Intellectual Property Law

TJX Suspect Was Near Plea Agreement Until New Charges Halted Talks

By Kim Zetter

Accused TJX hacker Albert Gonzalez, who is set to go to trial next month in New York, was close to reaching a comprehensive settlement with federal prosecutors when new charges were levied against him this week in New Jersey, according to his lawyer.

Rene Palomino, Jr., told the New York Times that he had been close to a settlement that would have put an end to all active investigations against his client, including the new New Jersey case. In exchange for a guilty plea, Gonzalez was ready to agree to a prison sentence in the 20-year range, but the new indictment halted the negotiations.

?We are giving it our best shot trying to resolve these cases and to prevent the government from wasting all these millions of dollars to bring to trial all these cases,? Palomino told the Times. ?We were very close.?

Palomino accused New Jersey prosecutors of showmanship and said they moved up the timing of the indictment announcement in order to short-circuit the plea talks.

?I guess so they could bask in the glory of all the publicity they are getting from this,? he said.

Gonzalez was arrested in 2008 and charged with hacking into the networks of Dave & Busters restaurant chain, TJX and other companies. He was facing trial in New York next month on the Dave & Busters charges and next year in Massachusetts on the TJX charges.

Then on Monday, prosecutors in New Jersey announced a new indictment against Gonzalez and two unnamed Russian co-conspirators for hacking into Heartland Payment Systems, Hannaford Brothers, 7-Eleven and two unnamed retailers. The breaches of Heartland and Hannaford resulted in the theft of about 130 million credit and debit card numbers. Not calculated in the indictment were the losses from the breaches into 7-Eleven and the unnamed retailers.

Justice Department spokesman Ian McCaleb said the department had no comment at this time.

Palomino identified one of the unnamed Russian co-conspirators as Maksym Yastremski, who is already serving a 30-year sentence in a Turkish prison for his role in separate hacks in that country.

See also:

• TJX Hacker Charged With Heartland, Hannaford Breaches
• Card Processor Admits to Large Data Breach
• TJX Hacker Was Awash in Cash; His Penniless Coder Faces Prison
• Former Teen Hacker’s Suicide Linked to TJX Probe
• I Was a Cybercrook for the FBI
• Bullion and Bandits: The Improbable Rise and Fall of E-Gold
• Hacking Godfather ‘Maksik’ Sentenced to 30 Years by Turkish Court
• Stakeouts, Lucky Breaks Snare Six More in Citibank ATM Heist

Full post as published by Threat Level on August 19, 2009 (boomark / email).