A joint investigation supported by Europol has led to the dismantling of a Franco-Israeli criminal gang involved in large-scale CEO fraud (also known as BEC scams). The operational activities resulted in five action days, which took place between January 2022 and January 2023 in France and Israel:
The action resulted in:
- 8 house searches in France and Israel
- The arrest of the main organiser in Israel
- 8 suspects arrested (6 in France and 2 in Israel)
- Seizures include: electronic equipment and vehicles, about EUR 3 million from Portuguese bank accounts, EUR 1.1 million from Hungarian bank accounts, EUR 600 000 from Croatian bank accounts, EUR 400 000 from Spanish bank accounts, EUR 350 000 in virtual currencies
- The total value of the seizures is estimated at about EUR 5.5 million
Impersonating executives and lawyers
The criminal network, comprised of French and Israeli nationals, targeted companies located in France. In early December 2021, one of the suspects impersonated the CEO of a company specialised in metallurgy, based in the department of Haute-Marne in north-eastern France.
The fraudster asked the company’s accountant to make an urgent and confidential transfer of EUR 300 000 to a bank in Hungary. The fraud was discovered a few days later when the accountant, thinking he was acting on behalf of the company’s CEO, attempted to make a transfer of EUR 500 000. The company filed a complaint, and the investigators subsequently found that the call from the alleged CEO came from a number in Israel.
In late December 2021, a real estate developer based in Paris also felt victim to fraud with a similar modus operandi. The damages were much more significant in this case, however. To perpetrate the fraud, the suspects impersonated lawyers, saying they worked for a well-known French accounting company.
After gaining the victim’s trust, the fraudster requested a large, urgent and confidential transfer. Pretending to be consultants, they persuaded the CFO to transfer millions of euros abroad. In total, they defrauded the company of almost EUR 38 million in a matter of days. Using a pre-existing money laundering scheme, these funds were quickly transferred to different European countries, then to China and finally to Israel.
International search for the criminal network
A link between these two scams was established in January 2022 when the Parisian real estate company filed a complaint. The information exchange and international cooperation facilitated by Europol led to the discovery of accomplices, modi operandi and funds. The criminal investigation in Croatia contributed to the discovery of the real identity of the money mules used by the criminal network. The authorities in Croatia blocked and froze over EUR 600 000 in several bank accounts.
The Portuguese investigation led to the seizure of approximately EUR 3 million held in multiple bank accounts. The Hungarian authorities discovered that more than EUR 7 million had been received in Hungarian bank accounts before being withdrawn in cash or transferred to bank accounts in other countries. The Hungarian authorities interrogated 16 individuals, two of whom had been arrested previously and are currently under criminal supervision. They seized more than EUR 1 million in several bank accounts.