Secret Service names senior official to crack down on Covid-19 scams
Roy Dotson, who has spent nearly three decades in law enforcement, will be the agency’s point person for working with big banks to seize stolen Covid-19 recovery funds, and with the Justice Department to help crack down on the scammers.
The goal is to “maximize our investigative impact” and “recover as much as we can” in stolen money, Dotson told Fintech Zoom. He is also the assistant special agent in charge in the Secret Service’s Jacksonville field office.
The Secret Service says its work has led to the seizure of more than $1.2 billion and return of more than $2.3 billion in ill-gotten gains. One hundred people have been arrested.
But the agency still has more than 900 active criminal investigations into Covid-19-related financial fraud. And Dotson said he wants to see these investigations have a bigger impact. That means seizing big tranches of stolen funds and, with the help of the Justice Department, putting prolific scammers behind bars.
“I’ve never seen anything like this in my career as far as the magnitude and the scope,” Dotson said, referring to Covid-related financial fraud.
It’s part of a continued effort, 21 months into the coronavirus pandemic, by US law enforcement officials to prosecute well-organized criminal groups that have fleeced programs for unemployment insurance and small business loans.
The roughly $2 trillion coronavirus relief package known as the CARES Act that became law in March 2020 brought unemployment benefits and loans to millions of Americans, but it also opened up opportunities for criminals to exploit those programs by fraudulently applying for aid.
Crane Hassold, a former FBI analyst who is now director of threat intelligence at security firm Abnormal Security, said the CARES Act was “essentially a scammer’s World Series and Super Bowl rolled up into one.”
“Using platforms like Telegram or WhatsApp, scammers openly share techniques and best practices about how to most effectively submit fraudulent pandemic-related claims in channels dedicated to the topic,” Hassold told Fintech Zoom.
Hackers, too, have sought to exploit the pandemic response to break into US companies’ computer networks and defraud or spy on those organizations.
Within days of news of the Omicron variant breaking, suspected Iranian hackers were sending malicious emails mentioning the variant to certain US foreign policy experts, according to data that email security firm Proofpoint shared with Fintech Zoom. The firm declined to name the experts.
The hackers were “masquerading as a US media outlet’s newsletter to conduct reconnaissance” on their targets, Sherrod DeGrippo, Proofpoint’s vice president of threat research and detection, told Fintech Zoom.
Combating that hacking is beyond Dotson’s remit. But the alleged Iranian hackers, and the scammers that Dotson is pursuing, are both capitalizing on the uncertain and anxious nature of life during the pandemic: The path to relief, whether it’s good news about the new variant or an opportunity to save your business, could be just a click away.
Like epidemiologists, law enforcement officials are preparing for the next spike in Covid-related scams.
During the pandemic, Dotson said the Secret Service has learned how to more quickly identify big perpetrators of fraud. “We’ve learned a lot as investigators on what to look for the next time, maybe ways to be even faster [in] response,” he said.