Limo company owner accused in 'sophisticated' fraud, money laundering scheme

The owner of a Winnipeg limousine company is accused of defrauding a dozen clients of $1 million in what police call a "calculated and very sophisticated" money laundering scam.

A 36-year-old Winnipeg man and owner of the companyhas been charged with 14 offences related to fraud and money laundering.

He is alleged to havecharged $865,000 in unauthorized transactions to clients, saidpolice spokespersonConst. Dani McKinnonon Friday. About $1 million, some of it obtained through fraud, was moved around various accounts to launder the money.

A Winnipeg Police Service financial crimeunit investigation spanned two years, from May 2019 to February of this year, after reports of irregular transactions began flowing in.Police say they unearthed an intricate money laundering and fraud scam by a local limousine company.

"It's actually very calculated and very sophisticated," said Det. Bill Lodge with the unit.

Police allege the fraud and laundering occurred betweenJuly 2 and Oct. 10, 2019, when 23 different credit cards were used for more than 90 unauthorized transactions. Most of the transactions ranged in the thousands of dollars, said Lodge.

In May 2019, a mobile payment processing company contacted police claiming one of its merchants was processing unauthorized credit card data through its merchant account, dating back to 2018. Lodge said this can happen when someone notices something off on a credit card bill and disputes it with a credit card company, which then follows up with the person or business tied to the charge.

Investigators then found that customer credit card information was used for fraudulent transactions.

Several techniques were used. One tactic involved taking customer data and overcharging their credit card from a previous regular fare price. These went unrecognized until the customer saw the difference on their credit card statement and started inquiring with credit card companies, said McKinnon.

Other times, credit card information that was previously saved from a legitimate transaction was reprocessed without the customer knowing, police said.

"For someone to go through and sort of select their victims when they're going to do it, how much they're going to charge, how they're going to move their money around, how they're going to pay bills, how they're going to receive some of the fraudulent funds for personal use it takes a lot of calculated time and calculate risk for them to carry it out," said Lodge.

Twelve victims were identified by police, from customers who used the limo servicetolocal and international companies. An asset management company, a travel agency, anot-for-profit organizationand several financial institutions were also defrauded, police said.

Lodge said often in money laundering cases, a fraudster will mix in illegally-obtained funds with money made legitimately and move it all around different accounts to cover their tracks. That was the case here, said Lodge, where the $1 million transferred across accounts included money obtained through fraud.

The company remains in business, and the 36-year-old man was released on a promise to appear in court, said Lodge. No other suspects are being investigated.

There's been about half a dozen cases of fraud of this magnitude in Winnipeg in the past three years, said Lodge.

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