Dozens of people have been charged with forming a prolific identity theft ring that used thousands of stolen credit card numbers to shop at Apple stores around the country, according to a court document and a law enforcement official.
The group obtained stolen account numbers, forged credit cards and used them to buy laptops, iPhones and other merchandise at Apple stores in locales ranging from New York to Los Angeles to Wauwatosa, Wis. – with a ringleader steering the scheme even while behind bars, according to an indictment charging 18 people with grand larceny.
A law enforcement official said the allegations ultimately involve 27 people and roughly $1 million in merchandise. The official spoke on condition of anonymity to discuss the case ahead of an official announcement.
The Manhattan district attorney's office declined to comment Tuesday. DA Cyrus R. Vance Jr. and the U.S. Secret Service were expected to unveil a major cybercrime case Wednesday; the Secret Service didn't immediately return a telephone call about the matter Tuesday evening.
It wasn't immediately clear how the group is accused of getting the credit card numbers. But leaders created phony cards, provided them to associates and contrived to send the associates "to locations in (Manhattan) and elsewhere to purchase goods, such as laptop computers, iPods, iPhones, other electronic devices, gift cards and clothing products" starting in May 2009, the indictment said.
It lists purchases in Apple stores in a roster of major cities, including Las Vegas, Atlanta, Indianapolis and St. Louis, and smaller communities such as Altamonte Springs, Fla., and Stamford, Conn. Members of the group sometimes charged more than $3,000 worth of products in one stop, but other transactions were as small as a $53.45 tab for a laptop case, the indictment says.
Cupertino, Calif.-based Apple Inc. didn't immediately return a call seeking comment Tuesday.
Shaheed Bilal, accused of being a leader of the scheme, had thousands of stolen credit card numbers stored in e-mails and boasted via Twitter about using credit cards at restaurants, prosecutors said at his arraignment Tuesday. He continued "to oversee the operations of this conspiracy by communicating instructions via telephone" while incarcerated from last May to December, the indictment said. It's unclear why he was behind bars at the time.
Bilal, 28, was being held on $1 million bail after pleading not guilty at his arraignment Tuesday. His lawyer's name wasn't immediately available.
The group channeled at least some of the ill-gotten merchandise for below-market prices to a man who then resold it at a profit, the indictment said. The man accused of being the reseller, Gil Einhorn, also pleaded not guilty Tuesday. Defense lawyer Steven Kartagener said Einhorn was "confident in his ultimate vindication."