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Press Release

Utah Man Sentenced To 57 Months In Prison For $8 Million Credit Card Fraud Scheme, False Statements To Bank

For Immediate Release
U.S. Attorney's Office, District of New Jersey

TRENTON, N.J. – A Utah man was sentenced today to 57 months in prison for his role in two criminal schemes, U.S. Attorney Philip R. Sellinger announced.

Timothy Gibson, 48, of Lehi, Utah, previously pleaded guilty in Trenton federal court to Count One of a five-count indictment, which charged him with conspiracy to commit wire fraud for his role in a multi-million dollar credit card fraud scheme that occurred in New Jersey; and to a three-count information which charged him with making false statements to a bank as part of a scheme that took place in Utah.  Judge Georgette Castner imposed the sentence today in Trenton federal court.

According to documents filed in this case and statements made in court:

The credit card fraud scheme:

Gibson and his conspirators solicited personal information from straw credit card applicants so the members of the conspiracy could submit falsified credit card applications to obtain credit cards.  The credit cards were then used to make purchases that generated rewards points from the credit card company.  In general, purchases were made on the credit cards and were then cancelled after the rewards points posted but before the credit card payments for the purchases were due.  Other “purchases” on the cards were in fact sham transactions run through Gibson’s business’s merchant account.

Gibson and his conspirators solicited straw credit card applicants by offering to purchase credit card offers the applicants received in the mail.  They then asked the straw credit card applicants to provide their personal identifying information, and used that information to open numerous credit cards in the names of fictitious businesses created with falsified financial and employment information, straw e-mail addresses, and fake business addresses.  Straw cardholders sent Gibson and his conspirators the credit card account information in exchange for payment.  Gibson also used his business’s credit card merchant account to charge the fraudulent credit cards for sham purchases that he knew were not legitimate, all in an effort to generate rewards points on those cards.  The conspirators added themselves to the credit card accounts as authorized users, and transferred rewards points to accounts they controlled.  The conspirators cancelled the points-generating purchases before the credit card payment was due.

The conspiracy involved more than 8,000 fraudulent accounts in the names of more than 1,500 straw cardholders that obtained more than 800 million rewards points, which were worth more than $8 million.

Charges remain pending against Aharon Lev, a/k/a “Aaron Lev,” a/k/a “Aron Lev,” a/k/a “David Gold,” a/k/a “David Monroe,” 37, of Lakewood, New Jersey.  The charges against Lev are merely accusations and he is presumed innocent unless and until proven guilty.

The false statements to a bank:

In March 2020, the CARES Act established several new temporary programs and provided for the expansion of others to address the COVID-19 outbreak.  One new program was the Small Business Association’s (“SBA”) Paycheck Protection Program (“PPP”), a loan program designed to provide an incentive for small businesses to keep workers on payroll during the pandemic.  Borrowers were required to submit an application form through an SBA-approved entity.  

In May 2020, Gibson falsely reported the number of employees and the average monthly payroll of a business with which he was associated in order to obtain a loan through the PPP program, and advised multiple businesses on how they could do the same.

In addition to the prison term, Judge Castner sentenced Gibson to three years of supervised release and ordered him to pay restitution.

U.S. Attorney Sellinger credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Jenifer L. Piovesan; and postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Inspector in Charge Christopher A. Nielsen Philadelphia Division.

The government is represented by Assistant U.S. Attorney Matthew Specht of the Special Prosecutions Division.
 

Updated December 19, 2024

Topic
Financial Fraud
Press Release Number: 24-460