money laundering.” Suspects in the current case are believed to have used underground money-transfer systems in China, though few details have yet emerged.

Most of the multi-national companies targeted in the scam declined comment for the story, but no doubt there are a lot of internal discussions occurring about internal security and protocols for wiring money to company executives.

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