NEWARK, N.J. (2/7/13)--A credit card scam responsible for at least $200 million in losses is racking up impressive statistics: at least 7,000 phony identities, 25,000 fraudulent credit cards, and spanning eight countries and 28 states. But, for now, it is unclear whether credit unions are among the victim institutions.
The scheme involved:
- Making up false identities by creating fraudulent identification documents and fraudulent credit profiles with major credit bureaus;
- Pumping up the credit of the false identities by providing false information about their creditworthiness to the credit bureaus. The bureaus, believing the information was accurate, incorporated the false information into the credit reports, making it appear the false IDs had excellent credit; and
- Running up large loans using the false identities. The higher the fraudulent credit score, the higher the loans obtained. The loans were never repaid.
The scheme also used "tradelines" providers--a network of black-market businesses providing credit histories and adding "authorized" users to credit card accounts to raise their credit score.
Millions of dollars were wired to Pakistan, India, the United Arab Emirates, China, Romania, Japan and Canada.
Babar Quereshi, 59, of Iselin, N.J., and Muhammad Shafiq, 38, Bellerose, N.Y., are allegedly the ring's leaders, said the complaint. Most defendants have ethnic ties to Pakistan but live in New Jersey, Philadelphia, and New York. Three charged earlier have pleaded guilty.