Lahore court grants NCCIA further two-day remand of suspects over US postage stamp fraud

LAHORE: A judicial magistrate on Tuesday granted the National Cyber Crime Investigation Agency (NCCIA) a further two-day physical remand of two suspects in a Rs35 billion fraud involving the online sale of counterfeit US postage stamps.

The prime suspect, identified as a 33-year-old resident of Khanewal, had been charged by a Florida jury with defrauding the United States Postal Service (USPS) of $126 million, the US Attorney’s Office of the Southern District of Florida said on Sept 28.

The Lahore NCCIA announced the prime suspect’s arrest in late October, and he was sent on a five-day physical remand on Oct 21. Today’s extension of the physical remand is the third for him, and second for the co-suspect.

On Tuesday, the NCCIA produced both men before Judicial Magistrate Naeem Wattoo upon the expiry of their latest four-day remand.

The investigating officer (IO) sought custody of the suspects for another five days for interrogation.

However, Magistrate Wattoo granted the agency two more days of physical custody and directed the IO to produce the suspects again on Nov 5.

According to NCCIA, the initial investigation revealed that the prime suspect operated a website to market and sell over 5m fake US postage stamps over a period of more than three years.

According to the US Department of Justice, the website run by the Pakistani national was not authorised to sell USPS products and services.

The counterfeit labels allegedly allowed customers to ship packages at rates “far below legitimate USPS prices”, it said, adding that it caused losses exceeding $126m to the postal service.

US prosecutors alleged that the website sold the labels for around $2 each, regardless of a package’s weight, size or destination. A US court order authorised the seizure and shutdown of the website.

Money trail

In a press conference on Oct 20, NCCIA’s Lahore Zone Additional Director Atif Ameer said that 16 bank accounts had been used in the scam. Seven of the accounts were operated by the suspect, five by his brother, two by his wife, and one each by his sister and aunt.

He said the agency had expanded the investigation across several parts of the country.

“Eight special teams were formed in Punjab, Islamabad and Sindh to trace the suspect and investigate the network,” he said and added the teams conducted raids at 35 locations and questioned 47 people as part of the investigation.

“Investigators also employed digital and forensic techniques to establish the suspect’s movements and identify people associated with the operation.”

Ameer added that investigators analysed 122 call-data records, 50 IMEI-tracking reports and audio and video recordings from 120 cameras.

“Artificial intelligence and other modern technological tools were also used during the investigation. A locator operation continued for 10 days as investigators attempted to establish the suspect’s whereabouts and trace his activities,” he said.

The NCCIA said the major focus of the investigation was the financial trail generated by the online sale of the counterfeit stamps.

“We are examining transactions conducted through the 16 bank accounts and attempting to determine the flow of funds between the accounts allegedly belonging to the suspect and his relatives.

“The involvement of family members is also being examined as part of the investigation, particularly the alleged use of their bank accounts in connection with the online business,” the additional director said.

He said the role of other individuals in operating the website, processing orders, receiving payments or distributing the counterfeit stamps was also being probed.

“Investigators are also working to establish the full scale of the operation and verify the volume and value of the transactions,” he said.