Identity Thieves Arrested – Millions Stolen Through Home-Equity Scams

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Over 11 arrests have been made in both New Jersey and Virginia in related crimes involving global identity theft ring.  As if banks, mortgage lenders and home-equity line holders haven’t suffered enough challenges recently, this group has stolen over $10 million through home equity scams.  The identity theft ring hijacked home-equity lines that had been issued to thousands of customers using what has been called a combination of “high-tech equipment and old-fashioned con-artistry.” Identity Thieves Under ArrestRecently, three men plead guilty to charges of conspiracy to commit bank fraud in the U.S. District Court for the Eastern District of Virginia.  Authorities say over $10 million was involved. This week four more men (four were charged earlier this year) were charged in New Jersey’s U.S. District Court.  The identity thieves in this case scammed several credit unions and banks into wiring over $2.5 million from home-equity lines to members of a fraud ring in China, South Korea, Vietnam, Japan and Canada.The Equity-Line Transfer Scam: The Targets, The Identity Theft and the Phone TagThis criminal ring targeted people with good credit who had large but untapped home-equity lines of credit.How did they steal the victims’ identities?The identity thieves used:o    public records, such as property deeds and mortgageso    internet databases to obtain credit reports. o    fee based internet databases to find documents that provided birthdates, social security numbers and mother’s maiden names (which is a common security question answer)Once armed with the victims’ personal information the identity theft ring acknowledges that they used a variety of technologies to avoid exposing their phone numbers when calling banks including caller-ID spoofs, prepaid cell phones and PC wireless phones.  In at least one case Hakeem Olokodana allegedly called Verizon, posing as a victim and complaining of phone problems.  He finally persuaded Verizon to forward all incoming calls to a separate number so when the bank returned the “customers” call, they would reach Olokodana. Verizon spokesman Eric Rabe admits that they are a “frequent target of these kinds of attacks” and adds “we certainly have lots of measures in place to prevent this sort of thing.”  Remember, however that the criminals had already accessed so much personal information that they would easily pass any security question test.Protect Your Identity and Your Home-Equity LineAccording to New Jersey U.S. Attorney Christopher J. Christie, “”Home-equity lines of credit are an expanding front in the battle against mortgage fraud.  Homeowners should carefully review their statements to make sure their hard-earned equity is not disappearing from under their noses.”Many customers with good credit apply for and are issued a home-equity line of credit that they don’t intend to use right away.  For many, it is a “just in case I need it” cushion that they enjoy having in place.The Credit Union Information Security Professionals Association claims a number of credit unions have beefed up security in response to an increase in home-equity fraud, but those precautions have come with their own drawbacks including longer call times to customer service and legitimate customers who fail the security questions.Anne Wallace, president of the Identity Theft Assistance Center, a nonprofit industry group, said properly training bank employees to detect fraud is critical but customers should also protect themselves by getting the free copies of credit reports and keeping an eye on bank statements. If you have been approved for a home-equity line, take Wallace’s advice and make sure you check your credit reports and open and review your statements regularly.  You take measures to keep thieves out of your home, take steps to keep them out of your home-equity line too.

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