Feds arrest 9 in connection with scheme that defrauded 400 people out of $5M
Nine out of 13 people have been arrested in connection with "a grandparent scheme" that called 400 older Americans across four states and collectively defrauded them of $5 million, United States Attorney Leah Foley said on Tuesday.
One suspect facing charges has pleaded guilty to this scheme and four people remain at large, two in the Dominican Republic and two in the United States, Foley said during a press conference in Boston. Calls targeted older people in Massachusetts, California, New York and Maryland.
FBI Special Agent in Charge Ted Docks named the scheme's leader as Oscar Manuel Castanos Garcia, who authorities said referred to potential new targets in New Hampshire and Maine as "fresh meat."
This "sophisticated criminal enterprise" was conducted in organized call centers in the Dominican Republic, Foley added. Following a two-year investigation led by the FBI, with the assistance of their counterparts in the Dominican Republic, the call center in Santiago de los Caballeros was shut down.
Castanos Garcia ran these call center locations, with several managers who supervised, instructed and paid the employees, Foley's office said in a statement after the press conference.
"Elderly victims received calls from someone pretending to be a grandchild in urgent distress, claiming to be in car accidents, arrested or otherwise in trouble," Foley explained of the scheme.
"Openers" would call people, pretending to be children or grandchildren, and ask for bail money, or callers impersonated lawyers "demanding cash to resolve the fake emergencies," she continued. "Individuals known as 'runners' in the United States were then allegedly dispatched to collect that money and sometimes using ride share drivers who had no idea that they were being used as part of a scam."
"Unfortunately, the fraud did not always stop after the first payment," Foley said. "In many instances, these defendants allegedly called the victims again and again, telling the panicked elderly victims that there had been a miscarriage or that someone had died in a crash, pushing them to send even more money. This was not a one-off scam."
Once in the hands of the "runners," the money was laundered and sent to the Dominican Republic, she said.
Foley's office and the FBI obtained photos of the scripts that callers used. When the caller would request an Uber, they would tell the driver, "My grandmother is going to be sending me some documents," Foley said as an example. "She's going to put the box in your car and just bring it to me." Other times, drivers would be requested to take older people to the bank, give the money to the driver and "deliver the money to someone else."
Once Uber's Global Security team noticed these activities, they tipped the FBI and the investigation began, she added. None of the drivers have been arrested in connection with the scheme, but Uber has revised its training for drivers so that they can identify these types of scams.
Foley and Docks asked people to look out for their older relatives, be aware of large bank withdrawals and any panic caused by the fraudulent call from a relative.
"Victims not only lost their savings, but their sense of safety, judgment and trust in the world around them," Foley said. "Some were too ashamed to tell their families what happened. Others never recovered from the loss. The stories are truly heartbreaking."
"I'm here to say that we have had enough of this preying on our elderly," she continued. "... We are looking for you and we will find you and we will bring you to justice no matter where in the world you are located."
Foley also advised that anyone who thinks they were a victim of this scheme should contact the FBI or her office.
These are the names of people who face charges in connection with the scheme:
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Oscar Manuel Castanos Garcia, 33, of the Dominican Republic — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Joel Jose Cruz Rodriguez, 33, of the Dominican Republic — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Edward Jose Puello Garcia, 44, of the Dominican Republic — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Joan Manuel Mathilda Leon, 27, of the Dominican Republic and the Bronx, New York — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Luis German Santos Burgos, 32, of the Dominican Republic and Dorchester — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Gerardo Heriberto Nuñez Nuñez, 41, of the Dominican Republic — money laundering conspiracy.
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Ransel St. Arlin Tavarez Jimenez, 26, of the Bronx, New York (at large) — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Joel Francisco Mathilda Leon, 26, of the Bronx, New York (at large) — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Andry Joel Baez Santana, 31, of the Bronx, New York — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Jose Osvaldo Polanco Batista, 28, of Winter Park, Florida (at large) — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Chaman Samael Sliverio, 31, of Defiance, Missouri — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Manuel Nicolas Rivera Cueto, 25, of Santa Clara, California, — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
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Jose Arony Fermin Vasquez, 31, of New Jersey (at large) — conspiracy to commit mail fraud and wire fraud, and money laundering conspiracy.
The charge of conspiracy to commit mail fraud and wire fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of up to $250,000, or twice the loss to the victim. The charge of money laundering conspiracy provides for up to 20 years in prison, three years of supervised release and a fine of up to $500,000 or twice the amount of laundered funds, whichever is greater.
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