Feds bust identity theft ring

December 9, 2008

By Jim Feehan

Ringleader used Newcastle p.o. box for fraud

A Renton man using a Newcastle address was the ringleader behind an identity theft ring that sold computers bought with credit cards stolen from gym locker rooms in Washington, Oregon, Colorado and Georgia, federal prosecutors said in charging documents. 

Gabriel Jang, 36, along with an associate, Billy Britt, 35, of Seattle, were charged last month in U.S. District Court on charges of wire fraud and aggravated identity theft.

Wire fraud is punishable by up to 20 years in prison and a $25,000 fine. Aggravated identity theft is punishable by a mandatory minimum two years in prison to run consecutive to the sentence imposed on any other conviction.

Investigators allege Jang took in more than $3 million since 2001 by selling merchandise on the Internet auction site eBay. Jang used an e-mail address registered to a business with a Newcastle post office box number to communicate with customers and co-conspirators, according to a 40-page federal complaint. Prosecutors said Jang had associates who would steal credit cards from gym locker rooms. 

The suspects then altered the cards and made fake identification cards.

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.”

Many of those items were posted for sale on eBay within days of the cards being stolen, detectives said.

Thousands of people who bought electronics from Jang’s company, Nexus Systems Inc., have been notified that they will have to return their purchases. 

In the meantime, a Best Buy store investigator had become suspicious of a 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.

A Seattle police detective, assigned to a 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 police after learning that the rewards card had been presented when the stolen cards were used at a Best Buy store.

The detective 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.

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

In January 2002, Jang was arrested in Colorado and found in possession of two Sears gift cards purchased in Colorado Springs using a stolen Visa credit card. On Feb. 24, 2003, Jang pleaded guilty to possession of stolen property in King County Superior Court. He was sentenced to 20 days community service and 12 months of probation.

Jang and Britt had a preliminary hearing scheduled for Dec. 4 in U.S. District Court.


One Response to “Feds bust identity theft ring”

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