Gang members in prison in South Carolina made at least $144,000 in a "sextortion ring" involving nude photos and smuggled cellphones, federal officials say.
At least a dozen people have been charged and several have pleaded guilty, including a convicted murderer who was already sentenced to decades behind bars, prosecutors say.
Now eight more people have been indicted for money laundering in connection with the scam.
Earlier this year, prosecutors said more than 400 members of the military were scammed by the "sextortion ring" run from South Carolina prisons. Prosecutors said the scheme netted $560,000 for the inmates and their accomplices on the outside.
The indictment, filed recently in federal court in Florence, accuses the eight people of accepting nearly 75 "fraudulent money transfers" from victims.
As part of the scheme, prison inmates used cellphones with internet connections to target men in the military on dating apps, federal prosecutors say. The inmates would pretend to be women and send nude photos to the victims, according to prosecutors.
The inmates would then pretend to be the angry father of an underage girl and threaten the victims with going to police and accusing them of soliciting nude photos from a minor, according to court filings.
One Army veteran killed himself after being targeted by the scammers, a family told The Greenville News.
Jimmy Dunbar, in inmate serving 30 years for murder at Lee Correctional near Florence, pleaded guilty in July to running the scam from behind bars with help from "money mules" on the outside. A judge gave him another 46 months for extortion, money laundering and conspiracy to commit wire fraud.
At the time, federal investigators said Dunbar made about $30,000 off the blackmail victims.
The new indictment lists three Lee Correctional inmates by their initials and says they are all members of the Bloods gang. Two have been convicted for murder and the third for assault and armed robbery, according to court filings. It's not clear if Dunbar is among the three connected to the new criminal charges.
Court filings lay out how the eight people are accused of receiving money from two victims in the scam. One victim made 70 cash transfers, totaling $136,000 in extortion payments, and the second paid more than $8,000 in the scam, prosecutors said.
The money laundering charge has a maximum sentence of 20 years, and the maximum for wire fraud is a decade in prison.
