New York Man Sentenced to Prison for Leading Multi-State Scheme to Obtain New Cell Phones
BOSTON - A New York man was sentenced yesterday in federal court in Boston in connection with a fraudulent scheme to obtain and re-sell more than $330,000 worth of new cell phones and for resuming the scheme after being indicted and released pending trial.
Kevin Johnson, 26, of New York City, was sentenced by U.S. District Court Senior Judge Mark L. Wolf to 70 months in prison, three years of supervised release and restitution to be determined at a later date. In December 2016, Johnson pleaded guilty to one count of wire fraud conspiracy. Johnson was initially arrested and charged in December 2014; he was then re-arrested in March 2015, after an investigation revealed that he had resumed the fraud less than a week after his pre-trial release.
From at least January 2014 through October 2014, Johnson, Jimmy Phan, David Hul, Curtis Peebles, and other co-conspirators called T-Mobile customer service centers impersonating T-Mobile employees and used dealer codes that enabled them to add any name as an authorized user on T-Mobile accounts. They then recruited “runners,” including Lee Tran, to go into T-Mobile stores and impersonate the customers. Johnson, Phan, Hul, and Peebles used the dealer codes, among other methods, to add either the runners’ real names or false identities to the customer accounts, sometimes using false names that closely matched the runners’ real names to reduce the likelihood of T-Mobile detecting the fraud.
Runners then went to T-Mobile stores in Massachusetts, Nevada, New Hampshire, New York, Pennsylvania, Rhode Island, New Jersey, Florida, and elsewhere where they presented identification in the real or assumed names and acquired one or more new cell phones on accounts that were eligible for upgrades. Runners returned the new phones to Phan, Hul, and Peebles who paid them a portion of the phone’s value. Johnson, Phan, and Hul re-sold the cell phones to other co-conspirators for distribution in the United States and abroad. In total, the scheme netted at least $330,000 worth of new cell phones. In the months after he was indicted, Johnson obtained another approximately $30,000 in AT&T cell phones.
Although T-Mobile regularly alerted its customers to changes to their accounts, the affected customers frequently did not learn of the fraudulent modifications in time to prevent the distribution of the phones.
Judge Wolf previously sentenced David Hul and Curtis Peebles to 21 and 18 months in prison, respectively, for their role in the scheme. Jimmy Phan and Lee Tran will be sentenced on May 9.
Acting United States Attorney William D. Weinreb; Matthew Etre, Special Agent in Charge of Homeland Security Investigations in Boston; and Stephen Marks, Special Agent in Charge of the U.S. Secret Service’s Boston Field Office, made the announcement. The U.S. Attorney’s Office acknowledges T-Mobile and AT&T for their assistance with the investigation. Assistant U.S. Attorney Seth B. Kosto of Weinreb’s Cybercrime Unit is prosecuting the case.