New York District Attorney Cyrus Vance, Jr., held a press conference on Friday along with Police Commissioner Raymond Kelly and New York Secret Service Field Office agent Paul Mahon to proudly announce that their three agencies had collaborated on breaking up a massive credit card fraud and identity theft operation which employed waiters at expensive restaurants in New York, New Jersey and Connecticut.
The fraud ring stole at least fifty American Express credit card numbers using handheld “skimmers,” legal products available for sale online.
The thieves then embarked on a similarly massive operation to counterfeit the cards, even going so far as to create phony drivers licenses to back-up the cards, which they used to buy luxury goods form stores in the city and around the country, as far away as Boston, Chicago and Palm Beach, Florida. Some of the goods were then turned around and re-sold for discounted prices on eBay.
The Manhattan DA’s office said that police officers recovered $1.2 million in cash and $1 million in expensive wine and wrist watches. Twenty eight people were indicted on 172 counts of enterprise corruption, conspiracy, grand larceny and other felonies.
“The high-end targets of this case make it notable, but disturbingly this case is far from unique,” said District Attorney Vance, in a press release announcing the bust. “…My Office’s Cybercrime and Identity Theft Bureau will continue to work with our partners in law enforcement to dismantle criminal rings that attempt to use technology to circumvent the law.”
The investigation, which took 18 months, began at famed New York steakhouse Capital Grille and mushroomed out from there. The Capital Grille, for its part, acknowledged an incident involving a “single employee” in January, but said that the NYPD hadn’t contacted them about the indictments, NBC New York reported.
New York’s law enforcement agencies have reported an increase in identity theft and credit card fraud, parting ways with nationwide surveys that show an overall decrease in ID theft, though the thefts that do occur are costing victims more time and money. In this case, American Express reimbursed the victims for their losses, according to Kelly.
But New York’s law enforcement agencies have also reported successes in nabbing the perpetrators, with Kelly in October reporting that New York City police had disrupted what he said was the largest and most sophisticated credit card fraud ring in American history, nabbing more than $13 million worth of goods with stolen funds.
In February, the Manhattan DA’s office and the Secret Service disrupted another credit card fraud ring that had obtained $1 million in merchandise using stolen funds, The New York Times reported.
When asked by reporters at Friday’s press conference why law enforcement agencies didn’t just go after the credit card “skimmer” manufacturers, Vance pointed out that they do have legitimate uses for small businesses.
“This is rapidly changing technology,” Vance said. “Hopefully restaurants are taking the opportunity to move to swipe-at-the-table machines.”
