Ukrainian resident pleads guilty for his role in a sophisticated international scheme to steal money from US bank accounts | takeover bid

A US citizen who previously resided in Ukraine has pleaded guilty to conspiracy to commit bank fraud.

According to court documents, Harold Sobel, 69, was a member of an international criminal enterprise that illegally debited money from the bank accounts of ignorant American victims. Members of the criminal enterprise set up shell companies in an effort to receive funds from victims and created fake websites for the shell companies that claimed to offer products or services, such as cloud storage. Members of the criminal enterprise made unauthorized debits from the victims’ bank accounts, while falsely stating to the banks that the debits were authorized by the victims in payment for non-existent goods and services.

“The department will prosecute members of international criminal enterprises who defraud Americans and deceive American banks,” said Assistant Deputy Attorney General Brian M. Boynton, chief of the Justice Department’s Civil Division. “No matter where they are, the department will prosecute the perpetrators of these fraud schemes.”

“A sophisticated transnational criminal enterprise executed false debits against unsuspecting victims and deceived banks – victimizing American consumers and financial institutions in the process,” said Inspector in Charge Eric Shen of the Criminal Investigations Group. of the United States Postal Inspection Service. “The guilty plea demonstrates the tenacity and determination of the United States Postal Inspection Service and its law enforcement partners to hold criminals accountable for their unscrupulous actions.”

Unauthorized debits from victims’ accounts, caused by conspirators, resulted in returned transactions and high return rates that often drew scrutiny from banks. To conceal and continue to make these unauthorized debits, members of the criminal enterprise made false statements to financial institutions about the transactions, claiming they were authorized. In some cases, members of the criminal enterprise have caused accounts used by the criminal enterprise to also “micro-debit” other bank accounts controlled and funded by or for the criminal enterprise. The “micro-debits” were used to artificially lower return rates to levels that the conspirators believed would reduce banking oversight and thus reduce the likelihood of closure of accounts used by the criminal enterprise. The criminal enterprise also operated a call center that received complaints from victims of unauthorized removals. The call center sought to dissuade victims from making statements to victims’ banks and government agencies.

As part of the business, Sobel opened bank accounts in the United States under a co-conspirator who organized and directed the affairs of the company from outside the United States. For example, on or around October 16, 2019, Sobel opened four business deposit accounts at a bank branch in Las Vegas. Sobel opened the accounts for a shell company called “Silver Safe Box” and registered as the only member and authorized signatory in the account opening documentation. The criminal enterprise then funded “micro-debits”, designed to reduce return rates, through Silver Safe Box accounts. Between December 2019 and approximately January 2021, Silver Safe Box accounts funded over 800,000 “micro-debits” for amounts ranging from $0.99 to $1.85. Sobel also recruited at least two associates in the United States to help the foreign co-conspirator, among other things, open additional bank accounts and register front companies.

Sobel’s involvement also included providing support to the criminal enterprise’s call center operations in Ukraine. Sobel devised a script to be used in response to victim complaints by call center staff to retain as much of the proceeds of the criminal enterprise as possible and – only in cases where these efforts failed – to then issue full refunds, to deter victims from reporting to victims’ banks and government agencies. Sobel also devised a metric by which he and the alien co-conspirator could gauge the effectiveness of the call center staff. As part of his guilty plea, Sobel admitted that more than $1.5 million in debits from the victim were reasonably foreseeable to him.

Sobel pleaded guilty to conspiracy to commit bank fraud. He is due to be sentenced on October 12 and faces a maximum sentence of 30 years in prison. A federal district court judge will determine any sentence after considering US sentencing guidelines and other statutory factors.

The United States Postal Inspection Service is investigating the matter.

Trial Attorneys Meredith Healy and Wei Xiang of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorney Mina Chang of the District of Nevada are pursuing the case. The US Attorney’s Office for the Southern District of Texas provided substantial assistance.

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