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Prosecutors say 25 Canadians have been charged in connection with a multimillion dollar "grandparent scam" targeting elderly Americans nationwide. Bernd Weißbrod/Picture Alliance via Getty Images hide caption
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Bernd Weißbrod/Picture Alliance via Getty Images
Twenty-five Canadians have been charged with swindling hundreds of American seniors out of more than $21 million through what's known as a "grandparent scam," federal prosecutors announced Tuesday.
The Office of the United States Attorney for the District of Vermont said in a statement that the alleged perpetrators were indicted by a federal grand jury in late February.
They range in age from their late-20s to mid-40s and all but one are based in Quebec province, which is home to Montreal. The announcement lists their names as well as the aliases they used, including Muscles, Elvis, Blondie, Happy, Honda and Toast.
All 25 are charged with conspiracy to defraud, while five of them are also accused of conspiring to commit money laundering.
Information about the defendants' lawyers and court appearances was not immediately available, and the U.S. Attorney's Office for the District of Vermont declined to elaborate as the case is ongoing.
Prosecutors say the scheme, which started in the summer of 2021, targeted elderly victims in 46 states.
"These individuals are accused of an elaborate scheme using fear to extort millions of dollars from victims who believed they were helping loved ones in trouble," said Michael Krol, special agent in charge for Homeland Security Investigations in New England.
How the alleged scheme worked
A 14-page indictment unsealed on Tuesday accuses the group of operating an elaborate scheme based out of a network of call centers in the Montreal area, using technological means to make their calls look like they were coming from the U.S.
The participants would allegedly call elderly Americans — culled from spreadsheets with their personal information, including age and household income — and pretend to be a relative, typically a grandchild, who needed money for bail after a car crash.
They would falsely claim that a "gag order" prevented their concerned victim from telling any other family members. They would then pass the call to another suspect, who posed as an attorney representing the relative in distress.
Victims were persuaded to give the money to another individual who came to their homes — in New York City, Chicago and other locations — posing as a bail bondsman or in some cases send it by mail. Prosecutors say that money was later transmitted to the suspects in Canada, a process that often involved cryptocurrency.
"These transactions obscured the source of the money and the identities of the co-conspirators who collected and controlled the money, and promoted and paid the operating expenses of the Grandparent Scam," the indictment reads.
Some victims were allegedly pursued multiple times, with suspects calling back later to say the bail amount had increased and more money was needed. Suspects referred to a victim who provided substantial amounts of money as a "whale," the indictment says.
Overall, prosecutors say the scheme defrauded hundreds of elderly victims across the U.S. until early June 2024, when Canadian law enforcement executed search warrants at the call centers.
That day, the indictment says, one defendant was found in his truck with "numerous cell phones and lists of elderly individuals in multiple states," while more than a dozen others were found at multiple call centers "in the act of placing phone calls to elderly victims in Virginia."
What's next?
All but two of the suspects were arrested in Canada on Tuesday, which American authorities say is the result of extensive cooperation between local and federal agencies in both countries.
"Today's arrests demonstrate IRS-CI's commitment to protecting the American people from bad actors, no matter where they are hiding," said Thomas Demeo, acting special agent in charge of the Boston field office of the Internal Revenue Service Criminal Investigation (IRS-CI).
All 25 suspects are facing a charge of fraud conspiracy, which prosecutors say is punishable by up to 20 years in prison.
The five suspects accused of managing the call centers — Gareth West, Usman Khalid, Andrew Tatto, Stephan Moskwyn and Ricky Ylimaki — are also charged with conspiring to commit money laundering. They face up to 40 years in prison if convicted.
West and Ylimaki remain at large, prosecutors say.
In addition to this group, nine other people were previously charged in Vermont in connection with this same scam, the U.S. Attorney's Office says. The individuals range in age from 27 to 39, and hail from places as varied as Miami, Los Angeles, Montreal and Guangzhou, China.
Grandparent scams are increasingly common
It's not unusual for scammers to gain access to people's personal information — by scouring social media or buying data from cyber thieves — and then "create storylines to prey on the fears of grandparents," the Federal Communications Commission (FCC) says.
"Grandparents often have a hard time saying no to their grandchildren, which is something scam artists know all too well," it adds.
An FBI report released last year found that scams targeting people ages 60 and up caused over $3.4 billion in losses in 2023, a roughly 11% increase from the previous year.
Authorities warn that grandparent scams have grown increasingly sophisticated in recent years, with some perpetrators using AI to clone the voices of victims' loved ones in a hauntingly realistic touch.
The Federal Trade Commission (FTC) urges people: "Don't trust the voice." Anyone who gets this kind of call, especially if they are pressured to send money quickly, should call or text the person who supposedly contacted them to verify their story.
While some entities have tried to beat scammers at their own game — like the British phone company that developed an AI "granny" to waste shady callers' time — experts have warned against scam-baiting.
According to the FCC, the best defense against these scams is awareness.
People can monitor resources like the AARP Fraud Watch Network Scam-Tracking Map and alerts from the Better Business Bureau. They are also encouraged to report any suspicious calls on the FTC's website.
Any fraud victims ages 60 or older can also call the National Elder Fraud Hotline, a free resource from the U.S. Department of Justice.
