California Couple Convicted of Federal Credit Card Fraud and Identity Theft Charges
|U.S. Attorney’s Office December 04, 2013|
ATLANTA—Elton Lee Flenaugh and Deje D. Silas have been convicted of federal credit card fraud and identity theft charges.
“This case highlights the need for aggressive federal investigation and prosecution of credit card fraud and identity theft crimes,” said United States Attorney Sally Quillian Yates. “We commend the U.S. Secret Service for synchronizing local law enforcement activities in multiple cities to bring this brazen, multi-state scheme to a halt and these defendants to justice.”
“The defendants’ criminal actions reflect how advancements in digital technology can alternatively have a negative effect on our communities. The Secret Service will continue to collaborate with its law enforcement partners and the public and private sectors to actively investigate and arrest those that commit crimes that prey on unsuspecting victims,” said Reginald G. Moore, Special Agent in Charge of the United States Secret Service, Atlanta Field Office.
According to United States Attorney Yates, the charges, and other information presented in court, Flenaugh and Silas had a romantic relationship dating back several years. On February 9, 2013, Flenaugh and Silas were scheduled to fly from Atlanta to Los Angeles. During the pre-flight security screening process, alert TSA security officers noticed a suspicious package in Flenaugh’s carry-on bag and, upon further inspection, found nearly 100 fraudulent credit cards secreted inside a double-sealed manila envelope, which had been hidden inside an empty, foil-lined Lay’s potato chip bag. Thirty-three of the cards were embossed in Silas’ name, 28 were embossed in three different aliases used by Flenaugh, and 21 were blank and had not yet been embossed. Subsequent searches by the Atlanta Police Department revealed fraudulent driver’s licenses inside the protective case attached to Silas’ cell phone and underneath the removable insole of one of Flenaugh’s shoes in the carry-on bag.
Additional investigation revealed fraudulent credit cards, licenses, and stolen credit card account and identity information of hundreds of people. These were found in personal items seized from and during searches of Google e-mail accounts controlled by Flenaugh and Silas, an Apple iPad seized from them at the airport, and a 2007 BMW M6 automobile registered to one of Flenaugh’s aliases.
The investigation showed that the scheme began at least by early 2012 and continued until Flenaugh and Silas’ arrests in February 2013. The scheme involved obtaining credit and debit card account information of hundreds of people, which were then used to manufacture fraudulent credit cards. The cards were made to appear as if they had been issued by major financial institutions such as Chase Bank, U.S. Bank, and Capital One. The defendants also obtained personal identifying information—including Social Security numbers, dates of birth, and credit information—of dozens of people, which were used to create fraudulent driver’s licenses to use with the fraudulent credit cards. The fraudulent credit cards were then embossed with the names used on the fraudulent driver’s licenses. The issuing banks and the names embossed on the fraudulent credit cards were merely a front to make them appear legitimate. The magnetic stripes on those cards were encoded with the actual debit and credit card account information of account holders at dozens of financial institutions throughout the country, but primarily at credit unions located in California, Florida, Georgia, Oregon, and Washington.
In at least three instances identified to date, Flenaugh and Silas opened fraudulent credit card accounts in one of the stolen identities and made thousands of dollars in unauthorized charges. As part of his plea agreement with the United States, Flenaugh agreed that he is responsible for losses between $200,000 and $400,000.
Elton Lee Flenaugh, a/k/a Josh Ford a/k/a Ali Waheed, 34, of Richmond, California; and Deje D. Silas, 21, of San Francisco, California, were originally arrested and charged by the Atlanta Police Department at the airport on February 9th and taken into custody by the Clayton County Sherriff’s Office.
On March 4, 2013, the U.S. Secret Service took Flenaugh into federal custody at the Clayton County Jail after Clayton County authorities indicated that Flenaugh had posted bond and would be released from custody in Clayton County. A federal complaint was filed against him later that day. On March 7, 2013, the court ordered Flenaugh detained as a flight risk and as a danger to the community, and he has remained in custody since then. A federal grand jury indicted Flenaugh on the instant charges on April 2, 2013.
Flenaugh pleaded guilty today to one count of possession of 15 or more counterfeit or unauthorized access devices and one count of aggravated identity theft. The charge against him for possession of counterfeit or unauthorized access devices carries a maximum sentence of 10 years in federal prison, and the aggravated identity theft charge carries a mandatory minimum sentence of two years in federal prison, which is required to be imposed consecutive to any sentence imposed on the possession charge. Each of the charges also authorizes a fine of up to $250,000. In determining the actual sentence, the court will consider the United States Sentencing Guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.
Silas remained in Clayton County custody until May 8, 2013, when she agreed to waive indictment and appeared in federal court on a criminal information pursuant to a negotiated plea agreement. On May 21, 2013, she pleaded guilty to one count of conspiracy to possess 15 or more counterfeit or unauthorized credit cards. On August 28, 2013, the court sentenced Silas to three years, five months in federal prison in connection with the scheme. Silas is currently serving her sentence.
Sentencing for Flenaugh is scheduled for February 27, 2014, at 2:00 p.m. before Senior United States District Judge Orinda D. Evans.
This case is being investigated by special agents of the United States Secret Service. Valuable assistance has been provided by the Hartsfield-Jackson Atlanta International Airport division of the Atlanta Police Department, the Office of the Chief Counsel of the Transportation Security Administration, the city of Atlanta Department of Aviation, the Miami-Dade State’s Attorney’s Office, the San Francisco Field Office of the Federal Bureau of Investigation, the Investigations Division of the California Department of Motor Vehicles, and the Oakland Police Department.
Assistant United States Attorney David M. Chaiken is prosecuting the case.
Anyone who believes they may be the victim of identity theft is strongly encouraged to request and review their credit reports from the three nationwide consumer credit reporting companies, Equifax, Experion, and Trans Union, to be sure everything on the reports are authorized and to request a fraud alert from the companies. It is also suggested that they immediately close any accounts that have been compromised or opened fraudulently. Those who do online banking or manage other accounts online should check these accounts regularly and be sure passwords are strong. To report identity theft, contact the Federal Trade Commission at http://www.consumer.ftc.gov/articles/0277-create-identity-theft-report or the FTC Identity Theft Hotline at 1-877-438-4338 or TTY 1-866-653-4261.
For further information please contact the U.S. Attorney’s Public Affairs Office at USAGAN.Pressefirstname.lastname@example.org or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia Atlanta Division is http://www.justice.gov/usao/gan/.