- Ensuring that justice is served across borders
Compiled by Annalise Kempen
Have you ever thought that South African investigative standards or investigators are not on par with international standards? Think again. An operation entitled Scams R Us is an excellent example of how the South African authorities have contributed to justice being served across borders.
The modus operandi
In September 2011, a female victim located in the United States of America informed US investigators that a person with whom she communicated through an online dating service had requested that she repackage and ship two cellphones to an address in Pretoria, South Africa, using labels that this person provided to her. The initial investigation revealed that the cellphones were purchased using the stolen personal and credit card information of an American citizen who (obviously) did not authorise the use of this information.
A US undercover agent then took over the identity of the female victim in order to communicate with the subject online. This contact led to communications with other persons who were knowingly participating in a scheme to defraud others through the use of counterfeit and illegally obtained cheques, and that two such cheques had been mailed to potential victims. The Internet Protocol (IP) address for the e-mail that was used by the target of the investigation revealed that it was being done from Pretoria.
A further investigation was launched and as a result of the execution of a series of search warrants, investigators obtained e-mail contents from approximately 360 e-mail accounts that were used in the fraud schemes. The majority of the IP addresses of the e-mail accounts reflected locations in Pretoria. Analysis of the contents of more than a million e-mails provided evidence of several online fraud schemes, including reshipping of fraudulently purchased merchandise; account takeovers of credit card accounts; counterfeit and/or unauthorised cheque scams; account takeovers of retirement and other accounts; and laundering of illicit proceeds through layers of pre-paid credit cards. The e-mails also revealed the purchase and/or use by the defendants of personal identification information of hundreds of people who were living in the USA, including multiple banks and victims located in the southern District of Mississippi. This information was used to open accounts and fraudulently take over bank and credit card accounts.
The fraudsters used illegally obtained lists of e-mail addresses to send hundreds of prescripted e-mails solicitating unwitting individuals into scams, ranging from romance scams and work-at-home scams to secret shopper scams. These unwitting individuals then facilitated the transfer of funds from various accounts takeovers to the fraudsters by using Western Union and Money Grams and even through prepaid credit cards. In doing this, these individuals, often unintentionally, became money mules or e-mules since they had partaken in laundering the proceeds of crime. Money mules/e-mules, just like fraudsters, are guilty of illegally transporting fraudulently gained money which is the reason why they could be prosecuted.5
However, that was not where the fraud stopped - these money/e-mules were also used to repackage and ship fraudulently purchased cellphones, computers, televisions and other electronics by using fraudulently obtained shipping labels from the US Postal Services, Federal Express, United Parcel Services and DHL. The fraudsters also advertised many of the electronic items for sale on Gumtree (an online classified South African website).
The South African authorities become involved
In July 2013, members of the Electronic Crime Unit (ECU) of the Directorate for Priority Crime Investigation (DPCI) (the Hawks) started a project-driven investigation into the activities of the suspects. The project concluded with the take-down operation during May 2014 with the simultaneous search, seizure and arrest operations in Canada of two suspects; in the USA of four suspects and in South Africa of 11 suspects. This eventually led to the successful extradition of some of the suspects in July 2015 (see infra). The South African government received an official request from the US Department of Justice in May 2014, asking for its assistance in obtaining evidence for use in the criminal investigation and related criminal proceedings.
The request was premised on the Treaty between the Government of the United States of America and the Government of the Republic of South Africa on Mutual Legal Assistance in Criminal Matters, which was signed in Washington on 16 September 1999.