ST. GEORGE — Two suspects were indicted by the Utah Attorney General’s Office for taking part in an alleged gift card scheme that targeted primarily the elderly, a fraud that resulted in a $600,000 loss to both the individuals and Walmart.
Junliang Tang, 35, and Shuyan Wang, 33, both Chinese nationals, face three second-degree felony charges, including one count of money laundering, one count of pattern of unlawful activity and one count of unlawful use of a card.
The charges stem from an extensive multiagency investigation into a fraud ring that resulted in more than $600,000 in losses to a number of victims and to Walmart, Daniel R. Strong with the Utah Attorney General’s Office noted in the indictment filed Thursday.
In the scheme, individuals, primarily the elderly, are manipulated into loading large sums of money onto Walmart gift cards by suspects posing as government agents, a computer service person, bail bondsmen, IRS agents or other rouse.
The investigators also learned that a number of elderly individuals defrauded in the scheme reportedly received a phone call from “someone posing as an authority figure,” the indictment said, and were told they would lose their money if it wasn’t transferred onto a Walmart gift card.
One elderly couple told investigators they were scammed by someone claiming to be a police officer who instructed them to purchase several thousand dollars in Walmart gift cards, the indictment said.
Once the gift cards were purchased, the individuals were instructed to scratch off the code protector on the back of the card and then photograph the card before sending the photo to the caller.
The investigation also revealed that once the money was loaded, a network of suspects used the fraudulently obtained gift cards to purchase other “closed loop” gift cards – which are cards that can only be used at a specific retailer or brand – at various Walmart stores. Those cards are then monetized into cash through various online marketplaces.
Once the fraudulent transactions were identified, investigators were able to link them back to Sam’s Club membership records, which also required a photograph, and a number of individuals throughout the U.S. suspected of being involved in the scheme were identified.
On Jan. 23, two of the suspects involved, Tang and Wang, entered a Walmart store in Utah County and were recognized by the store’s loss prevention officers who alerted police.
As the investigation continued, detectives learned the suspects had used the fraudulently obtained gift cards at a number of Walmart stores in Saratoga Springs, American Fork and other stores throughout the county.
In Saratoga Springs, loss prevention officers reached out to police Jan. 22, reporting that an Asian woman purchased over $1,600 of various gift cards using Walmart gift cards loaded on her phone. Detectives followed the woman out to her Kia where they obtained the license plate number.
The detective was also informed that a suspect matching the description of the woman driving the Kia was observed days earlier purchasing gift cards at a Walmart store in Oregon accompanied by a male, and was still wearing the same baby blue colored jacket in both the Utah and Oregon footage.
The following day, loss prevention managers at the Oregon store also observed the same Asian man purchasing approximately $1,800 worth of gift cards over a series of transactions, using gift cards with the same bar codes as the cards loaded onto the woman’s phone the previous day.
Meanwhile, on Jan. 23, the same woman, Wang, was seen purchasing gift cards at the Walmart in American Fork, which also turned out to be when Walmart’s global investigators were in the Salt Lake area briefing agents with the Utah Attorney General’s Office of the scheme.
Investigators identified both suspects after matching their names to the names used to loaded up the gift cards during a review of the transaction records.
So far, nearly 1,380 Walmart gift card purchases throughout Utah between Jan. 16-23 have been linked to the fraud ring thatincludes more than 200 suspects in 46 states, resulting in a loss of nearly $240,000 that was laundered in the scam.
Agents also discovered that the card numbers were typically monetized into cash within hours of being purchased by the victims.
Due to the to the “scale and scope of this scheme and because the defendants are Chinese nationals without connections to Utah,” Strong wrote, the state requested that each suspect be held on $200,000 bail, a request that was granted and the pair remains in custody at the Utah County Jail.
The investigation is ongoing and involves the Utah Attorney General’s Office, Secure Strike Force, Walmart’s global loss prevention team and multiple local law enforcement agencies within Utah.
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