Fraud Related Offenses

March 5, 2010

Queens Identity Theft & Credit Card “Bust Out” Scheme Results in Indictment of Five PC Richards Employees

Only days ago, I published an entry regarding the new Cybercrime and Identity Theft Bureau in the Manhattan District Attorney’s Office. Having served as a member of that bureau’s predecessor, the Identity Theft Unit, during my seven years as a prosecutor under Robert Morgenthau, I commented on the necessity of such a unit despite my adversarial role as a New York criminal defense attorney. I don’t think anyone could argue the significance of this expanded bureau as schemes involving Identity Theft and Computer Crime continue to flourish in New York and beyond.

Although the most recent arrests and allegations stem from the Queens County District Attorney’s Office, the purpose of such a unit or bureau has once again been made clear. According to the Queens County District Attorney’s Office, twelve individuals, including five employees at PC Richards and Sons, have been arrested and indicted in a fraudulent credit card “bust out” scheme. The 92 count indictment charges Raza Chaudry, Reema Chaudry, Tahir Chaudry, Azadar Chaudry, Zishan Chaudry, Shaheen Akhtar. Hemet Adnand, Mathew Alli, Mohammad Aslam, David Francis, Benzy Jonny and Sheikh “Naveed” Zaheer with crimes including Grand Larceny, Criminal Possession of a Forged Instrument, Falsifying Business Records and Offering a False Instrument for Filing. Although they are not charged with the technical crime of Identity Theft, it is alleged that the “bust out” scheme involved stolen social security numbers. According to the Queens District Attorney’s Office, a search warrant resulted in the recovery of “Pakistani passports belonging to several of the defendants and bearing multiple names and dates of birth, blank Social Security cards, Canadian and New York driver’s licenses and binders containing in excess of 300 credit cards.”

February 16, 2010

DA: Stockbroker Pads Resume and Portfolio – Former Maxim “Partner” Fools Merrill Lynch for $780,000

by Jeremy Saland

Manhattan District Attorney Cyrus Vance, Jr. announced the arrest and indictment of Steven Mandala, a former stockbroker with the Maxim Group and Merrill Lynch. According to the District Attorney’s Office, Mr. Mandala stole $780,000 from Merill Lynch after he allegedly told Merrill Lynch that he was not only a partner at Maxim Group (he was merely an employee stockbroker making $100,000), but that he was in charge of managing $300 million of clients’ assets. As a result of his work with Maxim Group, prosecutors allege that Mr. Mandala claimed he generated $1.5 million in revenue. Due to Mr. Mandala’s claims, alleged “improvements” to his resume, and his assertion he was compensated in the neighborhood of $765,000 a year by Maxim Group, Merrill Lynch hired the stockbroker and advanced Mr. Mandala $780,000. As a result of his chicanery, which was somewhat less successful, Mr. Mandala was charged with Grand Larceny in the Second Degree, Money Laundering in the Second Degree, Identity Theft in the First Degree, Criminal Possession of a Forged Instrument in the Second Degree and Falsifying Business Records in the First Degree.

Despite Mr. Mandala’s alleged claims that he managed $300 million and generated $1.5 million in revenue, it is alleged that Mr. Mandala not only rarely went to work, but that he brought in only $20,000 in new business. During he approximately two months as an employee at Merrill Lynch, it is alleged by prosecutors that Mr. Mandala deposited the $780,000 into his parents’ account and purchased a Ferrari under his father’s name. Mr. Mandala’s employment came to an end when he allegedly sent an email to Merrill Lynch indicating that he was not only resigning, but that all his personal effects should be discarded.

February 16, 2010

Credit Card Theft & Fraud – New York Penal Law 155.30(4) & 165.45(2): Stealing or Possessing a Stolen Credit Card or Debit Card is an Automatic Felony in NY

by Jeremy Saland

It is very easy in New York State to compound a bad mistake and inadvertently roll it into a felony case. To find an example of this, one needs to look no further than the Grand Larceny in the Fourth Degree pursuant to New York Penal Law 155.30(4) and Criminal Possession of Stolen Property in the Fourth Degree pursuant to New York Penal Law 165.45(2). These two statutes address the theft and possession of stolen debit and credit cards and are “E” felonies punishable by up to four years in state prison.

Grand Larceny in the Fourth Degree, New York Penal Law 155.30(4):

February 5, 2010

Unlawful Possession of Personal Identification Information (NY PL 190.81, 190.82 & 190.83) & Your Criminal Defense: Does New York Law Require the Use of the Personal Information?

by Jeremy Saland

You have been arrested with a print out of checking account numbers or a list of maiden names of ten different people. Although it is crumpled up in your wallet, you had not actually used the information or attempted to use that information. Well, is the mere possession of that personal information a violation of New York Penal Law Section 190.81, Unlawful Possession of Personal Identification Information?

Pursuant to NY PL 190.81, Unlawful Possession of Personal Identification Information:

January 31, 2010

Forgery (NY Penal Law 170.05 & 170.10) of Clothing, Jewelry or Handbags? Does Forgery Only Apply to “Written Instruments?”

by Jeremy Saland

The pertinent part of New York Penal Law sections 170.05 & 170.10, Forgery in the Third and Second Degree, plainly states that one is guilty of Forgery when with intent to defraud, deceive or injure another, a person falsely makes, completes or alters a written instrument.

Depending on what a person forges, the level or degree of the offense may be elevated from a misdemeanor to a “D” or even a “C” felony. For example, if the item forged is deed, will or instrument created by the government, the crime can go from an “A” misdemeanor punishable by up to one year in county jail (Rikers) to a “D” felony punishable by up to seven years in state prison. Moreover, if one counterfeits United States currency, the crime can be bumped up further to a “C” felony pursuant to New York Penal Law 170.15 and is punishable by up to 15 years prison. Well, what about knock off handbags, clothing or other items? Assuming the buyer is not knowingly buying a fake handbag (so, forget the shoppers seeking out “deals” on Canal Street) and the person selling the handbag or other property is presenting it as the authentic product with the intent to defraud the buyer, can the seller be charged with Forgery for making the knockoff handbag or Criminal Possession of a Forged Instrument for possessing the same?

January 17, 2010

Manhattan White Collar Criminal Defense Firm Gets Dismissal & Misdemeanor After Client Accused of Two Thefts Totaling $70,000

by Jeremy Saland

Saland Law PC, a Manhattan based white collar criminal defense firm representing clients throughout the New York City region, is pleased to announce another tremendous result for a client in the arena of fraud and theft allegations. Our client, charged on two separate dockets, allegedly defrauded approximately $35,000 from one individual and approximately $35,000 from a second individual. Prosecutors charged our client with twenty-five felonies in the two criminal court complaints including Grand Larceny in the Third Degree (NY PL 155.35), Forgery in the Second Degree (NY PL 170.10), Criminal Possession of a Forged Instrument in the Second Degree (NY PL 170.25) and Identity Theft in the First Degree (NY PL 190.80). Prosecutors alleged that our client stole these monies through drafting checks without permission and using credit cards, including a corporate business card, without authority to do so. Despite the large value of the alleged theft, approximately $70,000 between two people, Saland Law PC attacked the veracity of one of the complainants as well the length of time between the incident and the reporting of the theft. Moreover, investigation revealed that this complainant may have been trying to “hide” money from his spouse. After further investigation and challenging the prosecution regarding their ability to prove the $35,000 theft beyond a reasonable doubt, prosecutors dismissed all of the charges. Although we were not as successful with the second felony case as we were with the first case, Saland Law PC negotiated a tremendous disposition on the second matter as well. In the second case, prosecutors agreed to a misdemeanor plea for Petit Larceny (the “shoplifting” statute) as well as Criminal Possession of Stolen Property. Although the complainant and prosecutors presented us with documentation for a significant portion of the $35,000 as well as a signed stipulation by our client that she in fact owed these monies, we successfully argued that despite the admission and documentation, the facts of the case would establish that the complainant was not being forthright. Even if true, the value of the alleged loss was exaggerated and our client signed the agreement under duress. Fortunately, through our investigation and diligence, we were able to corroborate our position thereby weakening the ability of the prosecution to prove the theft and the loss amount beyond a reasonable doubt. After all of our efforts working with our client for over a year to avoid a felony or jail, the court sentenced our client on the misdemeanor plea to three years of probation (no jail) and $20,000 in total restitution. As this client learned, each case is unique and requires its own analysis and defense. Whether it takes one month or one year, some felony fraud cases can be negotiated to a lesser offense while others ultimately may not. Furthermore, some cases may require a trial to prove one’s innocence where a real risk may be present of a conviction and accompanying jail. Whatever result you are seeking and whether or not it is actually attainable, it is imperative that your counsel be a knowledgeable and a zealous advocate who keeps you informed throughout the process as it unfolds.

December 3, 2009

Issuing a False Financial Statement (NY Penal Law 175.45): A New York Criminal Defense Overview

by Jeremy Saland

Issuing a False Financial Statement, pursuant to New York Penal Law 175.45, is certainly not the most severe crime amongst its brethren in the arena of white collar crimes, but one that has serious ramifications beyond the criminal context. First of all, this crime is often associated with or is a part of a larger scheme. Therefore, you may not merely find yourself being investigated for or charged with Issuing a False Financial Statement, pursuant to New York Penal Law 175.45. Other crimes may be lingering right around the corner. However, before addressing those other crimes, let me present the statute of Issuing a False Financial Statement so you have a general understanding of the law.

Issuing a False Financial Statement New York Penal Law 175.45:

November 12, 2009

No Oliver Twists in Pickpocket Crew: Manhattan DA Announces 639 Count Grand Larceny and Identity Theft Indictment

by Jeremy Saland

He may have loved the book, theatrical performance or even the movie, but Manhattan District Attorney Robert Morgenthau is not a fan of real life Oliver Twists. According to reports, the New York County District Attorney’s Office unsealed a 639 count indictment involving the arrests of 15 alleged pickpocket crew members. The defendants, including Arthur Franklin, Jospeh Simms, Vincent Franklin, James Mannix, Kathleen Miller, Carol Dibitetto, Larry Ford, Kandra Lysland, Tina Barboza, Mary Bennett and Yvonne Harris are alleged to have stolen over $600,000 and compromised at least 60 bank accounts. The 639 count indictment includes numerous felonies such as Grand Larceny, Identity Theft, Criminal Possession of a Forged Instrument, Conspiracy, Scheme to Defraud, Attempted Grand Larceny, Forgery and Criminal Possession of Stolen Property. It is interesting to note that prosecutors did not charge the defendants with Enterprise Corruption. While there could be numerous reasons, it is possible that the crew had no ascertainable structure, but was alleged to be more consistent with a loose knit band of thieves. Regardless, the scheme is purported to have operated for at least one year before the arrests and indictments.

According to the District Attorney’s Office, vigilant investigators at Chase Bank reviewed video surveillance of fraudulent transactions and noticed a common theme of women wearing wigs and glasses. Further investigation revealed that Arthur Franklin, Vincent Franklin and Joseph Simms were present either inside or outside the bank when the transactions occurred. Chase Bank put the dots together when they learned that many of the victims of the fraudulent bank transactions were also victims of pickpockets.

November 12, 2009

Manhattan DA Demolishes $1 Million Construction Scheme: Contracting Company Caught Allegedly Defrauding Employees Pay

by Jeremy Saland

The Manhattan District Attorney announced the arrest and indictment earlier today of Michael Batalias, Elisavet Batalias, Vassiliki Stergiou and EMB Contracting Corporation for defrauding employees in the neighborhood of $1 million dollars. The defendants are charged with Grand Larceny in the First Degree and Scheme to Defraud in the First Degree. Moreover, Elisavet Batalias was charged with eleven counts of Offering a False Instrument for Filing in the First Degree.

According to the Manhattan District Attorney’s Office:

November 10, 2009

A New York White Collar Criminal Defense Primer: Defining Offering a False Instrument for Filing in the First (NY Penal Law 175.35) & Second (NY Penal Law 175.30) Degrees

by Jeremy Saland

While your “average” white collar crime case may not include the offenses of Offering a False Instrument for Filing in the First Degree (New York Penal Law 175.35) and Offering a False Instrument for Filing in the Second Degree (New York Penal Law 175.30), the former Manhattan prosecutors at Saland Law PC still believe it is important for our readers to have a grasp on this section of the New York Penal Law. Therefore, the following article will address these crimes.

Offering a False Instrument for Filing in the Second Degree (NY Penal Law 175.30):