A federal grand jury in Los Angeles returned an indictment against four California-based defendants for their alleged roles laundering fraud proceeds stored on gift cards. The indictment, which was unsealed today, charges U.S. citizen Blade Bai, 33, of El Monte; and Chinese citizens Bowen Hu, 26, of Hacienda Heights; Tairan Shi, 27, of Diamond Bar; and Yan Fu, 58, of Chino Hills, with conspiring to launder proceeds of wire fraud that were stored on gift cards issued by retailer Target.
According to the indictment, defendants Bai, Hu and Shi obtained over 5,000 gift cards from a group known as the “Magic Lamp.” Defendants Bai, Hu and Shi caused the gift cards to be distributed to “runners” like defendant Fu who used the funds on the cards at Target stores in Los Angeles and Orange County and elsewhere to purchase, among other items, consumer electronics and other gift cards. Through the purchases, returns and other transactions at multiple Target stores, the defendants and their co-conspirators sought to conceal the fact that the gift cards had been originally funded with fraudulent proceeds.
The indictment further alleges that perpetrators of the fraud schemes induced victims to send proceeds to defendants’ associates, and defendants then conspired to launder the proceeds. The indictment also alleges that victims of the schemes are spread throughout the United States, including California, Texas, Illinois and Georgia.
“The Department of Justice and its law enforcement partners are committed to tackling fraud schemes from every angle,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “Individuals who knowingly facilitate the victimization of American consumers make fraud possible, are criminally culpable for the offenses and should expect to be held accountable.”
“This case offers an important reminder to consumers that gift cards are for presents to friends and loved ones – they should never be used for payments to any government or corporate entity,” said Acting U.S. Attorney Tracy L. Wilkison for the Central District of California. “Don’t be fooled by callers claiming to be with a government agency, a bank or any other institution demanding that you purchase gift cards. There is no reason to purchase a gift card to resolve a problem with an account, your Social Security number or a supposed criminal case.”
“The case against these defendants is the result of the impressive work by Homeland Security Investigations’ (HSI) Los Angeles-led El Camino Real Financial Crimes Task Force,” said Special Agent in Charge David A. Prince for HSI Los Angeles. “These types of crimes have devastating effects on the victims. Through coordinated investigative efforts by law enforcement and our prosecution partners, HSI will continue to aggressively investigate those who prey on our elderly population.”
Defendants are charged with conspiracy to commit money laundering. If convicted, they face a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
This case was investigated by HSI Los Angeles’ El Camino Real Financial Crimes Task Force, a multi-agency task force comprised of federal and state investigators focused on financial crimes in Southern California, with substantial assistance from the FBI Los Angeles Field Office. Investigative assistance was also provided by the Social Security Administration, Office of the Inspector General.
Assistant U.S. Attorney Monica Tait of the Central District of California and Trial Attorney Wei Xiang of the Civil Division’s Consumer Protection Branch are prosecuting the case.
The Consumer Protection Branch and the U.S. Attorney’s Office for the Central District of California are part of the Transnational Elder Fraud Strike Force, which investigates and prosecutes scams run by transnational criminal organizations, including mass mailing, telemarketing, and tech support scams. For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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September 29, 2021 at 03:50AM
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Four Defendants Indicted for Laundering Target Gift Cards Purchased by Fraud Victims - Department of Justice
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