FTC, Law Enforcement Partners Crackdown on Fraud in Auto Sales

The Federal Trade Commission and 32 law enforcement partners today announced the results of Operation Ruse Control, a nationwide and cross-border crackdown to protect consumers when purchasing or leasing a car, encompassing 252 enforcement actions. The six new FTC cases include more than $2.6 million in monetary judgments.

There were 187 enforcement actions in the United States since the agency’s last sweep, and 65 actions in Ontario and British Columbia, Canada. Enforcement efforts by the FTC, United States Attorney’s Office in the Northern District of Alabama and other partners at the federal, state and local level in the U.S. and Canada include both civil and criminal charges of deceptive advertising, automotive loan application fraud, odometer fraud, deceptive add-on fees, and deceptive marketing of car title loans.

“For most people, buying a car is one of the largest purchases they’ll make,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “Car ads must be truthful, loan terms must be clear, and dealer practices must be honest. That’s why our partners are working together to crack down on deceptive marketing about car sales, leasing and financing.”

“Growing fraud and other deceptive practices in auto sales and financing are important issues affecting consumers when they are buying a vehicle,” said Joyce White Vance, United States Attorney for the Northern District of Alabama. “My office has worked closely with the FTC on this issue, and has prosecuted criminal cases at a Birmingham dealership. The Mortgage, Loan Fraud and Discrimination Working Group of the Attorney General’s Financial Fraud Enforcement Task Force also is working with other law enforcement agencies to determine what we can do now to prevent fraud during the auto lending process.”

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Hospital worker charges over $1,000 on other people’s credit cards

MILWAUKEE —A hospital worker from Milwaukee is accused of making purchases using credit card numbers gathered from the food court.

Court documents say Chazala Chesir, 27, made over $1,200 worth of purchases on credit cards obtained through the food court at Froedtert Hosppital in Wauwatosa.

According to the complaint, a woman visiting a family member ordered a meal from the hospital’s food service and gave her credit card number over the phone.

The woman told police that she noticed two purchases from a Pennsylvania clothing store on her credit card statement shortly after the hospital transaction.

Detectives met with hospital security, who identified Chesir as a suspect.

When questioned, Chesir told detectives that she took food orders at the hospital and wrote down the customer credit card numbers on a scrap of paper. She told police that she took a screenshot of the transaction to her work email address and used the information to make purchases away from work.

Chesir told police that she was supplementing her income as rent, student loans and raising her daughter were “getting to be too much.”

She faces six years in prison or $10,000 in fines if convicted of the felony charge.

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Niece stole $121,000 by collecting dead man’s New York state pension

A Florida woman was sentenced to state prison Friday after admitting earlier this year to stealing $121,773 in pension benefits that were issued to her uncle, who died almost 30 years ago, state officials said.

Graycelia Cizik, 64, a resident of Polk County, received a two- to six-year prison term from Supreme Court Judge Roger D. McDonough in Albany County Court, according to a statement from Attorney General Eric Schneiderman and Comptroller Tom DiNapoli.

Cizik pleaded guilty on Jan. 21 to a one-count indictment charging her with second-degree grand larceny, a felony. In Friday’s sentencing she also agreed to a judgment in favor of the New York State and Local Employees Retirement System for the $121,773 amount.

Under a plea agreement, Cizik admitted to stealing the pension benefit money issued by the state Comptroller’s Office on behalf of the state and Local Employees Retirement System, to her deceased uncle, David Wynn.

Wynn was a state pensioner who had retired from the Port Authority of New York and New Jersey. He died in 1988.

The agencies, working together, discovered that Cizik witnessed a cremation authorization form for Wynn when he died, but failed to notify the retirement system of his death. Instead, she submitted false information to Wynn’s bank indicating that he was still alive, and used a power of attorney to access his account and withdraw pension benefits paid on his behalf over 12 years — from June 30, 1997, to Oct. 30, 2009, officials said.

Cizik was arrested in August 2014 by agents of the Polk County Sheriff’s Office in Florida, and extradited to Albany County to face the indictment.

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Bethalto Illinois bank manager charged with theft, embezzlement, fraud

Matthew S. Liebheit, 39, of Moro, IL, was charged Friday with a three count Complaint charging him with two counts of Theft, Embezzlement, or Misapplication by a Bank Officer or Employee, and one count of False Bank Entries.

The charges stem from a purported bank robbery at Liberty Bank in Bethalto, Illinois, on December 13, 2014. Liebheit, a bank manager at Liberty Bank, called police to report a bank robbery, indicating that a masked individual forced him into the bank at gun point prior to the bank opening. He gave a description of the suspect’s vehicle as being a tan station wagon or crossover style vehicle. He stated that he was forced to give that individual over $200,000 from the bank’s vault.

Further investigation revealed that Liebheit’s truck was used by the masked individual and a band of ten dollar bills was found in a search of Liebheit’s truck. Additional investigation showed that Liebheit had allegedly altered withdrawal documents from a Liberty Bank customer’s account to reflect a larger than intended withdrawal from that customer’s account. The day before the purported robbery, Liebheit allegedly falsified documentation to show a substantial deposit to that customer’s account.

Liebheit is scheduled for an initial appearance on the complaint today at 11 a.m. in federal court in East St. Louis.

If convicted, Liebheit faces a term in federal prison of not more than thirty years, a fine of up to $1,000,000, and a term of supervised release of not more than five years.

A criminal complaint is merely a document used to begin a federal prosecution. A defendant is presumed innocent of any charges unless or until a jury decides that the person is guilty beyond a reasonable doubt.

The case was investigated by the Federal Bureau of Investigation and the Bethalto Police Department. The case is assigned to Assistant United States Attorney Laura Reppert.

This content has been reproduced from its original source.

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Atlanta police: Gangs responsible for 15 Craigslist robberies

ATLANTA – Police say two Atlanta street gangs used fake car ads to lure victims on Craigslist. Seven people have been arrested, including a mother and her two sons. Police are attributing the robberies to two street gangs.

Atlanta Police Deputy Chief Darryl Tolleson said more than $20,000 was stolen from the victims in 15 robberies. “We are fortunate that none of these robberies turned into something far worse,” he said.

That sentiment is not lost on Janeailos Pachero, one of the victims.

“Oh man, I was thinking I was going to die,” he said.

Pachero was lured to 1797 Hadlock Street in SW Atlanta on July 3, 2014. He saw an ad on Craigslist for a 2007 BMW. The alleged owners of the vehicle told Pachero they wanted to get rid of it because they were moving out of town and would sell it for $4,000.

Pachero was told to bring the money in cash to the address. But when he got there he didn’t see the car.

“Two guys, they come and put the gun to my head and me, my friends, so they take everything, my wallet, the money, the phones,” he said.

From June to December 2014, 14 other victims were robbed at the same location or within a block. The robberies either took place on Hadlock Street or at an apartment complex at 1700 Stanton Road.

At a news conference at Atlanta Police Headquarters Tuesday, seven arrests were announced. Tayza Harris, 41, and her two sons, JuJuane, 17, and Darious, 21, along with Aqueelah Jannah, 18, Jacorey Johnson, 25, Tereka Mills, 20, and Cameron Neeley, 18, were charged with Participation in Criminal Street Gang Activity and Armed Robbery.

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Fraud Starts to Take a Bite Out of Apple Pay

It didn’t take long for fraud to find its way to Apple Pay.

Some banks are witnessing a growing incidence of fraud on Apple Inc.’s mobile-payment service as criminals exploit vulnerabilities in the verification process banks follow when users add a credit card to the service, according to people familiar with the matter.

Banks are tightening this process in an attempt to curb the fraud, these people said.

The problem was brought to light in late February in a blog post by Cherian Abraham, a payments expert who works with banks and retailers on mobile-payment strategies. He said fraud “is growing like a weed, and the bank is unable to tell friend from foe.”

Mr. Abraham said it isn’t “an anomaly” for fraud to account for about 6% of Apple Pay transactions, compared with about 0.1% on transactions that involve swiping a credit card.

He said that fraud rates on credit cards vary, depending on the bank that issued them.

Mr. Abraham is an adviser to SimplyTapp, which provides the host-card-emulation technology for contactless payments on devices using Google Inc.’s Android operating system. Those payment systems compete with Apple Pay.

Mr. Abraham said other mobile-payment services might be exposed to the same fraud problem, “irrespective of origin, scale, intent or patron saint.”

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Caregiver charged in alleged theft of $631,000 from Palos Hills woman

A 24-hour caregiver has been accused of being part of a scheme that bilked an elderly Palos Hills woman out of $631,000.

Two other women who also were allegedly involved are being sought but may have fled the country, Palos Hills police Chief Paul Madigan said Thursday.

Marion Issert, 65, of Joliet, was arrested Wednesday and charged with one count of felony senior financial exploitation, Madigan said.

Authorities believe the other two women fled to the Philippines. Madigan said police believe one was a friend of the victim’s who may have helped Issert get a job as her caregiver.

The suspects allegedly took the money from the woman’s bank account between June and October, police said, taking the woman to banks to transfer funds out of her account.

Police said the suspects initially asked the woman to donate the money to a church group in the Philippines, but she refused.

“Apparently they took it upon themselves to get the money transferred into their own accounts, and they were trying to send the money overseas,” Madigan said.

Palos Hills police were notified about a possible theft a few weeks ago by the PLOWS Council on Aging, he said.

“PLOWS was contacted by a bank who thought there was some suspicious activity on the accounts, which is an understatement,” Madigan said.

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4 Arrested After Passing Off Thousands In Fake $100 Bills At Mills Mall

FRAZER TOWNSHIP (KDKA) – Four people are facing numerous charges after police say they tried to pass off thousands in fake $100 bills at the Pittsburgh Mills Mall.

Police say three men and one female, a juvenile, from the Bronx, New York, passed off the counterfeit money at about 20 stores.

They allegedly would buy $5 or $6 worth of merchandise at a store to make change out of the fake bills. Police say they had thousands in fake $100 bills.

“They were making small purchases, small items and they would pay with big bills and receive real money for the correct change, so they were washing the money,” said Frazer Police Sgt. Brian Pazak.

Among the stores hit were Victoria’s Secret, American Eagle, Foot Action, H&M and Starbucks.

Mall security reported the bogus bills at one of the stores and an officer spotted the foursome leaving the mall and pulled them over.

They were later arrested during a traffic stop.

The suspects have been identified as 27-year-old Raul Agero, 26-year-old Steven Orr, 18-year-old Juan Quinones and a 17-year-old female.

All four face 22 counts of forgery each, plus additional counts of theft and corruption of a minor.

The three men were taken the Allegheny County Jail and the juvenile female was taken to the Shuman Center.

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Woman faked husband’s death to collect $2M

A couple of years after Igor Vorotinov’s wife told his insurer that he died in Moldova, the FBI grew suspicious.

The purported death of Igor in October 2011 netted his widow, Irina Vorotinov, reportedly of Minneapolis, Maple Grove and Plymouth, more than $2 million from a life insurance claim.

That claim — which included a badly putrefied body, found lying on the side of a rural Moldovan village road — was false, prosecutors now say.

Irina Vorotinov, 50, and her son, Alkon Vorotinov, 25, were charged Tuesday in federal court in St. Paul — the purported widow with mail fraud, and her son with having knowledge of the actual commission of a felony and concealing a crime.

According to a criminal complaint, Mutual of Omaha, the insurance company that paid Vorotinov’s claim, hired a private firm to investigate the 2011 death.

That firm interviewed the Moldovan police officer who found the supposed body of Igor Vorotinov.

The officer received an anonymous 902 call (the equivalent of 911 in the United States), saying a dead body was at the entrance of Cojusna village in Moldova, an eastern European country between Romania and Ukraine.

The officer said he found the body on the side of the road between two bushes and determined there were no signs of violence; he then called his son to help him take it to a morgue in Straseni.

A passport and hotel cards belonging to Igor Vorotinov were found with the body.

Neither the police officer nor the morgue took pictures of the body, because neither authority “had access to a camera,” the complaint stated.
Irina Vorotinov traveled to Moldova from the Twin Cities, identified the body as her husband and ordered it cremated. She then took the ashes back home to Minnesota.

In March 2012, she received a check from Mutual of Omaha for $2,048,414.09 in life insurance proceeds.

More than a year later, in June 2013, the FBI received a tip from an anonymous source in Moldova that Igor Vorotinov was not in his widow’s urn.

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How Social Media Networks Facilitate Identity Theft and Fraud

Recent research reveals that identity theft affects millions of people a year, costing victims countless hours and money in identity recovery and repair. What causes this pattern of online theft and fraud? It’s a combination of factors: a lack of consumer knowledge regarding protecting your identity online; growing comfort with, and trust in, social platform providers; the need for social platforms to generate revenue; and a lack of standards or policing of these standards. Although this issue is not yet in the mainstream consciousness, it likely will be sooner rather than later.

Fueling the Fire
Social media sites generate revenue with targeted advertising, based on personal information. As such, they encourage registered users to provide as much information as possible. With limited government oversight, industry standards or incentives to educate users on security, privacy and identity protection, users are exposed to identity theft and fraud. Additionally, these platforms have a ton of confidential user information, and are likely vulnerable to outside (or inside) attack. On the marketing front, Google recently patented an algorithm to rate individual’s influence within social media. Once publicized, it will likely encourage greater participation by active users in order to boost their influence score.

Crimes of Opportunity
With the increased global use of social media, there are more opportunities than ever before to steal identities or perpetrate fraud online. For example, status updates posted on Twitter, Facebook and many other social media sites can be used by criminals. If you post that you’re out of town on vacation, you’ve opened yourself up for burglary. If you mention that you’re away on business for a weekend, you may leave your family open to assault or robbery. When it comes to stalking or stealing an identity, use of photo- and video-sharing sites like Flickr and YouTube provide deeper insights into you, your family and friends, your house, favorite hobbies and interests.

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