The schemes targeted unsuspecting victims including universities in North Carolina, Texas and Virginia, and attempted to cause more than $5 million in losses.
BEC, also known as “cyber-enabled financial fraud,” is a sophisticated scam often targeting employees with access to company finances, businesses working with foreign suppliers and/or businesses that regularly perform wire transfer payments.
This is often accomplished by impersonating a key employee or business partner after obtaining access to that person’s email account or sometimes done through romance and lottery scams.
BEC scams may involve fraudulent requests for checks rather than wire transfers; they may target sensitive information such as personally identifiable information (PII) or employee tax records instead of, or in addition to, money; and they may not involve an actual “compromise” of an email account or computer network. Foreign citizens perpetrate many BEC scams. Those individuals are often members of transnational criminal organizations, which originated in Nigeria but have spread throughout the world.
Oludayo Kolawole John Adeagbo aka John Edwards and John Dayo, 43, a Nigerian citizen and UK resident, and Donald Ikenna Echeazu aka Donald Smith and Donald Dodient, 40, a dual UK and Nigerian citizen, are charged with wire fraud conspiracy, money laundering conspiracy and aggravated identity theft for defrauding a North Carolina university (the University) of more than $1.9 million via a business email compromise scheme. The indictment was returned by a federal grand jury in the Western District of North Carolina on April 17, 2019, and was unsealed Tuesday following Echeazu’s initial appearance in federal court in Charlotte.
From Aug. 30, 2016, to Jan. 12, 2017, Adeagbo and Echeazu obtained information about significant construction projects occurring throughout the United States, including an ongoing multi-million-dollar project at the victim University. To execute the scheme, the defendants ended up charged with registering a domain name similar to that of the legitimate construction company in charge of the University’s project and created an email address that closely resembled that of an employee of the construction company, according to the indictment.
Using the fake email address, the co-conspirators deceived and directed the University to wire a payment of more than $1.9 million to a bank account controlled by an individual working under the direction of defendants, according to the indictment. Upon receiving the payment, the co-conspirators laundered the stolen proceeds through a series of financial transactions designed to conceal the fraud.
The wire fraud conspiracy charge and the money laundering conspiracy charge each carry a maximum statutory sentence of 20 years in prison. The aggravated identity theft charge carries a mandatory two-year prison sentence consecutive to any other term imposed.
Adeagbo and Dayo, are also charged in the Southern District of Texas with conspiracy to commit wire fraud and wire fraud. A federal grand jury returned the indictment March 30, which was unsealed on Aug. 3.
From November 2016 until July 2018, Adeagbo participated in cyber-enabled business email compromises in an attempt to steal more than $3 million from victims in Texas, including local government entities, construction companies and a Houston-area college. The indictment alleges Adeagbo registered domain names that looked similar to legitimate companies. They then sent emails from those domains pretending to be employees at those companies, according to the charges. The conspirators sent emails to clients or customers of the companies they impersonated and deceived those customers into sending wire payments to bank accounts they controlled.
Adeagbo faces up to 20 years in prison, if convicted on the charges.
Olabanji Egbinola, 42, is charged with wire fraud, conspiracy to commit wire fraud, money laundering, and conspiracy to commit money laundering.
From Sept. 26, 2018, to Dec. 26, 2018, Egbinola conspired with others to defraud a Virginia-based university. Egbinola created and used a fraudulent email account that incorporated the name of a construction company that had a large, ongoing contract with the university. Using this email account, Egbinola deceived the university into transferring $469,819.49 to a bank account controlled by Egbinola. That money was quickly laundered and transferred overseas through numerous transactions. Evidence obtained during the investigation showed Egbinola repeatedly accessed the email account used to defraud the Virginia university.
All three defendants were arrested April 23, 2020, by UK authorities at the request of the United States and ordered extradited on Sept. 3, 2021. All three defendants filed appeals, all of which were rejected by the UK High Court on July 12.