How Hushpuppi defrauded US government $400k from prison has emerged
Documents have emerged of how Hushpuppi defrauded the US Government in fresh $400k while in prison.
According to a US-based journalist, Mathilde Salome Bonnet, citing a new court document which was included in an amended charge sheet, Ramon Abbas, popularly known as Hushpuppi perpetrated the fraud while in prison in the United States of America.
Hushpuppi reportedly received the fresh charges as US prosecutors submit court documents showing how he committed fraud and laundered over $400k from behind bars.
On Wednesday, US prosecutors presented documents to the United States District Court of California with new evidence accusing Hushpuppi of fraud and money laundering in a US federal prison.
Hushpuppi allegedly participated in the purchase and laundering of unlawfully obtained Economic Impact Payment (EIP) debit cards while incarcerated in a US Federal detention facility, according to court records.
EIP are financial support offered by the US government to U.S residents according to the CARES Act. Debit cards are one of the methods that eligible US people receive their EIP. Hackers utilize data of US residents to file and get EIP debit cards, according to evidence submitted in court. They sell these EIP cards to other cyber criminals on underground markets.
In a court filing, US prosecutors stated that inmates have unrestricted access to phone calls, video calls, the internet, and computers; they are not monitored since inmates have a right to privacy. Hushpuppi, like the other detainees, was granted the same access.
However, security officers at a US Federal penitentiary facility detected Hushpuppi using the internet more frequently between the 28th of January and the 4th of March 2022. They got an order to record Hushpuppi’s activities after learning that he had been arrested for internet-related crimes. For him, a special system was set up, and his activities were logged for seven days.
Hushpuppi was discovered to be purchasing EIP debit cards from an underground cybercriminal marketplace. Hushpuppi purchased 58 EIP debit cards with a total value of $429,800 on the site while being recorded and laundered the money through one AJ.
Inmates in correctional facilities across the US are allowed certain activities which include access to phone calls, video calls, the internet, and computers with limited and regulated usage
Inmates have constitutional rights to their privacy
Phone calls from correctional facilities by inmates are not recorded except when necessary and a warrant is obtained for this purpose. Inmates’ internet activities are not logged or recorded except when necessary and a warrant is obtained for this purpose.
Abbas was also allowed these privileges like every other inmate
Between 28th January 2022 and 4th March 2022, security officers at the US Federal correctional facility, Central District of California, observed more frequent usage of the internet by Abbas. With the knowledge that the crimes Abbas committed which he is being charged for are all internet related crimes, security officers were concerned and informed the Federal Bureau of Investigation (FBI).
On 7th March 2022, investigators obtained a federal search warrant, issued by Central District of California, to monitor and record Abbas’ internet activities.
Security officers at the US Federal correctional facility, Central District of California, were instructed to setup a dedicated computer for Abbas. Any time Abbas requests for access to the internet, he should be given that dedicated computer. Only Abbas should be given that computer.
From 7th March 2022 to 13th March 2022, investigators monitored and recorded Abbas’ internet activities. In this period, he requested internet access daily. He spent an average of 55 minutes for each session.
During this period, we found out that Abbas was actively buying Economic Impact Payments debit cards from an underground cybercriminal marketplace where hackers sell EIP debit cards for Bitcoins.
The document went further to detail their shocking findings while recording Hushpuppi’s activities.
EIP debit cards purchase and money laundering
Investigators found out that Abbas uses an underground cybercriminal marketplace for hackers to sell EIP debit cards for Bitcoins.
On the marketplace, hackers listed EIP debit cards with different balances. Investigators found EIP debit cards with $1,400 balance to as high as $8,000. These EIP cards were applied for by hackers using compromised and stolen data of US citizens and residents.
Investigators found out that criminals can order a virtual option of EIP debit cards and receive it instantly. They use this for online purchases. Criminals can also order for the plastic version of EIP debit cards and they receive it to their mail address.
Abbas bought between seven to 10 EIP debit cards daily for the period he was recorded. He purchased a total of 58 EIP debit cards in this period, with a total value of $429,800.
Of the 58 EIP debit cards, Abbas chose the virtual card option for 36 EIP cards and he selected the plastic physical card option for 22 EIP cards.
Abbas was in constant communication with one AJ. Abbas sent all the cards he bought from the marketplace to AJ. Abbas gave instructions to AJ on what to shop online. He gave instructions on what to do with the purchased items. Abbas also gave instructions on cash withdrawal from ATMs with the plastic cards.
In the document, the prosecutors mentioned Hushpuppi was constantly buying high-end gadgets such as iPhones, gaming consoles, MacBooks and iPads through his primary contact AJ. Investigators could not ascertain the total proceeds Hushpuppi has laundered from this fraud. Their recorded evidence was for a total of $429,800.