Twenty-Three Defendants Charged In Manhattan Federal Court In Connection With Counterfeit Credit Card Scheme
Scheme Involved the Theft of More Than 1,000 Account Numbers and Caused Losses of At Least $2 Million
Preet Bharara, the United States Attorney for the Southern District of New York, and Steven G. Hughes, the Special Agent-in-Charge of the New York Office of the United States Secret Service, announced today the unsealing of an Indictment and a Complaint charging 23 individuals for their alleged participation in a large-scale counterfeit credit card scheme. As part of the scheme, the defendants allegedly obtained more than 1,000 stolen credit and debit card numbers, created counterfeit credit and debit cards with the stolen account information, and then utilized teams of “shoppers” to make more than $2 million of unauthorized purchases at retail stores located throughout the United States. In a coordinated operation early this morning, agents of the Secret Service and the Drug Enforcement Administration arrested 19 defendants in Flushing, Queens, and one defendant in Los Angeles, California. Agents also executed six search warrants and recovered counterfeit credit card manufacturing equipment and supplies. The defendants arrested in Queens will be presented before U.S. Magistrate Judge Debra Freeman in Manhattan federal court later today, and the defendant arrested in Los Angeles will be presented in federal court in the Central District of California this afternoon. An additional defendant is already in state custody in New York on other charges, and the two remaining defendants, Bing Lin and Ling Fu Shi, are at large.
Manhattan U.S. Attorney Preet Bharara said: “As alleged, the defendants used classic cyber-crime techniques of computer intrusions and accessing carding websites to obtain account numbers and then rake in millions of dollars through shopping sprees funded by counterfeit credit cards created with the stolen personal account numbers. Today’s arrests are a testament to our continued commitment to prosecuting cyber and identity theft crimes and holding the perpetrators of them to account.”
U.S. Secret Service Special Agent-in-Charge Steven G. Hughes said: “Today’s cyber criminals are increasingly targeting the personal and financial information of ordinary citizens, and the proprietary information of companies engaged in e-commerce. In order to combat emerging cyber threats, the U.S. Secret Service has adapted our investigative techniques and implemented a variety of innovative, operational capabilities. The U.S. Secret Service will continue to cooperate with partners from the Drug Enforcement Administration, Homeland Security Investigations, and the U.S. Attorney’s Office in the Southern District of New York in order to prevent further online, criminal activity.”
According to the allegations in the Indictment and Complaint unsealed today in Manhattan federal court:
From at least June 2013 through December 2013, the defendants and their co-conspirators obtained stolen credit/debit card information that had been obtained through computer intrusions and “carding” websites, which are Internet-based forums where users sell and exchange stolen credit and debit card information. Using the stolen account information, they manufactured counterfeit credit/debit cards that were encoded with the stolen account information and embossed with the names of “shoppers”—i.e., co-conspirators responsible for making unauthorized purchases with the counterfeit cards.
Other members of the conspiracy acted as “drivers,” who coordinated teams of “shoppers” and transported them to retail stores located throughout the country, including Texas, North Carolina, Virginia, Pennsylvania, and New Jersey. The “shoppers” were given dozens of counterfeit credit/debit cards and used them to make purchases of retail items, including gift cards, electronics, cosmetics, clothing, and other merchandise worth thousands of dollars. To convert these items to cash, the defendants then transported the goods to New York and California, where they were sold to co-conspirators who, in turn, sold the items or had others exchange them for refunds.
As part of the scheme, the defendants and their co-conspirators obtained stolen account information for more than 1,000 credit/debit card accounts and used that stolen information to make, or attempt to make, more than $2 million in unauthorized purchases.
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The defendants, who all reside in Flushing, Queens, are each charged with one count of conspiracy to commit access device fraud, which carries a maximum penalty of seven-and-a-half years in prison, and one count of aggravated identity theft, which carries a mandatory sentence of two years in prison.
A chart identifying the defendants’ ages and residences is attached.
Mr. Bharara praised the outstanding investigative work of the Secret Service. He also thanked the Drug Enforcement Administration for its assistance during the investigation.
This case is being handled by the Office’s Complex Frauds Unit. Assistant U.S. Attorneys Timothy T. Howard and Andrew C. Adams are in charge of the prosecution.
The charges contained in the Indictment and Complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.