05/23/2008

News / 38 INDIVIDUALS IN U.S. AND ROMANIA CHARGED IN TWO RELATED CASES OF COMPUTER FRAUD INVOLVING INTERNATIONAL ORGANIZED CRIME

International Law Enforcement Cooperation Leads to Disruption of
Organized Crime Ring Operating in U.S. and Romania
BUCHAREST, ROMANIA – Thirty-eight individuals with ties to
international organized crime have been charged in two separate
indictments involving computer and credit card fraud schemes,
Deputy Attorney General Mark R. Filip, Romanian Prosecutor
General Laura Codruţa Kövesi, U.S. Attorney for the Central District
of California Thomas P. O’Brien and Acting U.S. Attorney for the
District of Connecticut Nora R. Dannehy announced today. The
Deputy Attorney General made the announcement with the Romanian
Prosecutor General to highlight the extensive and continued
cooperation between the two countries in addressing these types of
international crimes. The announcement comes less than one month
after U.S. Attorney General Michael B. Mukasey announced the
Department’s new Law Enforcement Strategy to Combat
International Organized Crime.
“International organized crime poses a serious threat not only to the
United States and Romania, but to all nations,” said Deputy Attorney
General Mark R. Filip. “Criminals who exploit the power and
convenience of the Internet do not recognize national borders;
therefore our efforts to prevent their attacks cannot end at our borders
either. Through cooperation with our international partners, we can
disrupt and dismantle these enterprises, just as we have done today
with these indictments and arrests.”
A federal grand jury in Los Angeles charged 33 individuals in a 65-
count indictment unsealed today for their alleged participation in an
international racketeering scheme that used the Internet to defraud
thousands of individual victims and hundreds of financial
institutions. Seven individuals were charged in a District of
Connecticut indictment for their roles in an Internet phishing scheme,
including two who were also charged in the Los Angeles case.
U.S. law enforcement authorities are executing nine arrest warrants in
the Los Angeles area and Romanian law enforcement authorities are
executing search warrants in Romania today in connection with the
racketeering indictment.
As described in the indictments and other publicly filed documents, a
"phishing" scheme uses the Internet to target large numbers of
unwary individuals, using fraud and deceit to obtain private personal
and financial information such as names, addresses, bank account
numbers, credit card numbers and Social Security numbers. Phishing
schemes often work by sending out large numbers of counterfeit email
messages, which are made to appear as if they originated from
legitimate banks, financial institutions or other companies.
The Los Angeles indictment alleges a conspiracy to violate the RICO
Act; conspiracy in connection with access devices; production, use
and trafficking in counterfeit access devices; bank fraud; aggravated
identity theft; unauthorized access to a protected computer;
possession of device making equipment; and a forfeiture allegation.
The RICO conspiracy charge carries a maximum prison sentence of
20 years. The count of access device fraud conspiracy carries a
maximum sentence of seven and a half years in prison; the charge of
production, use and trafficking in counterfeit access devices carries a
maximum 10 year prison sentence; and possession of device making
equipment carries a 15 year maximum prison sentence. The charge
of bank fraud carries a maximum 30 year prison sentence. The
unauthorized access count carries a maximum prison sentence of five
years, and aggravated identify theft carries a mandatory two year
prison sentence. All charges except aggravated identity theft also
contain provisions for fines and terms of supervised release.
According to the indictment, the Romania-based members of the
enterprise obtained thousands of credit and debit card accounts and
related personal information by phishing, with more than 1.3 million
spam emails sent in one phishing attack. Once directed to a bogus
site, victims were then prompted at those sites to enter access device
and personal information. The Romanian “suppliers” collected the
victims’ information and sent the data to U.S.-based “cashiers” via
Internet “chat” messages. The domestic cashiers used hardware
called encoders to record the fraudulently obtained information onto
the magnetic strips on the back of credit and debit cards, and similar
cards such as hotel keys. Cashiers then directed “runners” to test the
fraudulent cards by checking balances or withdrawing small amounts
of money at ATMs. The cards that were successfully tested, known
as “cashable” cards, were used to withdraw money from ATMs or
point of sale terminals that the cashiers had determined permitted the
highest withdrawal limits. A portion of the proceeds was then wire
transferred to the supplier who had provided the access device
information.
“Partnerships and cooperation among all levels of law enforcement –
both domestic and foreign – are the keys to tackling criminal activity
that increasingly knows no borders,” said U.S. Attorney for the
Central District of California Thomas P. O’Brien. “Just as street
gangs don’t respect municipal borders, computer criminals can reach
into other countries and prey upon unsuspecting victims who have no
idea their identities and money are going to another country.”
The individuals named in the indictment operated from locations in
the United States and abroad including Canada, Pakistan, Portugal
and Romania, and include both U.S. citizens and foreign nationals.
Sonny Duc Vo, Alex Chung Luong and Leonard Gonzales are U.S.
citizens. Nga Ngo, Thai Hoang Nguyen, Loi Tan Dang and Dung
Phan are permanent legal residents of Vietnam. Hiep Thanh Tran is a
U.S. permanent resident from Vietnam. Caroline Tath is a permanent
legal resident of Cambodia. Hassan Parvez is a citizen of Pakistan.
Rolando Soriano is a Mexican citizen and is currently charged in Los
Angeles with illegal entry by an alien following deportation. Ovidiu-
Ionut Nicola-Roman; Petru Bogdan Belbita; Stefan Sorin Ilinca;
Sorin Alin Panait; Costel Bulugea; Nicolae Dragos Draghici; Florin
Georgel Spiru; Marian Daniel Ciulean; Irinel Nicusor Stancu; Didi
Gabriel Constantin; Mihai Draghici; Marius Sorin Tomescu; Lucian
Zamfirache; Laurentiu Cristian Busca; Dan Ionescu; Marius Lnu;
Alex Gabriel Paralescu; and Andreea Nicoleta Stancuta are
Romanian citizens. An additional four individuals known only by
their aliases, “Cryptmaster”; “PaulXSS”; “euro_pin_atm” and
“SeleQtor” are believed to be Romanian citizens.
Seuong Wook Lee, a cashier in the scheme, pleaded guilty on May
15, 2008, in U.S. District Court in Los Angeles to racketeering
conspiracy, bank fraud, access device fraud and unauthorized access
of a protected computer.
In a related case, seven Romanian citizens were charged in an
indictment returned by a federal grand jury in New Haven, Conn., on
Jan. 18, 2007, and unsealed on May 16, 2008, in connection with an
Internet phishing scheme. The indictment alleges conspiracy to
commit fraud in connection with access devices, conspiracy to
commit bank fraud and aggravated identity theft.
The investigation in the District of Connecticut resulted from a
citizen’s complaint concerning a fraudulent e-mail message made to
appear as if it originated from Connecticut-based People’s Bank. In
fact, the e-mail message directed victims to a computer in Minnesota
that had been compromised, or “hacked,” and used to host a
counterfeit People’s Bank Internet site. During the course of the
investigation, it was determined that the individuals had engaged in
similar phishing schemes against many other financial institutions
and companies, including Citibank, Capital One, JPMorgan Chase &
Co., Comerica Bank, Wells Fargo & Co., eBay and PayPal.
“This case shows that Internet fraudsters cannot avoid prosecution
just by launching their attacks against U.S. residents and U.S.
companies from overseas,” said Acting U.S. Attorney for the District
of Connecticut Nora R. Dannehy. “With the help of our law
enforcement partners around the world, we will investigate and
prosecute fraudsters wherever they can be found.”
“We will continue to work closely with our foreign and domestic law
enforcement partners and employ the investigative tools available to
bring organized criminals to justice,” said FBI Deputy Director John
S. Pistole. “The recent cooperation and information sharing with our
Romanian law enforcement partners and allies at the Southeast
European Cooperative Initiative has been invaluable. Despite being
separated by oceans, we are united in the fight against organized
crime.”
The individuals named in the District of Connecticut indictment are
Ciprian Dumitru Tudor, Ovidiu-Ionut Nicola-Roman, Mihai Cristian
Dumitru and Petru Bogdan Belbita, all residents of Craiova,
Romania; and Radu Mihai Dobrica, Cornel Ionut Tonita and Cristian
Navodaru, all residents of Galati, Romania. Nicola-Roman was
located in Bulgaria and arrested on an Interpol warrant on June 6,
2007. He was extradited to the United States on Nov. 8, 2007.
Nicola-Roman and Belbita are also charged in the Los Angeles case.
If convicted, each of the individuals in the District of Connecticut
case faces a maximum term of five years in prison on each
conspiracy charge, and a mandatory term of two years in prison on
the aggravated identify theft charge. In addition, each of the
individuals is subject to a maximum fine of $250,000 on each count,
or twice the gain resulting from the offense, whichever is greater.
The individuals also may be sentenced to a maximum term of three
years supervised release on each charge.
On April 23, 2008, Attorney General Michael B. Mukasey announced
the Law Enforcement Strategy to Combat International Organized
Crime to address the growing threat to U.S. security and stability
posed by international organized crime. The strategy was developed
following an October 2007 International Organized Crime Threat
Assessment.
The strategy specifically reacts to the globalization of legal and
illegal business, advances in technology, particularly the Internet, and
the evolution of symbiotic relationships between criminals, public
officials and business leaders that have combined to create a new,
less restrictive environment within which international organized
criminals can operate. Without the necessity of a physical presence,
U.S. law enforcement must combat international organized criminals
that target the relative wealth of the people and institutions in the
United States while remaining outside the country. Ultimately, the
strategy aims to create consensus among domestic law enforcement
in identifying the most significant priority targets and then unified
and concerted action among domestic and international law
enforcement in significantly disrupting and dismantling those targets.
International organized crime is defined as those self-perpetuating
associations of individuals who operate internationally for the
purpose of obtaining power, influence, monetary and commercial
gains, wholly or in part by illegal means, while protecting their
activities through a pattern of corruption and violence. International
organized criminals operate in hierarchies, clans, networks and cells.
The crimes they commit vary as widely as the organizational
structures they employ.
An indictment is a formal charging document notifying the defendant
of his/her charges. All persons charged in an indictment are
presumed innocent until proven guilty.
The Los Angeles case is the result of a joint investigation involving
the FBI, the Romanian General Inspectorate of Police, the U.S. Postal
Service, the Internal Revenue Service and local law enforcement
agencies including the Seal Beach, Costa Mesa, Huntington Beach,
Irvine, Westminster and Anaheim, Calif., Police Departments.
Additional assistance was provided by the U.S. Secret Service. The
case is being prosecuted by Assistant U.S. Attorney Mark Aveis in
the U.S. Attorney’s Office for the Central District of California.
The case being prosecuted in the District of Connecticut was
investigated by the FBI and the Connecticut Computer Crimes Task
Force. The case is being prosecuted by Assistant U.S. Attorney
Edward Chang of the U.S. Attorney Office’s Computer Hacking and
Intellectual Property Unit.
CONTACT:
U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
thomas.carson@usdoj.gov

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