Former CEO of Sunwest Management Ordered to Pay Over $74 Million in Restitution to More than 1,400 Victims
PORTLAND, Ore.—The U.S. Attorney’s Office for the District of Oregon announced today that Oregon Tool, Inc., a Portland-based manufacturer of professional-grade cutting tools, which at all relevant times was known as Blount, Inc., has entered into a non-prosecution agreement and paid $1.7 million for accepting payments for products sold to two distributors transmitted through an unlicensed money transmitting business linked by the FBI to a trade-based money laundering scheme in Nigeria.
In December 2019, the FBI began investigating a criminal organization based in Nigeria that operated several online fraud schemes, including romance scams, targeting elderly women in the United States. Over the course of this investigation, the FBI identified a Nigeria-based black market currency exchange network that offered U.S. dollar deposits into U.S.-based bank accounts in exchange for Nigerian currency provided in Nigeria. The U.S. dollars transmitted by the network were the proceeds of financial fraud schemes perpetrated against at least two dozen victims in the United States.
Between 2012 and 2020, Blount’s two Nigerian distributors used the unlicensed money transmitting business to convert Nigerian naira to U.S. dollars which were used to pay for Blount products. In March 2012, the U.S. Secret Service notified Blount’s then-general counsel that the agency was preparing to seize one of the Nigerian distributor’s bank accounts, because it was allegedly being funded primarily by fraud and the proceeds were being used to pay Blount.
From November 2016 to December 2017, Blount credited more than $974,000 in deposits to the distributor. Those deposits originated from sources including individuals, many of whom the FBI later assessed were women in the United States over the age of 60 who had been the victim of romance fraud schemes; various business LLCs; and other anonymous cash depositors with no logical business relationship or established history with the distributor or Blount. Two of the deposits were made by an individual who believed the money would purchase artwork for someone they had met on a dating website. Another payment was made by a person residing in Beaverton, Oregon at the request of someone on a dating website.
Between April 2017 and February 2018, unbeknownst to Blount, a second Nigerian distributor received more than $652,000 to its U.S.-based bank account that the FBI linked to fraud. The distributor used these funds, which it received from multiple individuals in their late 60s, to pay Blount. As with the fraud victims associated with the first Nigerian distributor, the individuals who made these payments had no logical business relationship with Blount and several later reported being the victim of romance scams or other online fraud schemes.
In January 2022, the FBI notified Oregon Tool of its investigations involving the company and provided details of the fraudulent deposits made by its Nigerian distributors. Prior to this notification, Oregon Tool had, in November 2021, terminated its relationship with one of the two distributors. After the FBI’s notification, the company promptly terminated its association with the second.
Oregon Tool cooperated fully with the government’s investigation of this matter and, under new ownership, has implemented policies to prevent its future association with unlicensed money transmitting businesses. Among other remedial measures, the company has adopted a global anti-money laundering policy restricting third-party payments and an enhanced training program for relevant personnel. None of the senior executives implicated in the improper activity by Blount Inc. are currently employed by Oregon Tool.
The U.S. Attorney’s Office and FBI intend to file a civil forfeiture complaint against the $1.7 million paid by Oregon Tool and will seek to distribute those funds to victims of this fraud scheme.
This case was investigated by the FBI. The terms of this non-prosecution agreement were negotiated by the Criminal Division of the U.S. Attorney’s Office for the District of Oregon. The related financial forfeitures are being handled by the Asset Recovery and Money Laundering Division of the U.S. Attorney’s Office for the District of Oregon.