COUNTY SCAMMED
2 Nigerians bilked Mercer County of $660K in 2019, Hughes administration kept it quiet »
TRENTON » The coverup is worse than the cybercrime.
In September 2019, the feds announced the arrests of numerous fraudsters who used “business email compromise” or BEC schemes to intercept and hijack wire transfers of vulnerable agencies.
The four-month probe, dubbed Operation reWired, involved the U.S. departments of State, Justice, Homeland Security, Treasury and the U.S. Postal Inspection Service.
Investigators seized $3.7 million in stolen funds and arrested 281 people, more than half who were from Nigeria. Authorities nailed others in Turkey, Ghana, France, Italy, Japan, Kenya, Malaysia, the United Kingdom and the United States.
Not a peep was made about the international roundup in the Trenton press, because the news release obscured a littleknown fact, kept close to the vest by members of the Mercer County Executive Brian Hughes administration: Two of the arrestees, Nigerian “money mules” Emmanuel Igomu and Jude Constantine Balogun, were tied to the theft of $660,000 in taxpayer funds from the Mercer County government in February 2019.
Details of Mercer County’s connection to the massive dragnet are coming to light now only after a whistleblower upset with the Hughes administration for not telling the public about the stolen funds tipped off The Trentonian about the Nigerians’ case, which originated out of Atlanta, Georgia.
At least 177 of the defendants in the sprawling takedown had been sentenced as of last year, court records show, including the two fraudsters who bilked Mercer County.
It took more than two years for Hughes’ office to publicly acknowledge the financial blunder, coming only after The Trentonian inquired about it this week.
The news compounds a bad streak of press for the longtime Democratic county executive, as he faces questions about an encounter he had with Pennsylvania State Police last summer.
In the June 1, 2020, interaction with police, Hughes abandoned a county-owned vehicle along the Pennsylvania Turnpike and then bizarrely claimed to a trooper that he was racing four others in Paris, France.
The federal theft case is sure to set off a fresh round of questions about Hughes’ handling of county affairs and his administration’s forthrightness with county leaders and the public.
The Trentonian has learned that the administration waited nearly a year before providing commissioners with a DOJ release that made no mention of New Jersey or Mercer County government’s connections to the case.
County spokeswoman Julie Willmot said county counsel sent commissioners the news release in January 2020.
Samuel Frisby, chairman of the Board of County Commissioners, said he couldn’t provide a “definitive answer” about when commissioners first learned about the $660K missing funds.
He recalled the administration provided information sometime in 2019 about a data breach, later conveyed to employees in a letter at the beginning of 2021.
“It was a, ‘Hey, look, we might have had a compromise and we’re dealing with it,’” he said.
Frisby acknowledged the administration has left commissioners in the dark about county business a few times, including regarding Hughes’ police encounter last year, which commissioners learned about from The Trentonian.
“There are times where we’re saying, ‘Hey, we found about this in the paper,’ and that’s not what we want,” he said. “They’ve been better about that over the last couple of months.”
Officials acknowledged a delay in relaying information to county employees about a data breach of the county’s network that compromised workers’ personal information.
A “breach coach” cybercrimes firm discovered the problem in September 2019, about seven months after the feds’ investigation commenced into the stolen funds, according to a Jan. 6, 2021 letter sent to employees.
The county said there was “no evidence” that anyone’s personal identifiers — such as Social Security numbers, tax identification numbers, bank routing numbers and employees’ sensitive medical information — were used for fraudulent purposes.
The county said it has increased security measures — like a “multi-factor identification” — and identified vulnerabilities to prevent future attacks.
Willmot said no county employees were disciplined over the fraudulent transfer, which occurred Feb. 16, 2019, according to a criminal complaint filed by FBI special agent Steven Evans.
While Willmot claimed the “irregularity” was discovered in less than 24 hours, the complaint suggests Mercer County officials didn’t realize the funds were pilfered until Feb. 22, 2019.
The Mercer County Prosecutor’s Office worked with New Jersey State Police and the feds to trace and freeze
$542,000 of the funds. The remaining portion that was stolen is being covered by the county’s insurance provider, officials said.
BEC Scheme
Igomu, of Atlanta, and Balogun, of San Francisco, were arrested and charged with aiding and abetting wire fraud in 2019.
Prosecutors said they “utilized false identity documents to open business bank accounts through which money was transmitted and then withdrawn by others,” according to court documents.
Balogun from May 2018 to March 2019 controlled an unlicensed and unregistered money transmitting business and transferred more than $1 million, according to charging documents.
Money transmitting businesses often engage in check cashing, currency exchange or money transfer services. They’re required by federal law to register with the U.S. secretary of the Treasury, and such businesses in Georgia must obtain a license to operate.
Last September, Balogun, 30, was sentenced to 30 months of incarceration and ordered to repay $888,278 in restitution after he admitted to running an unlicensed money transmitting business and failing to comply with the money transmitting business registration requirements.
That includes $660K to Mercer County, nearly $150,000 to Mettler-Toledo LLC of Ohio and $78,950 to the Tanner Health System of Georgia, records show.
Balogun has a release date of Nov. 11, 2022, according to the federal Bureau of Prisons.
Igomu, 36, was sentenced April 21, 2020, to a term of 33 months, records show. He is incarcerated in Texas with a July 22 release date as he spent time locked up while the case was pending, according to the BOP.
His attorney minimized his role in the BEC scheme, saying Igomu earned a percentage of the exploits to serve as a “passthrough bank account” for fraudsters responsible for sending fake emails to companies to redirect funds, according to court records.
Igomu must repay a total of $673,895 in restitution to Marantz Bros. Inc., Kabbage Inc., Esquire Title Escrow P, Elk and Elk Inc. and Raj Mittra, and he’ll be deported once he finishes his prison bid, according to court records.
Troubled History
Balogun arrived in the U.S. in October 2011 on an F-1 student visa to attend Laney College, while Igomu worked as an airline technician before relocating to America on a six-month visa in 2014.
Igomu had trouble with the law not long after settling down in Atlanta, Georgia, foreshadowing his trouble with the feds.
In 2015, Atlanta Police found him with two fake driver’s licenses, a U.K. passport and six bank cards under three names. He was placed on probation for three years as a first-time offender in 2017 after being convicted of five felonies.
The Nigerian nationals met in California, according to a court memo filed by defense attorney Colette Resnik Steel.
Balogun’s attorney claimed her client’s illegal partnership with Igomu began after $20,000 that Balogun was holding for “safekeeping overnight” was stolen out of the glove compartment of Balogun’s car.
When Balogun told Igomu about the missing $20,000, Igomu warned his business partner not to file a police report, according to Resnik Steel’s memo.
In summer 2017, Igomu demanded Balogun repay the stolen funds and later offered Balogun a “job” in Atlanta as recompense.
The court records appear to show the two men were in cahoots together for a while, as investigators learned they exchanged more than 7,000 messages between February 2018 and March 2019.
Igomu bought Balogun the plane ticket to help out with the job in Atlanta, Georgia, records show.
Investigators began untangling the sophisticated scheme after Tanner Health System, a business in Carrollton, Georgia, came forward saying it was defrauded out of more than $3.5 million.
The fraudsters pretended to be Bernie Buchanan, an executive vice president at
R-Lin and Associates, which had a contract with THS.
Funds were transferred to an account controlled by Garrett LLC in Newark, Delaware. More than $570,000 was wired to another account belonging to a fictitious tech company run by Lucy Andrews.
The feds tied the fake Andrews’ address back to Igomu, who had a postal box registered to him under the name Henry Dax. Dax allegedly collected Andrews’ mail from a UPS Store, court records show.
Investigators used an email address, phone number, IP addresses and electric company records to learn where Igomu lived and raided the home he shared with Stephanie Gaspard, who he claimed was his wife.
They found a trove of incriminating evidence, including a fake South Carolina license for Henry Dax, bearing Igomu’s mugshot.
The feds learned of three more accounts controlled by Igomu, who had written out a $78,95 check “for supplies” to “James Clark,” also known as Balogun, who Gaspard identified as Igomu’s business associate, records show.
The feds connected both men to the Feb. 16, 2019, Mercer County transfer, which was intended for the Mercer County Improvement Authority.
The funds were deposited into a bank account belonging to M&B Used Auto Sales LLC, a fake company registered to Marcelo Rojas.
Rojas was actually Balogun, the feds said.
The Nigerian nationals exchanged text messages Jan. 11, 2019, about the unlikelihood of Balogun passing for a Spanish man, records show.
“I no look Spanish na. I no go lie,” Balogun wrote. “I no get confidence in the name at all.”
Igomu replied, “Lol,” short for laughing out loud.
The two communicated again Feb. 19, 2019, about the origin of the Mercer County transfer.
“Something county,” Igomu wrote, confused over the entity that deposited the money, to which Balogun responded, “Mercer County.”