Minnesota Commerce Department: Fraud Scheme Using Fake Insurance Agency as Cover

Minnesota Commerce Commissioner Mike Rothman says fraudsters have been operating a large-scale fraud scheme in the state using a fake insurance agency as a cover.

The commerce department said recently that it has received five complaints and inquiries from Minnesotans who were contacted, via email and phone, by someone claiming to be with “Skyline Insurance” and offering a job re-labeling and forwarding packages to other addresses. The job offer promises as much as $3,500 per month for the work.

The department says there is no insurance business licensed in Minnesota by the name of Skyline Insurance. There is no Skyline Insurance located at the physical address listed in the email, nor does anyone answer at the phone number.

The company’s purported federal employer identification number actually belongs to eBay. The company’s website (skyline-ins.com) is fake, too, but with a minimal amount of content to make it look like a legitimate insurance agency, according to the commerce department.

The department says the scam is known as “reshipping” and often shows up as a “work from home” opportunity posted on job boards, dating websites or chat rooms. In reality, it is an attempt to lure unsuspecting individuals to participate in a large-scale fraud scheme.

Criminals use stolen credit cards to buy high-priced goods online and have them sent to the U.S. addresses of “reshipping mules,” who repackage the stolen goods and mail it to overseas addresses. Not only do the reshippers get pulled into a crime, they also typically never get paid and, in fact, lose the money they spent on their own for the reshipping.

Sometimes the scam also involves the victim getting a fake certified or regular check to deposit in their own bank account. They are instructed to use some of it for postage but wire transfer most of it elsewhere. When the bank determines the check is counterfeit or part of a crime, the victim may end up responsible for the full amount of the check along with any bank fees.

A recent study suggests that some 1.6 million credit and debit cards are used to commit at least $1.8 billion in reshipping fraud each year. Many online retailers have stopped allowing direct shipments from the U.S. to Russia, eastern Europe and Africa, citing the high rate of fraudulent transactions. As a result, criminals have resorted to reshipping schemes.

Source: Minnesota Commerce Department