July 15, 2011

Law enforcement officials in Romania and the United States have arrested and charged more than 100 individuals in connection with an organized fraud ring that used phony online auctions for cars, boats and other high-priced items to bilk consumers out of at least $10 million.

According to a statement from the Justice Department, the scams run by this ring followed a familiar script. Conspirators located in Romania would post items for sale such as cars, motorcycles and boats on Internet auction and online websites. They would instruct interested buyers to wire transfer the purchase money to a fictitious name they claimed to be an employee of an escrow company. Once the victim wired the funds, the co-conspirators in Romania would text information about the wire transfer to co-conspirators in the United States known as “arrows” to enable them to retrieve the wired funds. They would also provide the arrows with instructions as to where to send the funds after retrieval.

The arrows in the United States would then visit wire transfer services such as Western Union or MoneyGram, provide false documents including passports and drivers’ licenses in the name of the recipient of the wire transfer, and grab the cash. They would subsequently wire the funds overseas, typically to individuals in Romania, minus a percentage kept for commissions. The victims would not receive the items they believed they were purchasing. In some cases, co-conspirators in Romania also directed arrows to provide bank accounts in the United States where larger amounts of funds could be wired by victims of the fraud.

Since February 2011, FBI agents and U.S. Justice Department authorities in Florida, Pennsylvania and Texas have arrested or charged at least 21 Romanians and Moldovans in the U.S. who were allegedly members of the ring. Thirteen of those charged have pleaded guilty, and three remain at large.

The Bucharest news agency Adevarul.ro has more details on the 90 Romanians arrested by authorities there in nine different cities. The Romanian authorities say the group stole almost $20 million, about twice as much as the Justice Department estimates.

Some of the Romanians arrested were from the town of Râmnicu Vâlcea, a location that has become synonymous with online auction fraud. In January, Wired published a fascinating and readable article on how this remote town of 120,000 residents has become cybercrime central, earning the town the nickname “hackerville.”

10 thoughts on “More Than 100 Arrested in Fake Internet Sales

  1. Jim J.

    I continue in awe as to buyers wiring funds. I don’t know about other wire services, but Western Union has high-visibility warning placards on their outlets and on the wire forms. I muster little sympathy toward the victims.

  2. John

    I muster little sympathy for people who buy large items online. Really your going to buy are car without seeing it and wire money to someone you have never meet. Wow.

  3. Huh?

    I’m please to see more and more cooperation between authorities here and abroad. Brian I think a story about the cooperation between countries is really need for the public to know how well authorities are working together. Right now it feels like a mystery. For example, do the Germans and the Iranians work together closely? (Stuxnet). How about the different countries in NATO and how well they work together with Eastern block countries?

  4. TheGeezer

    I can’t say I have much sympathy for anyone purchasing high price items from some organization or person they never heard of either. However, I’m glad to see US and Romanian law enforcement are getting some of these shysters off the street (or internet).

  5. xAdmin

    Two axioms come to mind…..

    A fool and his money are soon parted.

    Only two things are infinite, the universe and human stupidity, and I’m not sure about the former. Albert Einstein

  6. Gary

    The Bucharest news agency Adevarul.no

    …should be…ro

  7. Tom Seaview

    It’s about time.
    I first found out about this two years ago, when my mother-in-law was looking for a used car.
    My wife, who is not a car person, kept sending me links to Craigslist ads. The cars listed were in her price range, but they were clearly too good to be true.
    So, I used an anonymous Email address to inquire about several of the imaginary cars, and soon got replies like:
    “I am soldier in Army, shipping for Afghanistan soon next week, and car is at [real army base] near [Des Moines or some other city]…” followed by details on how to pay for it.

    My replies went something like this:
    “[Des Moines]? What a coincidence… my brother-in-law is the service manager of [real dealership in that city], only {approximate number] of miles from [Des Moines]. What time tomorrow can he look at it? If it is satisfactory, he will pay cash…”

    It would take a few days to put together a specific reply in English, since their first response had been a pasted Email, but then they would reply in terribly convoluted sentences about how the car is in a shipping container in a secure area, and could not be seen, and they only accept payment by wire transfer…

    I did this dozens of times, loving the extra labor I was putting them through. I especially liked the way they would send their initial pitch Email in response to any communication, including “YOU ARE A #%$$^&#%$ SCAMMER AND WE ARE SENDING INTERPOL TO ARREST YOU.”

    1. kooberfacer

      Beautiful!Now thats using the ole nogging.A fool hacker and his scam are easily dragged into the spotlight.

  8. Konrads

    While any criminal that gets busted is good news, I wouldn’t put high hopes on Romania suddenly cracking down on them. Most likely, US put immense pressure and bribes to local officials were insufficient to protect.

Comments are closed.