While Bitcoin and other cryptocurrencies are often associated with illicit activities, a recent multi-million dollar scam involving Wells Fargo underscores how traditional banks are used to facilitate illegal transactions.
Hakop Zakaryan, a former manager at a Wells Fargo branch in Glendale, California pleaded guilty on Monday to taking advantage of his position to help conduct a $14-million money-laundering scam.
Zakaryan faces up to 30 years in prison for engaging in fraudulent activities involving fake bank accounts, false identities, fake Republic of Armenia passports and tax refunds. The 34-year-old has pleaded guilty to one count of bank fraud.
According to the U.S. Attorney’s Office, he used his position to make frozen fraudulent accounts active again by providing false information to Wells Fargo’s loss prevention department.
“Zakaryan admitted in his plea agreement that he used his position as bank manager in Glendale to ‘unfreeze’ bank accounts that Wells Fargo had frozen because of suspected fraud. To do so, Zakaryan called the bank’s loss prevention department and provided false information to unfreeze the bank accounts, even though he knew that the schemers were using fraudulent identities, according to the plea agreement. Zakaryan admitted that he assisted the schemers because they paid him thousands of dollars in cash.”
The Attorney’s Office reveals that in July of 2014, Zakaryan received $3,000 for unfreezing a fraudulent account holding $29,453. The money laundering scam took place over the course of several years and involved hundreds of bank accounts that were created using fake or stolen identities.
The IRS reportedly received 7,000 fake tax returns that were seeking refunds totaling $38 million. The agency later issued $14 million in refunds.
Officials investigating the matter say that this is the same scam that a Glendale attorney,