British Man Pleads Guilty to Wire Fraud and Aggravated Identity Theft in Brazen Scheme that Victimized Hundreds of Thousands across the Country
A British man living in Las Vegas, Nevada, pleaded guilty today to a scheme to abuse the personal and financial information of hundreds of thousands of victims in order to steal millions of dollars, the Department of Justice announced today.
Gareth David Long, 40, pleaded guilty to one count of wire fraud and one count of aggravated identity theft in federal court in Las Vegas before U.S. District Judge Andrew P. Gordon. The court set Long’s sentencing hearing for Feb. 20, 2020.
“The defendant took millions of dollars from numerous victims by misusing their personal and financial data,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “As demonstrated by this case, the Department of Justice is committed to protecting the public from those who unlawfully use personal and financial data to victimize American consumers.”
“Today’s events serve as another example of the unremitting dedication of the Postal Inspection Service to halt the devastating effects of identity theft. Those who engage in this type of fraud must learn they cannot escape detection and will be brought to justice,” said Inspector in Charge Delany De Leon-Colon of U.S. Postal Inspection Service’s Criminal Investigations Group at National Headquarters. “The guilty plea of Gareth Long has brought justice for all who suffered financial and emotional distress because of his actions.”
As part of his plea agreement, Long admitted that he created and deposited checks drawn on the checking accounts of more than 375,000 victims without authorization during a six-month period in 2013. Although Long had no authorization to charge the victims’ accounts, he represented to victims’ banks that the victims had authorized the debits. When account holders called to complain about the charges, Long instructed his employees to tell callers that they had authorized the charges in connection with an online payday loan application. Long used the proceeds of his fraud scheme to purchase a 5,400 square foot ranch and 23 acres of land in Texas, three airplanes, cars, a fire truck, and construction and farm equipment, as well as to pay other personal expenses.
In pleading guilty, Long admitted that, from 2008 through 2013, he operated a third-party payment processing company, V Internet Corp, which also did business as Altcharge and Check Process. As a payment processor, Long specialized in the creation and deposit of remotely-created checks (“RCCs”). An RCC is a check created not by the account holder, but by the third-party payee. In place of a signature, Long’s RCCs contained a typed statement claiming that the check was authorized by the account holder. Because of this payment processing activity, Long possessed the personal and financial information of hundreds of thousands of consumers whose accounts he debited in 2012 and earlier.
In January 2013, Long stopped acting as a third-party payment processor for other merchants, and simply started using RCCs to charge the bank accounts of consumers whose personal identifying information he had acquired over the previous five years, as well as other consumers whose information Long purchased in the form of “lead lists.” Long did not have authorization to charge any of these victims’ accounts.
From January through July of 2013, Long created and deposited more than 750,000 RCCs totaling more than $22 million. While approximately half of these RCCs were immediately reversed by victims’ banks, Long nevertheless succeeded in stealing approximately $11 million over a six-month period.
The U.S. Postal Inspection Service seized more than $2.9 million from Long’s company bank accounts. Postal Inspectors also seized property that Long purchased with the proceeds of his fraudulent activity, including three airplanes and the other vehicles and property described above. In addition, as part of his plea agreement, Long will forfeit the ranch and land he purchased in Texas.
The Department of Justice’s case is being handled by Trial Attorneys John W. Burke and Ehren Reynolds of the Consumer Protection Branch in coordination with the U.S. Attorney’s Office for the District of Nevada and with substantial investigative support from the U.S. Postal Inspection Service.