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"Through the course of the scheme, they manipulated Amazon’s vendor system in attempts to fraudulently induce Amazon to pay for goods that Amazon had not ordered," Audrey Strauss, the Acting United States Attorney for the Southern District of New York, said.
In executing the scheme, they fraudulently attempted to obtain at least approximately $32 million and successfully obtained at least approximately $19 million, Strauss said.
The four are:
- Yoel Abraham, 28, of Suffern,
- Heshl Abraham, 32, of Spring Valley,
- Zishe Abraham, 30, of Spring Valley,
- and Shmuel Abraham, 24, of Airmont
“The indictment alleges that Yoel, Heshl, Zishe, and Shmuel Abraham came up with a new twist on an old trick, but the use of complex technology did not hide the simple fact that the defendants were bilking Amazon for goods they never provided," Strauss said. "The more our economic life moves online, the more we must ensure the integrity of our digital markets, which my Office is committed to doing.”
According to the Indictment unsealed in Manhattan federal court:
- The four, who purportedly operated wholesale businesses, opened vendor accounts with Amazon to sell the company small quantities of goods.
- By accepting a purchase order, the they agreed to supply specific goods, at specific prices, in specific quantities.
- Instead, they manipulated Amazon’s vendor system, and then, in the most egregious iteration of the scheme, invoiced the company for substitute goods at grossly inflated prices and excessive quantities.
- They frequently shipped and invoiced for more than 10,000 units of an item when Amazon had requested, and had agreed to ship, fewer than 100.
The court documents said the brothers communicated about the scheme, extended help and advice to one another, and helped one another evade detection using an encrypted group texting chain on WhatsApp, a messaging application.
For example, Strauss said, on or about May 1, 2018, Yoel Abraham, the defendant, stated to the group “I’m so in the mood to (expletive deleted) Amazon,” and asked “Did anyone try to overship and make a million profit in a week?”
Once Amazon detected the pattern of fraudulent overshipping, it suspended the vendor accounts engaged in the fraud.
In response, the brothers tried to open other vendor accounts and disguise their identities by registering them in fake names, using different email addresses, and using virtual private servers (“VPSs”) to obfuscate their connection to previously suspended accounts and frustrate Amazon’s ability to detect and mitigate their fraudulent activity, Strauss said.
The four were each charged with:
- conspiracy to commit wire fraud,
- wire fraud,
- and money laundering.
Wire fraud and wire fraud conspiracy carry a maximum sentence of 20 years in prison, and money laundering carries a maximum sentence of 10 years in prison.
Strauss praised the work of the Department of Homeland Security, Homeland Security Investigations, the New York City Police Department, U.S. Customs and Border Protection, the Rockland County Sheriff’s Department, and the Waterfront Commission of New York Harbor, and thanked Amazon for its cooperation with the investigation.
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