How to Commit a $200 Million Scam: Inside the Year’s Most Shocking Credit Card Fraud —Daily Beast

The FBI Says it Busted an 18-Person Ring that Spanned 8 Countries and 28 States. 

Make Up. Pump Up. Run Up.

Daniel Gross at The Daily Beast explains:  It’s not the latest exercise fad. Rather, according to the Justice Department and the Federal Bureau of Investigation, it’s the three-step process through which an 18-person ring allegedly committed a stunning $200 million credit-card fraud.   Here’re the basics of how it worked.  Read the full piece at The Daily Beast for all the detail on this scoop:  

The complaint, which can be seen here, describes what an FBI agent involved in the case called an “extensive, sophisticated, organized scheme.” A ring of people, ranging from a 31-year-old credit counselor in Philadelphia to a 74-year-old jeweler in northern New Jersey, allegedly conspired to make up fake identities, pump up credit profiles with more false information, and then run up huge unpaid credit-card bills.

All 18 people named in the indictment were charged with the same count of conspiracy to commit fraud, which carries a maximum penalty of 30 years in prison and a $1 million fine. Only 13 have been arrested. One is out of the country, and authorities are looking for the other four, according to a spokesman for the U.S. attorney for New Jersey.

The complaint describes something that resembles a multinational corporation—the enterprise “spanned at least 8 countries” (including Pakistan, India, China, Romania, and Japan), and at least 28 states. It involved the creation of 80 fake companies, more than 1,800 mailing addresses, 7,000 false identities, and 25,000 credit cards. It was as if the alleged fraudsters manufactured a small suburb, in which everyone had good credit at the beginning—only to walk away from big credit-card bills once they maxed out the plastic. The total cost is still being counted. But the U.S. says “final confirmed losses may grow substantially above the present confirmed losses of more than $200 million.”

Visit the Daily Beast for the full story here. 

$200 Million is a Pretty Good Sized Fraud to Run Up Using Credit Cards