Three Indicted On Fraud And ID Theft Charges In Multimillion-Dollar International Cybercrime Scheme
Organization Allegedly Capitalized on Information Hacked
From The Customers of More Than a Dozen Global Financial Institutions
NEWARK, N.J. – Three alleged members of an international cybercrime, money laundering and identity theft conspiracy were charged in New Jersey today with a scheme to use information hacked from customer accounts held at more than a dozen banks, brokerage firms, payroll processing companies and government agencies in an attempt to steal at least $15 million from American customers, U.S. Attorney Paul J. Fishman announced.
The three defendants – Oleksiy Sharapka, 33, and Leonid Yanovitsky, 39, both of Kiev, Ukraine; and Richard Gundersen, 47, of Brooklyn, N.Y., were indicted by a federal grand jury on charges of conspiracy to commit wire fraud, conspiracy to commit access device fraud and identity theft, and with aggravated identity theft.
According to the Indictment and other documents filed in the case:
Sharapka allegedly directed the conspiracy with the help of Yanovitsky. Gunderson allegedly facilitated the movement of fraud proceeds. Sharapka and Yanovitsky are fugitives. Gundersen will be arraigned on the new charges on a date to be determined.
Conspiring hackers gained unauthorized access to the bank accounts of customers of more than a dozen global financial institutions and businesses, including: Aon Hewitt; Automatic Data Processing Inc.; Citibank N.A.; E-Trade; Electronic Payments Inc.; Fundtech Holdings LLC, iPayment Inc.; JP Morgan Chase Bank N.A.; Nordstrom Bank; PayPal; TD Ameritrade; U.S. Department of Defense, Defense Finance and Accounting Service; TIAA-CREF; USAA; and Veracity Payment Solutions Inc.
After obtaining unauthorized access to the bank accounts, the defendants and conspirators diverted money from them to bank accounts and pre-paid debit cards the defendants controlled. They then implemented a sophisticated “cash out” operation, employing crews of individuals known as “cashers” to withdraw the stolen funds, among other ways, by making ATM withdrawals and fraudulent purchases in New York, Massachusetts, Illinois, Georgia and elsewhere.
As part of the scheme, the defendants stole identities from individuals in the United States, which they used to facilitate the cash out operation, including by transferring money to cards in the names of those stolen identities. They also used some of those identities to file fraudulent tax returns with the IRS seeking refunds.
The defendants and their conspirators laundered the proceeds of the scheme, often through international wire transfer services, to the leaders of the conspiracy overseas.
The government’s ongoing investigation into the organization has so far identified attempts to defraud the victim companies and their customers of more than $15 million.
If convicted, each of the defendants face a maximum potential penalty of 20 years in prison on the conspiracy to commit wire fraud count, five years in prison on the conspiracy to commit access device fraud and identity theft count, and a consecutive term of two years in prison on the aggravated identity theft counts. The wire fraud and identity theft counts also carry a maximum fine of $250,000, or twice the gross amount of pecuniary gain or loss resulting from the offenses. The money laundering conspiracy count carries a maximum fine of $500,000, or twice the value of the monetary instruments involved.
U.S. Attorney Fishman credited the U.S. Secret Service, under the direction of Special Agent in Charge James Mottola; U.S Immigration and Customs Enforcement/Homeland Security Investigations, under the direction of Special Agent in Charge Andrew M. McLees; Department of Defense, Criminal Investigative Service, under the direction of Special Agent in Charge Jeffery D. Thorpe; and IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Jonathan D. Larsen, with the ongoing investigation.
The government is represented by Assistant U.S. Attorney Gurbir S. Grewal, Chief of the U.S. Attorney’s Office Economic Crimes Unit.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.
Gundersen: Cynthia H. Hardaway Esq., Newark