In a recent case involving cross-border gift card fraud, a Chinese national named Mingdong Chen, who was residing illegally in Brooklyn, New York, has been sentenced to 24 months in prison by a federal court in New Hampshire. Two other Chinese defendants in the same case, Nanxin Wu and Mengying Jiang, who were also residing illegally in New Hampshire, have been sentenced to 33 months and 60 months in prison, respectively. After serving their sentences, all three individuals will face deportation.
According to information released by federal prosecutors, an organized crime group from China used various fraudulent methods to obtain over $100 million in gift cards. These methods included hacking into U.S. companies, tampering with gift cards, engaging in online romance scams, and targeting elderly individuals for fraud to steal Americans’ gift card information. The card numbers were then sent to Chinese members in the U.S. via Chinese communication platforms to exchange for cryptocurrency.
After receiving the gift card data, multiple Chinese groups in the U.S. made large purchases of high-value electronic goods like Apple products. They stored these products in warehouses before shipping them to China, Hong Kong, and Southeast Asia for resale and profit.
Prosecutors detailed that Mingdong Chen was involved in fraudulently using over $400,000 in gift cards, while Nanxin Wu’s case involved $1.4 million and Mengying Jiang’s case involved a staggering $3 million. The three defendants were responsible for bulk purchases of Apple products in states with no sales tax, such as New Hampshire, to maximize profit margins. Although they did not participate in the initial fraud, their roles were crucial in laundering the fraud funds and transferring goods. All three defendants have admitted to conspiring to commit telecommunication fraud.
“These individuals were part of a Chinese transnational criminal organization with highly covert and coordinated operations. They played a crucial role in converting funds obtained through online fraud into physical goods, making them an indispensable link in the entire fraud supply chain,” a Special Agent from the Homeland Security Investigations (HSI) New England Field Office stated.
This case is part of the Department of Justice’s “Operation Reclaim America,” aimed at cracking down on illegal immigrant crime, combating transnational criminal organizations, and protecting community safety.