Attorney General John Ashcroft, Assistant Attorney General Christopher A. Wray of the Criminal Division, FBI Assistant Director Jana Monroe and Federal Trade Commission Chairman Tim Muris announced last week the arrests or convictions of more than 125 individuals and the return of over 70 indictments in a coordinated nationwide enforcement operation designed to crack down on the leading types of online economic crime.
The operation targets a variety of online economic crimes that involved schemes including fraud, software piracy and the fencing of stolen goods. The investigation exposes the ways in which economic crimes are becoming increasingly global and multijurisdictional in nature.
"Online criminals assume that they can conduct their chemes with impunity," said Attorney General John Ashcroft. "Operation Cyber Sweep is proving them wrong, by piercing the criminals' cloak of anonymity and prosecuting them to the fullest extent of the law."
Some of the charges filed in districts throughout the country include:
- In Massachusetts, Van T. Dinh, a 19-year-old residing in Pennsylvania, was charged in an indictment with the unauthorized access to a protected computer and other crimes in connection to his unlawfully accessing a computer belonging to an individual residing in Westborough, MA, and using information gained through that intrusion to make unlawful trades through the individual's on-line brokerage account.
- Also in the Massachusetts, John Corrado, was sentenced to one year of probation and ordered to pay approximately $10,000 in restitution to his former employer, Telecast Fiber Systems, a private company which provides fiber optic and electronic equipment for television broadcast and radio networks. While working for the company, Corrado worked as a buyer and managed the company's document control. Approximately one month after leaving the company, Corrado accessed the company's network server from a remote location and deleted critical operating files from the company's computers. The deletion of the files caused damage and financial loss to the company in the amount of $10,360.
- In California and in Connecticut, Albert Mayzels pleaded guilty to charges in two separate indictments for unauthorized use of access devices and conspiracy to possess
counterfeit checks as part of an Internet fraud scheme against online retailer Outpost.com. Specifically, Mayzels admitted to obtaining stolen credit card numbers from various individuals to purchase more than $80,000 in computer equipment and electronic devised from Kent, Connecticut-based Outpost.com.
- In Virginia and Tennessee, 21-year- old K.C. Smith pleaded guilty to two felony charges of securities fraud. Smith admitted to using the Internet in 2002 to promote a fraudulent scheme that promised investors high returns on their "international tax-free" investments in the "Maryland
Investment Club," a fictitious enterprise. After moving to Tennessee, Smith continued advertising his bogus enterprise rough the use of unsolicited bulk e-mail, commonly referred to as spam. Smith was sentenced to 14 months in prison.
- In Pennsylvania, Allan E. Carlson was indicted on charges of hacking into computers of unsuspecting users across the country to launch spam e-mail attacks criticizing the Philadelphia Phillies baseball team. Carlson, a disgruntled Phillies fan, was also charged with identity theft for illegally using the e-mail address of reporters at Philadelphia newspapers.
- In Virginia, Helen Carr pleaded guilty to conspiracy to possess unauthorized access devices. The defendant engaged in "phishing" by sending fake e-mail messages to America Online customers, advising that they must update their credit card/personal information on file with AOL to maintain their accounts.
Cyber crime will continue to be one of the FBI's highest priorities for the foreseeable future," stated FBI Assistant Director Jana Munroe. "The results of Operation Cyber Sweep should send a clear warning to those criminals who exploit technology and use the Internet to commit criminal acts.
Operation Cyber Sweep was launched in response to an increase in the reporting of Internet-related complaints to federal agencies. The Internet Fraud Complaint Center (IFCC) - a joint project of the FBI and the National
White-Collar Crime Center - reported that in the first nine months of 2003, it referred 58,392 Internet-related fraud complaints to law enforcement. In contrast, in all of calendar year 2002, the IFCC referred about 48,000
Internet-related fraud complaints to law enforcement. The FTC reported that more than one-third of the 218,000 fraud complaints it received in 2002 were Internet-related fraud complaints.
Victims of online crime are encouraged to file a complaint online with the Internet Fraud Complaint Center, or IFCC. The IFCC is a joint venture of the FBI and the National White Collar Crime Center. The IFCC staff reviews
complaints, looking for patterns or other indicators of significant criminal activity, and refers investigative packages of complaints to the appropriate law enforcement authorities in a particular city or region. Victims can find the online form at http://www.ifccfbi.gov. (The Federal Trade Commission also has an online form for complaints about consumer fraud and deception, available
through its website, http://www.ftc.gov.)