Victims across the United States were targeted in an alleged fraud scheme that used fear, intimidation and false accusations to convince older adults to hand over large sums of money, according to a federal indictment.
Prosecutors allege the scheme operated from April 2025 through June 2026 and involved suspects posing as bank security officers and government officials.
Victims were told their bank accounts were linked to financial crimes and, in some cases, were falsely accused of transferring child sexual abuse material overseas.
"They created such a sense of urgency," said Chelsea Binns, an associate professor at the John Jay College of Criminal Justice. "That's part of the fear angle that these perpetrators were operating on."
According to court documents, the callers attempted to make their claims appear legitimate by providing fake badge numbers, FTC case numbers and references to federal laws victims were allegedly violating.
Investigators say the goal was to convince victims to withdraw money from financial institutions and convert it into gold or cryptocurrency.
Victims were allegedly instructed not to discuss the situation with anyone and were told cooperation would prevent authorities from issuing arrest warrants.
The investigation began after victims in Virginia Beach contacted Homeland Security Investigations.
"We have more and more people in our community who are being taken advantage of," said retired police lieutenant Jeff Lurie.
Federal prosecutors say victims handed over significant amounts of money during the scheme.
Court records allege that victims surrendered approximately $20,000 in cryptocurrency and about $260,000 worth of gold on separate occasions.
As the investigation progressed, law enforcement agents conducted an undercover operation using counterfeit gold.
Prosecutors allege that Keyong Chen arrived to collect what he believed was another shipment of gold from victims.
According to court records, authorities followed Chen for roughly 35 miles along Virginia's Eastern Shore before arresting him following a brief pursuit.
Lurie said the case highlights the growing sophistication of scams.
"As a law enforcement officer, you have a sense of empathy for the person," Lurie said. "At the same time, you think to yourself, where did we fail as a society that we haven't given these citizens the protections that they need to avoid falling victim to these scams?"
The indictment does not identify other individuals allegedly involved in the operation.
Binns said consumers face a constantly changing landscape of fraud schemes.
"Every day there's new schemes, new things happening," she said. "It's hard to even keep up with everything. Everything's happening so quickly."
Chen has been charged with conspiracy to commit wire fraud and conspiracy to commit interstate transportation of stolen property.
Court records state that Chen lived in New York City and arrested in Florida and is a citizen of both the United States and China.
Prosecutors allege he participated in collecting money and valuables from victims, while Chen has denied knowing what was inside the packages he received or the identities of those directing him to pickup locations.
His attorney declined to comment.
How to avoid similar scams
Federal authorities advise consumers to be skeptical of unsolicited calls claiming to be from banks, law enforcement agencies or government officials. Legitimate agencies will not demand payment in gold, cryptocurrency or gift cards, nor will they threaten immediate arrest unless money is provided.
Anyone who believes they may be the target of a scam should contact local law enforcement and their financial institution immediately.
