Houston fraud ring exposed with 40 arrests in $600K fraud scheme that used dark web data

MONT BELVIEU, Texas (KTRK) — Police say 40 people have been arrested in a fraud scheme that led to hundreds of thousands of dollars stolen from people in the Houston area.

Authorities say the crew used financial information from the dark web to do the job.

“Crooks have nothing but time to figure out how to get your data,” Mont Belvieu Police Chief Jimmy Ellison said.

Mont Belvieu police say they know of 35 residents in our area who are victims of this scheme.

Police started working on the case in June and have made 40 arrests thus far. Some suspects lived as far away as Georgia and Illinois, but many resided in Houston.

Gregory Edwards III, 23; Doc Frank, 25; Jayson Gipson 20; and Lajewel McGilbray, 21, are the ringleaders, according to police.

They have all been charged with money laundering and engaging in organized criminal activity.

Edwards, Gipson, and McGilbray were also charged with breach of computer security.

Police say the suspects got financial information off the dark web that came from data breaches and used it to wire money out of people’s accounts.

According to authorities, the total amount of stolen money ranges between $360,000 to $600,000.

Other suspects were arrested for letting the ring leaders funnel stolen money through their bank accounts.

“Once they get the information, they start making wire transfers out of the victim’s bank accounts. But, in order for them to be successful, they have to transfer that money into a clean account and that’s where they began recruiting other people,” Ellison explained.

Most were friends and family, while others were recruited through social media.

The victims in this case weren’t tricked into clicking on something online or giving out their bank passwords. They just woke up one day to see money missing from their accounts.

So, how can you try to keep this from happening to you?

Chris Bronk, a University of Houston professor and cybersecurity expert, says you should:

• Make your banking passwords different than other passwords

• Set up two-factor authentication, especially for banking

• Use biometrics like facial recognition and your fingerprint to log in when possible

• Be selective with what companies you do online business with

“There are lots of other avenues of fraud, but that’s really the key one. If you’re using the same username and password every place you do business online, you’re going to get nailed at some point by somebody,” Bronk said.

He added that when it comes to companies getting hacked, as a customer, there is not much else you can do. The responsibility is on businesses to get better.

“You’re never going to be in a foolproof position, but you want to be a harder target than the next guy,” Bronk said.

As for the fraud investigation, Mont Belvieu police are still working to track down a couple more people they believe were involved.

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