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This is my 21st post in the Divorce & Hidden Money series.  It is also the 8th post in my series describing what private investigators can and cannot do legally when searching for hidden assets.  My July 13th post mentioned private investigators & their clients using law enforcement databases and illegal pretext calls to search for assets.  As a practicing attorney, I am aware of another kind of asset search which would be illegal & this post describes it.  The post provides a hypothetical account which discusses a divorcing wife who hired a private investigator.  The private investigator in this hypothetical account, illegally obtains bank account information from an insider—a teller at a bank located in Nevada.

THE DIVORCING WIFE IN NEW JERSEY

Even though Ralph was a medical doctor with a thriving private practice, Ralph claimed in his New Jersey divorce that he had a low net worth.  Ralph’s divorcing wife Nancy suspected Ralph had hidden money in anticipation of the divorce.  Nancy gathered documents she obtained during the pretrial discovery phase of the divorce and before.

These documents included copies of Ralph’s: passport, statements for airline frequent flyer miles, phone bills, tax filings and additional financial records.  Nancy gave the documents to Mike, the licensed private investigator Nancy retained to perform an asset search regarding Ralph.  After conducting an investigation for more than a month, Mike told Nancy that Ralph hid monies at offshore banks and at a bank in Nevada.

THE SEARCH FOR SECRET BANK ACCOUNTS

Mike stated that Ralph secretly maintained about $2.5 million dollars in the offshore bank accounts which were located in high-risk geographical locations known for money laundering.  Ralph had supposedly hidden another $85,000 dollars in the secret bank account in Nevada.  Mike explained to Nancy that he could collect evidence regarding the secret bank accounts by conducting searches at the Nevada and the offshore banks.

Nancy paid Mike over $10,000 dollars for the bank account searches and Mike provided Nancy with an investigative report summarizing his search results.  The report named the offshore banks and the Nevada bank Ralph supposedly used to hide his money.  It supplied the purported secret bank account numbers; account balances and detailed the bank signatory information.

The report meanwhile, never explained the source of Mike’s information/how Mike detected Ralph’s supposed secret bank accounts.  When Nancy asked Mike how he had obtained the information at the report, Mike said the report was completely reliable.  A trusted colleague supplied Ralph’s offshore bank account information, Mike said.  Mike also explained he obtained Ralph’s Nevada bank account information from an “insider”, a teller who worked for the Nevada bank.  According to Mike, the insider used the bank’s computer system to sneak a peek at Ralph’s $85,000 dollar bank account.

THE U.S. CRIMINAL LAW VIOLATION IN NEVADA

Assuming that Mike’s representations to Nancy were true, then the bank teller and Mike could have violated privacy and other U.S. laws.  The two may have conspired to access Ralph’s Nevada bank account information in violation of  18 U.S.C. §1030  (Fraud and related activity in connection with computers).  Another type of case involving an insider at a bank was U.S.A. v. Feliciano, 2:09−cr−00197−NS.  The March 2009 indictment filed in Feliciano, alleged that a bank teller had stolen confidential customer information as part of a bank fraud/identity theft scheme.

First Image: Patrick Brassat/Shutterstock.com

Second image courtesy of Flickr (Licensed) by Tsahi Levent-Levi

Copyright 2015 Fred L. Abrams

This post describes a case in which illicit drug monies were concealed offshore and laundered via a Cayman Island bank account.  The case is also about tax fraud; identity theft and a murder.   I published the post earlier at the Asset Search Blog and have used the post as a handout at many of my speaking engagements.  It is an example of how financial fraudsters can operate.  Some of the facts below have been changed/sanitized for privacy reasons.  The following occurred over a four month period during 2002:

TAX FRAUD

As part of his tax fraud, “Mr. Wallace” contacted a Cayman Island bank by mail in order to open a personal account with it.  He mailed account opening documents to it which included a copy of his U.S. passport and also supplied the names of references. According to these documents, Mr. Wallace lived in Miami and was a real estate developer.  Based upon all of the foregoing, the Cayman Island bank opened Mr. Wallace’s personal account with a “O” balance.  Just six days later however, bank “X” in Panama wired $6.3 million to Mr. Wallace’s Cayman account without any mention of the remitter.

Mr. Wallace then went on a business trip to Central America for several months; so he rented his Miami home to “Chuck”.  Although Mr. Wallace hadn’t known at the time, Chuck was a small-time crook.  In fact, soon after Chuck took possession of Mr. Wallace’s home, Chuck started stealing Mr. Wallace’s mail.  One of the letters Chuck had stolen was written by “Bob”, a personal banker from the Cayman Island bank where Mr. Wallace maintained his account.  Bob had written to Mr. Wallace about a lucrative investment opportunity.

THE IDENTITY THEFT & MURDER

Surmising from Bob’s letter that Mr. Wallace had a sizable bank account, Chuck wrote to Bob pretending to be Mr. Wallace.  As the sanitized copy of Chuck’s First Letter partly demonstrates, Chuck had assumed Mr. Wallace’s identity in that particular letter by forging Mr. Wallace’s signature.  To comfort Bob, Chuck’s First Letter had also asked Bob for the minimum balance required to keep Mr. Wallace’s account open. Chuck’s “softening up” letter further suggested to Bob that Mr. Wallace’s funds might soon be needed “at very short notice” for an alleged real estate deal in Mexico.  In the sanitized copy of Chuck’s Second Letter, Chuck again pretended to be Mr. Wallace as he wrote to Bob at the Cayman Island bank.  In his Second Letter, Chuck directed the wire transfer of Mr. Wallace’s funds from the Cayman Island bank to Chuck’s own bank account in Mexico. Continue Reading A Case of Tax Fraud, Identity Theft & Murder

The criminal complaint filed in U.S.A. v. Brandon Lee Price, U.S. District Court, Western District of Pennsylvania, Case No. 12-152 M, essentially claims that Microsoft billionaire Paul Allen was the target of an identity theft.  As reported at “Identity Thief Targets Billionaire Allen”, suspected identity thief Brandon Lee Price of Pittsburgh supposedly tried to illegally transfer $15,000 from Mr. Allen’s Citibank account.

“Identity Thief Targets Billionaire Allen” raises the question of how identity thefts are carried out.  It observes that identity thieves might obtain a bank customer’s account information from the trash.  Armed with this type of information, the thieves then attempt to impersonate the bank customer and illegally access bank accounts.  The article indicates these thieves can employ spyware and computer hacking to steal personal information.  This kind of hacking was utilized by identity thief Albert Gonzalez, who was accused of stealing 130 million credit / debit cards by fraudulently accessing computers at Heartland Payment Systems.

Some bank tellers, medical office staff, etc., too illegally provide identity thieves with a prospective victim’s personal identifying information like social security numbers and dates of birth.  Determined identity thieves also carry out their crimes through forged documents, pretext calls, mail intercepts or by obtaining a corporate director’s personal information from public registries.

The following Asset Search Blog articles describe methods identity thieves employ:

  1. A Tax Fraud & Identity Theft From Miami
  2. Identity Theft & An Impersonator On The Phone
  3. Committing Bank Fraud Through Identity Thefts
  4. Concealing Cash By Laundering In Lithuania
  5. Pretexting During An Asset Search

Copyright 2012 Fred L. Abrams

 

The following fact pattern has been changed for privacy reasons:

Robert received dunning letters and phone calls from debt collectors because he supposedly owed more than $50,000 dollars in credit card debt.  The debt collectors alleged that various financial institutions had issued Robert seven credit cards many years ago.  These debt collectors too claimed that Robert paid just the monthly minimum on the credit cards for several years, until his recent default.

When Robert tried explaining he had no knowledge of the credit cards, the debt collectors & financial institutions ignored him.  Although Robert had been the victim of an identity theft, the financial institutions damaged Robert’s good credit score by submitting negative references about the alleged debt to TransUnion, Experian and Equifax.  Despite all of the foregoing, Robert ultimately had his good credit score restored and the financial institutions relinquished their claims against him.  This partly occurred because Robert followed the advice of the Federal Trade Commission at its “Tools For Victims” identity theft webpage.

Robert had also hired an attorney who conducted a fraud investigation.  The attorney wrote letters to the financial institutions demanding the production of “account opening” and other relevant credit card documents.  A financial institution responding to these letters supplied a telemarketing application connected to Robert’s case.  The telemarketing application suggested that the identity thief applied for one of the seven credit cards by impersonating Robert on the phone.  As a highlighted and redacted copy of this application shows, the identity thief might have also used a post office box to aid the scheme-

Click On The Telemarketing Application For Full View

Copyright 2011 Fred L. Abrams

Secreting Assets Without A Border Trace” shows the role portable valuable commodities like diamonds can have in a scheme to hide assets.  This January 4th “Asset Search News Roundup” reviews two more ways assets can be hidden.

Bulk Cash Smuggling

A December 16th press release refers to one case now being prosecuted which allegedly involved bulk cash smuggling and other crimes.  In these situations, currency or monetary instruments are physically transported / concealed in what is often a money laundering scheme.  An earlier “Asset Search Blog” article that discusses bulk cash smuggling in detail is “A Doctor, A Lawyer & Bricks Of Cash In Switzerland“.

Checks & Wire Transfers

Assets are also routinely hidden through the misuse of checks and / or wire transfers.  The article “A Tax Fraud & Identity Theft From Miami” for example, mentions a drug trafficker named Mr. Wallace.  Mr. Wallace had concealed $6.3 million dollars by wire transferring it from Panama to his Cayman Island bank account.

Nearly all of this $6.3 million was next stolen by Chuck who had forged letters to gain access to Mr. Wallace’s Cayman Island bank account.  Chuck specifically did this by impersonating Mr. Wallace in two letters he sent to the Cayman Island bank.  One of these letters redacted below, partly reveals that Chuck drained Mr. Wallace’s bank account by directing a wire transfer to Mexico:


(To Read The Letter Click On It)

Copyright 2011 Fred L. Abrams

$20 million airline-ticket fraud aided by hotel workers, prosecutors say” mentioned that suspected identity thieves and their supposed co-conspirators were indicted for allegedly using stolen credit card information to purchase airline tickets. These tickets are believed to have been sold on the U.S. black market at steep discounts to airline passengers.

A July 9th press release describing the indictments quoted a U.S. prosecutor as saying: ‘What began as a local law enforcement investigation ultimately exposed an extensive nationwide black market for airline tickets.‘ The U.S. black market is of course not the only way airline passengers might acquire tickets connected to alleged credit card frauds.

Jamaican authorities for example, are investigating Montego Bay, Jamaica resident Andrew Hemmings, about his possible acquisition of Spirit Airlines’ tickets during a suspected credit card fraud. To obtain evidence about this alleged fraud originating in Jamaica, Jamaican authorities issued the following legal assistance request / letter rogatory:

(Click On The Legal Assistance Request To Read It)

Copyright 2010 Fred L. Abrams

The "Asset Search News Roundup: January 26, 2009 " mentioned that Heartland Payment Systems was subjected to what might have been the biggest credit / debit card information theft in the U.S.  Mr. Albert Gonzalez was ultimately indicted for that privacy law violation / computer intrusion and other ones.  In fact, Mr. Gonzalez pleaded guilty to criminal charges respectively brought in New Jersey, New York and Massachusetts. 

As "Using Foreign Computer Evidence Against An Accused Hacker" indicated, Mr. Gonzalez had initially been accused of using multiple jurisdictions / cross-border elements to facilitate computer hacking, identity theft and money laundering.  A December 29th Department of Justice press release also apparently indicated that Mr. Gonzalez had used cross-border elements to commit his crimes. 

According to the December 29th press release, Mr. Gonzalez was an "international hacker" convicted because of "coordination across….geographical lines".  Page 7 paragraph (1) (c) of a November 20, 2009 plea agreement additionally suggests that Mr. Gonzalez used cross-border elements in his crimes.  It stated that he had leased or controlled computer servers in Latvia and Ukraine:

  (To Read The Plea Agreement, Click On It)

 

Copyright 2010 Fred L. Abrams

An August 25 Newsweek article mentioned that Federal Reserve Chairman Ben Bernanke had fallen prey to identity thieves after Mr. Bernanke’s wife had her purse stolen.  One of the people believed to have been responsible for that identity theft is Clyde Austin Gray, Jr.  Mr. Gray had conspired to commit identity theft nationwide, according to the single-count criminal information in U.S.A. v. Gray, Index No. l:09-CR-00326.  A July 22, 2009 factual statement shows that Mr. Gray was a ringleader who had stolen over 2.1 million dollars from at least ten financial institutions such as SunTrust Bank of Atlanta and M & T Trust in Buffalo.

He and other identity thieves had acquired bank account numbers, credit cards, driver’s licenses and other identifying information through pick pocketing, mail theft, the use of “insiders” at professional offices, etc.  The August 25th Newsweek article additionally mentioned that Mr. Gray pleaded guilty in July to conspiracy to commit bank fraud (18 U.S.C. §1349).  The Newsweek article also observed that identity thieves can victimize both the “mighty and powerful” and “hapless consumers”.

In a completely different identity theft case I have written about, a major illegal narcotics trafficker lost the $6.3 million he had hidden in a Cayman Island bank account.  As set forth in “A Tax Fraud & Identity Theft From Miami“, that trafficker’s $6.3 million was transferred by an identity thief from the Cayman Island bank account to Mexico.  The identity thief had accomplished this transfer by impersonating the trafficker in two letters to the Cayman Island bank.

The trafficker however, soon learned that he had lost his millions because of the identity thief’s letters and then killed the identity thief.  Sanitized copies of these letters used by the identity thief to impersonate the trafficker, are reproduced below:

Click On The Above Letters For A Better View

Copyright 2009 Fred L. Abrams

Albert Gonzalez was arrested in the Southern District of Florida on May 8, 2008 pursuant to this warrant:

Click On The Arrest Warrant To Enlarge It

The arrest arose out of Mr. Gonzalez’s alleged computer hacking / identity theft scheme which was later outlined in a May 14, 2008 New York superseding indictment.  This superseding indictment in U.S.A. v. Yastremskiy, et. al., 08-cr-00160, claimed that Mr. Gonzalez and his co-defendants had stolen credit card information through computer intrusions at Dave & Busters, Inc. restaurants.  Mr. Gonzalez and / or his co-defendants were accused of violating federal laws including but not limited to: conspiracy (18 U.S.C. §371); fraud related to computers (18 U.S.C. §1030); wire fraud (18 U.S.C. §1343 ); access device fraud (18 U.S.C. §1029); aggravated identity theft (18 U.S.C. §1028A); etc.

Almost three months after the superseding indictment was filed against him in New York, Mr. Gonzalez was next indicted in Massachusetts.  According to the August 5, 2008 Massachusetts indictment in U.S.A. v. Albert Gonzalez, 08-cr-10233, Mr. Gonzalez had hacked computers which stored credit card information for BJ’s Wholesale Club, DSW, OfficeMax, Boston Market and others.

Like the New York superseding indictment, the Massachusetts indictment accused Mr. Gonzalez of: conspiracy (18 U.S.C. §371); fraud related to computers (18 U.S.C. §1030); wire fraud (18 U.S.C. §1343 ); access device fraud (18 U.S.C.§1029); and aggravated identity theft (18 U.S.C. §1028A).  The Massachusetts indictment also essentially asserted that Mr. Gonzalez had hidden the proceeds of his hacking / identity theft scheme by money laundering through multiple jurisdictions.

Continue Reading Using Foreign Computer Evidence Against An Accused Hacker

Identity theft can play a role in white-collar crimes ranging from money laundering to tax fraud.  Perhaps most interesting are the schemes which share identity theft and money laundering as common elements, like the one mentioned at "A Tax Fraud & Identity Theft From Miami".  Identity theft and money laundering are similarly alleged to have occurred in the case of U.S.A. v. Renee Gill Pratt, et. al. Criminal No. 2:08-cr-00140. 

The May 22, 2009 superseding indictment in Pratt, alleges that former Louisiana state representative and New Orleans city councilwoman Renee Gill Pratt participated in a RICO criminal enterprise which misappropriated government funds and concealed assets.  Said superceding indictment contains a total of thirty-four counts alleging money laundering, aggravated identity theft and other crimes, as mentioned by an FBI press release.

Identity theft is of course, not just limited to cases involving money laundering.  In U.S.A. vs. Torrella et. al. 3:07-cr-05775 for example, data brokers Emilio and Brandy Torrella pleaded guilty on May 20, 2008 to violating 18 U.S.C. §1028A (aggravated identity theft), among other things.  As my post "Pretexting During An Asset Search" explained, the Torrellas were accused with private detectives, of illegally obtaining confidential information from the I.R.S., Social Security Administration, pharmacies, medical offices and various state labor departments. 

The Torrellas had violated people’s privacy rights and committed aggravated identity theft by making pretext calls, (i.e. eliciting information by using false identities / false pretenses in telephone calls).  They are now scheduled for sentencing before the Court on July 10, 2009. 

    

Copyright 2009 Fred L. Abrams