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- Inside Job: Bank Employees Push Up Check Fraud š¦
Inside Job: Bank Employees Push Up Check Fraud š¦
Frank McKenna
February 04, 2025
Hi Friends,
This week, several significant cases involving bank insiders facilitating check fraud came to light, underscoring the importance of banks developing programs to stop it. Internal fraud is an area that doesnāt receive enough resources from experience.
Check out all the fraud news and trends I have sourced and written for you this week. šļø
š„This Weekās Top Fraud Highlights š„
Billion Dollar Fraud - The SEC is investigating what could become a billion-dollar fraud case involving Broad Street Global Fund; they say the group inflated returns and profits from merchant cash advances that didnāt exist.
Fyre Festival Is A GhostāBilly McFarlandās big festival is two months away, but he has gone eerily silent on social media. There is no mention of who will perform or any actual details about the event, which is selling tickets that cost up to $1 million to attend. My prediction is that we are headed for Fyre Festival Fraud Round Two!
Off the Rails - Deepseek is a security and fraud disaster that failed over half the guardrail test researchers conducted. This means that AI is highly susceptible to being used in scams.
Doing Time At LeavenworthāDisgraced CEO Shan Hanes, who was simultaneously a victim of Pig Butchering and a fraudster who took down his bank, is the subject of this exclusive magazine article, which tells the entire backstory.
First Recorded Data Breach in the USāTake a walk back in time to the first recorded data breach in the US. Itās June 22nd, 1984, and the password for TRWās Electronic Bulletin Board, belonging to Sears, was stolen. The thief then gained access to 90 million consumer credit reports.
A Huge Ban Is UnfoldingāHundreds of US companies and government agencies are banning Deepseek because they worry that personal data will be sent to the Peopleās Republic of China.
Check Frauds Scary Turn - A teenās scary ordeal on TikTok is shedding light on a new check fraud scam that involves threats and police impersonation. Check out the video report on the scam here.
End of Era - Scott Bessent has taken control of the CFPB and ordered the immediate halt of all activity at the consumer bureau. The future of the agency is unclear at this time and marks the end of one its most active eras.
1,900 Year Old Fraud Case - A papyrus document has been located by researchers detailing the oldest documented fraud case in history which involved forging documentation!
Deepseek Ruse - A new report finds that Deepseek spent $1.6 Billion in hardware to build the model, not $6.1 million they claim.
My Name Is Oliver. I Am Horrible At Fraud, And Thatās Ok
My nephew Oliver needed to do a one-month internship for high school. I offered to take him under my wing and teach him the ropes of fraud.
He became the first-ever FrankonFraud intern.
Although he failed his assignment in some ways, he ultimately learned a valuable life lesson that he will carry with him for the rest of his life. Sometimes, failing is the greatest thing you could hope for.
TextVerified Helps Fraudsters Bypass Your OTP Checks
Banks, fintech companies, and lenders should be aware of this warning because it threatens the heart of their fraud control systems. Fraudsters are using TextVerified to pass phone verification and reputation checks.
The service allows fraudsters to access phone numbers that have tenure and appear as clean āpost-paidā mobile accounts. Postpaid mobile accounts are generally considered more secure than pre-paid plans, which fraudsters have favored in the past.
Inside a $900,000 Wells Fargo Check Fraud Scheme Orchestrated via Facebook
Deonte Trent bribed Wells Fargo phone bankers to provide information of customers who had balances of over $30,000 in their accounts. Using that information, he would create counterfeit checks and bribe others to open new Wells Fargo accounts to pass those checks fraudulently.
A former internal fraud investigator, Carson Dach from the bank (who is mentioned in court docs), busted the scheme with video surveillance showing suspicious withdrawals by the suspects.
The most interesting aspect of this case is that it was all perpetrated on Facebook, proving once again that the platform is at the heart of most fraud and scams.
DeepTrump.AI Appears To Use DeepSeek To Make Alarming Deepfake Videos
Chinaās new Deepseek model may be leveraged on a new website called DeepTrump.AI, allowing users to create deepfakes of President Trump.
The site allows a user to type in any text, create a deepfake video of Trump reading that text, and then download the video.
Fifth Third Personal Banker Worked With Fraud Ring To Steal $2.6 Million In Check Fraud.
Do you have a good internal fraud program at your bank? If not, now might be a good time to start thinking about it.
Frederick Jeffries, a 53-year-old former personal banker, is accused of identity theft and check fraud for opening fraudulent accounts and depositing forged checks.
Shockingly, he worked with another bank employee in Florida to carry out the scheme. The other employee has yet to be named.
Nigerian Scammers Are Using This Cunning New AI Trick To Fake āProof Of Lifeā Photos
Ever see how people post photos of themselves holding up a sign that says the person's name or the date to show that they are legitimate? These are also called āproof of lifeā photos and are widely used on social media to prove itās not a scam.
Nigerian Romance scammers post videos showing how they fake proof-of-life photos using a simple and cunning AI trick that appears to work well.
Massachusetts Man Weaponized AI to Impersonate and Terrorize Professor
People call him a keyboard coward, as he hid behind his computer to inflict untold damage to his victim. He turned to AI to help him in his campaign of terror.
A man named James Florence has agreed to plead guilty to using AI chatbots in a seven-year campaign of cyberstalking against a university professor, marking what experts believe is the first criminal case involving AI impersonation for stalking purposes.
Wanna See The Deepfake NewsClip Scammers Used In Brad Pitt Case?
Nigerian scammers use news clips involving their victims to convince them of their scams.
Check out the video that the victim of that $850,000 Brad Pitt scam received, which reported how Brad Pitt loved her. Itās short, but you get the gist of what they are doing.
New Threat - Hyper-Disposable Email Domains That Evade Current Fraud Tools
Email risk solutions provider AtData is calling out an alarming trend of rapid appearing and disappearing email domains that now account for 45% or more of fraudulent emails.
The email domains may last for 7 days or less, making keeping up with negative files and blacklisting nearly impossible.
Uber Goes After Alleged Fraud Ring, Files A RICO Lawsuit
Uber has filed a lawsuit against a group of lawyers and doctors saying that they are behind a massive insurance fraud ring that is targeting people using their app. They are turning minor injuries into massive insurance claims.
One example detailed in the complaint involves a passenger who claimed she experienced devastating injuries after her Uber vehicle hit a cardboard box containing a sofa cushion.
The dashboard camera footage showed the passenger calmly continuing a phone conversation during and after the incident. Yet within months, she had undergone spinal fusion surgery and accumulated extensive medical bills, with her attorneys demanding $5 million in damages.
She Defrauded Her Employer for $2,000,000, Now Watch As She Is Arrested
She forged checks, authorized fake deposits, and authorized altered Amazon orders for luxury merchandise shipped to her home.
Now, watch as she is arrested at her home. She appears to be a hoarder based on the piles of clothes everywhere.
OpenAIās Deep Research Agents Are Like Magic for Fraud Fighters
I always scout for excellent tools for fraud fighters, and Deep Research from OpenAI is an absolute game changer. My mind is blown š¤Æ
Suppose you are trying to research any subject related to fraud or scams. In that case, Deep Research agents will use reasoning to synthesize large amounts of online information and complete multi-step research tasks for you. Itās like magic!
I asked Deep Research to investigate āOTP Bots,ā and it developed this report in about four minutes. Click here to see the report it produced - Here
Famous Fraud Guy Is At It Again š
Heās back! Famous Fraud Guy Adam Boston talks about AI fraud agents in this hilarious take on the subject.
Thanks again for all of your support in the fight against fraud. Special thanks to reader Tim Yandow for his tip on the oldest fraud in history.
I hope you have a fantastic week ahead fighting fraud!