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Apr 14

An Allegation of Harm

In December 2013, an executive from big-three credit reporting bureau Experian told Congress that the company was not aware of any consumers who had been harmed by an incident in which a business unit of Experian sold consumer records directly to an online identity theft service for nearly 10 months. This blog post examines the harm allegedly caused to consumers by just one of the 1,300 customers of that ID theft service — an Ohio man the government claims used the data to file fraudulent tax returns on dozens of Americans last year.

Defendant Lance Ealy.

Defendant Lance Ealy.

In February, I was contacted via Facebook by 28-year-old Lance Ealy from Dayton, Ohio. Mr. Ealy said he needed to speak with me about the article I wrote in October 2013 — Experian Sold Consumer Data to ID Theft Service. Ealy told me he’d been arrested by the U.S. Secret Service on Nov. 25, 2013 for allegedly using his email account to purchase Social Security numbers and other personal information from an online identity theft service run by guy named Hieu Minh Ngo.

“I really need to speak with u about this case because the US attorney assigned to this case and the Secret Service agent are trying to cover up Experian involvement in this case,” Ealy said, without elaborating on his theory about the alleged cover-up.

Ngo is a Vietnamese national who for several years ran an online identity theft service called Shortly after my 2011 initial story about his service, Ngo tauntingly renamed his site to The Secret Service took him up on that challenge, and succeeded in luring him out of Vietnam into Guam, where he was arrested and brought to New Hampshire for trial. He pleaded guilty earlier this year to running the ID theft service, and the government has been working on rounding up his customers ever since.

Mr. Ealy appears to be one of several individuals currently battling charges of identity theft after allegedly buying data from Ngo’s service, which relied in part on data obtained through a company owned by Experian.

According to the complaint (PDF) against Ealy, government investigators obtained a search warrant for Ngo’s email account in March 2013. Going through that email, investigators found that a customer of Ngo’s who used the address had already purchased from Ngo some 363 “fullz” — a term used in the underground to describe a package of everything one would need to steal someone’s identity, including their Social Security number, mother’s maiden name, birth date, address, phone number, email address, bank account information and passwords.

The Justice Department alleges that between Jan. 28, 2013 and Oct. 17, 2013, Ealy filed at least 150 fraudulent tax returns on Americans, instructing the IRS to send the refund money to prepaid credit card accounts he controlled. The government claims that about 50 of those bogus claims were made with Social Security numbers and other data obtained from Ngo’s ID theft service. Continue reading →