Indictment Opened In IRS Fraud Scam

The U.S. Department of Justice announced on October 27 that it had indicted 61 individuals for alleged involvement in a “transnational criminal organization” that has been extorting large sums of money from U.S. citizens via a network of call centers based in India.

According the a news release by the DOJ, the individuals implicated in the scam would impersonate employees from the U.S. Internal Revenue Service during repeated calls with unsuspecting victims. From there, callers would extort large sums of money from victims under threats of fines or imprisonment.

“One 85 year-old California woman was threatened over nonexistent tax violations,” reported NPR’s Carrie Johnson. “Prosecutors say she turned over $12,000 to the scammers.”

The indictment opened on October 19 cites one victim from Hayward, California who was allegedly tricked into handing over $136,000 over the course of 20 days. The individual was directed to purchase 276 pre-paid cards which were then funneled into reloadable debit cards by the scammers.

Scammers reportedly also used “hawala” networks to transfer money internationally without the use of formal banking systems or promissory agreements.

Historically, hawala systems have been used to fund terrorist cells all over the world, as well as guarantee other illicit money transfers to organizations in India and Pakistan.

“[…] no money actually moves,” explains former FBI official Matthew Levitt to NPR. “What actually moves is communication, and they pay out through pots of money here and pots of money there.”

The DOJ were able to trace the scammers to call centers in Ahmedabad, India, though 20 of the suspects were arrested in the U.S.

The U.S. is seeking extradition of the involved scammers based in India, according to Detroit Free Press

“This indictment will serve to not only seek the conviction of those involved, but will send a message around the world that no one is safe from prosecution for participating in such pervasive transnational fraud schemes,” said U.S. attorney Kenneth Magidson.

The suspects have been charged by a U.S. District Court with counts of conspiracy to commit identity theft, false impersonation of an officer of the United States, wire fraud, and money laundering.

“To potential victims, our message today is simple: U.S. government agencies do not make these kinds of calls, and if you receive one, contact law enforcement to report the suspected scam before you make a payment,” states the DOJ in the aftermath of these crimes.

Sources: Detroit Free Press, U.S. Department of Justice, NPR (2)/Photo Credit: geogus78/Flickr