December 16, 2011

Authorities in Manhattan today unsealed indictments against 55 people suspected of operating an identity theft and financial fraud ring, including a number of insiders at banks and companies throughout New York who allegedly helped to steal more than $2 million from hundreds of customers and clients.

Prosecutors say the 18-month-long investigation is notable because it underscores the ways in which traditional street crooks are moving their activity online: New York authorities maintain that more than a dozen of the defendants have violent criminal records and belong to different street gangs in Brooklyn.

At the center of the alleged conspiracy are employees at New York institutions that had access to large amounts of sensitive consumer and business data. Among those being arraigned today in a New York state court are JP Morgan Chase employees Karen Chance, Mercy Adebandjo and Joanna Gierczack; Tracey Nelson, an employee of the United Jewish Appeal-Federation; Roberto “Robbie” Millar, a car salesman for Open Road-Audi in Brooklyn; and Nicola Bennett, a compliance officer employed by AKAM Associates Inc., a residential property management company.

“These insiders used their positions to gain access to client data, and then sold that data to make money for themselves and their accomplices,” District Attorney Cyrus Vance Jr. said in a written statement. “We will continue to work with our partners to build significant cases to disrupt identity theft and dismantle these criminal organizations.”

The indictments allege that middlemen named in the conspiracy purchased personal information on customers and donors from Nelson and Millar, and then either re-sold the data or used it themselves to commit fraudulent financial transactions.

Prosecutors also charge that the Chase employees abused their access to steal personal data on account holders, and sold the information to counterfeit check makers and to individuals who specialized in setting up and executing fraudulent bank transfers.

Some of the defendants are alleged to have recruited other indicted members for the purpose of using their bank accounts to conduct fraudulent transactions. Prosecutors say the recruiters played a dual role: trafficking in stolen personal information bought from others, and recruiting people to provide bank accounts through which they could commit fraud.

These so-called “collusive account holders” — effectively complicit money mules — make up the bulk of the individuals named in the indictments. New York authorities charge that when defendants wanted to withdraw money quickly from collusive accounts, they purchased US Postal Service money orders with the debit cards linked to the accounts.

The indictments state that some the defendants arraigned today used automated systems set up by Citibank and TD Bank to change the personal information on ID theft victims’ bank records, including the victims’ contact address, phone numbers and email addresses.

For example, prosecutor alleged that one of the defendants,  Josiah “Pespi” Boatwains, would request that stolen credit cards be mailed to an address where a co-conspirator Richard Ramos, an employee at United Parcel Service (UPS) would intercept the cards on Boatwain’s behalf in exchange for money.

Boatwains and two other defendants allegedly then used those stolen cards to purchase luxury items that other defendants sold to co-conspirators named in the indictments. Other defendants allegedly used hijacked credit card account numbers to make online purchases buying airline tickets, movie ticket, credit reports, pizza and iTunes products.

A statement of facts filed with the New York State Supreme Court notes that there is a large amount of violent activity that surrounds the defendants in this case. The statement reads:

“During the course of our investigation 2 targets of the investigation were murdered. One of the deceased was brutally murdered. When his body was found by the police, they recovered personal identifying information of victims linked to our case. Specifically, on his person, a copy of a check was found that was from one of our identity theft victims that had donated to the United Jewish Appeal.”

“In addition, we are informed by the police department that many of these defendants are members of the Brooklyn Gang called “The Outlaws,” and others are Bloods and Crypts [sic]. Many of our defendants have violent criminal convictions.”

New York authorities say they expect the dollar losses to increase as the investigation continues.

13 thoughts on “NY ID Theft Ring Used Insiders, Gang Members

  1. b

    I’m fairly sure “Bloods and Crypts” is supposed to be “Bloods and Crips” in that last quote …

    1. bt

      Oh fuu the Bloods and Cryptors are back, serving up lead and obfuscated executables.

    2. Anonymous

      You mean like the “Bloods and Crips” episode of southpark? That’s Hilarious!

  2. JS

    White collar criminals gamble that their passing on info to hardened criminals may not get them killed. They buy into the self delusion that it is a bloodless crime.

    I wonder if the body count will increase along with the monetary losses.

    It would be interesting if a shocking random unsolved surburban mugging and or murder gets linked to this and shown for what it really was; retribution for not forking over more data or for the fact they were trying to get out.

    Then there is witness tampering and other ways to prevent white collar criminals from testifying against the more hardened mafias.

    In the end, behind the white picket fences of the suburbs are hidden the same crimes as down on the mean streets… the difference is they are just not spoken of in polite company and often covered by insurance or government bailouts.

  3. Daniel

    What these types of cases illustrate to me is that anti-money laundering work. As I thought experiment I once looked closely into how I might launder a million dollars. It’s possible but it’s actually quite an extensive, expensive, and time-consuming process.

    With two people dead in this case wouldn’t it have just been quicker to rob an armored car and kill the drivers. I’m not advocating that activity but it just seems like thieves are not the most intelligent when it comes to opportunity cost.

  4. Jim J.

    Big banks don’t render a simple background check? Sorry about my logic. Background checks cost a few bucks. I’m not surprised with the UPS vermin.

    1. Jim J.

      I see a few downs to my comment. Probably the UPS comment that got the down hits. I will qualify my comment. I was an antique and early firearms collector/seller when UPS began refusing to ship firearms of any kind. When the CEO of the time was asked by the local gun show community the reason. They were told, ‘Because some UPS employees were stealing them.’ In addition, many UPS customers have had their packages arrive with rocks or other objects that had replaced the original items.

  5. MaineLou

    Wonder if TD Bank would have had these issues if they had kept their operations in Maine instead of trying to play with the big boys but not pay for the increased security costs in NY/NJ?

  6. Tyler

    Thanks again Brian for the article.
    This is another good reminder for each us to keep close tabs on our finances as our financial accounts face both internal and external threats constantly.

  7. Richard Steven Hack

    $2 million divided by 55 people equals around $36K each. Not much incentive for getting killed and going to jail.

    OTOH, if the Bloods and Crips are involved, one might expect penny-ante crimes.

    Also, presumably some of the ringleaders made a lot more while the bulk of the 55 “account mules” made considerably less.

    What I see as the problem for the conspirators is a lack of internal security. All these accounts linked to actual people (even if with fraudulent identities), whose faces are on security cameras at Post Offices and the like, probably means that the ringleaders at the top were mostly insulated but the bulk of the money mules were treated as “disposable assets”.

    Which makes them morons for agreeing to do all this for the princely sum of $36K – and probably a lot less.

    OTOH, a lot of these people probably were lucky to make ends meet in New York based on salaries for clerks at the big banks… So X thousand bucks might have sounded really good.

    Then of course, once the right someone was tagged during the investigation and hauled in, they proceeded to give up the guys at the top in exchange for a reduced sentence.

    Which makes the guys at the top morons…

    So really, all this is not much different from the sort of drug and other petty crime that goes on every day.

  8. Nkwell

    Thanks Brian for deleting my first comment. Possibly because I had linked to the source code I had released on G+ a few months back that does this?

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