California Man Pleads Guilty Over Role in $50 Million Fraud Scheme

A California man this week admitted before a U.S. district judge to his role in a $50 million internet-enabled fraud scheme.

Court documents claim that, between 2012 and 2020, Allen Giltman, 56, of Irvine, California, created fraudulent websites to ask for funds from investors.

Working with others, the defendant created websites closely resembling the websites of legitimate financial institutions, as well as websites of seemingly legitimate institutions that in fact did not exist.

The fraudulent websites, which could be discovered by Internet searches, advertised investment opportunities, including the purchase of certificates of deposit. The advertisements promised high rates of return, to lure potential victims.

To appear legitimate, the websites displayed the actual names and logos of financial institutions and claimed that the institutions were regulated by known authorities that also insured the deposits made by investors.

Court documents also allege that, when contacted by victims by phone or email, Giltman impersonated real Financial Industry Regulatory Authority (FINRA) broker-dealers and then provided victims with instructions to purchase certificates of deposit.

The defendant allegedly moved funds wired by the victims to various bank accounts, including accounts in Hong Kong, the Republic of Georgia, Russia, and Turkey.

At least 150 fraudulent websites were created as part of the scheme, and at least 70 individuals fell victim to it. The victims are believed to have sent the perpetrators roughly $50 million, but none of them ever received a certificate of deposit.

If found guilty of wire fraud conspiracy, Giltman could be sentenced to up to 20 years in prison and a fine of $250,000. He could receive up to five years in prison for the securities fraud charge.

Related: Estonian Botnet Operator Pleads Guilty in U.S. Court

Related: Identity Fraud: A Major Growth Area for Criminals

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Ionut Arghire is an international correspondent for SecurityWeek.

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