Authorities are working to tackle a phone scam where the caller pretends to be a DEA agent and then tries to steal the victim’s money – often by buying gift cards.
Phone fraud in general is on the rise, with the number of reported fraud cases nearly doubling between 2019 and 2020 according to the latest figures from the Federal Trade Commission. In the last year alone, half a million reports were filed, with losses totaling over $ 1 billion.
ABC News has been tracking new scam notifications sent by the FBI, IRS, and DEA in cities across the country including Boston, Houston, San Francisco, and Spokane, Washington itself as officials claim the target has been linked to a crime, and then demand that they pay for it or bring charges.
The Drug Enforcement Administration recently warned of a “widespread fraud program” in which the caller pretends to be a DEA agent in order to extort money.
According to DEA Special Agent James Pokryfke, the scam begins with the potential thief informing the target that their name and social security number were used to rent a vehicle that was later found on the southern US-Mexico border Drugs and money laundering.
“The fake DEA agent will convince people to transfer money in a number of ways. One is to avoid prosecution,” Pokryfke said. That option often involves paying a fine, he said.
The other option is to offer the target a way to secure their money using the risk of a frozen bank account.
When Terri Tuson’s phone rang last July, she was told that her Social Security number had been used to rent a car that was found with drugs in the car in Texas along the border. The scammers told her they would freeze her bank accounts unless she withdrew her money and transferred it to gift cards.
“I was scared because I didn’t know if it was actually going to happen or not,” said Tuson, who works as a housekeeper at an Illinois hospital.
At the time, she had $ 2,800 in her one account. She says she pulled everything back by following the scammer’s instructions and went to a drug store and grocery store where she bought eBay and Best Buy gift cards.
“They told me they would open another account that I could put my money into, send a sheriff to my house and give me all this information so I could get my money back. It never happened,” Tuson said.
ABC News spoke to several other victims of the same scam, whose losses ranged from $ 200 to over $ 450,000.
The DEA raised questions about a possible investigation into this specific fraud to the FBI, which refused to comment on the status of an investigation.
In an audio recording provided by the DEA to ABC News, a scammer is heard doing his best to convince a target that he is a legitimate DEA agent – and even texting a photo of a fake federal badge .
The scammer was unaware that his target had hit a real DEA agent, Pokryfke, who reported the scammer that what he was doing was criminal and the subject of an investigation.
“The DEA will never call you and threaten you with arrest unless you make a payment,” Pokryfke told ABC News. “And they will never ask you to give them money to keep it safe.”
The YouTube star “Pierogi”, a pseudonym used to protect his true identity, gained fame through “scamming the fraudsters”. Videos of his conversations with phone scammers show Pierogi – who has a background in cybersecurity and IT – plays a range of characters, from a widowed grandmother to a college student.
“I talk to scammers on the phone every day and I hear victims receiving gift cards in the background and giving these people their money,” Pierogi told ABC News. He said the helpless feeling of being unable to help the victims brought him to tears.
Pierogi, whose videos have been viewed more than 60 million times since his channel launched in 2019, said the scammers aren’t just targeting the elderly.
“It could be 18 to 85 – they don’t care. If they think they can cheat on you, they will,” he said.
Pierogi said scammers use gift cards as their preferred method of payment because of their very fast processing. “The scammers have Facebook groups where people either tie gift cards or use them as currency,” he said.
FTC deputy director Monica Vaca told ABC News that scammers have financial systems in place to monetize the cards.
“Sometimes they sell them on a secondary market or use them for themselves,” said Vaca. “Once you read these numbers on the gift card [to the scammer]You will be able to access these resources, “she said.
Gift cards were the number one payment method for those who said they had been a victim of DEA scams in the past year, with an average loss of $ 850 per victim, according to the FTC. The FTC said the most popular gift cards requested by scammers are eBay, Google Play, and iTunes cards.
FTC officials said they worked with retailers to post visible signage on gift card sections of stores as part of a public awareness campaign entitled “Hang Up on Gift Card Scams,” warning gift card buyers of possible phone scams should be.
“We hear from consumers that in many cases it is these sellers who step in and prevent them from sending money,” said Vaca when the targets of the fraud are to buy the cards.
Among those taking part in the awareness campaign is Walmart, the world’s largest retailer.
A Walmart spokesperson confirmed to ABC News that warning signs had been posted in Walmart stores in the United States. The company also confirmed that the store’s staff had received training on how to best identify red flags related to potential fraud cases.
ABC News’ Dylan Goetz and Katie Conway contributed to this report.
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