A federal grand jury in California has indicted a Chinese citizen on a charge of money laundering conspiracy.
Prosecutors said that members of the scheme allegedly impersonated federal law enforcement officers or employees when contacting their target victims. They would tell the victims lies about their bank accounts, such as saying that wrongful charges had been filed against them and that their accounts would be frozen. The scammers would then tell their victims that they need to withdraw their savings in cash and turn the money over to an officer or federal employee for supposed safekeeping.
Under the scheme, Liu allegedly served as a money launderer, impersonating either a federal employee or law enforcement officer, to collect money from victims in California and Nevada.
Scheme
On April 9, Liu went to pick up what he believed was $20,000 from a victim, but the money was fake, as the FBI had set up a sting operation. Liu was arrested shortly after he took the fake cash.According to a complaint filed last month, the victim that Liu had met on that day was a 75-year-old woman who lost more than $780,000 to the scam.
The victim told the FBI on March 18 that someone claiming to be a U.S. marshal contacted her a year ago. The scammer purporting to be a marshal told the woman that her name and social security number were being used by “a drug cartel to commit money laundering, drug trafficking, human trafficking, and other crimes,” prosecutors said.
The scammer told the woman that her money would be frozen and that there was a federal arrest warrant for her, according to the complaint. The scammers claimed that to remedy the situation, the woman could transfer her money to the Federal Reserve for protection.
“Due to the nature of the alleged arrest warrant, the Victim was coached to lie to employees of financial institutions in order to get her funds,” the complaint reads, referring to the elderly woman.
From February 2024 to December 2024, the woman liquidated her savings and investments and took out more than $200,000 in home mortgages, according to the complaint.
If convicted, Liu could face up to 20 years in prison and a fine of $500,000 or twice the value of the property involved in the transaction, according to the April 24 statement.
Government Impersonation Scams
In June 2024, the Federal Trade Commission (FTC) reported an increase in cash payments associated with government impersonation scams from 2022 to 2023.Consumers reported losing $76 million in cash payments to scammers in 2023, up from $40 million in the previous year.
Reported losses from government impersonation scams, across various payment methods, topped $618 million in 2023—a significant increase from the $497 million reported in 2022 and $428 million in 2021.
In recent weeks, the FBI’s Miami and Philadelphia field offices both issued warnings about government impersonation scams.
“Criminals use law enforcement impersonation scams as a means of confusing and unnerving their intended victims in order to get them to act rashly,” Supervisory Special Agent Michael Brown said in a statement, according to the release.
“In the 2024 IC3 [FBI’s Internet Crime Complaint Center] report released this week, Florida residents reported 1,579 impersonation scams with an estimated loss of over $12 million.”
It lists things that the FBI would never ask the public to do, including demanding payment or threatening arrest; using money to help catch a criminal; wiring a “settlement” to avoid arrest; sending money via wire transfers to foreign accounts, cryptocurrency, or gift and prepaid cards; and calling about “frozen” Social Security numbers.
