29 September 2016

Wells Fargo wires crook $2.1m

29 February 2012  |  13565 views  |  1 wells fargo logo web screen shot

Wells Fargo has been tricked into transferring over $2 million from a customer escrow account to a scammer who faxed asking for the money.

The con, revealed in lawsuit papers seen by Forbes, involved an unnamed crook faxing the bank's corporate trust services department in San Francisco and convincing it to wire money from an escrow account Wells maintained for Californian hospital chain Catholic Healthcare West (CHW).

The scam was made possible because CHW is required to maintain $7.5 million in an escrow account as part of its contract with Merced County to operate a medical centre. The firm wanted to move the account to Wells from WestAmerica Bank, a move that needed the green light from the Merced County Board of Supervisors.

As part of the moving process, last February the board put a partial copy of the escrow agreement, including the signatures of Merced County director of public health Tammy Chandler and CHW CFO Michael Blaszyk, on the county's public Web site.

These signatures proved useful to the crook, who on 6 December included forgeries of them in a fax sent to Wells Fargo asking for $445,000 to be wired from CHW to an HSBC account in New York held in the name of HUGE International T. Ltd. The transfer did not go ahead because HSBC said it had no such account.

On 14 December another fax was received by Wells asking for $445,000 to be wired to a Hong Kong account for HUGE International at Hang Seng Bank. This was also rejected because no such account existed.

However, just days later a third fax asked for $989,000 to be sent to an account for Textil Trading UK Limited at Standard Chartered Bank in Hong Kong and this one went through.

This was followed two days later by a fax asking for $2.9 million to be sent to the Standard Chartered account - a request denied only because it required the sale of securities. The next day a fax asking for the smaller figure of $1.1 worked for the scammer.

Finally, on 28 December when it received a sixth fax asking for the transfer of $2.2 million, a Wells escrow agent called CHW and discovered it had been duped.

The US Attorney has now filed a "complaint for forfeiture" in a bid to get Hong Kong authorities to recover the stolen money from the fraudster's account. Meanwhile, Wells told Forbes that it had been the victim of a "sophisticated fraud".

Wells Fargo Bank Gives Scammer Three Tries - Forbes

Comments: (1)

Keith Appleyard
Keith Appleyard - available for hire - Bromley | 01 March, 2012, 16:37

Bit worrying if this ever became possible in the UK, given that my Signature appears in the public domain on Annual Accounts & Report available on the Charity Commissioners website - no need to even pay a fee!

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