U.S. authorities in California, Nevada, and North Carolina so far have arrested 33 of 53 defendants named in an indictment by a federal grand jury in Los Angeles. Egyptian authorities have charged 47 people in the scheme in the first-ever joint cybercrime investigation between Egyptian and U.S. authorities. FBI officials say the charges in the U.S. represent the largest cybercrime investigation to date.
"The sophistication with which Phish Phry defendants operated represents an evolving and troubling paradigm in the way identity theft is now committed," said Keith Bolcar, acting assistant director in charge of the FBI in Los Angeles. "Criminally savvy groups recruit here and abroad to pool tactics and skills necessary to commit organized theft facilitated by the computer, including hacking, fraud, and identity theft, with a common greed and shared willingness to victimize Americans."
The indictment says the Egyptian-based attackers phished bank account numbers and related personal information from an unknown number of bank customers and then hacked into accounts at two banks -- the names of which were not disclosed publicly.
The Egyptian defendants allegedly then worked with their co-conspirators in the U.S., who transferred the funds from victims' accounts to fraudulent accounts set up for the ring. U.S. defendants Kenneth Joseph Lucas, Nichole Michelle Merzi, and Jonathan Preston Clark, all of California, ordered associates to recruit "runners" to set up the accounts. Some of the stolen money was transferred via wire services to their Egyptian counterparts.
The indictment accuses all of the alleged phishing ring members with conspiracy to commit wire fraud and bank fraud, which could carry a sentence of 20 years in federal prison. Some were also charged with bank fraud; aggravated identity theft; conspiracy to commit computer fraud, specifically unauthorized access to protected computers in connection with fraudulent bank transfers; and domestic and international money laundering.
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