SEAL BEACH – A string of transactions with counterfeit money in Seal Beach prompted an investigation that led to the arrest of eight suspected gang members in a national counterfeiting scheme on Thursday.

Police and the U.S. Secret Service said at a news conference that the suspects bought merchandise at stores, including Toys “R” Us and Nordstrom, then returned the goods for cash refunds.

“The money was used to fund their criminal organization and support their lifestyles," Seal Beach police Chief Joe Stilinovich said.

The investigation started in December when some suspected gang members tried to use fake $20 bills at a Toys “R” Us at 12347 Seal Beach Blvd. On April 25 members of the group bought items using the fake money at a Toys “R” Us in Cypress and later returned them to a store in Seal Beach for a refund.

“We later tied them to 15 separate incidents in Seal Beach,” Stilinovich said.

Since then police departments nationwide and federal agents have traced similar bills to members of two Los Angeles gangs: the “51 Nothing But Trouble Gangster Crips” and the “52nd Hoover Gangster Crips.”

More than 4,200 transactions totaling $100,000 have been documented so far across the country, said Secret Service Special Agent Rob Savage.

Locally, similar crimes and bills have been reported by police in Brea, Cal State Fullerton, Cypress, Fountain Valley, Fullerton, Huntington Beach, La Habra, La Palma, Los Alamitos, Placentia and Westminster, said Sgt. Phil Gonshak.

After the investigation started, it was determined the bills were passed as early as 2013 and as far as Jamaica -- but 80 percent of the crimes happened in California, authorities said.

The suspects would spend anywhere from $5 to $1,000 during shopping trips and stores would lose money they could not retrieve.

“Unlike a fraud that you could take with a credit card and the credit card company could reimburse you, you’re stuck with the counterfeit currency note. You’re stuck with the loss,” Savage said.

Authorities carried out 15 search and arrest warrants on Thursday in Los Angeles County and found computers, receipts, gift cards, weapons and counterfeit bills.

They are still investigating where the fake bills were manufactured and how many more instances of the fraud took place.

Secret Service agents said the bills have slightly different characteristics as authentic ones but are indistinguishable to store workers who haven’t been trained to detect phony money.

The eight arrested people were booked on several charges including fraud and burglary.

Gonshak said the scheme is unrelated to arrests in Seal Beach last week when two men tried to use fake $100 bills at a Vons grocery store.