Owner, Employee, and Contractor of Private Investigative Firm Sentenced in Connection with Pretexting

SAN JOSE, CA—Bryan Wagner was sentenced yesterday to three months in prison, followed by two years of supervised release with six months of home monitoring, for aggravated identity theft and conspiracy, United States Attorney Melinda Haag announced. Joseph Depante and Matthew Depante were previously sentenced on July 12, 2012, to three years of probation, including six months with a location monitoring condition, for conspiring to falsely represent a Social Security number.

Joseph and Matthew Depante pleaded guilty on February 22, 2012, to a one-count information charging them with a violation of 18 U.S.C. § 371. According to his plea agreement, Joseph Depante admitted that, between April 2005 and September 2006, he owned and operated Action Research Group (ARG), a private investigative company in Melbourne, Florida. He participated in a conspiracy with others, including his son Matthew Depante who was an ARG employee, involving the misrepresentation of identity to obtain confidential and personal information belonging to certain individuals (sometimes called pretexting). The object of the conspiracy was to obtain individuals’ telephone records by intentionally deceiving representatives of telephone carriers into believing that the participants in the conspiracy were the true subscribers of the telephone numbers. The conspirators were able to deceive the telephone carriers by providing all or part of the true subscriber’s Social Security number, in violation of 42 U.S.C. § 408(a)(7). Joseph Depante and his employees provided that information to third parties in exchange for a fee to ARG. His son, Matthew Depante, admitted engaging in the same conspiracy.

Joseph and Matthew Depante admitted that employees and contractors of ARG obtained telephone records and other confidential information belonging to subjects of an internal investigation conducted by Palo Alto-based Hewlett-Packard (HP), as well as for other clients located throughout the United States. The persons conducting the HP internal investigation asked ARG to obtain the confidential and personal information of multiple subjects whom they later discovered to be (1) HP board members, employees, and others affiliated with HP; (2) family members of the HP board members, employees, and others affiliated with HP; (3) reporters; and (4) family members of the reporters. ARG required clients to provide the personal information, including complete Social Security account numbers, associated with the subjects whose phone records they sought.

ARG used outside contractors to obtain the telephone records. Joseph and Matthew Depante admitted that they knew that the outside contractors contacted the telephone company provider, either online or telephonically, and fraudulently misrepresented that the outside contractor was the owner and subscriber of the telephone account in question. After obtaining the telephone records, the contractors passed the records to ARG, which passed them on to the clients who made the original requests for the confidential toll records. Joseph and Matthew Depante conspired with the outside contractors working for ARG to use this process to obtain confidential and personal information of at least 14 individuals who were later identified as subjects of the HP internal investigation, as well as 19 others.

Bryan Wagner pleaded guilty on January 12, 2007, to an information charging one count of conspiracy to 1) commit aggravated identity theft; 2) commit wire fraud; 3) access a computer without authorization and obtain information; and 4) falsely represent a Social Security number, in violation of 18 U.S.C. § 371, and one count of aggravated identity theft, in violation of 18 U.S.C. § 1028A. According to the information, ARG engaged Wagner to obtain telephone records of the subjects of the HP internal investigation through pretexting.

Joseph and Matthew Depante agreed that ARG grossed between $20,000 and $30,000 through pretexting.

In 2006, the U.S. House of Representatives, Committee on Energy and Commerce, conducted an investigation into what was called “Hewlett-Packard’s Pretexting Scandal.” Joseph Depante and Bryan Wagner were called to testify but declined to do so, citing their Fifth Amendment rights. Later that year, Congress passed and the president later signed the “Telephone Records and Privacy Protection Act,” Pub. L. 109–476, § 3(a), January 12, 2007, 120 Stat. 3569. That legislation created a new federal criminal statute, 18 U.S.C. § 1039, which makes it a felony to obtain confidential phone records by “pretexting”—that is, making certain specified false representations.

All defendants have been on pretrial release since their arraignments. The sentences were handed down by U.S. District Court Judge D. Lowell Jensen. Judge Jensen also ordered that the defendants pay restitution one of the victims for the expenses she incurred in relation to her participation in the investigation and prosecution of the defendants.

The prosecution is the result of a lengthy investigation by the Federal Bureau of Investigation and the Social Security Administration Office of Inspector General.