Multi-Million Dollar Scams Exposed: Fake Invoices, AI Bots, and Lavish Spending Lead to Prison Time

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Multi-Million Dollar Scams Exposed: Fake Invoices, AI Bots, and Lavish Spending Lead to Prison Time
A cybersecurity expert inspecting lines of code on multiple monitors in a dimly lit office.
Photo by Mikhail Nilov on Pexels

In recent times, a series of audacious financial fraud schemes have come to light, revealing how individuals managed to illicitly obtain vast sums of money from companies, employing methods ranging from sophisticated digital deception to seemingly straightforward fraudulent billing. These cases, spanning continents and industries, underscore the persistent challenge faced by businesses in safeguarding against internal and external threats, no matter how robust their security systems may seem.

One notable instance involves a Lithuanian man named Evaldas Rimasauskas, who, along with unnamed others, orchestrated a scheme that defrauded two major American technology companies, Google and Facebook, out of a staggering $122 million between 2013 and 2015. Their method was remarkably bold: they posed as Quanta Computer, a legitimate computer and electronic hardware manufacturing company based in Taiwan, with whom both Google and Facebook had existing business relationships.

The scheme involved sending invoice requests purportedly from Quanta Computer to the two tech giants. The invoices directed to Google totaled $23 million, while those sent to Facebook amounted to a remarkable $99 million. Believing these requests were legitimate payments for services or goods previously rendered by the actual Quanta Computer, the companies proceeded to wire the requested funds.

Quanta Computer
Man stole $122m from Facebook and Google by sending them random bills, which the companies dutifully paid – Boing Boing, Photo by boingboing.net, is licensed under CC BY-SA 2.0

However, the money was not sent to Quanta Computer’s accounts. Instead, Rimasauskas directed the payments to bank accounts located in Latvia and Cyprus, which were under his control. To conceal the true nature of these large transactions and explain the influx of money to the banks, Rimasauskas reportedly employed forged invoices, contracts, and letters that appeared to bear the signatures of executives and agents from both Google and Facebook.

A particularly striking detail highlighted in reports is that no one from either company appeared to have thoroughly investigated the legitimacy of these invoices before authorizing the substantial payments. This apparent oversight allowed the scheme to continue for two years, facilitating the transfer of $122 million into the control of Rimasauskas and his associates.

The success of the fraud, however, was not permanent. In 2017, at the age of 50, Rimasauskas was apprehended by authorities in Lithuania. He was subsequently extradited to New York to face charges related to the scheme that had siphoned millions from the tech giants. Facing the evidence, Rimasauskas ultimately pleaded guilty to one count of wire fraud, acknowledging his role in the criminal enterprise.

Rimasauskas prison sentence
They tried to defraud Big Tech. It didn’t go well | Endless Thread, Photo by wordpress.wbur.org, is licensed under CC BY-SA 4.0

The legal consequences for Rimasauskas were significant. In 2019, he received a sentence of 60 months in prison for his fraudulent activities. Additionally, U.S. District Judge George Daniels ordered that following his prison term, Rimasauskas would serve two years of supervised release. Further financial penalties included the forfeiture of $49.7 million and an order to pay restitution totaling nearly $26.5 million.

Authorities viewed this case as a critical moment and a cautionary tale for the corporate world, particularly the technologically advanced sector. Acting U.S. Attorney Joon Kim commented at the time of Rimasauskas’ arrest, stating, “This case should serve as a wake-up call to all companies—even the most sophisticated—that they too can be victims of phishing attacks by cyber criminals.” He also issued a stern warning to other potential offenders: “And this arrest should serve as a warning to all cyber criminals that we will work to track them down, wherever they are, to hold them accountable.”

Kim also acknowledged the collaborative effort that led to the apprehension and recovery of funds. He noted, “The charges and arrest in this case were made possible thanks to the terrific work of the FBI and the cooperation of the victim companies and their financial institutions.” He extended gratitude, saying, “We thank the companies and their banks for acting quickly, coming forward promptly, and cooperating with law enforcement; it led not only to the charges announced today but also to the recovery of much of the stolen funds.”

Another case highlighting internal financial vulnerabilities emerged in Florida, where Madelyn Hernandez, a longtime employee of a textile and apparel supply chain company, was found to have stolen over $4.199 million from her employer. Hernandez worked remotely for the New York-based company from 2004 until July 2024, holding responsibilities that included placing orders with vendors and managing business logistics such as shipping, invoicing, and inventory.

The fraudulent scheme, according to federal prosecutors, commenced in 2018. Hernandez initiated the theft by creating and submitting “false invoices of purported goods ordered from suppliers, vendors, and third parties to (her company) for payment.” These invoices were designed to deceive her employer into believing they owed money to various fabric suppliers.

One of the fictitious entities used in the scheme was ‘Cape Prints,’ a business explicitly noted in court documents as being “controlled by (her).” By emailing these fabricated invoices to her company, Hernandez successfully tricked her employer into issuing payments that were ultimately directed into her personal bank accounts, allowing her to access and spend the stolen funds.

Hernandez illicit money
Florida woman fakes her own death after stealing over $4 million from her employer | The Independent, Photo by static.independent.co.uk, is licensed under CC BY-ND 4.0

Prosecutors detailed how Hernandez utilized the money she illicitly obtained from the company. According to the U.S. Attorney’s Office for the Middle District of Florida, the funds were spent on “personal expenses and for gambling.” This pattern of expenditure points to the motive behind the sustained theft.

The company began investigating financial discrepancies tied to Hernandez as it was preparing for closure by the end of 2024. As the scrutiny on her activities intensified, a bizarre development occurred: the company received a message purporting to be from a family member of Hernandez, stating that she had been ill and had died following complications from surgery. This was an attempt, prosecutors say, by Hernandez herself to feign her own death and evade accountability.

The company, however, did not accept the message at face value and alerted authorities. This led to a joint investigation by the FBI and IRS Criminal Investigation, culminating in a search warrant executed at Hernandez’s home in October. During this encounter, agents interviewed Hernandez.

Hernandez admitted stealing company money
Florida Woman Who Faked Death After Gambling Stolen $4M Gets 10 Years, Photo by casino.org, is licensed under CC BY-SA 4.0

In the interview, Hernandez made admissions regarding her actions. According to court documents, she “admitted to” stealing her company’s money for her own benefit and stated that she “went to the casino.” Prosecutors wrote in court filings that she also “admitted that she has a gambling problem,” shedding light on how a portion of the stolen funds was used.

Hernandez further revealed to agents that she “did not want (her company) to find out what she was doing.” She also claimed she would occasionally return some of the funds she had taken, though she acknowledged, “She said that she did not think what she took was as high as $4 million.” Critically, she admitted that it was she, not a relative, who had sent the message to her employer falsely claiming her death.

Legal proceedings followed swiftly. On January 10, a criminal information document charged Hernandez with three counts of wire fraud and two counts of money laundering. She entered a guilty plea to all counts on January 28. United States District Judge Thomas P. Barber sentenced Hernandez, 49, to 10 years in prison for her crimes. She has also been ordered to forfeit the substantial amount she stole from the company.

A similar case of internal financial betrayal unfolded in the United Kingdom, where Anita Mirmohammadi, a 31-year-old finance manager, was convicted of defrauding her employer, an Essex-based family business. Mirmohammadi had commenced her employment in 2018 and, in her capacity within the finance team, was granted access to a business credit card.

fraud came to light
Fraud – Free of Charge Creative Commons Clipboard image, Photo by picpedia.org, is licensed under CC BY-SA 4.0

The fraud came to light on April 21, 2022, approximately four years after she started working there. Unrelated fraud checks being conducted on the Brentwood-based company’s accounts revealed a pattern of unexplained financial transactions occurring worldwide. This discovery prompted the company to contact banks, police, and Action Fraud to investigate the irregularities.

The investigation uncovered that Mirmohammadi had been using her personally-issued credit card to fund her own expenses, illicitly utilizing company funds. Furthermore, she had been creating fraudulent invoices as a secondary method to extract additional money directly from the business accounts, amplifying the scope of her theft.

Through these two methods – misuse of the business credit card and the creation of fake invoices – Mirmohammadi managed to siphon a total of £184,675.89 from the company. The breakdown of the stolen amount showed £126,381.19 taken via the credit card and £63,294.70 extracted from the business account through the fraudulent invoices.

The investigation into her spending habits during her employment revealed a pattern of lavish purchases, indicating how the stolen money was used. Mirmohammadi made luxury acquisitions at high-end stores such as Harrods and Selfridges, and spent money with Mercedes Benz. She also funded holidays to international destinations including Mexico, Turkey, and Dubai, enjoying a lifestyle far beyond her legitimate means.

Further evidence of her spending was uncovered by Harrods during their own investigation, which found CCTV footage of Mirmohammadi making a purchase with the company card just one month before her scheme was discovered. Beyond the major luxury items and trips, she also used company funds for regular expenses with services like Apple, Amazon, eBay, Uber, and Zara, as well as payments for utilities and dental work (Thames Water and Harley Street Dental).

Mirmohammadi was apprehended at Gatwick Airport upon her return from a holiday in Dubai on May 22, 2022. Despite being arrested and interviewed by Essex Police, she chose to answer no comment to all questions posed by investigators, declining to cooperate or explain her actions.

She was subsequently charged with fraud by false representation on February 10, 2023. The case proceeded to trial, and following a seven-day hearing at Basildon Crown Court, she was found guilty on March 14, 2025. At a hearing at the same court on Friday, May 9, Mirmohammadi was sentenced to five years and 10 months in prison for her crimes.

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Judge Shane Collery commented on Mirmohammadi’s conduct during the sentencing hearing. He stated, “She was not dependent on stealing to survive, and her claim that she does care is hard to accept as she gave no thought to the consequences at all.” The judge characterized her actions severely, describing her as “a selfish, self-obsessed woman who repeated regular dishonesty, which was systemic and sustained, and she must have seen what she was doing.

Detective Constable Karen Venables of Essex Police also commented on the case after the conviction. She asserted, “This sentence shows the severity of Mirmohammadi’s offending.” Detective Constable Venables described the crime as “a calculated, ongoing fraud that would have continued had she not been caught, and I am glad to see the judge recognise this in his sentencing.”

Venables further added, “It was clear from the deception we found in these accounts that Mirmohammadi knew what she was doing was wrong and was trying to cover her tracks. She frittered this money away – she thought she was entitled to the finer things and it didn’t matter to her who was paying for them.” Financial investigators are continuing their work to identify criminal gains that can be confiscated from Mirmohammadi under the Proceeds of Crime Act, with a confiscation hearing scheduled for the week commencing November 3, 2025.

The landscape of fraud is constantly evolving, with technological advancements sometimes exploited for illicit gain. A recent indictment by the US Department of Justice highlights a case involving the suspected use of artificial intelligence to manipulate the music streaming ecosystem, allegedly generating over $10 million in fraudulent royalties.

artificially inflated music streams prosecution
FBI Arrests Musician For Streaming Fraud, Claiming He Collected $10M From Hundreds Of Thousands AI-Generated Songs, Photo by stereogum.com, is licensed under CC BY-SA 4.0

This case, marking what is believed to be the first criminal prosecution involving artificially inflated music streaming streams, targets Michael Smith, a 52-year-old resident of North Carolina. Smith is accused of creating “hundreds of thousands of songs” using AI technology. He then allegedly deployed automated programs, commonly known as “bots,” to create numerous fake accounts and stream these songs billions of times across various streaming platforms, including Amazon Music, Apple Music, Spotify, and YouTube Music.

The indictment references an email Smith sent himself in October 2017, where he estimated the potential scale of his operation, calculating that he could use the bots to generate approximately 661,440 streams per day. He projected that this rate could generate annual royalties totaling $1,207,128.

To facilitate and conceal his fraudulent streaming activities, Smith allegedly employed various measures, such as using fake email accounts and cloud computer services to mask the origin of the streams. He also reportedly paid for family plans on streaming platforms, likely to increase the number of accounts he could control for streaming purposes.

Smith music streaming fraud
Music Producer Allegedly Used AI Songs to Swindle Spotify, Photo by variety.com, is licensed under CC BY-SA 4.0

While Smith was a musician himself and had access to a small catalog of his own music, the indictment notes that “that catalog was not nearly large enough for Smith’s streaming fraud.” This limitation seemingly drove him to seek a larger volume of content to make the scheme appear more legitimate and harder to detect.

The indictment further suggests that Smith attempted to expand his operation and potentially involve others by offering to sell his fake streaming plan to other musicians. The proposal involved fraudulently generating streams for their music or sharing royalties derived from the fake streams, illustrating an attempt to scale the illicit activity.

Faced with the need for a massive volume of music to avoid suspicion and circumvent anti-fraud measures employed by streaming platforms, Smith allegedly turned to artificial intelligence. In 2018, he reportedly collaborated with the CEO of an unnamed AI music company and a music promoter to accelerate the production of songs for the scheme.

An email cited in the indictment, sent by Smith to two partners in December 2018, underscores the urgency and strategy behind this move: “We need to get a TON of songs fast to make this work around the anti-fraud policies these guys are all using now.” By playing his songs across multiple fake accounts and spreading the fraudulent plays across a large number of tracks, Smith allegedly aimed to dilute suspicion and make the artificial activity harder for the platforms to detect.

Smith streaming fraud
Fraud – Free of Charge Creative Commons Legal Engraved image, Photo by thebluediamondgallery.com, is licensed under CC BY-SA 4.0

The government alleges that Smith “deceived” the streaming platforms by artificially inflating the number of streams. This deception allowed him to receive royalties that, under normal circumstances, would have been paid to legitimate musicians, songwriters, and other rights holders whose songs were genuinely streamed by actual listeners. His actions effectively diverted millions of dollars from legitimate artists and the broader music ecosystem.

Smith is facing serious charges, each carrying a potential prison sentence of up to 20 years. The charges include one count of wire fraud conspiracy, one count of wire fraud, and one count of money laundering conspiracy, reflecting the alleged criminal nature and scope of his scheme.

The case highlights the proactive efforts by entities within the music industry to combat streaming fraud. The Mechanical Licensing Collective (The MLC), an organization responsible for issuing blanket mechanical licenses for qualified streaming services in the US, identified irregularities in Smith’s streaming data. As a result, the MLC took action to withhold the associated royalty payments, preventing the distribution of funds suspected to be fraudulently generated.

Kris Ahrend, CEO of The MLC, commented on the significance of the indictment, stating, “Today’s DOJ indictment shines a light on the serious problem of streaming fraud for the music industry.” He emphasized the MLC’s role in detecting the alleged misconduct: “As the DOJ recognized, the MLC identified and challenged the alleged misconduct and withheld payment of the associated mechanical royalties, which further validates the importance of the MLC’s ongoing efforts to combat fraud and protect songwriters.”

The case aligns with growing efforts globally to address streaming fraud, which detection companies estimate diverts substantial amounts from legitimate artists annually—reportedly around $2 billion per year, according to Beatdapp. Recent actions elsewhere include a Danish man sentenced to 18 months in prison in March for using bots to inflate stream counts on his uploaded tracks and reports from Sweden in 2022 exposing an indie label using fictitious artist names to generate revenue.

FBI Acting Assistant Director Christie M. Curtis commented on the indictment, stating, “The defendant’s alleged scheme played upon the integrity of the music industry by a concerted attempt to circumvent the streaming platforms’ policies.” She added a clear message regarding law enforcement’s focus: “The FBI remains dedicated to plucking out those who manipulate advanced technology to receive illicit profits and infringe on the genuine artistic talent of others.

US Attorney Damian Williams also weighed in, emphasizing the impact of the alleged scheme. “As alleged, Michael Smith fraudulently streamed songs created with artificial intelligence billions of times in order to steal royalties,” Williams stated. He highlighted the victims of the fraud: “Through his brazen fraud scheme, Smith stole millions in royalties that should have been paid to musicians, songwriters, and other rights holders whose songs were legitimately streamed.” Concluding with a pointed remark, Williams added, “Today, thanks to the work of the FBI and the career prosecutors of this office, it’s time for Smith to face the music.”

The pursuit of illicit wealth through deception is not limited to traditional businesses or digital streaming. Federal prosecutors have also indicted Carl Rinsch, a director known for the film ’47 Ronin,’ for allegedly taking $11 million from Netflix for a promised sci-fi series that was ultimately never completed. According to the indictment, Rinsch is accused of using the funds for lavish personal purchases and investments rather than the production of the series.

FBI Assistant Director Leslie Backschies
This director scammed Netflix by selling a fake TV series called ‘White Horse’ and used their $11M check on luxury items and risky investments. He used the, Photo by redd.it, is licensed under CC BY-SA 4.0

FBI Assistant Director Leslie Backschies commented on this case, stating, “Carl Rinsch allegedly stole more than $11 million from a prominent streaming platform to finance lavish purchases and personal investments instead of completing a promised television series.” She reiterated the FBI’s commitment to pursuing such cases: “The FBI will continue to reel in any individual who seeks to defraud businesses.”

Details from the U.S. Attorney’s Office for the Southern District of New York indicate that Rinsch, aged 47, is charged with one count of wire fraud, one count of money laundering, and five counts of engaging in monetary transactions in property derived from specified unlawful activity. Each charge carries a maximum sentence ranging from 10 to 20 years, potentially resulting in a lengthy prison term if he is found guilty.

The project in question was initially known as ‘White Horse’ and was acquired by Netflix from Amazon in 2018 for over $61 million. It was later renamed ‘Conquest.’ Despite burning through $44 million of Netflix’s cash for the project and holding final-cut power, Rinsch reportedly demanded an additional $11 million from the streamer in 2020, claiming the funds were necessary for pre- and post-production needs.

Netflix canceled project
Director Charged for Fraud in $11M Scheme Over Netflix Sci-Fi TV Show, Photo by wikimedia.org, is licensed under CC BY 2.0

Netflix provided the additional $11 million. However, a year later, with reportedly little to show for the investment, Netflix canceled the project and subsequently wrote off over $55 million in costs. Netflix later won a $12 million arbitration ruling against Rinsch after he claimed the company owed him $14 million.

Prosecutors allege that after receiving the $11 million, which was deposited into a bank account under the name of the “Rinsch Company,” the director moved the money to various other accounts and locations. He reportedly spent approximately half of the $11 million within less than a year on “bad market trades.” Following this, Rinsch allegedly went on an extensive spending spree using the remaining funds.

The inventory of purchases put together by SDNY prosecutors and the FBI paints a picture of extraordinary luxury spending. Rinsch is accused of using the money to “speculate on cryptocurrency and on personal expenses and luxury items.” The detailed list includes approximately $1,787,000 on credit card bills, about $1,073,000 on lawyers (including those for his divorce and to sue Netflix), around $395,000 on luxury accommodation like the Four Seasons hotel and various rental properties, approximately $3,787,000 on furniture and antiques (including $638,000 on two mattresses and $295,000 on luxury bedding), roughly $2,417,000 to purchase five Rolls-Royces and one Ferrari, and approximately $652,000 on watches and clothing.

These cases, while varying in scale and method, collectively paint a vivid picture of the multifaceted nature of financial crime. From simple yet effective fraudulent invoices that fooled tech giants and small businesses alike to the weaponization of cutting-edge technology like AI for large-scale deception and the alleged misappropriation of development funds for personal indulgence, the drive for illicit gain remains a persistent challenge.

A man holding a sign reading 'FRAUD' in a tech environment, highlighting cybersecurity concerns.
Photo by Tima Miroshnichenko on Pexels

The audacity of these schemes—impersonating long-term business partners, faking one’s own death to evade detection, or allegedly diverting millions meant for creative production into a personal trove of luxury goods—is striking. Yet, the unraveling of each plan, through diligent investigation, cross-industry cooperation, and robust legal processes, underscores the enduring commitment of authorities to pursue and hold accountable those who seek to build fortunes on foundations of fraud.

The consequences faced by those caught—lengthy prison sentences, mandates to forfeit ill-gotten gains, and orders to repay victims—serve as powerful reminders that the glittering facade of fraudulently acquired wealth inevitably crumbles. While the methods of deception may evolve with technology and opportunity, the ultimate fate of those who choose this path often leads down the same stark road towards justice and reckoning.

These narratives are not just accounts of individual criminal acts; they are cautionary tales etched into the complex fabric of global commerce and digital interaction. They reveal the vulnerabilities that exist, the constant need for vigilance, and the relentless pursuit by law enforcement to protect the integrity of financial systems against the ever-present shadow of deceit. They remind us that even in an age of advanced technology and sophisticated corporate structures, the most fundamental elements of trust and verification remain paramount in the fight against fraud.

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