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FinCEN reports spike in email scams

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The Financial Crimes Enforcement Network (“FinCEN”) issued an advisory and trend analysis alerting financial institutions to a recent surge in business email compromise (“BEC”) incidents, as reported in suspicious activity reports.  According to FinCEN, these reported attacks climbed from 500 per month in 2016 to over 1,100 per month in 2018, with attempted BEC thefts increasing from $110 million per month in 2016 to $301 million monthly in 2018.

According to the advisory and analysis, a BEC scam typically involves a cyber criminal emailing false invoices or payment instructions to an individual or business while impersonating a supervisor, vendor or other legitimate third party.  Once payment is made, the proceeds are fraudulently directed to a criminal-controlled account.  Sometimes the emails originate from hacked accounts, while at other times, they are made to appear as communications from trusted sources.  Victims can include businesses, government agencies, universities and non-profits, often those that make frequent wire transfers.  Most BEC incidents reportedly involve transfers to domestic accounts in the United States, likely controlled by “money mules.”

Continue reading at:  Mondaq.com

OIG: Beware of fraud ring scamming equipment by posing as federal buyers

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A transnational fraud ring is specifically targeting America’s federal procurement offices and vendors, according to an alert the Homeland Security Department’s Office of Inspector General issued this week.

Last July, the OIG discovered that members of a ring based in Atlanta, Georgia had posed as a Homeland Security procurement official to get their hands on computer equipment supplied by private vendors.  Diving deeper into the case, the IG found that the fraudsters were also stealing electronic equipment from other agencies including but not limited to the Commerce, Defense, Labor, Justice and Transportation departments.

“Some of the purchase orders identified were for hundreds of thousands of dollars each,” the OIG said.

In their scheme, the phony actors find federal government solicitations for equipment such as hard drives or smartphones, and send fraudulent requests for quotations to federal vendors from across the nation.  Though the RFQs use the legitimate names of procurement officials, the schemers use their own phone and fax numbers and they are also known to spoof government agency email addresses, using domain names such as “rrb-gov.us.”

Continue reading at:  Nextgov

Email scam netted $3 million worth of top-secret US military equipment

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Recently released Court documents show that con artists convinced a U.S. Defense Contractor to send them millions of dollars worth of sensitive military equipment.  The equipment was so top-secret that “even a photograph [is] considered controlled.”

The “highly sensitive communications interception equipment” was valued at $3.2 million.  The manufacturer is identified in legal documents only as “Company B,” and is located in Maryland.  The scammers acquired the military equipment by posing as a Navy Contracting Officer named “Daniel Drunz” and sent fake purchase orders to acquire the top-secret technology.

Continue reading the:  Court Documents

Scam Alert: Malicious e-mail spoofs being sent to vendors

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The Defense Logistics Agency (DLA) is reporting that a fake solicitation is being sent to vendors in the form of a Request for Quotation (RFQ).

The fake email solicitation, purporting to be from DLA, has been targeting GSA STARS II vendors.

The emails are not from DLA.mil.  Instead, they are coming from a “Reply-To” address ending in @dla-mil.us, which is not a government address.

In some cases, “stars2@american consultants.com” has been identified to supposedly send messages on behalf of a DLA Contract Specialist — these are also fake.

Some of the bogus emails suggest that vendors use the “stars2” Google Group at https//groups.google.com/a/americanconsultants.com to obtain more information or to unsubscribe from the email communication.  Be advised that “stars2” is not a DLA affiliated group.

Always remain cautious of emails that arrive in your inbox that are not explicitly addressed to you.  Sometimes scammers attempt to hide their actions by addressing their targets in the “bcc” line.

Also, please be aware that the phone number in these recent bogus emails is not a DLA phone number.  In addition, the RFQ form in the email is not an official government form, nor is the signature block legitimate.

DLA’s notice about this matter can be seen here: Vendor Phishing Notice -DLA – 8 June 2018.  The notice shows copies of the bogus emails.

Bottom line: Vendors should always remain vigilant about suspicious emails, and be cautious about opening email attachments.  Questions or comments can be directed to DLA at CERTFusionCell@dla.mil.

In addition, if you ever have a question about the legitimacy of any emails having to do government contracting opportunities, especially those which solicit a fee, please feel free to contact the Georgia Tech Procurement Assistance Center (GTPAC) for advice.  GTPAC can be emailed at gtpacatl@innovate.gatech.edu.

To read previous articles about scams involving government contracting, visit http://gtpac.org/?s=scam

How to recognize and avoid grant scams

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If an individual contacts you about an opportunity to obtain free money in the form of a grant from the federal government, be extremely wary.  You are likely being targeted as part of a scam.  Any of the following statements should put you on high alert:

“Great news! You are eligible to receive a government grant.“

Fact: The government does not contact individuals to award grants for which there has been no application. An individual who makes this claim is not from the government and could be trying to collect private personal data from you, such as your Social Security number, bank account number or other such information.

“For a small fee, you can obtain a government grant.“

Fact: The government does not charge a fee for individuals or entities applying for a federal grant. While financial information may be required as part of the application process, it should be submitted through a government website, such as Grants.gov, and there should never be a cost to you.

“The Federal Bureau of Grant Awards has awarded you a $8,000 grant.“

Fact: Beware of individuals claiming to work for grants-related government bureaus and departments that do not actually exist. The individual may even provide a valid address for a government office, adding a touch of realism to their claim, but do not be fooled.

“Our office is located in Washington, D.C.“

Fact: Current technology can fool caller ID systems into reporting that a caller is phoning from Washington, D.C. In fact, a scam artist could be calling from anywhere in the world. Similar tactics can be used with email addresses in online communication, so be alert!

“This type of federal grant does not require an application.“

Fact: Every grant from the federal government involves an application submitted through a government website, such as Grants.gov. Also, you cannot apply for federal grants over the phone or via email. Any individual claiming that a grant does not require an application, or requires only a phone call or an email, is attempting to scam you.

“You won the government grant in a drawing.“

Fact: The government does not award grants based on a drawing or raffle; an individual or entity must first apply for the grant through a federal website, like Grants.gov. Any individual who claims the government is awarding a grant, for example, to a lucky group of citizens who have paid their taxes on time is attempting to scam you.

“You have been awarded a federal grant that you can spend any way you like.“

Fact: Federal grants are usually awarded for specific programs, research or projects – most often to local governments, organizations, institutions and universities. Beware of any individual who promises a government award that can be spent on paying down tuition or credit card debt, or home electronics and décor.

Source: https://www.grants.gov/web/grants/learn-grants/grant-fraud/grant-related-scams.html

2 San Diego contractors sentenced in DoD scam

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Two San Diego defense contractors were each sentenced Thursday to 15 months in custody for conspiring to commit wire fraud and file false claims, and making false statements on their federal income tax returns.

Jeffrey Harrington, 55, and Michael Mayer, 63, admitted to fraudulently obtaining money from the U.S. government by making false claims to the Department of Defense for payment on items that the defendants knew had not been sold to the Navy, but which had been substituted with other, unauthorized products.

As part of the sentence, three of the companies owned by Harrington and Mayer — San Diego-based Veteran Logistics, Industrial Xchange and Boston Laser Technology — were ordered to forfeit over $1.4 million and pay a $1 million fine for their roles in the offenses, according to the U.S. Attorney’s Office.

Keep reading this article at: https://timesofsandiego.com/crime/2017/12/14/2-san-diego-contractors-sentenced-in-department-of-defense-scam/

Beware of bogus emails supposedly from state contracting offices — and other scams

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We’ve written about this before, and it’s time to repeat our advice:

Watch out for government contract-related scams!

Counselors from the Georgia Tech Procurement Assistance Center (GTPAC) hear from business people every week who tell us about schemes designed to take their money in return for little or nothing of value in their pursuit of government contracts.

One of the latest examples we received actually came from the purchasing office of the State of Oregon warning us to ignore a bogus email that invites vendors to update their contact information in order to receive details on upcoming contract opportunities.  By clicking on the link, vendors would actually be uploading data about their company — such as bank routing information — which would be used for exploitation.

To see our earlier warnings, read these stories:

Georgia Tech purchasing office issues fraud alert, GTPAC warns of other fraud

Bipartisan Senate bill introduced to protect small businesses from contracting fraud

FTC wants to help small businesses spot cyber scams

Beware of Affordable Care Act phishing campaign

Owner of fraudulent Florida FEMA registration firm faces 20 years

FTC wants to help small businesses spot cyber scams

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If you’re a small business owner receiving Facebook messages about a business grant you’ve won, you might be the target of a cyber scam—and the Federal Trade Commission wants to make sure you don’t fall victim.

FTC this week launched a new site designed to help small businesses protect themselves from cyberattack. They’re often easy targets, especially because they don’t have the financial resources larger organizations do to constantly monitor their networks, according to FTC.

The Facebook scam, in which criminals posed as a recipient’s friend to collect cellphone numbers, is just one example; the percentage of spear-phishing attempts directed at small businesses rose from 18 percent in 2011 to 43 percent in 2015, according to Symantec’s threat report.

Keep reading this article at: http://www.nextgov.com/cybersecurity/2017/05/ftc-wants-help-small-businesses-spot-cyber-scams/137734/

Fraud alert: HHS OIG hotline telephone number used in scam

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The U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) recently confirmed that the HHS OIG Hotline telephone number is being used as part of a telephone spoofing scam targeting individuals throughout the country.

These scammers represent themselves as HHS OIG Hotline employees and can alter the appearance of the caller ID to make it seem as if the call is coming from the HHS OIG Hotline 1-800-HHS-TIPS (1-800-447-8477). The perpetrator may use various tactics to obtain or verify the victim’s personal information, which can then be used to steal money from an individual’s bank account or for other fraudulent activity.

It is important to know that HHS OIG will not use the HHS OIG Hotline telephone number to make outgoing calls and individuals should not answer calls from 1-800-HHS-TIPS (1-800-447-8477).

HHS OIG encourages the public to remain vigilant, protect their personal information, and guard against providing personal information during calls that purport to be from the HHS OIG Hotline telephone number.

The OIG’s office also reminds the public that it is still safe to call into the HHS OIG Hotline to report fraud.  The OIG particularly encourages those who believe they may have been a victim of the telephone spoofing scam to report that information through the HHS OIG Hotline 1-800-HHS-TIPS (1-800-447-8477) or spoof@oig.hhs.gov. Individuals may also file a complaint with the Federal Trade Commission 1-877-FTC-HELP (1-877-382-4357).

 

Source: https://oig.hhs.gov/fraud/consumer-alerts/alerts/phone-scam.asp

Beware of scams involving FEMA’s response to Hurricane Matthew

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Hurricane Matthew is being used as a platform to circulate false information to government contractors and other vendors.

femaWe want to make sure that you are aware of this situation so no one takes advantage of you, especially at a time when so many people are vulnerable to the storm hitting Florida, Georgia and South Carolina.

Please be on alert to the possibility of phone calls and emails which encourage you to register in a database that will give your company “priority vendor” status by “emergency managers” (implied to be FEMA officials) so that you can be given the “opportunity to help your community for disaster relief efforts and make profits at the same time.”  The services offered in these solicitations carry a price tag ranging between $195 and $1,200 for a variety of services, including a “priority listing.”

Please be advised that FEMA does NOT have a “priority vendor” program. 

FEMA does maintain a legitimate web site for vendors who wish to voluntarily provide supplemental information on the kinds of services they would like to furnish to FEMA, and there is no fee to use it.  That web site is at: https://www.fema.gov/media-library/assets/documents/29748.

FEMA states: “Submission of the vendor profile form does not place you on a preferred list of vendors to be considered for procurements.  FEMA does not maintain such a list. The form is used to assist in secondary market research and is voluntary.  FEMA does not charge any company a basic registration fee.  There are companies that replicate services of Federal Government entities and there are typically fees associated with their services.  Most Federal Government services, if not all, are free of charge.  Always make it a practice to reach out to the appropriate Federal agency first to inquire about the validity of the service, specifically if a fee is associated with it.”

Please feel free to consult with any GTPAC counselor whenever you are in doubt about the legitimacy of any government contract-related offer.  In fact, we would appreciate it if you would share questionable solicitations with us.

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