Serbian resident pleads guilty to multi-million dollar BEC scheme

A Serbian-Hungarian dual citizen pleaded guilty on Tuesday to operating a $3.7 million business email compromise (BEC) scheme, according to an announcement from the U.S. Department of Justice.

The 49-year-old Dejan Medic scammed 15 unnamed victim companies in both the U.S. and Europe by claiming to be a senior executive or board member from the victims’ parent company. He then solicited assistance in an “urgent wire transfer of funds regarding purported debts of the parent company,” according to a 2019 indictment. 

Investigators said they uncovered multiple failed BEC attempts from Medic that would have resulted in an additional $6.8 million of fraudulent payments. 

Damian Williams, the United States Attorney for the Southern District of New York, said that the defendant pleaded guilty to the BEC scheme as well as to one count of wire fraud, which carries a maximum prison sentence of 20 years. 

Instances of BEC scams have been increasing over the years and are proving to be a serious global threat. According to a 2020 report from the FBI’s Internet Crime Complaint Center (IC3), it received complaints totaling more than $2.1 billion between 2014 and 2019.

“BEC scams have been reported in all 50 states and in 177 countries,”  the announcement said.  

The U.S. is one of the most targeted countries for these types of attacks. In 2020, IC3 said it received nearly 20,000 BEC complaints, and added that the schemes have become increasingly sophisticated and threatening since 2013. “Over the years, the scam evolved to include compromise of personal emails, compromise of vendor emails, spoofed lawyer email accounts, requests for W-2 information, the targeting of the real estate sector, and fraudulent requests for large amounts of gift cards,” the report stated. 

The scheme operated by Medic made use of phone calls and email spoofing — creating an email address that closely resembles an already established one, duping recipients into thinking the email was sent by the intended source. Within the email communication, Medic provided wire transfer information and instructions by which the recipient could send the purported debts through to the parent company. 

The indictment provided details showing that Medic was able to open multiple Hungarian bank accounts using real identification documents. Throughout the investigation, Hungarian authorities confirmed that the bank accounts were opened and controlled by Medic and received wire transfers from at least four of the victim companies.

“Medic’s plea today should serve as a warning to those who think they can victimize others and hide behind the anonymity of the internet at a safe distance: the United States and its international partners will find you and hold you accountable,” Williams stated. 

Medic is currently awaiting sentencing, the DoJ said. The 2019 indictment can be found here:

Dejan Medic indictment by Adam Janofsky