Scammers stealing from government-funded pandemic relief programs have found a new trick — opening accounts with at least four online investment platforms, CNBC reported Monday (March 29).
Law enforcement officials say digital platforms are an easy way to dump money into stolen identity accounts.
Authorities say over $100 million in fraudulent funds reportedly passed through investment accounts in the time since Congress passed the CARES Act last March.
Among the platforms allegedly used by thieves are Robinhood, TD Ameritrade, E-Trade and Fidelity, according to law enforcement.
“The thieves are loving this stuff. This has been the financial crime bonanza act of 2021,” said Charles Intriago, a money-laundering expert and former federal prosecutor, according to CNBC.
The CARES Act was rolled out quickly as the pandemic began to help Americans suffering from job losses and economic downfall. Now, because of the size of the potential fraud arising from the situation, law enforcement is having trouble keeping up, CNBC reported, though there are several investigations underway.
According to experts, the criminals are taking advantage of how easy it is to sign up for the accounts along with the anonymity available.
According to CNBC, the fraud typically works where a criminal steals a business owner’s identity, applies for a loan and (once the criminal gets the funds) uses a stolen identity to deposit it in an investment account from one of the aforementioned sites. Other cases could involve a “synthetic identity” where a fictitious U.S. Social Security number is created and tied to a real person or “mules.”
Robinhood faced some controversy earlier in the year as it shut down some “meme stocks” like GameStop to help the market get back to normal amid a frenzy of trading. However, Robinhood is also filing for an initial public offering (IPO) and will list on the Nasdaq.
It’s currently unknown exactly how the company plans to go public.
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