The U.S. Justice Department announced charges against 18 people who bilked financial institutions out of at least $200 million in an international credit card fraud scheme. This would be one of the biggest credit card scams ever broken up by the U.S. Justice Department.
Charges were filed in U.S. District Court in Newark. The fraud occurred in at least 28 states and eight countries. Court papers say that millions of dollars were wired to India, Pakistan, Canada, Romania, China, Japan and the United Arab Emirates.
Authorities believe the scam started ten years ago. The ring used 1,800 different addresses to create thousands of false identities. The thieves sent fictitious reports to credit agencies which persuaded the agencies to give the fictitious people excellent credit scores. They used these identities and scores to obtain 25,000 credit cards.
The scammers started out with small purchases over an extended time. The excellent credit scores gave the thieves higher credit limits to run up large loans that they never repaid.
They also set up at least 80 false companies that did little or no legitimate business. They allegedly set up terminals that rang up false charges, using the money to buy electronics, spa treatment, luxury automobiles and gold. Millions of dollars were wired overseas.
Prosecutors said Muhammad Shafiq and Babar Qureshi, of Iselin, N.J., were the ringleaders. The defendants are scheduled to appear this afternoon in a Newark federal court.