Man Pleads Guilty to Laundering Proceeds from Romance and Cyber Scams
On November 16, 2018, Peter Vincent Cruz, a resident of Washington State and Alaska, pleaded guilty to money laundering charges, stemming from his decision to launder hundreds of thousands of dollars in fraud proceeds from online romance and business email compromise (“BEC”) scams, announced U.S. Attorney Ariana Fajardo Orshan for the Southern District of Florida, Special Agent George L. Piro of the Federal Bureau of Investigation (FBI), Miami Field Office and Brian Swain, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office.
According to documents filed with the court, from approximately June 2016 through June 2018, in Broward County, Florida, and elsewhere, Cruz knowingly and willfully agreed to participate in, and did participate in, a conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h). The purpose of the conspiracy was for Cruz and his co-conspirators to unlawfully enrich themselves, to hide illegal proceeds, and to further wire fraud schemes by, among other things, withdrawing, depositing, and transferring fraudulently obtained funds between federally insured credit unions, federally insured banks, and individuals, and converting the fraudulently obtained funds to cash and cryptocurrency. Cruz laundered proceeds from BEC and romance scams.
According to court documents, Cruz’s co-conspirators in Nigeria and elsewhere contacted businesses (the “business victims”) located throughout the United States, using email, social media, and other Internet-based methods of communication, and falsely and fraudulently posed as vendors seeking payment for services rendered, in order to facilitate the BEC scam. The co-conspirators, posing as vendors, used spoofed emails and email account takeover techniques to send emails falsely and fraudulently directing the business victims to make payments to various bank accounts, through wire transfers, in purported satisfaction of invoices due to the actual vendors.
The court docket further indicates that Cruz’s co-conspirators also used stolen and false identification information to create online personas, utilizing online dating applications, email, social media, and other forms of communication, in order to facilitate romance scams. The co-conspirators then pursued false and fraudulent relationships online with individual victims (the “romance scam victims” or “individual victims”), and tricked these victims into falling in love with them. Eventually, the co-conspirators would persuade these individuals to open bank accounts and shell companies; to conduct financial transactions (cash withdrawals or transfers) under false pretenses, such as to purportedly aid with medical bills or business expenses; and to send money from the victims’ personal savings, or in the form of iTunes gift cards.
At times, Cruz’s co-conspirators directed fraudulently obtained funds from the business victims into accounts established by the romance scam victims. They then directed the romance scam victims to wire the fraud proceeds on to accounts controlled by other co-conspirators, such as the defendant, Cruz. One of these victims resided in Broward County, Florida.
According to the court record, Cruz’s role in the laundering conspiracy was to convert fraud proceeds from the cyber and romance scams via wire, in United States dollars, into cryptocurrency. Cruz then provided the cryptocurrency to his co-conspirators via email, and in doing so, Cruz assisted them in further concealing their true identities, and their role in the underlying fraud schemes. Cruz met, and routinely communicated with, his co-conspirators via e-mail, over the dark web, and through online cryptocurrency exchange forums. Indeed, Cruz regularly received funds from multiple anonymous sources, and regularly sent cryptocurrency payments to anonymous counterparties.
Cruz is scheduled to be sentenced on January 25, 2018 before U.S. District Judge William P. Dimitrouleas. He faces a statutory maximum sentence of twenty years in prison. He also faces a period of supervised release of up to three years, restitution and monetary penalties.
U.S. Attorney Fajardo Orshan commended the investigatory efforts of the FBI, FBI Miami’s Cyber Task Force and USSS in this matter. This case is being prosecuted by Assistant U.S. Attorney Lisa H. Miller.