FTC targets $10 million international credit card scam
Since at least 2006, more than one million people have been charged $10 or less and their payments routed through at least 16 dummy corporations in the United States to bank accounts in Eastern Europe and Central Asia.
The scammers hid under phony company names that resembled real companies and stole personally identifiable information from victims in the U.S., according to court documents. Using that information, they were able to open more than 100 merchant accounts with companies that process credit and debit card charges.
Investigators say perpetrators recruited at least 14 people, known as "money mules," through spam emails to create fake companies. The emails announced that an international finance services company was looking for a U.S. finance manager. The "money mules" listed the names of identity theft victims as owners of the companies and also used information from legitimate companies without their knowledge.The suspects also set up bank accounts, which they used to obtain debit cards to set up phone service, virtual addresses and websites as part of the scam.
Some consumers, who noticed the charges on their credit or debit card statements, called a listed toll-free number next to the charge only to learn that the number was disconnected or they had to leave a message. Consumers who left messages never received a call back.
Most victims did not notice the charges, which ranged from 20 cents to $10, or they did not seek reimbursement, FTC officials say.
A federal judge in Illinois has frozen the accounts linked to the 16 sham companies. To see related court documents and a list of the companies, click here.