Five defendants charged in multi-state identity theft and fraud conspiracy
FOR IMMEDIATE RELEASE |
August 23, 2011 |
NEWARK, N.J. – A federal complaint was unsealed this morning, charging five defendants with participating in a conspiracy to defraud Wal-Mart Stores, Inc. and T-Mobile USA by, among other things, engaging in wide-scale identity theft and fraud, United States Attorney Paul J. Fishman announced.
Alfredo Rodriguez, 22, of Brooklyn, N.Y., and Adiel Lopez, 20, also of Brooklyn, N.Y., were arrested at their residences this morning by Postal Inspectors of the United States Postal Inspection Service on a federal criminal Complaint charging them with conspiracy to commit wire fraud. Jason Cruz, 18, also of Brooklyn, N.Y., was arrested by Postal Inspectors in Fort Lauderdale, Fla. on the same charge.
Ralbert Olacio, 23, of Brooklyn, N.Y., and Edwin Rodriguez, 21, also of Brooklyn, N.Y., who are also charged in the Complaint with conspiracy to commit wire fraud, remain at large.
The defendants arrested this morning in Brooklyn are scheduled to appear before United States Magistrate Judge Patty Shwartz in Newark federal court. Cruz is scheduled to appear before a United States Magistrate Judge in Fort Lauderdale later this morning.
According to the criminal Complaint unsealed today:
Between in or about May 2010 through in or about July 2011, Alfredo Rodriguez, Ralbert Olacio, Jason Cruz, Adiel Lopez, and Edwin Rodriguez: (1) fraudulently activated numerous T-Mobile cellular service accounts using stolen identities; (2) fraudulently purchased discounted cellular phones at Wal-Mart retail stores ordinarily available only to qualified T-Mobile customers; and (3) re-sold the fraudulently obtained cellular phones at a profit. The defendants referred to themselves as the “Interstate Boys” because their criminal conduct stretched the length of Interstate 95 from Maine to Florida.
During this period, the defendants obtained the personal identification information, including the names and Social Security numbers, of over 400 identity theft victims. Using this information, they completed T-Mobile’s credit check process and opened in excess of 400 T-Mobile cellular telephone accounts in the names of identity theft victims (the “Fraudulent T-Mobile Accounts”). After establishing the Fraudulent T-Mobile Accounts, the defendants traveled to over 350 different Wal-Mart stores located from Maine to Florida on approximately 600 occasions to complete activation of the Fraudulent T-Mobile Accounts and to purchase approximately 2,000 discounted cellular handsets, which they then re-sold at a profit. Retailers such as Wal-Mart typically offer cellular handsets to new T-Mobile customers at steep discounts because they receive incentives from T-Mobile over time that help offset the discount amount. In the event such an account is deactivated for fraud, Wal-Mart does not receive any incentives from T-Mobile and solely bears the losses associated with the discounts it offered.
In most cases, the Fraudulent T-Mobile Accounts were deactivated by T-Mobile for fraud or identity theft shortly after they were established. Nevertheless, T-Mobile suffered hundreds of thousands of dollars in losses as a result of unpaid service charges, among other things. In addition, Wal-Mart suffered significant losses related to its sale of discounted cellular handsets to defendants because it was unable to recoup the incentives it expected when it sold the equipment. In total, the defendants’ scheme has resulted in approximately $1 million in losses to T-Mobile and Wal-Mart associated with unpaid T-Mobile cellular service, discounted cellular handsets, and the costs associated with investigating the defendants’ criminal conduct.
The count with which the defendants are charged carries a maximum penalty of 20 years in prison and a fine of up to $250,000, or twice the gross amount of any pecuniary gain derived from the offense, or pecuniary loss sustained by any victims of the offense.
U.S. Attorney Fishman praised Postal Inspectors of the United States Postal Inspection Service, under the direction of Postal Inspector in Charge Philip R. Bartlett, for their role in the investigation leading to today’s arrests, as well as T-Mobile USA’s Major Investigations Group and Wal-Mart’s Asset Protection Group, both of which worked closely with federal law enforcement during the course of the investigation.
The government is represented by Assistant U.S. Attorney Gurbir S. Grewal of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
The charge and allegations contained in the Complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
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