VCU loses nearly $500,000 in multi-million dollar cyber fraud scheme
RICHMOND, Va. (WWBT) – Three Nigerian citizens have been extradited from the UK to the US in a multi-million dollar cyber scheme involving several institutions including Virginia Commonwealth University.
According to an FBI press release on Wednesday, Texas, North Carolina and Virginia were among the states involved in the fraudulent scheme.
This type of crime is known as “cyber financial fraud”.
The documents detail that VCU transferred almost half a million dollars from its bank account to Bank of Hope for a group of Nigerian scammers posing as an employee of the real construction company Kjellstrom and Lee, with whom VCU had a current contract.
The scammers made their first contact with the university in September 2018, posing as an employee of the company and using an email address similar to the company name under the pseudonym “Rachel Moore”.
The documents detail that Moore informed the purchasing department that an employee that the bank registered with the construction company was being audited and asked if the next payment could be made to an overseas account.
After nearly three months of correspondence, the university initiated an ACH wire transfer for $469,819.49 from its bank account on December 20, 2018 to the Bank of Hope listed in the ACH setup provided by Moore.
But in January 2019, VCU was informed by its bank that the large wire transfer was fraudulent. The university also learned that the construction company employee did not exist.
In the days following that initial bank transfer, the scammers initiated multiple bank transfers through a method that leaves a tiny paper trail.
The scammers also circumvented currency reporting requirements as many transfers were under $10,000.
According to the complaint, the majority of the nearly $500,000 transfer could not be recovered and was a loss to the university.
Olabanji Egbinola, 42, is charged with wire fraud, conspiracy to commit wire fraud, money laundering and conspiracy to commit money laundering.
Egbinola and two other defendants were arrested in the UK in 2020 and extradited in September last year. All three defendants appealed, all of which were rejected last month by a UK high court.
NBC12 has reached out to VCU for a statement, but at this time the university says it is not ready to respond.
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