Wednesday, May 19, 2004

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JACKSON HEIGHTS VARIETY STORE OWNER WHO MASTERMINDED $6.8 MILLION CREDIT CARD FRAUD AND MONEY LAUNDERING SCHEME CONVICTED AFTER TRIAL; FACES UP TO 25 YEARS IN PRISON

Queens District Attorney Richard A. Brown today announced the conviction of a Jackson Heights variety store owner for masterminding an intricate credit card fraud and money laundering scheme that ripped off nine credit card companies between 1999 and 2002 for over $6.8 million.

District Attorney Brown said, "The defendant has been convicted of operating with accomplices an elaborate fraud scheme in which he and others stole over $6.8 million from credit card companies and laundered $1.2 million of the illicit proceeds to conceal their criminality. The defendant and his ring of thieves mistakenly thought that they could evade detection, but investigators uncovered a paper trail that led to their discovery, prosecution and prison.”

The District Attorney identified the defendant convicted yesterday after a Queens Supreme Court jury trial that lasted nearly five months as Anwar Haque, 50, of 58-22 Van Cleef Street in Corona, owner of the Amasia USA/Dollar Connection variety store at 75-15 37th Avenue in Jackson Heights.

Defendant Haque’s trial before Justice Roberta L. Dunlop ended when a jury of three men and nine women that had deliberated two and one-half days and returned a verdict of guilty. The defendant was remanded without bail to await sentencing on June 25, 2004. He faces up to 25 years in prison.

According to the District Attorney the evidence at trial included testimony about a complex scheme to defraud credit card companies that involved collusion among scores of credit card holders and several small businesses in Jackson Heights. The defendant and his accomplices repeatedly submitted to their merchant processor banks maximum limit charges -- some up to $5,000 -- on multiple credit card accounts for fictitious purchases of goods and services by numerous card holders. Card holders and merchants split the proceeds of the fraudulent transactions and card holders thereafter "busted out" their accounts by failing to make payments, forcing the credit card companies to close the accounts and place them in collection.

In addition to obtaining credit card processing accounts, the defendant also opened business bank accounts in which the credit card transaction proceeds could be electronically transferred by the merchant processing banks.

The credit card companies victimized by the scheme sustained losses totaling over $6,872,891 in amounts ranging from $44,000 to $1.7 million. The companies included Bank One/First USA ($1,087,268); Chase ($1,716,525); American Express ($1,500,000); Citibank (($986,189); MBNA ($723,977); Bank of America ($384,745); Fleet ($60,000) and Wells Fargo ($44,291).

The investigation began in November 2001 when several credit card companies and banks conducted a review of credit card accounts that had been closed for non-payment and placed in collection and discovered a pattern of large monetary transactions among a group of Queens merchants. The companies brought their information to the District Attorney's Economic Crimes Bureau which began working together with the United States Postal Inspection Service and New York City Police Department to identify individuals involved in the credit card fraud operation.

The investigation determined that some credit card holders with 25 to 50 separate accounts had sold their credit cards to collusive merchants who in turn had run up charges on all the credit cards to their maximum allowable charging limit. Payments on these accounts made with worthless checks enabled charges to be made far in excess of their original credit limits. In one instance a credit card account with an $8,000 credit limit was charged $34,000 that was left unpaid.

The investigation uncovered a paper trail of credit card transactions which led directly back to the merchants and card holders, most of whom are immigrants from Bangladesh and Pakistan.

In order to launder the criminal proceeds, the defendants concealed the illegally obtained credit card monies by writing checks made payable to various business entities and individuals then writing in the check memo space that the check was for the purchase of various items including cigarettes, phone cards, frozen fish and loans. The evidence at trial showed that over $1.3 million was laundered by the defendants.

Fourteen other defendants have also been convicted in the case. Some are now serving prison terms of up to four years.

The investigation was conducted by detectives and investigators of the following governmental agencies:(QDA) Detectives Richard Lewis and Edward Russell and Lieutenant Robert Burke of the District Attorney's Detective Bureau under the supervision of Chief Lawrence J. Festa; (USPIS)Inspectors Eric Brown and Ana Bourdon under the supervision of Inspector Alex Malaiko, Queens Team Leader; (NYPD)Detectives Carolyn Shabunia and Michael McGinnis of the Special Frauds Squad under the supervision of Lieutenant Kenneth Ling and Inspector Jeremiah Quinlan of the Special Investigations Division and detectives of the Asset Forfeiture Unit under the supervision of Lieutenant Steve Dato and the general supervision of Captain Michael J. O'Hara.

Assisting in the investigation and prosecution were Investigators Leslie Godden and Dyan Henn, Bank One/First USA; William Quinones, American Express; Carol Muellers, Chase Manhattan Bank; Eric Court and James Burton, Citibank; Barbara Simcox, MBNA; Steven George, Bank of America; Ken Tomlinson and Bob Farrell, Discover Card; John Crowe, Household Credit Services; Robert Greene, Visa USA; Larry Herman, Bridgeview; Susan Johnson, Wells Fargo; Eleanor Beckmann, NPC; Brandy Gregory, EFS National Bank; Laurie LeBoeuf, Delta-Woodforest; Robin Brace, Fleet; Maria Russo, ACCPC; Gany Karim, Payment Resources; Joseph Pilatere and Emma Coronado, Paymentech; David Woods, Fifth Third Bank; and Kevin Wortman, Provident Bank.

The case was prosecuted by Assistant District Attorney Diane M. Peress, Deputy Bureau Chief, and Assistant District Attorney Bernadette K. Ford, with the assistance of Investigative Accountant Assistant Phylesia Lang, Senior Investigative Accountant James Dever and Michael Albanesi of the District Attorney's Economic Crimes Bureau under the supervision of Assistant District Attorney Brian J. Mich, Bureau Chief, and the overall supervision of Executive Assistant District Attorney for Investigations Peter A. Crusco and Deputy Executive Assistant District Attorney for Investigations Linda M. Cantoni.

Assisting in the prosecution were USPIS Postal Inspectors Eric Brown and Ana Bourdon under the supervision of Team Leader Alex Malaiko and NYPD Detectives Carolyn Shabunia and Michael McGinnis, Special Frauds Squad.