Department of Justice seizes more than $1 million of collectible stamps as proceeds of criminal fraud scheme

Seattle – The Department of Justice has seized more than $1 million in proceeds from a massive fraud scheme targeting seniors and other vulnerable populations, announced U.S. Attorney Tessa M. Gorman. The U.S. Attorney’s Office for the Western District of Washington filed a Verified Civil Forfeiture Complaint seeking forfeiture of 149 lots of collectible stamps and other items seized from the Robert A. Siegel Auction Galleries Inc. of New York. An investigation revealed that the stamps were purchased with monies stolen from victims who were swindled by fraudsters impersonating government agents, regulators, or romantic interests. Once the stamps have been forfeited to the United States, they will be liquidated by the U.S. Marshals Service and the government will seek to return the funds to the victims.

“Too often when victims have been defrauded in these schemes, their money is gone for good,” said U.S. Attorney Gorman. “We are delighted to be able to share good news with these victims and hope to be able to return funds to them through this civil forfeiture action.”

According to the court filings, the deposits made to the Siegel Galleries and used to purchase the stamps, have been traced to victims of crime. Multiple frauds were used in this case, both government impersonation scams and romance scams. Siegel Galleries is not accused of any crime.

The government has identified 28 victims, from Western Washington and from across the country who were defrauded and mislead. The fraud occurred in two phases. In phase one, victims were called by a person claiming to be from a government entity such as the FBI, SEC, or DOJ reporting that the victim’s bank account or personal identity had been breached and stating that the victim needed to send their funds to a different entity for safe keeping.  In some instances, victims were told they had been implicated in a money laundering scheme and to prove their innocence and protect their funds they needed to send them to the account designated by the caller. Victims were told their funds would be returned once the matter had been resolved. Some victims were defrauded of hundreds of thousands of dollars.

Some of the victims sent cashier’s checks directly to the gallery. Others were instructed to send the money via cashier’s check to a second set of victims: romance scam victims. These victims were contacted via social media, and believed they were assisting a romantic interest with money from an inheritance, or an investment or to pay debts. This second set of victims were told to deposit the cashier’s checks from the first set of victims and then withdraw the funds and send or wire the money to the gallery.

In all investigators have traced $1,012,300 to the various victims. Funds deposited toward the invoices for purchase of the stamps total $1,383,437. Prosecutors and agents are still working to trace funds to additional victims.

No criminal charges have been filed yet. Potential charges include conspiracy, mail fraud, wire fraud, and money laundering.

The FBI is investigating the case in coordination with Asset Forfeiture Assistant United States Attorney Krista Bush.