Fifty-four fraudsters were arrested for their role in an identity theft ring responsible for $4 million in fraud losses while the ring leader plead guilty to five different charges on January 9th. Sang-Hyun Park, a 45 year old immigrant from South Korea, plead guilty to: aggravated identity theft; money laundering; conspiracy to commit wire fraud affecting financial institutions and bank fraud; conspiracy to unlawfully produce identification documents and false identification documents; and conspiracy to defraud the IRS. Although he won’t be sentenced until April, Park may face more than $2 million in fines and a prison sentence up to 12 years under the terms of his plea agreement.
Park was the ring leader in an intricate scam where he and other members bought Social Security cards stolen from Asian immigrants working in U.S. territories such as Guam and American Samoa. Park then resold the Social Security cards to immigrants in America so they could apply for driver’s licenses and build credit with their fraudulent identities. The fraud ring helped their customers apply for driver’s licenses in California, Illinois and other states Park determined were easiest for obtaining the bogus ID cards. Now the customer had an identity, the next step was to establish credit. This was done by adding the names of fraud ring members with strong credit scores to accounts opened with the fake identities. After a short time the false identities established enough credit to begin the bust-out attack.
To monetize the fraudulent credit accounts opened with fake identities ring members purchased luxury goods to be resold and processed payments through shell companies until credit limits were reached. To extend the life of a fraudulent identity and line of credit fraud ring members would mail in a check for the full payment, but the check would draw from an empty account. In many instances the bank trusted that the check would go through enabling the fraudsters to start using the line of credit again.
Park employed many other people to help in his fraud ring including those who sold identity documents in the black market and some who worked to increase the credit scores and limits for the fraud ring’s customers. He even took out space in Korean-language newspapers to advertise the fact he was selling U.S. identity documents. In addition to the $4 million Park defrauded from financial institutions, credit card companies and others from his scam, his fraud ring was also responsible for over $182,000 in stolen tax refunds after filing for fictitious tax returns using the false identity documents. The fraud ring was first uncovered in May 2008, an investigation then began which ultimately led to the 54 arrests, including Park, in September of 2010.
For More Information: Palisades Park man admits running ID-theft and bank-fraud ring that netted $4 million