The U.S. Department of Justice announced that Michael Brian Cotter, the former CEO of a tech support company, was sentenced to 28 months in prison for deceiving banks by artificially inflating sales figures to avoid scrutiny over excessive consumer chargebacks. Cotter pleaded guilty to conspiracy to commit bank fraud. Court documents describe how, after banks began restricting the company’s ability to process debit and credit card payments in 2016 due to fraud and chargeback concerns, Cotter and co-conspirators purchased virtual debit cards and ran thousands of sham transactions through their own merchant accounts. The scheme was used to make chargeback ratios, a key bank fraud-detection metric, appear within acceptable levels, including by using real customer personal identifying information without customers’ knowledge or consent to make the transactions look like legitimate sales. The United States Postal Inspection Service investigated the case, and the Justice Department’s Criminal Division Fraud Section prosecuted it.

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