THREE MEN CONVICTED BY FEDERAL JURY OF CONSPIRACY TO COMMIT FRAUD, ACCESS DEVICE FRAUD, AND AGGRIVATED IDENTITY THEFT
GRAND RAPIDS, MICHIGAN – ZHOU CHEN, of Pennsylvania, KANG HE and SHIFU LIN, both of New York, were convicted by a federal jury of conspiracy to commit fraud, access device fraud and aggravated identity theft after a two-day trial in Lansing, Michigan, U.S. Attorney Donald A. Davis announced today. The men face up to ten years in prison for the conspiracy and fraud counts. Additionally, they will be required to serve a consecutive two-year sentence for the aggravated identity theft conviction, which will be served after any prison sentence imposed for the conspiracy and access device fraud convictions. The defendants will be sentenced later this year by Chief Judge Paul L. Maloney, who presided over the trial.
The jury heard evidence that CHEN, HE, and LIN were arrested by Kent County Sheriff’s Detectives in the parking lot of the Knapp’s Corner Meijer store on the East Beltline in Grand Rapids on January 11, 2011, after the defendants were observed engaging in fraudulent purchases of $100 American Express Gift Cards using credit card numbers that had been stolen and re-encoded onto the magnetic strips of used gift cards. The true account holders, who resided in Florida, Georgia, North Carolina, Texas, and Alabama, were unaware their credit card numbers were being used without authorization to make purchases at Meijer stores in the Grand Rapids, Michigan area. The jury also heard evidence that the defendants – who also possessed a card reader/writer device that could encode credit card numbers onto magnetic strips on plastic cards – used those compromised account numbers to purchase at least $4,000 worth of gift cards in two days at six Meijer stores across Grand Rapids. The evidence at trial also established that one of the defendants wired several thousands of dollars to individuals in Russia and Ukraine during the course of the conspiracy, whose names appeared in internet chat conversations concerning number “dumps” that were recovered during a forensic examination of a laptop computer found inside the vehicle occupied by the defendants.
U.S. Attorney Davis stated: “These are very serious criminal offenses that strike at the heart of our nation’s financial system. Federal law enforcement, and its state and local partners, are committed to tracking down and prosecuting these modern-day bank robbers who, armed with only a computer, expired gift cards, and a magnetic strip writing device, can steal tens of thousands of dollars in a very short period of time.” U.S. Attorney Davis also recognized the substantial efforts of Meijer Inc. personnel in investigating and documenting the fraudulent purchases.
The case was prosecuted by Assistant U.S. Attorney Chris O’Connor and investigated by the U.S. Secret Service, Grand Rapids Field Office.