Did you pay with a credit card or debit card? Bank wire? Cryptocurrency?
Case Study: A Five-Year Wait Pays Off in the End
K.M. is a Swedish retiree whose saga began when she saw an internet advertisement about what seemed like a reasonable investment opportunity in the forex and CFD market, as well as cryptocurrencies. Since she could begin with the relatively small sum of $100, she thought that it might be a risk worth taking and filled out an online form asking for more information.
Soon afterwards K.M. received the first of many calls from someone who introduced himself as an account agent. Finally, she gave in to the incessant promises of impressive profits, and agreed to deposit the initial $100 using her credit card. Additional payments, both by credit card and bank wire, then followed, in response to encouragement from the account agent.
The first sign that something might be amiss was when K.M. saw in her credit card statement that the beneficiary of her first deposit was not the broker she engaged but rather another party she could not identify. So she inquired with the broker, and was somewhat reassured when they offered what seemed like a reasonable explanation about holding companies and the like.
But then came yet another cause for worry. Over the next several months K.M. did not see any profits in her account, which she regularly checked on the broker’s website. She inquired with her account agent, who once again tried to explain it away and told her to be patient. But then he just disappeared. At first, other representatives of the brokerage agreed to speak with her and reassure her, but then even they disappeared. So K.M. notified her bank that she may have been the victim of a scam, but they responded that there was nothing they could do (which was not true, since she was entitled to apply for a chargeback for the payments she made by credit card).
So, K.M. went to her local police station and filed a criminal complaint. The police did investigate the claim and even concluded that K.M. was indeed the victim of a scam, but nonetheless declined to take action because the broker was based abroad and beyond the reach of Swedish law.
Rather than give up, however, K.M. scoured the internet for options. She came across an article in a major Swedish newspaper that mentioned how MyChargeBack had assisted another consumer with a similar problem. So on August 9, 2018 she contacted us and signed up as a client.
The first action MyChargeBack took on behalf of K.M., of course, was to prepare the necessary documentation allowing her to file chargeback and bank wire recall requests with her bank. Even though the credit card network’s chargeback guidelines clearly qualified K.M., however, the bank rejected her claim. It similarly rejected the wire recall, even though the bank was to blame for not doing its due diligence in transferring her funds. That is because banks are prohibited from transferring customer funds to beneficiaries who are suspected of criminal conduct. Had K.M.’s bank done its due diligence it quickly would have found that the broker was the subject of a warning issued by the Financial Conduct Authority (FCA), the British regulator, for having provided financial services or products in the United Kingdom without its authorization – a classic sign of an investment scam. In addition, the German regulator, BaFin, had issued a cease and desist order to the owner of the brokerage, which used an Estonian address, to curtail its cross-border proprietary trading.
Moreover, not only was the beneficiary account held in a different name than that used by the fake broker, but it was also held at a Hungarian bank even though the fake brokerage itself was using a Bulgarian address and the owner was in Estonia. Spreading an administrative presence across multiple jurisdictions is yet another classic sign of a scam, since it complicates investigations and facilitates money laundering.
Furthermore, while the Swedish bank did contact the Hungarian bank regarding a wire recall, the latter rejected it, citing “bank secrecy.” The MyChargeBack agent handling the case proposed holding a conference call with K.M. and her bank’s dispute department, but the bank refused. It was now 2019.
Therefore, our next step was to have our attorney send a legal demand letter to the Hungarian bank. And we engaged with a Hungarian attorney specializing in fund recovery, who then sent the Hungarian police both the Swedish police report and a Hungarian translation. The Hungarian police found that the beneficiary account was tied to a scam involving 44 Hungarian companies. Twenty-three of those Hungarian companies, moreover, transferred more than €659 million from the account to a Polish company. And Latvian citizens constituted almost all of the beneficial owners of the account. In other words, this became a very complex case that would need much more time to resolve. We had to let the police do its job.
In February 2021 the Hungarian police accepted a criminal complaint our attorney in Budapest had submitted and agreed to turn the matter over to the prosecutor. In August of that year, the Hungarian police froze the beneficiary’s bank account while the prosecutor and police continued their investigations.
Almost a year later, in January 2022, the Hungarian police merged K.M.’s case with another similar one to facilitate resolution.
In May 2023, Hungarian police seized a substantial amount of money from the beneficiary’s bank account and asked our attorney to submit additional documents on behalf of the client. Finally, in July 2023, the police ordered the local bank in question to transfer €36,300 into K.M.’s Swedish bank account. According to Hungarian law, any interested party had the right to file an appeal against the police decision within eight days. If the appeal is rejected or if no appeal is filed, then the money must be transferred within 30 days. And it was. There was no appeal.
Five years is a long time to wait. But were it not for MyChargeBack and the dogged determination of its Hungarian attorney, K.M. would never have recovered her funds at all. That is, first and foremost, because MyChargeBack commits itself to investing 100% of its effort into every case it accepts, regardless of how long it takes to pursue. Even if it takes five years.
Secondly, MyChargeBack’s international network of dispute resolution professionals is positioned to pursue a case no matter how complicated and no matter where it leads – from Sweden to Bulgaria to Hungary to Poland to Latvia.
Finally, since each case is unique, each one may require its own tailored solution. MyChargeBack knows how to design a multi-pronged strategy that can simultaneously explore different directions, including, as in this case, chargebacks, a bank wire recall, legal demand letters, and the active involvement of multiple law enforcement agencies.
“It has been a very long struggle,” K.M. said afterwards. “Now I’m happy. No one in Sweden believed me. Everyone told me and there’s nothing to do. That was the problem. No one could help me. Not the bank, not the police. Only MyChargeBack.”
MyChargeBack in Sweden
Complaints filed with government agencies
Payment made by the bank
Did you pay with a credit card or debit card? Bank wire? Cryptocurrency?