Financial scammers reap huge amounts of cash in thefts from Eden Prairie businesses and individuals 

Financial fraud scammers have racked up nearly $12 million in thefts in four highly visible Eden Prairie cases in 2023. And that doesn’t take into account scammers who are working their computers and phones every day in search of money from businesses to senior citizens, according to Detective John Andrews, the Eden Prairie Police Department’s (EPPD’s) financial crimes investigator.

Search warrant affidavits filed by Andrews in Hennepin County District Court provide details about the most recent Eden Prairie cases:

• An Eden Prairie couple reported on June 15 that they had been scammed out of $9.2 million over a six-month period after the husband began investing in cryptocurrency at the suggestion of a woman he had met on LinkedIn. The wife learned about the scam when her husband called her in a panic after he tried to pull his money out and was told he needed to pay fees to do so. Andrews learned that the woman on LinkedIn wanted the husband to leave his wife for her.

• Foss Swim School reported on March 21 that the company had been swindled out of $1.3 million by someone who had hacked into its email system and began requesting payments for a construction project that the company had underway in Burnsville. The funds were diverted to the hacker’s account, according to the affidavit.

• The Margaret A. Cargill Foundation reported to Eden Prairie police in July losses of $1 million in a scam that involved unknown persons who intercepted payments to one of the foundation’s grant winners. An unknown person had gained access to an employee’s email and login information for the online system at the grant’s destination and changed the bank account number in which the money was deposited.

• Freight shipping giant C.H. Robinson reported losing as much as $361,225 in a theft by swindle. In that case, a search warrant filed in June identified a suspect and indicated probable cause for the alleged crime.

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The search warrants are typically aimed at banks and other financial institutions in an attempt to track money that has been stolen. Andrews told Eden Prairie Local News (EPLN) that he could not comment on any of the recent cases as investigations are ongoing. To date, no arrests have been made, and no charges have been filed.

The likelihood that all of them will be solved isn’t guaranteed, Andrews said.

Among the most frequent scams victimizing businesses is the Business Email Compromise, or BEC. In a typical BEC, criminals send an email that appears to come from a known source making a legitimate request, Andrews said.

“Everybody’s doing business over email,” Andrews said. “A lot of our correspondence with people is over email. (We’re) not picking up the phone, talking to people like (we) used to, you’re not meeting in person as much as we used to. The scammers and the criminals are exploiting that.”

Where does the money end up? “Eventually it makes its way overseas,” he said. Stolen money is often used to buy products that are sent overseas and turned into cash.

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In 2022, 17 Eden Prairie businesses reported losses of more than $1,000 due to fraud or swindle, according to EPPD data. Charges were filed in six of these cases. Two were denied by the prosecuting authority, and only one was cleared exceptionally. This means at least one offender was identified with probable cause to support arrest, charge, and prosecution.

Andrews recommends that businesses institute two-factor verification on their email system to make hacking the system more difficult. Second, if a vendor suddenly changes payment options, call them at a known number. “Pick up the phone or have a face-to-face with them to verify if it’s legitimate,” he said.

Don’t click on links, Andrews said. “Don’t open up any attachments that you don’t recognize.” He recommends contacting the company’s IT department to check the validity of suspicious attachments.

Finally, be careful about what personal information you post online, such as birthdates, pet names, and information that might be connected to your passwords.

The FBI’s Internet Crime Complaint Center (IC3) received 21,832 BEC complaints with losses exceeding $2.7 billion, according to the IC3’s 2022 annual report.

Elder fraud

On Oct. 29, 2022, an 85-year-old Eden Prairie woman received an email telling her that her computer had been hacked. Startled, she called the support number listed in the message, thinking she was calling Microsoft Support. The person on the line sounded legitimate. She seemed to know all of the pertinent information.

The suspect told the woman that her computer had a virus and needed to be wiped clean – for $3,500.

The suspect said the virus prevented the use of the victim’s computer to transfer the payment and suggested that the victim pay with Target gift cards.

The victim purchased $3,000 in gift cards at Target and another $500 card at Lowe’s. She returned home and called a different number to pay using the gift cards. After completing the payment process, the message on her computer disappeared.

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The woman’s story is not unusual. Hers was a one-time scam. Others are more sophisticated and can continue for months, Andrews said.

“Once (scammers) get their hooks into somebody, it’s really hard for that person to disassociate themselves without outside intervention,” he said. “I’ve been in a victim’s house telling them they have to stop, this person isn’t real, this person you are talking to is not a real person, and they don’t believe me.

“They’ve become so emotionally involved in this relationship or the situation that it becomes very difficult to stop it.”

Andrews said victims often end up traumatized and embarrassed. “Being the victim of a scam has a long-lasting effect on (them),” he said.

Of the 155 financial fraud cases reported to Eden Prairie police in 2022, 125 were reported by individuals. According to EPPD data, 30% of those individual cases involved losses of $1,000 or more. More than 50% of the cases involved various types of credit card fraud.

Social Security scams are common in Eden Prairie, Andrews said. Scammers typically reach out to seniors by phone. “They are very sophisticated and smart in what they do,” he said. “And I hate to use the terms, but they are experts and professional at what they do.”

In the scam, victims receive a phone call informing them that there is an issue with their Social Security account. To protect it, the caller directs the victim to liquidate accounts (bank accounts or retirement accounts) and send the money to the scammer to be held in escrow until the problem is solved.

“I’ve seen (elderly victims) liquidate all of their accounts,” Andrews said. The scammer will then ask how much the victim’s house is worth and ask them to send pictures of their car so they can determine their worth.

“They won’t stop until there’s nothing left,” he said.

Romance scams can involve people of any age, but Andrews said the biggest key is to not send money to anyone you haven’t met, no matter how sad their story or how insistent they may be.

He suggests that elderly people have somebody trustworthy, a child, grandchild or friend they can go to if they receive instructions involving financial matters.

“The IRS is never going to ask you to liquidate accounts and send them money,” Andrews said. “I recommend never answering a phone call if you don’t recognize the number.”

Scammers often spoof phone numbers to make it appear as if agencies like the IRS, FBI, or even the Eden Prairie Police Department are calling. He recommends calling those agencies back at a legitimate number to verify the call. He said people can call the police and ask if something is legitimate.

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Nearly 30% of the 2022 individual fraud cases in Eden Prairie involved victims age 60 and over, according to EPPD data. 

The vast majority of cases, 82%, were labeled inactive, meaning that investigations by EPPD officers or detectives did not lead to a suspect.

Of the remaining cases, 10 were referred to a city or county prosecuting attorney. A formal complaint was received, and the case is now being formally charged, according to EPPD data. In four cases, probable cause was established to support arresting, charging, and prosecuting a suspect.

For more information about common elder fraud schemes and how to protect yourself, visit the FBI’s elder fraud website.

If you believe you or someone you know may have been a victim of elder fraud, contact your local FBI field office or submit a tip online. You can also file a complaint with the FBI’s Internet Crime Complaint Center at ic3.gov.

Frank Farrell contributed to this report.