A North Carolina man has been sentenced to prison for his role in a retail refund fraud conspiracy organized through the messaging app Telegram, Acting U.S. Attorney Catherine L. Crosby announced.
U.S. District Judge Corey L. Maze sentenced Brian Nicklaus Buchanan, 30, of Clayton, North Carolina, to 12 months and one day in prison. Buchanan had previously pleaded guilty to conspiracy to commit mail fraud and wire fraud.
Buchanan was a member of “Noir’s Luxury Refunds,” a fraud network that operated a Telegram channel of the same name and targeted retailers across the country, according to court documents. The scheme operated from July 2020 until July 2022 and at one point attracted more than 5,900 followers on Telegram.
The group charged customers a percentage of a product’s price in exchange for fraudulently securing refunds on their behalf, prosecutors said. Members claimed to have the expertise to defraud retailers worldwide across a range of industries. The organization obtained or attempted to obtain refunds for millions of dollars’ worth of goods, including electronics, designer clothing and apparel, home furnishings and appliances.
Noir’s Organization used a variety of methods to carry out the fraud, including social engineering to manipulate customer service representatives into issuing refunds, manipulating shipping labels to make it appear that returned products had been received, and recruiting company insiders to process fraudulent refunds. The group also developed malware designed to circumvent retailers’ fraud prevention systems.
“Refund fraud is a billion-dollar problem plaguing American companies,” Crosby said in a statement. “These sentences send a message to cybercriminals that you can’t hide behind your keyboard.”
Several other members of the organization have also been sentenced, including Jason Seib, 44, of Mississauga, Ontario, Canada, who received time served after 26 months in custody; CK Chikong Tran, 31, of New York, who was sentenced to 21 months; and Damion Wayne Scarlett, 27, of Deer Park, New York, who was sentenced to 16 months, among others.
The FBI investigated the case as part of Operation Chargeback, an initiative targeting organized refund fraud groups across the United States and internationally. Assistance was provided by multiple retailers and companies, including Amazon, Walmart, Target and Google’s CyberCrime Investigation Group.
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