Huge bank con bust in dramatic sting

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Police Crime Intelligence Unit officers lead away two of six suspects who were arrested in a sting operation.

Durban - A multi-national bank fraud syndicate, thought to be responsible for scamming hundreds of millions of rand from a range of the country’s banks, was bust in a dramatic sting in a Durban hotel on Thursday night.

The swoop, which saw heavily armed officers bursting into a hotel room at the end of an undercover operation, was the culmination of a six-week investigation of the gang and thwarted their attempt to steal R52 million in a single night.

A Stanger man thought to be the gang’s kingpin was arrested as well as six others, among them foreign nationals from Nigeria and the Democratic Republic of Congo.

The sophisticated criminal operation is understood to be an evolution of card skimming, using electronic speedpoint machines owned by businesses to draw millions from their accounts in a matter of minutes.

With millions of speedpoint machines in circulation, and no real way to combat the gang’s operation, banks are counting the cost of electronic fraud on a grand scale.

Police Crime Intelligence agents had gathered evidence in a series of meetings and eventually lured the gang to the hotel.

With the room rigged with audio and visual surveillance equipment, and a team of officers listening in, in the adjacent suite, the gang effected fraudulent transactions using a speedpoint machine.

The gang was able to raid an account of nearly R1 million in under two minutes, using the machine to perform refunds to cards provided by the ring.

A source close to the investigation explained how the gang operated, approaching businessmen in financial difficulty and offering huge kickbacks if they allowed their speedpoint machines to be used.

“The businessman who lets the guys use the speedpoint is told a long story about how they can use the machine to pull money from another account using special codes, when in actual fact all the gang does is raid his own by performing refunds on to cards.”

“The gang will refund amounts just under R500 000 on to each card and just keep going until the business’s account is empty.

“Bigger businesses with a bit of depth to their accounts can be taken for millions in a matter of minutes,” the source said.

“At the end of it all they give the business owner a card with his cut on it; what he doesn’t know is that the card has several others linked to it, which pull the stolen money out of the account before he even gets to an ATM.”

The source said gang members would use the loaded cards to buy appliances or to gamble at a casino before cashing out and walking away with cash in hand.

“The problem is that businessmen cave when they are offered huge kickbacks, and at the end of the day, they are the ones left holding that ball with an empty account and these men in the wind,” he said.

“This operation is huge, they came there that night intent on taking up to R50m and they would have done it if we didn’t stop them; if they can take R500 000 every 30 seconds, imagine how much banks have been taken for in the past.”

Police spokesman Colonel Jay Naicker confirmed that the sting operation had taken place, and that members of KZN Crime Intelligence Unit and bank investigators had swooped on the syndicate.

He said the lengthy operation was a measurable success for police in the fight against banking fraud in the province.

South African Banking Risk Identification Centre head Kalyani Pillay commended the team’s effort between police officers and bank officials.

“We are aware of these arrests and we would like to congratulate the South African Police Service and the banks for the good work done in ensuring that these perpetrators are apprehended,” he said.

The six will appear in the Durban Magistrate’s Court tomorrow on fraud charges and there are more arrests expected.

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- Sunday Tribune


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