How a well-known Instagrammer became one of the most prolific money launderers in the world

Blog | 14 Dec 2022
Mark Rayner
 

On 7 November 2022, Ramon Olorunwa Abbas, aka “Ray Hushpuppi,” was sentenced to more than 11 years in prison for conspiring to launder over $300M and ordered to pay $1.7M in restitution to two of his victims. But how did a well-known influencer turn out to be what the FBI regards as “one of the most prolific money launderers in the world,” and what can we learn?

Convergence of cyber-enabled fraud with large-scale money laundering

Abbas had more than 2 million Instagram followers before he was arrested in 2020. He flaunted his lavish lifestyle, posting pictures of himself alongside private jets, supercars and high-end watches and calling himself the “Billionaire Gucci Master” on Snapchat.

Abbas’ lawyer claimed he was an entrepreneur who made money through real estate and promoting brands on Instagram. However, the court found Abbas had conspired to launder funds derived from business email compromise (BEC) scams, online bank heists, and other cyber-enabled fraud.

BEC scams rely on gaining access to a business email address so the attacker can impersonate a legitimate business. These scams can be highly successful, with victims reporting losses of nearly $2.4B to the FBI in 2021—more than any other form of cyber fraud. Abbas and his associates used this technique to target hundreds of millions of dollars in payments from businesses, including $922,857 from a New York law firm and over $100M from a Premier League football club.

Learning point: Cyber is the current dominant channel for fraud attacks, and the fusion of fraud and money laundering is increasingly blurring the lines. From a risk and control standpoint, institutions typically treat cyber, fraud, and financial crime differently, but criminals see no such separation, collaborating with associates to exploit the most effective methods to obtain and launder their funds. 

Institutions should look to apply a similar approach in their defense, creating a feedback loop to identify suspicious patterns of behavior and working towards an ‘information fusion’ where multiple teams can work from the same data to piece together behavioral patterns and crime connections.  

The international financial system is only as strong as the weakest link

Abbas was able to repeatedly abuse the international financial system, targeting individuals and businesses in the UK, Malta, New York, and Qatar, channeling money through accounts in Romania, Bulgaria, Mexico, and Kenya. 

He clearly understood where there were vulnerabilities, providing a co-conspirator with details of a bank account in Mexico that “could handle millions and not block.” He was also able to fraudulently acquire a St Kitts and Nevis citizenship and passport through a sham marriage to a St Kitts citizen, allegedly bribing a government official.

This case demonstrates the asymmetric battle between criminals who exploit the international system with ease and law enforcement officials who need to follow lengthy administrative processes. When the Royal Saint Christopher and Nexis Police Force started an investigation into Abbas’ alleged criminal activities, they drafted a request for assistance from the US, pursuant to the Mutual Legal Assistance Treaty between the two countries. This was dated 15 September 2021 and supported by the Director of Public Prosecutions. However, it remained unapproved by the then-Attorney General, hampering the local investigation, and was only identified when an inquiry was raised in October 2022.

Learning point: Criminals continually build their knowledge of weak practices and ways to stay under the radar. This is driving a need to share information across organizations, such as the TMNL initiative in the Netherlands and Invidem in the Nordics. Alongside ongoing changes to the regulatory framework, including the UK’s Economic Crime Act 2022 and the creation of the EU’s AML Authority, these initiatives play a key role in reducing the ability of criminals to exploit vulnerabilities in the financial system.

Financial crime is not a victimless crime

Although digital channels allowed Abbas to reach across the globe, his crimes had real-world victims. 

In one instance, Abbas and a co-conspirator defrauded a Qatari businessperson who sought a $15M loan to finance the construction of a school. The individual was deceived into paying $330,000 to fund an “investor’s account”, followed by requests for $575,000 in purported taxes, and other payments totaling $479,983. 

Abbas also conspired with Ghaleb Alaumary to launder $14.7M stolen from a Maltese bank, which the US government alleges was intended to support the North Korean regime and part of a broader activity to ‘steal and extort more than $1.3B … from financial institutions and companies’. 

When Abbas was arrested in Dubai alongside 11 other suspects, police seized $40.9M in cash, 13 luxury cars, 21 computers, 47 smartphones, 15 memory sticks, and five hard drives containing the addresses of 1.9M victims.

Learning point: Fraud and money laundering have a social, financial, national security, and economic impact. Education campaigns to individuals and businesses are becoming more necessary to improve understanding of how fraudsters establish false trust, when to question what is being asked of you, and how optimized software solutions can spot unusual money movements and out-of-character behaviors. 

Where do we go from here?

The scale of financial misery that Abbas inflicted on his victims and the support he provided for a hostile nation-state are timely reminders of why the international community needs to do more in the fight against money laundering.

The increasing sophistication of criminals, growth in transaction volumes, and the move toward real-time payments demand a new approach. Technologies such as machine learning, AI, and robotic process automation offer a way to improve effectiveness and efficiency through their ability to identify more nuanced behavior, operate at scale, and automate repetitive tasks. This frees human investigation capital from less productive work tasks, enabling more time to be spent on higher-risk activities.

At SymphonyAI Sensa-NetReveal, we specialize in AI-led compliance solutions that provide intelligent alert management, optimized investigation, and reduced overheads. If you’d like to find out more, please get in touch.

About the author

Mark Rayner, head of consulting at SymphonyAI Sensa-NetReveal, unwraps the layers of camouflage that “Ray Hushpuppi” used to target victims around the world and flaunt the purchases he made with the proceeds of his crimes.