Hitting the Identity Theft Jackpot

362

Reno, Nevada is known as “The Biggest Little City in the World” and is famous for its hotels and casinos. More recently, it’s known for a resident who operated an elaborate identity theft fraud scheme that involved creating and using more than 8,000 fraudulent online accounts to steal more than $3.5 million.

Federal Bureau of Investigation (FBI) investigators, along with a taskforce of other agencies, hit the proverbial jackpot when they discovered the perpetrator’s unmanned office. Eight computers were found running an elaborate, automatic script that opened illegal accounts and transferred money in real time. The sophisticated operation was devised by a Reno resident who previously worked as an IT specialist for a large Nevada company. (The fraudster meticulously collected the personal information of thousands of employees and customers while working there and took the information home with him. Then, he quit his job to run the elaborate scheme.)

Over five years, the Reno renegade used PayPal and the identities that he stole to open approximately 8,000 fraudulent and unauthorized accounts. Once the accounts were opened, he applied for linked credit accounts with the stolen identities. He avoided detection by engaging in a complex web of transactions that involved taking cash advances against the established credit line, then moving the money to more than 500 bank accounts and pre-paid debit cards in his control. (The scheme went largely undetected because the Reno man was moving very small dollar amounts.)

Where did all the cash go, you ask? The perpetrator shared his illegal earnings with his family, who lived a life of luxury as a result of his crime. Because the money he stole was not enough, he used the funds to gamble. He also bought a boat and travelled extensively.

Like many criminals who become overconfident in their abilities, they bet on their past successes, then lose big when they make a mistake. Apparently, the Reno man became tired of making numerous trips to the ATM to withdraw the stolen money. (The lazy fraudster directed PayPal to send the funds via check to him under a different name, even though the address was his.)

The 47-year-old pleaded guilty to wire fraud, mail fraud, filing a false tax return (he neglected to include more than $1 million of taxable income received from the illegal scheme) and aggravated identity theft and was sentenced to four years in prison. He will also serve three years supervised release, 100 hours of community service, pay about $1 million in restitution and $3.5 million in a forfeiture judgment.

In this day and technological age, it’s important to protect your personal information from being stolen. If you discover this unfortunate event has happened to you, make an immediate report to the Federal Trade Commission (FTC) at www.identitytheft.gov or by phone at 1-877-438-4338. Visit www.ftc.gov/idtheft for more identity theft prevention tips and free resources.

Today’s “Fraud of the Day” is based on an article entitled, “Nevada Man Stole Multiple Identities, Millions of Dollars,” posted on FBI.gov on September 18, 2018.

When police searched a suspected identity thief’s office last year in Reno, Nevada, they hit the investigative equivalent of pay dirt—the crime in progress, right before their eyes.

There was no one working in the office, but eight computers were running an automatic script to open up online accounts using the names and identifying information the thief had stolen from his employer years earlier.

SHARE
Previous articleIt’s a Good Day
Next articleEntitlement Can Be a Dirty Word
Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.