Money Mules and Facilitators – Part 1

Money Mules and Facilitators – Part 1.

For a long time we have been concerned that not enough is being done to target the money mules and facilitators who provide essential services to scams. Without the assistance of these key partners, scammers would find it impossible to establish, promote, take investors’ money and operate their scams.

MONEY MULES

Money mules allow their bank accounts to be used by scams to collect money from investors. We are regularly contacted by victims of scams who did not realise they had paid their investment to a money mule. When we look at the details of their transactions we can see that in a lot of cases they made their payments to money mules.

There is a Europol initiative called the European Money Mule Action which has been in operation for a number of years. Here is a link to a website which explains ‘money muling’. LINK TO EUROPOL SITE.

The problem is that law enforcement tends to view the money mule providers as ignorant victims. Rarely does a money mule face criminal prosecution despite it being a criminal offence. Money mules aren’t stupid. They know that if they are being paid to let someone use their ID to run scam bank accounts then it’s bound to be for illegal purposes, but until the prosecuting authorities take the matter seriously and prosecute money mules it will never stop.

The real victims in these cases are the investors who have lost their money, not the money mules. Money mules should be prosecuted to send a message to others that money muling is a criminal offence and has long-term consequences.

For that reason, we are putting resource into targeting money mules on behalf of our clients who were tricked into sending their cash to them. In one case, that of Clear View Marketing Services Ltd which one of our clients wound up in March 2019, we ended up identifying almost 50 different money mule accounts which were used by that company to take in money from investors. As far as we are aware none of them have ever faced criminal prosecution or been ordered to repay the money. CVMS ran a crypto-currency scam called the European Property Coin. This was a scam fronted by Florian Pierini who is in court right now facing charges of money-laundering for his role in a separate scam which stole around £15m from investors (the Essex and London Properties scam).

MONEY MULE ACTIONS

We mentioned in an earlier article – LINK HERE – that we had started the ScamTrackers Initiative. The first video was published this week. The series will cover our efforts in exposing the StratXMarkets binary option scam and our work with John, an investor in StratXMarkets, in closing down and investigating one of the money mules which took in a lot of money for that organisation. We’re now focused on another of the money mules that John paid.

John’s video story will break down the case and explain how we arranged for someone to visit an address in Estepona, Spain last month, how we recently tracked another money mule provider linked to the StratXMarkets scam to his place of work. Unbelievably he was working under the umbrella of one of the largest FCA-regulated companies in the UK and described as a ‘Business Development Manager’, and how we established links to several other binary option scams which all appeared to be separate operations, but which we could prove were linked to one family in Essex.

The pursuit of the money mules involved in StratXMarkets will lead to a prosecution because one of the money mule companies involved in John’s case received more than £1m from investors.

THE FACILITATORS

Facilitators covers the people and companies which provide escrow services, security trustee services, back-office functions, seed funding / bridging loans, and the sales and marketing service. Recent judgements in the UK courts have made it a little easier for victims of scams to take action against these parties.

The barrier, as always, is the reluctance of victims to risk more money (which is understandable) as they feel they may be throwing good money after bad. This is one of the factors that scammers and the facilitators rely on. Investors often believe that they can get law firms to offer ‘no-win no-fee’ deals, but our experience is that law firms are generally only willing to offer these deals in cases where there are regulated or well-insured targets, or where the asset position of the target is exceptionally strong. In a lot of cases it requires specialist asset-tracing companies to determine the assets of dishonest company directors.

If you decide to invest with any company you should ensure that you pay your money direct into the bank account of that company, not to the sales agent company, nor to what is described as “an escrow account”, and certainly not to any bank account with a completely different name from the company you are investing with.

Escrow accounts are used to act as a screen between the investor and the scam company so that the investor has no idea where their money ultimately ends up. The escrow company always uses the excuses of “client confidentiality or data protection” to stop investors finding out where they sent the money. In the majority of cases we come across we already know the escrow company because of its links to other scams e.g the Graham Arnott suite of companies which includes Jade State Wealth Ltd. There’s a small group of repeat offenders we see time after time.

Investors should always refuse to pay their money to an escrow company unless they have checked it out very thoroughly and obtained written confirmation from the escrow company regarding the instructions they have been given for distributing the investors’ money. If they won’t tell you – walk away and do not send any money. Scam companies have normally agreed with the escrow company that it should pay the money to different places e.g sales agent for their undeclared commissions, “admin fees” to offshore companies, fees to companies linked to the directors etc. Quite often the escrow company will be distributing 50% or more of an investor’s money in this way. For example, in the case of a £14m scam involving Glenn King and David Hyman, 70% of the investors’ money was distributed to these various parties. In the case of the Solari Energy scam, 85% of the investors’ money was distributed.

We will cover some of the facilitators in Part 2.

Money Mules and Facilitators – Part 1. Money Mules and Facilitators – Part 1.