Bronx Man Who Possessed Five “Ghost Guns” Charged With Possessing A Firearm And Ammunition

 

 Audrey Strauss, the United States Attorney for the Southern District of New York, John B. DeVito, Special Agent-in-Charge of the New York Field Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”), and Dermot Shea, Commissioner of the New York City Police Department (“NYPD”), announced the arrest of DOMINGO VALLE for being a felon in possession of a firearm and ammunition.  VALLE was arrested yesterday and was presented in Manhattan federal court before U.S. Magistrate Katharine H. Parker today.

Manhattan U.S. Attorney Audrey Strauss said: “Domingo Valle, despite being a felon, allegedly possessed six firearms, including two privately made AR-style rifles and three privately made pistols, and ammunition.  As alleged, for years, Valle purchased firearm tools, parts, and accessories online in order to create privately manufactured firearms, also known as ‘ghost guns,’ which are difficult to detect and trace.  Thanks to the ATF and NYPD, these dangerous weapons are out of the hands of a felon and will no longer pose a threat to the community.”

ATF Special Agent-in-Charge John B. DeVito said: “Privately manufactured firearms (PMFs) are an increasing source of weapons for criminals and pose an emerging threat to public safety.  ATF will continue to partner with NYPD and other agencies to identify, rigorously investigate, and apprehend those involved in the illegal manufacture and possession of firearms that endanger our communities.”

According to the allegations in the Complaint[1]:

For at least the past seven years, at least over 50 times, VALLE purchased online firearm parts, tools, and accessories that allow an individual to assemble a working firearm from component parts.  For example, in 2020, VALLE purchased online a replacement part for an Easy Jig, which an individual can use to create an assembled firearm from component parts, such as an 80% AR-15 lower receiver.  That same year, VALLE purchased online an 80% AR-15 lower receiver.

On October 4, 2021, agents from the ATF and NYPD recovered a pistol and five rounds of ammunition from VALLE’s residence in the Bronx, New York.  Inside the residence, agents also found two privately made AR-style rifles, three privately made pistols, body armor, which was loaded with rifle and pistol magazines, and numerous bullets.  In an effort to conceal the firearms, VALLE stored three of the privately made firearms in a concealed wall-mounted shelf in the residence. 

VALLE, 51, of Bronx, New York, is charged with being a felon in possession of a firearm and ammunition, which carries a maximum sentence of 10 years.  The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  

Ms. Strauss praised the outstanding investigative work of the ATF and the NYPD.  Ms. Strauss also thanked the Metropolitan Transportation Authority for its assistance in the investigation.

The charge contained in the Complaint is merely an accusation, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.

Two New Jersey Men Arrested And Charged With Securities Fraud For Scheme To Defraud Investors In Hemp Company

 

Vitaly Fargesen and Igor Palatnik Misappropriated Approximately $4 Million of Investor Funds

 Audrey Strauss, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced the arrests of VITALY FARGESEN and IGOR PALATNIK, and unsealing of an Indictment charging FARGESEN and PALATNIK with securities fraud, wire fraud and related offenses in connection with their fraudulent scheme to defraud investors in CanaFarma Corp. and later CanaFarma Hemp Products Corp. (together “CanaFarma”) by soliciting funds based upon false and misleading representations, failing to invest investor’s funds as promised, manipulating the public stock price of CanaFarma, and secretly misappropriating millions of dollars of CanaFarma funds.  The case is assigned to U.S. District Judge Loretta A. Preska. 

Manhattan U.S. Attorney Audrey Strauss said: “Vitaly Fargesen and Igor Palatnik presented themselves as entrepreneurs developing a new business for an emerging industry. But, as alleged, Fargesen and Palatnik were just using the trappings of a start-up to run an old-time scam: lying to investors to take money for themselves.”

F.B.I. Assistant Director-in-Charge Michael J. Driscoll said: “The defendants, as alleged, lured investors to CanaFarma by falsely representing the company’s financials, manipulating their stock price, and misappropriating millions for their personal benefit. Just as a reminder to anyone who thinks they can manipulate people’s investments in this way—that’s simply not the case.”

According to the allegations contained in the Indictment[1]:

From in or about March 2019 to in or about March 2020, CanaFarma was a privately-held Delaware corporation with offices in Manhattan, New York.  Beginning on or about March 19, 2020, CanaFarma was listed on the Canadian Stock Exchange and beginning on or about March 23, 2020, CanaFarma was listed on the Frankfurt Stock Exchange. CanaFarma marketed itself to the investors as a “fully integrated cannabis company addressing the entire cannabis spectrum from seed to delivery of consumer products.” FARGESEN and PALATNIK, who held themselves out as Senior Vice Presidents at CanaFarma, in fact exercised full control of CanaFarma,  The men hid their control from the investing public by, among things, convincing an experienced businessman to falsely present himself to the market as the CEO of the company.

Using their control of CanaFarma, FARGESEN and PALATNIK devised and carried out a scheme to defraud CanaFarma’s investors by soliciting more than $14 million in funds, including investments in private shares of CanaFarma, with false and misleading representations concerning the company’s management, products, and financials, failing to invest investor’s funds as promised, causing the manipulation of the public stock price of CanaFarma for the purposes of advancing the scheme to defraud investors and enriching themselves, and secretly misappropriating at least $4 million of CanaFarma funds for their own benefit. 

FARGESEN and PALATNIK effectuated the scheme by: (a) purchasing a Canadian shell company through a straw purchaser; (b) directing the reverse merger of the shell company and CanaFarma to exercise secret control of the resulting publicly traded company; (c) controlling CanaFarma through a nominal Chief Executive Officer who reported to FARGESEN and PALATNIK; (d) supporting CanaFarma’s stock price through manipulative trading; (e) attempting to artificially inflate CanaFarma’s reported revenue; and (f) making false statements to CanaFarma’s auditors. 

FARGESEN, 52, and PALATNIK, 47, both of New Jersey, are each charged with one count of conspiracy to commit securities fraud, which carries a maximum sentence of five years in prison, one count of securities fraud, which carries a maximum sentence of 20 years in prison, one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison, and one count of wire fraud, which carries a maximum sentence of 20 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Ms. Strauss praised the investigative work of the FBI and also thanked the Securities and Exchange Commission, which has filed a civil enforcement action against the defendants, for its assistance in the investigation.

The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation. 

Four Defendants Charged With COVID-19 Fraud Scheme

 

Defendants Charged With Abusing New York City’s COVID-19 Hotel Room Isolation Program by Falsely Claiming to be Healthcare Workers and by Selling Hotel Rooms to Ineligible Individuals, Defrauding the Government of $400,000

 Audrey Strauss, the United States Attorney for the Southern District of New York, Margaret Garnett, the Commissioner of the New York City Department of Investigation (“DOI”), and Jonathan Mellone, Special Agent-in-Charge of the New York Regional Office of the U.S. Department of Labor - Office of Inspector General (“DOL-OIG”), announced charges against CHANETTE LEWIS, TATIANA BENJAMIN, TATIANA DANIEL, and HEAVEN WEST for participating in a scheme that defrauded New York City’s COVID-19 Hotel Room Isolation Program of more than $400,000.  LEWIS was also charged with a second COVID‑19 scheme involving unemployment benefits fraud.  LEWIS and DANIEL were arrested today in New York and will be presented before Magistrate Judge Katharine H. Parker in Manhattan federal court.  WEST was arrested in Atlanta, Georgia, and will be presented before Magistrate Judge Catherine M. Salinas in the Northern District of Georgia.  BENJAMIN remains at large.

Manhattan U.S. Attorney Audrey Strauss said: “At the height of the COVID-19 pandemic in 2020, New York City designed a program to provide hotel rooms, free of cost, for qualifying individuals who could not safely self-isolate in their own homes, such as healthcare workers and individuals infected with COVID-19.  As alleged, the defendants abused this program by falsely claiming to be healthcare workers and by selling hotel rooms to non-qualifying individuals.  When, as alleged here, people illicitly exploit a public health crisis for private gain, they will find themselves facing criminal charges.”

DOI Commissioner Margaret Garnett said: “During the heart of the COVID-19 pandemic, while this City grappled with soaring transmission and death rates, these defendants exploited the very City-run program meant to provide respite and isolation to healthcare workers and City residents desperately trying to find space to quarantine and stem the spread of the virus, according to the charges. These defendants shamelessly posted their illegal conduct on social media and sold personal identification information of medical professionals to further their scheme, which siphoned more than $400,000 in hotel rooms paid for by the City and federal governments, according to the criminal complaint. DOI issued recommendations to the City Emergency Management to strengthen controls over this program, which has since ended, and thanks the agency for reporting this matter to DOI. I want to also thank our federal law enforcement partners at the Office of the U.S. Attorney for the Southern District of New York and the Office of Inspector General for the U.S. Department of Labor for working in partnership with us to uncover these charged COVID-19-related crimes and holding those involved accountable.”

DOL-OIG Special Agent-in-Charge Jonathan Mellone said: “The Unemployment Insurance Program exists to provide needed assistance to qualified individuals who are unemployed due to no fault of their own.  Fraud against the Unemployment Insurance Program distracts state workforce agencies from ensuring benefits go to individuals who are eligible to receive them.  The Office of Inspector General will continue to work closely with our many law enforcement partners, to investigate those who exploit the Unemployment Insurance Program.”

According to the allegations contained in the Complaint:[1]

In response to the COVID-19 pandemic, New York City created the COVID-19 Hotel Room Isolation Program (the “Program”).  Funded by New York City and the Federal Emergency Management Agency, the Program provided free hotel rooms for qualifying individuals throughout New York City.  The Program was open to: (1) healthcare workers who needed to isolate because of exposure to COVID-19; (2) patients who had tested positive for COVID-19; (3) individuals who believed, based on their symptoms, that they were infected with COVID-19; and (4) individuals who lived with someone who had COVID-19.  As stated on the City’s website describing the Program, such individuals “may qualify to self-isolate in a hotel, free of charge, for up to 14 days if you do not have a safe place to self-isolate.”  Those who wished to book a hotel room through the Program could either call a phone number or use an online hotel booking platform. 

The four defendants defrauded the Program in at least two respects.  First, they secured free Program hotel rooms for themselves by falsely claiming to be healthcare workers.  Second, they sold fraudulently obtained hotel rooms – including rooms located in Manhattan and the Bronx – to customers who were ineligible for the Program.  In total, the defendants collectively diverted more than 2,700 nights’ worth of hotel rooms through this scheme.  The defendants charged varying amounts depending on the duration of the customers’ hotel stay (e.g., $150 for one week, or $300 for two weeks).  Customers paid the defendants in cash and using electronic payment services.  The federal government and New York City paid more than approximately $400,000 for the hotel rooms that were fraudulently diverted as a result of the defendants’ scheme.

LEWIS worked at a call center (“Call Center-1”) that handled phone calls and certain reservations for the Program for several months in 2020.  LEWIS was hired specifically for the Program, and as a result of her employment, she had access to legitimate healthcare workers’ identifying information.  LEWIS abused her position, including by misappropriating healthcare workers’ identifying information, revealing the Program’s inner workings to co-conspirators, and making unauthorized sales of Program hotel rooms to ineligible individuals.  For instance, LEWIS sold BENJAMIN, for $800, personal identifying information of at least five healthcare professionals, as well as certain “codes” to use when booking hotel reservations through the Program, such as the employee ID number and license number.  LEWIS admitted, in Facebook messages, that she had stolen doctors’ identifying information in furtherance of the scheme, writing: “I work for 311 oem that how I got doctors licenses and stuff . . . I work in the part that I collect they information and I do and approval the booking . . . I take doctors and stuff certificate numbers and stuff.”  LEWIS also advertised to potential customers that, when hotels asked for a healthcare worker’s identification, LEWIS would supply a purported paystub and a letter asserting that the individual was (purportedly) a healthcare worker. 

All four defendants used Facebook to advertise the sale of fraudulently obtained Program hotel rooms; communicate with co-conspirators; and communicate directly with customers.  LEWIS worked directly with BENJAMIN and DANIEL, while WEST worked with, among others, DANIEL.  The defendants made various incriminating statements via Facebook, including the following statements: (1) LEWIS told one hotel customer, “I’m booking it as u a health care worker”; (2) BENJAMIN told a Facebook user, “Friend at 311 gave me the juice for the hotel so I been booking ppl rooms”; (3) DANIEL told LEWIS, “We gotta relocate that bitch they keep asking for employee ID”; and (4) when asked whether she had “rooms” available, WEST replied, “Nah I dead don’t bro / All essential hotels are clipped” and added: “They finding out we was scamming the system lol.”  All four defendants were paid by, among other means, Cash App, and their Cash App accounts revealed payments where the memo line said, for instance, “1 month telly”, “Hotel Manhattan 2 week extension for Kenny []”, “for the 2 week room”, “ayo telly”, “2 week stay in Manhattan”, “the room”, and “hotel for july 4-6”.

LEWIS is also charged with a second COVID-19 scheme involving unemployment benefits fraud.  LEWIS fraudulently obtained more than $45,000 in unemployment benefits by claiming falsely that she had not been employed since February 2020 due to a lack of work because of the COVID-19 pandemic.  In fact, LEWIS was employed for at least some of that period at Call Center-1, and LEWIS’s employment there ceased not because of the COVID-19 pandemic, but because LEWIS stopped showing up to work.

The Complaint contains five counts.  A chart containing the names, ages, residences, charges for each defendant, and maximum penalties, is set forth below.  The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.

Ms. Strauss praised the outstanding efforts of agents, investigators, and analysts from DOI, DOL-OIG, and the U.S. Attorney’s Office for the Southern District of New York.  Ms. Strauss also thanked the New York/New Jersey High Intensity Drug Trafficking Area (HIDTA) Intelligence Analysts for their support and assistance in this investigation.  She also expressed gratitude to the New York City Police Department, the New York State Department of Labor, and the DOL-OIG Atlanta Regional Office for their assistance.  She added that the investigation is continuing. 

The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

 

Defendant, Age, Hometown	Charges, Maximum Penalties
CHANETTE LEWIS, 30 Brooklyn, New York	Wire fraud: 20 years’ imprisonment Wire fraud conspiracy: 20 years’ imprisonment Honest services fraud: 20 years’ imprisonment Aggravated identity theft: mandatory minimum term of 2 years’ imprisonment, consecutive to any other term of imprisonment Theft of Government funds: 10 years’ imprisonment
TATIANA BENJAMIN, 26 Queens, New York	Wire fraud: 20 years’ imprisonment Wire fraud conspiracy: 20 years’ imprisonment Aggravated identity theft: mandatory minimum term of 2 years’ imprisonment, consecutive to any other term of imprisonment
TATIANA DANIEL, 27 Brooklyn, New York	Wire fraud: 20 years’ imprisonment Wire fraud conspiracy: 20 years’ imprisonment
HEAVEN WEST, 21 Brooklyn, New York	Wire fraud: 20 years’ imprisonment Wire fraud conspiracy: 20 years’ imprisonment

 

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.

BRONX MAN INDICTED FOR MANSLAUGHTER FOR DRIVING UNDER THE INFLUENCE AND COLLIDING INTO MTA BUS

 

Passenger in Defendant’s Car Was Killed in Crash

 Bronx District Attorney Darcel D. Clark today announced that a Bronx man has been indicted on Manslaughter, Vehicular Manslaughter and additional charges for rear-ending an MTA bus, killing a passenger in his own car. 

 District Attorney Clark said, “The defendant was allegedly under the influence and speeding when he slammed into an MTA bus, killing his front-seat 21-year-old passenger. The defendant’s reckless actions cut short the life of a young man. Thankfully, none of the passengers in the bus, which had just picked up riders, were seriously injured.” 

 District Attorney Clark said the defendant, Abraham Brown, 20, of 2562 Kingsland Avenue, was arraigned on October 4, 2021 on second-degree Manslaughter, second-degree Vehicular Manslaughter, Criminally Negligent Homicide, two counts of Operating a Motor Vehicle While Under the Influence of Alcohol, two counts of Operating a Motor Vehicle While Under the Influence of Alcohol or Drugs, and Reckless Driving before Bronx Supreme Court Justice Michael Gross. The defendant is due back in court on January 18, 2022.

 According to the investigation, at approximately 11:11 p.m. on February 13, 2021, the defendant was driving with front-seat passenger, Jermaine Paul, 21, on Bartow Avenue and Coop City Boulevard at 57 miles an hour instead of the 25 mile-per-hour speed limit. The defendant allegedly did not apply the brakes and rear-ended an MTA bus that had just picked up passengers at the time. Paul suffered multiple blunt injuries and was pronounced dead less than an hour after the incident at Jacobi Medical Center. Brown was allegedly driving while intoxicated and under the influence of marijuana.

 District Attorney Clark thanked Trial Preparation Assistant Jamece Hill of the Vehicular Crimes Unit, and NYPD Detective Randal McFarland of the Collision Investigation Squad for their assistance in the investigation.

An indictment is an accusatory instrument and not proof of a defendant’s guilt.

Governor Hochul Updates New Yorkers on State's Progress Combating COVID-19 - OCTOBER 5, 2021

 

46,455 Vaccine Doses Administered Over Last 24 Hours

38 COVID-19 Deaths Statewide Yesterday

Governor Kathy Hochul today updated New Yorkers on the state's progress combating COVID-19.  

"Our focus remains keeping kids in schools, returning people to work, and reopening New York safely," Governor Hochul said. "We all know the best way to ensure our continued progress is to get more shots in arms. If you are still unvaccinated you are far more vulnerable. I urge everyone who still needs their shot to get it as soon as possible because we cannot afford to take risks with all the progress we've achieved."

 

Today's data is summarized briefly below:

• Test Results Reported - 142,635
• Total Positive - 3,877
• Percent Positive - 2.72%
• 7-Day Average Percent Positive - 2.34%
• Patient Hospitalization - 2,231 (+23)
• Patients Newly Admitted - 246
• Patients in ICU - 519 (-10)
• Patients in ICU with Intubation - 288 (-12)
• Total Discharges - 201,994 (+187)
• New deaths reported by healthcare facilities through HERDS - 38
• Total deaths reported by healthcare facilities through HERDS - 44,703

The Health Electronic Response Data System is a NYS DOH data source that collects confirmed daily death data as reported by hospitals, nursing homes and adult care facilities only.

• Total deaths reported to and compiled by the CDC - 56,978

This daily COVID-19 provisional death certificate data reported by NYS DOH and NYC to the CDC includes those who died in any location, including hospitals, nursing homes, adult care facilities, at home, in hospice and other settings.

• Total vaccine doses administered - 25,567,201
• Total vaccine doses administered over past 24 hours - 46,455
• Total vaccine doses administered over past 7 days - 454,265
• Percent of New Yorkers ages 18 and older with at least one vaccine dose - 82.1%
• Percent of New Yorkers ages 18 and older with completed vaccine series - 74.1%
• Percent of New Yorkers ages 18 and older with at least one vaccine dose (CDC) - 84.8%
• Percent of New Yorkers ages 18 and older with completed vaccine series (CDC) - 76.0%
• Percent of all New Yorkers with at least one vaccine dose - 69.5%
• Percent of all New Yorkers with completed vaccine series - 62.6%
• Percent of all New Yorkers with at least one vaccine dose (CDC) - 71.9%
• Percent of all New Yorkers with completed vaccine series (CDC) - 64.2%

RECOVERY FOR ALL OF US: MAYOR DE BLASIO SIGNS LEGISLATION TO REQUIRE SEVERANCE PAY FOR HOTEL SERVICE EMPLOYEES

 

 Today, Mayor Bill de Blasio signed Intro. 2397-A, sponsored by Council Member Francisco Moya, into law. This legislation requires severance pay for hotel service employees if a hotel with over 100 rooms that laid off over 75% of its employees or closed during the pandemic fails to reopen by November 1^st, 2021. If a hotel does not reopen by November 1^st, the legislation requires the hotel to pay a weekly benefit of $500 per employee for a period of up to 30 weeks. 

“This legislation is about justice for working New Yorkers and giving our hotel workers their fair share,” said Mayor Bill de Blasio. “The tourism sector is critical to New York City, and having hotels reopen and employees back to work will supercharge our recovery.”

 

“The signing of this bill is another step forward towards a fair economic recovery from COVID, a pandemic that has hit hard the very communities that hotel workers represent. This legislation is not only providing our city’s greatest ambassadors with a much-needed economic lifeline, we are also protecting the livelihoods of families and revitalizing New York City’s hotel industry. We are already seeing the impact of this legislation with two major NYC hotels announcing they’re reopening, representing 1,000 jobs and counting. I look forward to seeing more hotels reopening, more people getting back to work, more tourism, and a better and stronger NYC. I thank the Mayor and my colleagues in the NYC Council for supporting this legislation and our city's hotel workers,” said Council Member Francisco Moya. 

 

“It’s not often you see legislation have such a clear and immediate positive impact, but today is one of those days. By encouraging hotels to reopen and recall their workers, this bill will give thousands of jobless New Yorkers the hope and financial security they so desperately need.  Major hotels have already announced their reopening and started calling workers back to their jobs thanks to this legislation. We thank Mayor de Blasio for signing it into law and Council Member Moya for leading the charge,” said Rich Maroko, President of the NY Hotel Trades Council (HTC).

 

88 Days and Counting

 

Ever since I visited Rikers Island those pesky reporters have stopped asking me when I am going to visit that hell hole. Now they question my figures on school staff vaccination figures. The New York City public school system is one of if not the safest place for your children, or my name isn't Bill de Blasio.

We are restoring a historic Chinatown building and requiring severance pay for hotel service employees. What's that, the feds went after Sergeants Benevolent Association President Ed Mullins Long Island Home and the police unions Manhattan headquarters. No I have no comment, thank you, no more questions.

Leader Of Cellphone Account Takeover Fraud Scheme Pleads Guilty

 

Defendant Impersonated Legitimate Account holders and Charged Over Half a Million Dollars’ Worth of Devices to Victim Accounts

 Audrey Strauss, the United States Attorney for the Southern District of New York, announced that defendant HENRY PEREZ pled guilty today to leading a multi-year cellphone account takeover fraud conspiracy.  PEREZ impersonated legitimate cellphone accountholders in order to fraudulently obtain smartphones and electronic devices that he charged to compromised accounts.  The fraud scheme also caused more than 300 victims across the United States to lose cellphone service for a period of time.  PEREZ pled guilty before U.S. District Judge Richard M. Berman, to whom the case is assigned.

Manhattan U.S. Attorney Audrey Strauss said: “As he admitted today, Henry Perez led a sophisticated fraud scheme that impersonated victims, changed victims’ account information so victims would not receive fraud alerts, charged purchases to victims’ accounts, and deprived victims of cellphone service.  Thanks to the dedicated work of our partners at Homeland Security, Perez stands convicted of this cellphone fraud scheme and now awaits sentencing for his crime.”

According to the allegations in the Indictment, public court filings, and statements made in court:

From June 2017 through December 2019, PEREZ was the leader of a criminal fraud ring that committed cellphone account takeover fraud and identity theft across the United States, including in the Southern District of New York.  The scheme’s primary objective was to obtain new, valuable electronic devices, including iPhones, and charge these purchases to victims’ accounts, without the knowledge or consent of the victim accountholders.  Over the course of the conspiracy, participants in the scheme attempted to fraudulently obtain more than $1 million worth of devices and, in fact, fraudulently obtained more than $530,000 worth of devices (e.g., iPhones, iPads, and AirPods), by charging purchases to victims’ accounts.

To conduct the scheme, members of the conspiracy, including PEREZ, used stolen identity information to impersonate victims who had cellphone accounts with a particular cellphone service provider (“Provider-1”).  Members of the conspiracy then called customer service representatives of Provider-1 and used social engineering techniques to take over accounts by making various misrepresentations, including impersonating accountholders and expressing a purported need to regain access to their accounts.  Through these misrepresentations, conspirators were able to gain unauthorized access to, and control of, accounts belonging to victim accountholders.  Once they gained access, members of the conspiracy made various unauthorized changes to victim accounts, so that fraud alerts and emails relating to account changes were sent to a conspiracy member, rather than to the legitimate accountholders.  Participants in the conspiracy then purchased new electronic devices, which they charged to victim accounts, without the knowledge or consent of the victims. 

In many instances, conspirators arranged for the fraudulently ordered devices to be shipped to addresses under their control.  In other instances, members of the scheme, including PEREZ, personally entered stores operated by Provider-1 to pick up fraudulently obtained devices.  In total, participants in the conspiracy conducted in-store pickups of fraudulently obtained devices in at least 10 different states.

Once they had successfully exploited a particular victim’s account, members of the conspiracy typically relinquished control of that account, and moved on to exploiting other victim accounts.  During the period in which the conspiracy compromised, and retained control of, a particular victim’s cellphone account, that victim typically lost cellphone service.  In total, the scheme caused more than 300 victims across the United States to lose cellphone service for a period of time.

PEREZ was integrally involved in all aspects of the scheme, including using victims’ personal identifying information to dupe Provider-1; gaining unauthorized access to victim accounts; making unauthorized changes to victim accounts; receiving fraudulently obtained devices; and recruiting, directing, and paying a subordinate, including supplying that subordinate with victim information.

PEREZ, 33, of Fort Lee, New Jersey, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison.  The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. 

PEREZ is scheduled to be sentenced by Judge Berman on January 18, 2022, at 10:00 a.m.  Under the terms of his plea agreement, PEREZ also agreed to pay restitution of $539,654.96 and forfeiture of $532,374.96.

Ms. Strauss praised the New York Office of Homeland Security Investigations (“HSI”) and its El Dorado Task Force for its outstanding work on this case.