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Arizona Woman at Center of North Korean Tech Fraud Scheme
WASHINGTON D.C. – The Justice Department dropped a bombshell today, unsealing charges and seizing assets in a massive fraud scheme allegedly designed to funnel revenue to the Democratic People’s Republic of Korea (DPRK), better known as North Korea. The operation involved placing IT workers overseas, masquerading as U.S. citizens and residents, in remote positions at American companies – a brazen attempt to bypass sanctions and line the pockets of a rogue regime.
At the heart of the scheme is Chapman, an Arizona woman whose name has not been released to the public, along with a Ukrainian man and three unidentified foreign nationals. They stand accused of defrauding over 300 U.S. companies, exploiting U.S. payment platforms and job sites, and utilizing proxy computers within the United States. This isn’t some small-time operation; authorities are calling it the largest case of its kind ever charged by the Department of Justice. The alleged scheme involved the theft and use of U.S. identities to create a façade of legitimacy for North Korean IT workers, allowing them to infiltrate company networks and siphon off earnings directly to Pyongyang.
Two criminal prosecutions, spearheaded by the U.S. Attorney’s Office for the District of Columbia in partnership with the Justice Department’s Criminal Division, were unsealed today. Arrests have already been made in both the United States and Poland, and five premises search warrants were executed. Authorities have seized illicitly obtained wages and website domains connected to the operation. The investigation was a coordinated effort led by the FBI Phoenix and New York Field Offices, and IRS Criminal Investigations (IRS-CI), with support from five other FBI field offices and four additional U.S. Attorney’s Offices.
“As alleged in the indictment, Chapman and her co-conspirators committed fraud and stole the identities of American citizens to enable individuals based overseas to pose as domestic, remote IT workers,” stated Principal Deputy Assistant Attorney General Nicole M. Argentieri. “These crimes are alleged to have benefitted the North Korean government. The Criminal Division remains firm in its commitment to prosecute complex criminal schemes like this one.” The scope of the fraud is staggering, highlighting the lengths North Korea will go to circumvent international sanctions and generate revenue.
U.S. Attorney Matthew M. Graves for the District of Columbia emphasized the broad scope of the investigation. “Today’s announcement of charges and law enforcement action show our broad approach to attacking funding sources for North Korea across the United States,” Graves said. “We will continue to vigorously pursue cases against individuals, in the United States and abroad, that use U.S. financial systems to raise revenue for North Korea.” The FBI’s Counterintelligence Division Assistant Director Kevin Vorndran described the scheme as a “new high-tech campaign to evade U.S. sanctions, victimize U.S. businesses, and steal U.S. identities.”
FBI Special Agent in Charge Akil Davis of the Phoenix Field Office warned that this case is a stark reminder of the evolving threat landscape. “That a woman living her quiet life in the outskirts of Phoenix can allegedly get so entangled in something like this clearly indicates our adversaries are getting more sophisticated and stealthier,” Davis stated. Businesses and citizens alike are urged to remain vigilant and report any suspicious activity, as the FBI and its partners continue to dismantle these networks of illicit finance fueling the North Korean regime.
Key Facts
- State: Washington DC
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes|Cybercrime|White Collar Crime
- Source: Official Source ↗
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