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Five facing federal indictments in banking Trojan theft

Five alleged money mules have been indicted in federal District Court for the Eastern District of North Carolina in connection with the illegal May 2007 transfer of $450,000 from the bank account of the city of Carson, Calif. The cash was transferred after a banking Trojan (Talex) infected the computer of the city treasurer Karen Avilla. All but $44,000 was recovered.

According to the indictment, Jennifer Ann Woodard, Deago Larase Smith, Lance Corbett Holt, John L. Quinn II and Anthony Leonard Bobbitt will face federal charges of bank and communications fraud.

Indictment here.

Softpedia news story here.

There have been very few prosecutions of money mules, who are mostly recruited through work-from-home schemes. The mules provide organized crime groups in other countries with details of their bank accounts. The malicious operators, using banking Trojans, tap the bank accounts of their victims and transfer cash to the mules, who take a percentage. The mules then use untraceable wire transfers to send the money to the criminals out of the country.

On one hand, the mules can claim they were duped, but on the other hand the descriptions of the jobs they take are pretty suspicious to anyone with half a brain. They end up being the lynch pin in a process that siphons hundreds of millions of dollars from corporations, organizations and government groups.

Last month, the head of the FBI’s Cyber Crime section, Patrick Carney, told a Federal Deposit Insurance Corporation symposium in Arlington, Va., that the Bureau was planning to pursue the mules:

“We want to make sure that public understands this is illegal activity and one of the best ways we can think of to give that message is to have some prosecutions. We realize it’s not going to make the problem go away, but it should help raise awareness and send a signal,” he said.

Brian Krebs column: “FBI Promises Action Against Money Mules”

Tom Kelchner