A man who helped siphon hundreds of thousands of dollars from Texas retirees was sentenced last week to eight years in prison.
Olumide Morakinyo, 38, a Nigerian national who was living in Canada, was found guilty in U.S. District Court for the Western District of Texas of conspiracy to commit money laundering in connection with a scheme that involved establishing unauthorized accounts for numerous participants in the Employees Retirement System of Texas.
Morakinyo and another man, Lukman Aminu, a New Hampshire resident, in 2017 began accessing accounts through the pension system's online portal, using personally identifying information for numerous participants, according to court records.
The two allegedly used bank deposit information from participants’ accounts to redirect payments to debit cards they controlled, funds from which were ultimately used for cash, expenses and buying used cars that were shipped to Nigeria and Benin for resale.
The pair also allegedly stole personal identifying information from a Texas CPA and filed fraudulent tax returns, according to the 2019 complaint against Morakinyo.
In total, the thefts came to nearly $1 million, which Morakinyo was ordered to repay as part of his sentencing.
Aminu was charged separately and was sentenced in late 2019 to 51 months in prison, according to a statement from the Department of Justice.
The sentencing announcement from the DOJ follows recent efforts by the Department of Labor to increase cybersecurity in retirement plans.
In April, the DOL issued cybersecurity guidance in three parts, outlining the responsibilities of plan fiduciaries. That included tips for hiring service providers, cybersecurity best practices and security advice for retirement savers. The guidance came after a report from the Government Accountability Office that called upon the DOL to provide clarity on their responsibilities for plan sponsors and service providers.
Over the summer, the DOL has started auditing plans, sending requests for information to numerous plan sponsors, according to a report in June from law firm Morgan Lewis, which noted that “the requests are probing and indicate serious inquiry.”
Last week, Tim Hauser, the deputy assistant secretary for national office operations within the Employee Benefits Security Administration, told attendees at an American Retirement Association conference that the burden of cybersecurity is highest for record keepers and other service providers, not plan sponsors. He noted that the DOL’s request for information is aimed at helping improve policies and is not necessarily punitive, according to a report from ARA.
In July, an industry group, the Spark Institute, put out its own list of cybersecurity standards, which are similar to those issued by the DOL but are more specific and clearer, according to the announcement. That guidance includes a seven-part fraud control chart that outlines responsibilities for plan sponsors, record keepers and participants.
The move to charge data aggregators fees totaling hundreds of millions of dollars threatens to upend business models across the industry.
The latest snapshot report reveals large firms overwhelmingly account for branches and registrants as trend of net exits from FINRA continues.
Siding with the primary contact in a marriage might make sense at first, but having both parties' interests at heart could open a better way forward.
With more than $13 billion in assets, American Portfolios Advisors closed last October.
Robert D. Kendall brings decades of experience, including roles at DWS Americas and a former investment unit within Morgan Stanley, as he steps into a global leadership position.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
