Feds Charge 3 in Massive Credit Fraud Scheme


NEW YORK (CNN) -- Three men have been charged with selling people's personal and credit information to criminals who defrauded tens of thousands in what prosecutors called the largest identity theft case to date.

"We know of approximately 30,000 victims -- and the numbers are growing every day -- and of losses that are in the millions and growing every day," U.S. Attorney James Comey said. "In short, with a few keystrokes, these men picked the pockets of tens of thousands of Americans, and in the process, took their identity, stole their money and swiped their security."

Philip Cummings, 33, worked as a help desk employee at Teledata Communications Inc. in Bay Shore, New York. The company provides the software and the hardware allowing banks and other lending agencies to get commercial credit information from three national agencies -- Equifax, TransUnion and Experian.

Cummings is accused of using his position on the company's customer service desk to obtain access codes that companies use to check a potential buyer's credit with the three major credit agencies.

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With a few keystrokes, these men picked the
pockets of tens of thousands of Americans.
-- U.S. Attorney James Comey
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Prosecutors said Cummings and a co-conspirator who is now cooperating with investigators sold the reports to criminals for $60 apiece and split the money. The buyers then used the information in those reports to defraud consumers of $2.7 million known so far.

FBI Special Agent Kevin Donovan said investigators believe the probe has turned up the largest known case of identity theft.

"We're still continuing to focus on the number of victims to focus on the losses," he said. "As we continue to conduct our investigation, we'll determine how extensive the case is at the present."

Greed led to downfall of ring, U.S. Attorney says

U.S. Attorney James Comey, center, announces the arrests in an identity theft investigation.

Authorities said Cummings and Linus Baptiste, 43, conspired to download and sell individual credit reports to street criminals in the New York area for about $60 each. Baptiste was arrested in October on wire fraud charges, while Cummings turned himself in Monday morning on wire fraud and conspiracy charges, Comey said.

A third man -- Hakeem Mohammad, 37 -- has been charged with defrauding several victims. He was arrested over the summer and pleaded guilty in to mail fraud and conspiracy charges in October, Comey said.

As a result, "Bank accounts of victims were depleted. Addresses were changed on accounts. New checks were ordered. New ATM cards were ordered. New credit cards were ordered. New lines of credit were opened and quickly drained," he said.

The ring was broken because the men "got greedy," Comey said. Repeated downloads of data -- 15,000 times in one case, in the name of Ford Motor Credit Corp. -- sent up red flags at the credit reporting agencies.

"The credit agencies knew somebody out there was doing this, and that it was only a matter of time before they were caught if they kept doing it," he said. "And they did exactly that."

Donovan recommended that consumers check credit reports yearly for "unusual" inquiries, bank transactions or credit accounts. Anyone who hasn't received a bank or credit card statement recently should call those companies, he said.

The scheme gave access to Social Security numbers that can be used to obtain false documents, but Comey said prosecutors have no reason to believe the ring was connected to terrorist activity.

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