Scam Centers Running in China Cost Americans Billions

China-based criminal rings have expanded into a sophisticated, multi-billion industry that now targets Americans as its top global priority, a congressional panel reported on July 18.

In a new study, the US-China Economic and Security Review Commission (USCC) said that Americans last year lost $5 billion or more to the Chinese scammers who conducted an array of frauds, an increase of 40 percent from 2023. “The scams – often linked to transnational crime syndicates involved in drug and money-laundering operations – target Americans through text messages, social media, dating apps, and jobsites,” the Washington Post reported.

Americans are not the only victims, however. Using different locations in Asia as a base, the fraudsters carry out scams in many countries. According to the USCC study: “Chinese criminal networks operate industrial-scale scam centers across Southeast Asia that steal tens of billions of dollars annually from people around the world – a massive criminal enterprise that rivals the global drug trade in scale and sophistication.”

Among the concerns raised by the commission is that these criminals are building up an inventory of Americans’ personal data, which can be exploited in identity theft. The commission also warned that the US response has been weak, due to “fragmented and under-resourced” law enforcement. “I don’t even think American law enforcement has figured out how to get their heads around this yet,” USCC Commissioner Michael Kuiken told the Washington Post.

Fraudsters Knock on Doors to get Medicare Numbers

Medicare scammers are increasingly posing as salespeople with offers of free protein shakes, cleaning services, groceries, or medical equipment for older Americans. They’re really after people’s Medicare numbers and signatures, and once they get them, they seek to sign their victims up for hospice care or other services they do not need.

“If you sign that paper you could be putting your future health care rights at risk,’’ warns Dr. Mehmet Oz, the Centers for Medicare and Medicaid Services administrator. “No one legitimate is going to come to your door to offer you services covered by Medicare.’’

Oz says the fraudsters may send emails, call by phone, or even knock on your door. And while the scammers try to profit from fraudulent Medicare payments, victims can be harmed by losing access to critical healthcare.

That’s because if your name is listed as a hospice patient, you are no longer eligible for “curative” care, such as prescription drugs, regular doctor appointments, or needed surgeries, warns California Health Advocates. “This can cause tremendous stress, lead to a decline in health and in some cases, has even caused death,” the organization noted. Rather than offering cures, hospice care focuses on comfort and quality of life for individuals in the late stages of a critical illness.

The scammers, meanwhile, are pocketing millions.

In July, the Justice Department revealed that a California man was part of a group that operated fake hospices for four years. He pled guilty to defrauding Medicare of more than $17 million. His partners also pleaded guilty in the case.

A 2022 case led to the arrests of 14 people who stole more than $4.2 million by enrolling unsuspecting patients into hospices.

“Health care fraud is not a victimless crime. Defrauding the Medicare program not only wastes valuable taxpayer dollars, it causes significant harm to enrollees,” said Acting Special Agent in Charge Omar Pérez Aybar at the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG) Los Angeles Regional Office.

Psychic Scammer’s Fortune Vanishes at the Bank

An astrologer in Long Island, New York has been charged with grand larceny and fortune-telling for attempting to scam an older adult out of tens of thousands of dollars.

Police in Nassau County arrested Hemanth Kumar Muneppa, of Hicksville, NY, after his victim, a 68-year-old woman, sought to make a large bank withdrawal which raised suspicions that something was amiss.

Initially, the woman paid $20,000 for psychic assistance from Muneppa, whose business offers astrology, “evil spirit removal” and “love spell caster” among other psychic services, according to CBS News. Shortly after her $20,000 purchase, the woman returned to Muneppa for more. He then demanded another $42,000 and brought her to a bank to withdraw the money. But wary bank employees sensed trouble. Instead of providing the cash, they called police.

According to the New York Post, prosecutors said Muneppa “knowingly and unlawfully engaged in a scheme to defraud and obtain money from the victim by falsely representing himself as a fortune teller with the power to combat evil and dark spirits.”

Grand larceny is a felony in New York State and most other jurisdictions. Prosecutors also invoked New York’s rarely used fortune-telling law, a misdemeanor, that generally prohibits telling fortunes for profit.

Muneppa, who has been released with an ankle monitor, pleaded not guilty to the charges.

Scam Watch: Briefs

• Following a complaint by the Federal Trade Commission, a federal judge has halted a $100 million fraud in which scammers – posing as banks and credit bureaus – targeted older consumers with false promises that they could sharply reduce their debts.

• The Oregon Department of Justice has warned the public about a scam in which a woman lost $600,000 to fake federal agents who told her they would protect her financial accounts from hackers if she converted the assets to gold and gave it to them for protection.

• Scammers who pretend to be Medicare officials are telling older adults to update the data on their Medicare cards, as a trick to capture personal information that they can use for identity theft, CBS News reported.