Online fraudsters behind £9.2m payment diversion fraud sent to prison

The Southwark Crown Court has sent a gang of five online fraudsters to prison for orchestrating a number of payment diversion fraud scams between 2014 and 2019 totalling £9,218,522.76.

The fraudsters injected malware into victims' devices to steal their email login credentials, logged in to victims' email accounts to search for high-value financial transactions, and then used the information to send spoof emails to convince victims into sending money to UK-based ‘mule’ bank accounts controlled by them.

The fraudulent-yet successful operation was discovered by the Met's Specialist Crime Directorate's North West London Economic Crime Unit which detected as many as 235 separate incidents of fraud involving the theft of over £9.2 million from innocent victims. The detectives found that the victims believed they were transferring funds to their conveyancing solicitor during a property transaction.

"The main method employed by the gang was the use of Malware to steal the login credentials of email accounts belonging to businesses and private individuals worldwide. This would allow the fraudsters to monitor the chosen email accounts for high-value financial transactions," said Met Police.

Payment diversion fraud help fraudsters steal £9.2m from Brits

"Having identified a legitimate financial transaction between two parties, email conversations were intercepted and spoof emails sent so that victims were duped into paying funds into UK based ‘mule’ bank accounts controlled by the fraudsters instead of their intended legitimate destination.

"Another method involved conning victims out of thousands of pounds by selling investments in ‘Binary currency trading schemes’ that did not exist. Victims ranged from high profile individuals and organisations to private individuals who thought that they were paying money to their conveyancing solicitor during a property transaction," the force added, stating that the fraudsters used at least a hundred mule accounts to perpetrate their crimes.

"I advise anyone conducting financial business by email to verify the bank account they are sending their money to by contacting the intended recipient by means other than email. Furthermore, people should be aware that a genuine investment company would not use different private bank accounts in different names in a legitimate transaction," said Chris Collins, Detective Constable of Economic Crime.

On Friday, after a trial that lasted five months, the Southwark Crown Court read out jail terms for all the fraudsters who committed these scams between 2014 and 2019. While ringleader Olumuyiwa Ogunduyile, a Nigerian national, was sentenced to six years for conspiracy to commit fraud by false representation and seven and a half years for conspiracy to convert criminal property concurrent, similar sentences were also awarded to two other Nigerian nationals, an Indian national, and a German-born Ghanaian.

Number of frauds in the UK rose by 9% in 2019

Recently, the National Crime Agency said that the number of fraud offences duping members of the public and businesses out of billions of pounds rose by 9% in 2019 to touch 3.8 million. To tackle the rising menace, law enforcement agencies recently carried out an operation code-named Project OTELLO to nab fraudsters participating in financial scams.

The operation involves participation from the National Economic Crime Centre, City of London Police, the Serious Fraud Office, the Financial Conduct Authority, Her Majesty’s Revenue & Customs, the Crown Prosecution Service, and other police forces.

"Fraud is one of the most prolific crimes affecting UK residents, and the numbers are rising. The methods used to dupe people into handing over their hard earned savings or inheritance are becoming more complex, and even the most savvy can become victims. This work aims to target those fraudsters causing the most harm," said Graeme Biggar, the Director General of the National Economic Crime Centre.

"We also know the current system in the UK for tackling fraud needs to change, which is why we are working closely with the Home Office, the City of London Police and others on broader reforms. We are determined, along with our private and public sector partners, to make a real difference to the way fraud is tackled," he added.

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