Govt IT Contractors Charged With 'Defrauding' the Feds
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The two cases, involving three individuals each, were the first time the DoJ issued charges connected to an ongoing investigation involving IT manufacturers, distributors and resellers and their deals with the federal government. The Department of Defense is among the agencies allegedly ripped off by the two groups of fraudsters, the DoJ noted, as were unspecified parts of the intelligence community.
[...] The first group, led by Maryland resident Victor Marquez, allegedly conspired to rig bids by using insider information "to craft bids at artificially determined, non-competitive and non-independent prices, ensuring Marquez's company would win the procurement," the DoJ said.
Marquez was charged [PDF] in a four-count indictment with wire fraud conspiracy, wire fraud and major fraud, for which he's facing up to 70 years in prison, with his co-conspirators charged with similar offenses.
In the other group, Breal L. Madison Jr. was hit with a 13-count indictment [PDF], and his co-conspirators with lesser charges, "for orchestrating a years-long scheme to defraud his employer and the United States out of over $7 million in connection with the sale of IT products to various government agencies."
Madison reportedly used the stolen funds to purchase luxury items, including a yacht and Lamborghini Huracan, which the government plans to seize if he's convicted. Facing charges of conspiracy, bribery, mail fraud and money laundering, Madison faces up to 185 years in prison if convicted.
[...] Human Security's Satori threat research team has disrupted an ecommerce fraud ring they say has been in operation for five years, infecting more than a thousand websites and raking in tens of millions of dollars from hundreds of thousands of victims in the process.
Victims who buy products are presented with a legitimate payment processor page, so the transaction is technically real - but there's no product, and nothing ever shows up.
Satori said it managed to get the fake listings it discovered pulled from Google SERPs, and victimized payment processors have banned Phish 'n' Ships operators from their platforms, but it's probably not safe yet.
"It's unlikely the threat actors will pull the plug on their work without trying to find a new way to perpetuate their fraud," Satori said.
Rule of thumb: If a deal seems too good to be true, it probably is.
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