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> The plot, prosecutors said, was simple: members of the Make Money Online (MMO) team would purchase crime proceeds via cryptocurrency at a discount and transfe

by koolba 2y ago

> The plot, prosecutors said, was simple: members of the Make Money Online (MMO) team would purchase crime proceeds via cryptocurrency at a discount and transfer those proceeds into bank accounts held by entities affiliated with newspaper. > The illegal proceeds would ultimately be moved back into the Epoch Times accounts through "tens of thousands of layered transactions", including through prepaid debit cards and financial accounts opened using stolen identification information. What are “crime proceeds”? Are these seized assets by the Feds sold at a discount? Or stolen assets by criminals (also sold at a discount)? Either way, sounds like classic money laundering as the follow up.

caf 2y ago
It would be the latter, because "transfer those proceeds into bank accounts" implies currency, rather than other types of assets.
perihelions 2y ago
The indictment says very little about the underlying crime schemes. (I understand indictments usually don't say and don't need to say very much). - "The prepaid debit cards were issued by different debit card companies and loaded with U.S. dollars that had been unlawfully obtained through various frauds (i.e. , the crime proceeds). For example, certain of the prepaid debit cards were loaded with fraudulently procured unemployment insurance benefits obtained using stolen personal identification information of U.S. residents." (page 4)
- eli 2y ago
  That seems clear to me. They used stolen identity information to make false unemployment insurance claims in other people’s names. The CFO bought the prepaid cards at a discount and then transferred the whole amount to the company account. Maybe there’s more to it but it doesn’t sound like it was very sophisticated and seems inevitable they would be caught eventually.
  - 0110101001 2y ago
    > They used stolen identity information to make false unemployment insurance claims in other people’s names. I don't think "they," meaning Epoch Times, did the actual identity theft / unemployment insurance fraud. The indictment says they "purchased" the debit cards, and there are no charges related to those crimes. It sounds like Epoch Times found a platform where such fraudsters were offloading their phony unemployment debit cards at a discount (this started in 2020, when I presume there was a huge boom in unemployment fraud) and tried to flip them around as legitimate donations and subscription revenue for an easy profit.
    - ajross 2y ago
      > It sounds like Epoch Times found a platform where such fraudsters were offloading their phony unemployment debit cards at a discount [...] and tried to flip them around as legitimate donations and subscription revenue for an easy profit. Just to be clear, since the framing here doesn't make it clear if you understand: that is textbook money laundering. "I didn't know where the money on these cards came from I was just buying them as a product" is not remotely a defense. AML/KYC laws apply to all financial transactions, not just to banks, and yes, "buying millions of dollars of pre-paid debit cards for real money" is quite clealy a "financial" transaction.
Spooky23 2y ago
One example was buying up fraudulent unemployment insurance debit cards.
AnthonyMouse 2y ago
These indictments always read so weird, like they're trying to describe a nefarious criminal organization even though its behavior is just the same as any other enterprise. So they performed an unspecified financial transaction (allegedly illegal but not proven), which turned a profit, then paid the money out to a lot of people, who in turn paid some of it back to them later. Isn't that just... the economy? Walmart pays Alice for doing customer service, then Alice pays Walmart for breakfast cereal and soap. Even the ostensible crimes are like, they opened a bank account, deposited their own money in it and then withdrew it again without stealing anything or harming anyone, but you're not allowed to do that under someone else's name. Meanwhile lots of people have reasons to want to have an anonymous payments system and a lot of them are quite sympathetic, to the point that the only reason it's even illegal is to help lazy prosecutors who can't be bothered to prove the original crime. And then lots of sympathetic people break the law, because it's a bad law and they have little alternative. Then the whole thing is alleged to be a grand conspiracy. But wait, what percentage of the accounts were under someone else's name? Was it done for this purpose, or do they just do business with a lot of people and some of them are e.g. undocumented immigrants who couldn't use their own name? If there is some kind of theft happening here then why can't they prosecute the stealing instead of these moving money around allegations? The last line of the story is also just uncanny. One of these things is not like the others: > In the years since, it has grown into purportedly one of the US's most powerful conservative news organisations and a home to conspiracy theories, right-wing misinformation and sharp opposition to the Chinese Communist Party. Right?
- pjc50 2y ago
  > they opened a bank account, deposited their own money in it and then withdrew it again without stealing anything or harming anyone, but you're not allowed to do that under someone else's name Yes, you're not allowed to do that under someone else's name, that's what the crime is. > can't be bothered to prove the original crime The entire point of money laundering is to make it as difficult as possible to find the original crime or connect it. In an environment of anonymous payments, how do you prove X made a payment to Y? It's basically an extension of anti-fencing law, which is a pretty old principle. You're not allowed to help people fence stolen goods, and it's not a defence to look the other way. Money has to be treated specially because it's fungible and not a "good", but the principle is the same. If you were running a "cars bought for cash" scheme and refusing to check if any of the cars were stolen, I would assume you'd eventually be prosecuted for that.
matwood 2y ago
> What are “crime proceeds”? Typically any proceed from a crime. In the simplest case, if someone stole money from someone, the money stolen is proceeds from the crime. Similar is if someone stole property and sold it, the money is the proceed. Same with selling illegal drugs, or money received from extortion or bribery. Like you said, regardless of the crime the money needs to be laundered.
deleted 2y ago
[deleted]
MichaelMarie 2y ago
[flagged]

by koolba 2y ago

caf 2y ago

It would be the latter, because "transfer those proceeds into bank accounts" implies currency, rather than other types of assets.

perihelions 2y ago

The indictment says very little about the underlying crime schemes. (I understand indictments usually don't say and don't need to say very much). - "The prepaid debit cards were issued by different debit card companies and loaded with U.S. dollars that had been unlawfully obtained through various frauds (i.e. , the crime proceeds). For example, certain of the prepaid debit cards were loaded with fraudulently procured unemployment insurance benefits obtained using stolen personal identification information of U.S. residents." (page 4)

eli 2y ago
That seems clear to me. They used stolen identity information to make false unemployment insurance claims in other people’s names. The CFO bought the prepaid cards at a discount and then transferred the whole amount to the company account. Maybe there’s more to it but it doesn’t sound like it was very sophisticated and seems inevitable they would be caught eventually.
- 0110101001 2y ago
  > They used stolen identity information to make false unemployment insurance claims in other people’s names. I don't think "they," meaning Epoch Times, did the actual identity theft / unemployment insurance fraud. The indictment says they "purchased" the debit cards, and there are no charges related to those crimes. It sounds like Epoch Times found a platform where such fraudsters were offloading their phony unemployment debit cards at a discount (this started in 2020, when I presume there was a huge boom in unemployment fraud) and tried to flip them around as legitimate donations and subscription revenue for an easy profit.
  - ajross 2y ago
    > It sounds like Epoch Times found a platform where such fraudsters were offloading their phony unemployment debit cards at a discount [...] and tried to flip them around as legitimate donations and subscription revenue for an easy profit. Just to be clear, since the framing here doesn't make it clear if you understand: that is textbook money laundering. "I didn't know where the money on these cards came from I was just buying them as a product" is not remotely a defense. AML/KYC laws apply to all financial transactions, not just to banks, and yes, "buying millions of dollars of pre-paid debit cards for real money" is quite clealy a "financial" transaction.

Spooky23 2y ago

One example was buying up fraudulent unemployment insurance debit cards.

AnthonyMouse 2y ago

These indictments always read so weird, like they're trying to describe a nefarious criminal organization even though its behavior is just the same as any other enterprise. So they performed an unspecified financial transaction (allegedly illegal but not proven), which turned a profit, then paid the money out to a lot of people, who in turn paid some of it back to them later. Isn't that just... the economy? Walmart pays Alice for doing customer service, then Alice pays Walmart for breakfast cereal and soap. Even the ostensible crimes are like, they opened a bank account, deposited their own money in it and then withdrew it again without stealing anything or harming anyone, but you're not allowed to do that under someone else's name. Meanwhile lots of people have reasons to want to have an anonymous payments system and a lot of them are quite sympathetic, to the point that the only reason it's even illegal is to help lazy prosecutors who can't be bothered to prove the original crime. And then lots of sympathetic people break the law, because it's a bad law and they have little alternative. Then the whole thing is alleged to be a grand conspiracy. But wait, what percentage of the accounts were under someone else's name? Was it done for this purpose, or do they just do business with a lot of people and some of them are e.g. undocumented immigrants who couldn't use their own name? If there is some kind of theft happening here then why can't they prosecute the stealing instead of these moving money around allegations? The last line of the story is also just uncanny. One of these things is not like the others: > In the years since, it has grown into purportedly one of the US's most powerful conservative news organisations and a home to conspiracy theories, right-wing misinformation and sharp opposition to the Chinese Communist Party. Right?

pjc50 2y ago
> they opened a bank account, deposited their own money in it and then withdrew it again without stealing anything or harming anyone, but you're not allowed to do that under someone else's name Yes, you're not allowed to do that under someone else's name, that's what the crime is. > can't be bothered to prove the original crime The entire point of money laundering is to make it as difficult as possible to find the original crime or connect it. In an environment of anonymous payments, how do you prove X made a payment to Y? It's basically an extension of anti-fencing law, which is a pretty old principle. You're not allowed to help people fence stolen goods, and it's not a defence to look the other way. Money has to be treated specially because it's fungible and not a "good", but the principle is the same. If you were running a "cars bought for cash" scheme and refusing to check if any of the cars were stolen, I would assume you'd eventually be prosecuted for that.

matwood 2y ago

> What are “crime proceeds”? Typically any proceed from a crime. In the simplest case, if someone stole money from someone, the money stolen is proceeds from the crime. Similar is if someone stole property and sold it, the money is the proceed. Same with selling illegal drugs, or money received from extortion or bribery. Like you said, regardless of the crime the money needs to be laundered.

deleted 2y ago

[deleted]

MichaelMarie 2y ago

[flagged]