U.S. Department of Justice|
Debra Wong Yang
United States Attorney
Central District of California
United States Courthouse
312 North Spring Street
Los Angeles, California 90012
FOR IMMEDIATE RELEASE
July 26, 2005
For Information, Contact Public Affairs|
Thom Mrozek (213) 894-6947
Los Angeles, CA - A San Pedro man who financed his law school education with proceeds from a credit card fraud scheme has been sentenced to five years in federal prison. A co-defendant who pleaded guilty in relation to the $1.2 million scheme was also sentenced to 60 months in prison.
Christian Ehlers, 30, who is an attorney, and Mark Sandoro, 43, of Rancho Palos Verdes, were sentenced Monday afternoon by United States District Judge J. Spencer Letts. In addition to the prison terms, Judge Letts ordered the defendants to pay $1,187,942 in restitution.
Ehlers was convicted at trial in December of conspiracy, eight counts of use of false names in a scheme to defraud, 11 counts of unauthorized use of access devices (credit cards) and one count of wire fraud. The federal jury that convicted Ehlers heard two weeks of testimony and deliberated for approximately 2 1/2 hours.
Sandoro pleaded guilty in March 2004 to 22 felony counts related to the fraud scheme.
A third defendant in the case - Alex Mascola, 31, of San Pedro, was scheduled to go to trial with Ehlers, but he pleaded guilty on the eve of trial to two counts of misuse of a Social Security Number. Judge Letts yesterday sentenced Mascola to two years of probation and ordered him to pay $14,000 in restitution.
Sandoro, Ehlers and Mascola, using their true names and in some instances assumed names, rented Post Office boxes in Lomita, Rancho Palos Verdes, San Pedro and Torrance. The men listed various assumed names as persons authorized to receive mail at the Postal facilities, and then they used various names to apply for and obtain credit cards.
The men applied for the credit cards using false SSNs, and they used the rented Post Office boxes as their mailing addresses. After receiving the fraudulently obtained credit cards, Sandoro, Ehlers and Mascola charged hundreds of thousands of dollars worth of goods and services. The men also used the fraudulently obtained credit cards to obtain cash, which they used for a variety of purposes, including making minimum payments to the card-issuing companies so that they could continue to charge to the credit cards.
To further their scheme, Sandoro, Ehlers and Mascola applied for and obtained "point of purchase" terminals from financial institutions. These terminals are used by merchants to obtain approval of charges to credit cards at the time customers purchase items or services, and to obtain payment for such charges from card-issuing companies. The men purported to obtain the terminals on behalf of companies with which they maintained a relationship or which they had created for purposes of executing the fraud. The men used the terminals to process charges made to credit cards they had fraudulently obtained, and to cause the card issuing companies to make payments to them for fraudulently incurred charges. This type of fraud is called a "bust-out" scheme.
Sandoro, Ehlers and Mascola used the cash they fraudulently obtained to rent a home in Rancho Palos Verdes, to operate various businesses, and to purchase automobiles, motorcycles, and other personal items. The evidence presented at trial showed that Ehlers used some of the money to pay tuition at the Loyola Law School, to pay for liposuction and to purchase luxury automobiles.
This case was investigated by the United States Secret Service and the Office of the Inspector General for the Social Security Administration.
Release No. 05-107
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