California resident is latest to be charged in Utah tap-to-pay scam

OREM — A California man is the latest person charged in Utah County in a tap-to-pay scam investigation.

Liu Huan, 36, of Irvine, California, was charged Wednesday in 4th District Court with money laundering, engaging in a pattern of unlawful activity, theft by deception, unlawful use of technology to defraud and unlawful use of a financial card, all second-degree felonies; and five counts of unlawful acquisition of a financial card, a third-degree felony.

According to prosecutors, "a tap-to-pay scam is executed by one or more perpetrators who use cell phones loaded with stolen financial transaction card numbers to purchase gift cards or high-end electronics. Payment for these items is made by tapping the cell phone on the store's self-pay device, causing the stolen financial transaction card to be charged. When purchasing gift cards, the perpetrator usually has multiple stolen card numbers in a digital wallet loaded onto the cell phone and makes multiple purchases at once using a different card number for each purchase."

Once the gift cards are purchased, the perpetrator "scratches the security covering off each gift card, and uses a cell phone to send gift card numbers to a supervisor or handler, who immediately transfers the funds from the gift card to some other account," the charges state. "Whether the tap-to-pay scams involve gift cards, electronics or both, a common feature of the scam is that the perpetrator will travel to a location from out of state and make purchases at numerous stores in quick succession."

Investigators believe a "criminal enterprise" comprised of Chinese nationals is sending people to Utah and other states to conduct tap-to-pay scams.

"The organization appears to be headquartered in China, with U.S. operation bases in California and New York. During the last year, dozens of Chinese nationals have been arrested in Utah County for executing tap-to-pay scams," according to charging documents.

Since Oct. 1, prosecutors say Huan has made tap-to-pay purchases in St. George, Orem, Sandy, Midvale, Salt Lake City and Draper, as well as in other states, the charges state.

When police arrested Huan, they "located dozens of receipts for gift card purchases, dozens of gift cards and multiple high-end electronic items that were still new in the box in (his) vehicle," according to the charges. "(Huan) admitted he had traveled from Los Angeles to Utah. (He) admitted purchasing two gift cards for $980 and sending screenshots of the cards to a person in China. He was supposed to receive $100 for that transaction."