Fraud Related Offenses

March 28, 2013

Understanding Official Misconduct & Obstructing Governmental Administration with a “Brady” Twist: NY Penal Law Sections 195.00 & 195.05

Being charged with and arrested for any misdemeanor crime in New York is no walk in the park. A New York criminal defense attorney need not advise you of this obvious fact. The reality is, any accusation has significant and collateral consequences. When the crimes involve some alleged form of fraud or dishonesty involving the government, the offense looks even uglier. Two crimes that fit in this mold are Official Misconduct, New York Penal Law 195.00 and Obstructing Governmental Administration in the Second Degree, New York Penal Law 195.05. As ugly as the crimes may be, however, an arrest for either PL 195.00 or PL 195.05 does not equate to guilt beyond a reasonable doubt.

Although I have blogged and drafted materials on both of these crimes, before addressing a recent court decision it is worth briefly explaining the parameters and definitions of these offenses. To be guilty of Official Misconduct pursuant to NY PL 195.00, one first must be a public servant. Further, one must have the intent to obtain a benefit or deprive another person of a benefit. In addition to these elements, as charged in the case discussed below and according to subsection two of this crime, one must knowingly refrain from performing a duty that one is imposed by law or clearly inherent in the nature of one’s office.

March 23, 2013

NYC ID Theft Ring Bust: Manhattan DA Charges Four in Fraudulent Debit Card Scheme – Over $200,00 & 100s of Debit Cards Recovered

by Jeremy Saland

The extent and amount of fraud that is perpetrated by Identity Theft is staggering. As a prosecutor in the Manhattan District Attorney’s Office who spearheaded many multi-million dollar Identity Theft, Forgery and Criminal Possession of a Forged Instrument investigations, arrests and indictments, I have certainly dealt with the underbelly of these financial crimes. As a New York criminal defense lawyer and IdentityTheft defense attorney, I have also represented numerous individuals accused of the same allegations that I prosecuted for years. While I have yet to be shocked by the means in which these crimes are committed or the extent of the alleged criminal networks involved, it seems clear to me that Identity Theft will be the central or greatest crime of our generation.

Along these lines, according to New York City newspapers, the NYPD has arrested four men in another alleged large scale Identity Theft ring. It is alleged that at least four Los Angeles and Las Vegas men (Garegin Spartalyan, Aram Martirosian, Hayk Dzhandzhapanyan and David Kudugulyan) and possible other accomplices, stole hundreds of thousands of dollars from Manhattan banks by utilizing bogus or fraudulent credit cards to withdraw money and cash. More specifically, its is claimed by the NYPD that the accused were caught after one or more of the men attempted to withdraw money from “flagged” bank accounts. Further, upon investigation and the execution of search warrants, $198,000 in money orders as well as $16,000 in cash with 200 fake credit cards were recovered from a hotel room. This was on top of the $5,000 and 92 debit cards and $16,000 and 82 debit cards allegedly recovered from two of the defendants.

December 30, 2012

Stealing the Identity of a Non-Existant Person in New York: Understanding New York’s Identity Theft Statute (NY PL Article 190)

by Jeremy Saland

If not the fastest growing crime, Identity Theft is exploding in New York at a pace that is equal to or greater than almost all other offenses. As a former Manhattan prosecutor who was one of the original members of the first Identity Theft Unit and as a New York criminal lawyer who represents clients accused of New York Penal Law sections 190.78, 190.79 and 190.80, prosecutors are becoming as creative in investigating New York Identity Theft crimes as the accused are alleged to perpetrate the offenses.

As an Assistant District Attorney, I spearheaded an investigation into a large scale Identity Theft ring that involved individuals giving others permission to “steal” their identities for the benefit of third parties. An interesting theory not clearly addressed in the New York Penal Law, the defense attorneys who represented the accused did not challenge the indictment on the grounds that the evidence did not support Identity Theft in the First Degree. Years later, a similar, yet different, issue is now before the court. That is, can you steal the identity of a person who does not exist? People v. Debranche, 2012 NY Slip Op 22359, Criminal Court of the City of New York, New York County, attempts to answer this question.

January 31, 2012

NY DMV Clerk Arrested For Fraudulently Issuing Drivers Licenses to Individuals Including Convicted Felon

by Jeremy Saland

It is almost as if he is shooting fish in a barrel. Manhattan District Attorney, Cyrus Vance, Jr., has made another big splash announcing the arrest and indictment of a New York State Department of Motor Vehicle’s (“DMV”) clerk who is alleged to have unlawfully processed at least three drivers license applications. It is claimed by prosecutors, who are understandably concerned about this type of conduct, that one of the individuals who fraudulently obtained a license had previously been convicted of a felony and deported from the United States. Clarence Jenkins, the DMV clerk indicted for the alleged scheme, is charged with three counts each of Criminal Possession of a Forged Instrument in the Second Degree, a class D felony, Issuing a False Certificate, a class E felony, and Official Misconduct, a class A misdemeanor. If convicted, the accused faces up to seven, four and one year in custody on each respective offense.

In acknowledging the danger of illegally issuing New York State drivers licenses to those who are not entitled to them, DA Vance stated “… [Jenkins] may have jeopardized public safety.” Whether as a New York criminal lawyer I agree with the prosecution’s ultimate determination as to how to handle the case and seek a potential plea or sentence, DA Vance is certainly correct in his assertion. Unlike a minor attempting to get a license for the purpose of going to a bar or purchasing alcohol, fraud such as that alleged here has the potential for grave danger. Fortunately, it does not appear from the press release that this is the case.

December 16, 2011

DA Vance: Multiple New York Identity Theft Crews Defraud UJA Federation Donors & Others

by Jeremy Saland

Stealing more than mere shekels, multiple alleged Identity Theft and check fraud rings pilfered $2 million from high worth individuals including the accounts of UJA-Federation donors. Although Hank Greenberg may not have noticed a few thousand dollars here or there, the alleged fraudsters are getting more than an “Oy Vey” from Manhattan District Attorney Cyrus Vance, Jr. for their alleged identity thieving. In fact, some of the nearly sixty defendants arrested or accused of various crimes are facing charges including Grand Larceny in the First Degree, a “B” felony punishable by a mandatory minimum of one to three years in prison. The maximum for this crime is eight and one third to twenty five years, but these numbers are all skewed should any of these men or women have prior felony records from the past ten years. While alleged gang association does not necessarily mean a criminal past, prosecutors further claim the many of those arrested in New York were members of the Bloods and Crips.

According to the New York County press release as well as numerous media outlets, the scheme (like many involving Identity Theft) was fairly east to perpetrate. For Example, Tracy Nelson, an employee of the UJA Federation, processed donor checks. This access to sensitive and financial information gave her the opportunity to allegedly take pictures and copy account information of donor checks. It is further claimed by DANY prosecutors that Nelson then sold the copies to other thieves who would open fraudulent checking accounts or credit cards with this information.

December 7, 2011

Manhattan DA: 94 Arrested & Indicted in TD Bank Fraudulent Check and Bank Account Ring

by Jeremy Saland

“Go get ’em, Cy!” That was likely the cheer that echoed through the halls of TD Bank corporate headquarters after the Manhattan District Attorney and his troops announced the indictment and arrest of 94 individuals in an alleged check fraud and Grand Larceny ring that pilfered approximately $450,000 from the global bank. While the loss of $450,000 has absolutely no impact on the bottom line of such a large institution, and is likely viewed merely as one of the many costs of doing business in the 21st century, such a theft is significant in terms of consumer and banker confidence and security. The alleged fraudsters may have believed they were in a real life Staples commercial when they allegedly looted approximately 90 accounts and spent the ill gotten gains on cards and dice at area casinos (Hey, “That was easy.”), but they were certainly wrong. The sad reality for the accused is that many of those arrested now face up to fifteen years in state prison. Reminiscent of the Queens District Attorney’s Office 16 million dollar and 100 plus person indictments charging Enterprise Corruption, Grand Larceny and other crimes, Manhattan prosecutors, like District Attorney Brown’s crew, are poised to to send a strong message to would be identity, cyber and check fraud thieves. In fact, taking a page out of the book of his predecessor, Robert Morgenthau, for fighting crimes in the streets and in the suites, DA Cyrus Vance, Jr. stated:

“Our job is to protect New Yorkers, whether on the streets, online, or in the banking system. The most recent cases brought by my Office’s Cybercrime and Identity Theft Bureau show how pervasive cyberfraud schemes are, and how they depend on individuals willing to play various criminal roles. Whether you are a ring-leader or a small player, if you are caught committing fraud, you will be prosecuted.”

December 5, 2011

What is Credit Card Fraud in New York: Examining NY P.L. 170.10 & 170.25

by Jeremy Saland

As I have addressed in the past, theft of a credit card or debit card in New York City, and in any of the surrounding boroughs or counties, will result in (at least) the felony charge of Grand Larceny in the Fourth Degree, NY Penal Law 155.30(4). Certainly anyone facing such a charge should consult with New York criminal defense attorney experienced in credit card crimes as the felony they would face is punishable by up to four years in prison. But what about credit card fraud (whatever that actually means!)? Will a perpetrator of credit card fraud be charged with a felony? Are there other charges that may accompany a credit card fraud charge? What evidence does the State of New York have to bring to prove credit card fraud? Let’s briefly address these questions here. After all, it is important to understand the seriousness of the charges a New Yorker can face if they perpetrate one of these crimes.

In New York, one of the crimes credit card fraud will result in is a charge of New York Penal Law 170.10(1) Forgery in the Second Degree. A “D” felony punishable by up to seven years in state prison, Forgery in the Second Degree is a relatively common crime. You are guilty of Forgery in the Second Degree if you fraudulently sign the name of the actual holder of the credit card or debit card on a written instrument (i.e. the transaction receipt). Similar to theft of a credit or debit card, forgery in the second degree does not turn on the value of goods stolen (i.e. the items you purchased by signing the false name on the receipt). If you forged a signature without authority and with the intent to defraud the credit card company and/or the store (or the cardholder for that matter), then you are guilty of Forgery in the Second Degree. It is fairly scary that this one bogus signature has enormous criminal ramifications.

December 1, 2011

Queens DA Obtains Indictments on Nearly $2 Million Car Loan Fraud Scam

by Jeremy Saland

Queens District Attorney Richard Brown keeps motoring on obtaining one Enterprise Corruption indictment after another. Whether the top prosecutor in Queens is chasing down identity thieves, gamblers or other alleged fraudsters, when he finally catches them he brings out the “big guns” found in the New York Penal Law. According to a press release from earlier today, DA Brown has done it again. Eighteen individuals, arrested for and charged with Enterprise Corruption, Grand Larceny, Criminal Possession of Stolen Property, Falsifying Business Records, Criminal Possession of a Forged Instrument and Conspiracy, are all alleged to be part of an auto loan fraud scheme. It appears that obtaining indictments against these individuals was not enough to satisfy DA Brown’s voracious appetite for justice as he also obtained indictments for three separate corporations.

According to prosecutors, eighteen individuals and three corporations have been indicted for their alleged roles in two massive automobile loan fraud schemes that resulted in nearly two million dollars in losses to 18 financial institutions on 47 loans. A fairly basic, yet lucrative, scheme it is alleged that the defendants were involved in obtaining loans to purchase high end automobiles – BMWs, Mercedes, Porsches – with the assistance of “straw borrowers.” These borrowers had good credit that enable them to allegedly purchase vehicles that were later resold or rented on the black market and used in criminal activities.

November 17, 2011

UPDATE – Manhattan DA Takes a Bite Out of Crime: Steakhouse Credit Card Fraud & ID Theft Ring Served by Waiters, Grilled by Prosecutors

by Jeremy Saland

While they may be best known for serving choice cut steaks, a few of New York’s most famous steakhouses may need to add an arrest profile to their Zagat’s ratings. According to reports, Manhattan District Attorney Cyrus Vance, Jr.’s prosecutors busted a credit card fraud ring allegedly run by men and women whose day jobs were to serve as waiters at some of New York’s flagship restaurants. From Smith and Wollensky, Capital Grille and Wolfgang’s Steakhouse in Manhattan to Morton’s in Stamford and the Bicycle Club in New Jersey, it is alleged that more than two dozen arrested waiters dined on patrons’ credit card numbers as their unsuspecting customers grazed on filet mignon, porterhouse and the occasional rib eye (bone in, of course). Although the allegations have yet to fully materialize, it is alleged that these waiters stole approximately fifty account numbers from the high-end credit cards, including the fabled American Express Black Card, and used these account numbers to go on expensive shopping sprees.

The means by which these accused waiters perpetrated the Enterprise Corruption, Identity Theft (although not technically charged with this crime), Grand Larceny, Criminal Possession of a Forged Instrument and other crimes is clear. The alleged fraudsters used hand held skimming devices to kick off the alleged scam. Fairly easy to purchase online, these devices can be hidden in one’s palm and can scan a credit card in the time it takes to take one swipe. Once the reader glides over the magnetic strip, the account number is then stored for later use. Armed with the credit card numbers, the alleged defendants then encoded a new credit card with the stolen account number.

November 16, 2011

Brooklyn DA: Former Stockbroker Yearns to Rejoin the 1% by Allegedly Defrauding Investors Out of $200,000

by Jeremy Saland

According to Brooklyn District Attorney Charles Hynes, a scamming former stock broker managed to cheat and lie his way back into the 1% at the expense of fellow one percenters and on the backs of the 99% as well. While the arrest and indictment of Boris Shteyngart will likely not stop the #OWS from disrupting lower Manhattan on Thursday, it may send a strong message to would be thieves in Kings County. It is alleged in a multi-count indictment that Shteyngart defrauded a dentist from the “Show Me State” out of $142,000 and an 84 year old retiree out of $10,00 which consisted of a significant portion of the latter’s life savings. All of this, according to Brooklyn prosecutors, was stolen and used to support Shteyngart’s lifestyle.

DA Hynes claims that Shteyngart perpetrated his criminal scheme by “cold calling” potential investors. At some point after his alleged victims began to trust him, Shteyngart would convince these “investors” to send him money by wire transfer or check payable to “Bori.” Once he received these checks, prosecutors allege that Shteyngart merely added an “s” next to “Bori.” Not rocket science, “Bori” became “Boris” and Shteyngart was able to deposit the checks in his own account. In total, prosecutors believe the scheme netted the defendant approximately $200,000.