Saturday, November 29, 2008

Local men arrested in credit card, ID thefts from gyms - - 21 Nov 08

Authorities have broken up a gang of gym thieves they say was responsible for using stolen credit cards to buy computers and other electronic equipment, which was then sold for millions of dollars on eBay, according to federal charges.

Officers assigned to a federal Electronic Crimes Task Force on Thursday arrested Billy Morris Britt, 36, of Seattle, and Gabriel K. Jang, 37, of Renton, on charges of wire fraud and aggravated identity theft. Both appeared before U.S. Magistrate Brian Tsuchida, where they were ordered held pending a detention hearing on Tuesday.

The two men are charged in a 40-page complaint alleging they and others stole hundreds of credit cards from gymnasium lockers in Washington and Oregon, created nearly instant fake identification in their cars and then purchased expensive electronics equipment with those stolen cards within hours of the theft.

Detectives determined that many of those items were posted for sale on eBay within days.

Assistant U.S. Attorney Kathryn Warma said the men operated what amounted to a "mobile counterfeiting lab" that could create within minutes realistic driver's licenses, bearing the names on the stolen credit cards and the photo of the thief.

Thousands of people who bought electronics from Jang's company, Nexus Systems Inc., are being notified that they will have to return their purchases, Warma said. Many of the items were "high-end computers and cameras," including Apple laptops, that were sold for thousands of dollars — but just under retail prices — on eBay by Jang as "overstock."

The thefts were so extensive that they had already caught the attention of police and of store-security officers at the electronics store Best Buy.

Seattle police Detective David Dunn, assigned to the U.S. Secret Service-led task force, was able to track the thieves and tie the credit-card thefts to the purchases through an e-mail address that was linked to a Best Buy Rewards card that had been used hundreds of times.

Rewards cards provide loyal customers with special deals and other incentives for buying at the store. Britt had drawn suspicion to his card because it had been used more than 125 times using 77 different credit cards for purchases of more than $250,000, according to the charges.

The case opened in October 2007 when another Seattle detective, investigating a credit-card theft from a Seattle gym, contacted Dunn after learning that the rewards card had been presented when the stolen cards were used at a Best Buy.

The rewards card had been used with that purchase, and Britt was able to find the person whose name it was registered in. That individual said he had never opened a Best Buy account, but that his credit cards had been stolen from a Bellevue gym several years earlier and used at Best Buy before he could cancel them, according to the complaint.

Dunn was able to track the e-mail address on that card to Britt, and began following him, the complaint said.

In the meantime, a Best Buy store investigator had become suspicious of the rewards card and opened his own investigation. By watching eBay, he was able to track items purchased using the fraudulent rewards card to identical items being sold just days — and sometimes hours — later on eBay by a broker named "Nexusi," an identification registered to Jang, according to the charges.

A financial investigation showed that $2 million from the sale of electronic goods had passed through a PayPal account used by Jang since 2004, and another $1.3 million into a checking account traced to Jang.

By Mike Carter

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