PORTLAND, Ore. – A $1.7 million penalty has been levied against Oregon Tool, Inc., formerly known as Blount, Inc., after the company knowingly accepted payments sourced from a complex Nigerian money laundering operation tied to romance and other online fraud schemes. The scheme preyed on vulnerable Americans, particularly elderly women, funneling illicit funds through an unlicensed money transmitting business to purchase professional-grade cutting tools.
The FBI launched its investigation in December 2019, uncovering a network of online fraud schemes originating in Nigeria. These schemes targeted victims across the United States, including elderly women seduced through romance scams. The operation converted Nigerian naira into U.S. dollars, depositing the funds into U.S. bank accounts and ultimately using those funds to purchase goods from Oregon Tool. This black market currency exchange acted as a conduit for the proceeds of fraud, enriching the Nigerian criminal organization.
Between 2012 and 2020, two Nigerian distributors utilized the illicit money transmitting service to pay for Oregon Tool products. The Secret Service flagged suspicious activity as early as March 2012, notifying Blount’s then-general counsel about a distributor’s bank account allegedly funded by fraud. Despite this warning, Blount continued to accept over $974,000 in deposits from dubious sources between November 2016 and December 2017. These deposits came from individuals, shell companies, and anonymous cash depositors with no legitimate connection to either Blount or the distributor.
FBI investigations revealed a disturbing pattern. Several deposits originated from victims of romance fraud, including individuals who believed they were sending money for artwork for online paramours. One Beaverton, Oregon resident sent funds at the request of a dating website contact. A second Nigerian distributor received over $652,000 between April 2017 and February 2018, funds also traced back to fraud victims, many in their late 60s, with no legitimate business ties to Oregon Tool. The FBI informed Oregon Tool of these findings in January 2022. The company terminated its relationship with one distributor in November 2021 and the second shortly after the FBI notification.
Oregon Tool, now under new ownership, claims full cooperation with the investigation and has implemented new anti-money laundering policies, including restrictions on third-party payments and enhanced employee training. All senior executives implicated in the prior misconduct at Blount Inc. are no longer with the company. The U.S. Attorney’s Office and the FBI entered into a non-prosecution agreement with Oregon Tool, securing the $1.7 million payment as restitution for the fraudulent scheme. The case serves as a stark warning: ignorance is no excuse when it comes to dirty money.
While Oregon Tool avoided criminal charges through the agreement, the incident highlights the increasing sophistication of international fraud rings and the challenges businesses face in preventing illicit funds from entering the supply chain. The FBI continues to investigate the Nigerian criminal organization and its U.S.-based collaborators, seeking to dismantle the network and bring those responsible to justice. The full extent of the financial damage inflicted on the victims remains under investigation.
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Key Facts
- Agency: U.S. Secret Service
- Category: Fraud & Financial Crimes
- Source: Official Press Release
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