Intellectual Property Law

Federal Reserve Chairman Hit by High-Tech Pickpocket Ring

By Kim Zetter

Identify theft isn’t just for the little people.

Federal Reserve Board chairman Ben Bernanke and his wife are among the victims of the tech-savvy pickpocket and ID theft ring Cannon to the Wiz, Newsweek reported Tuesday.

Threat Level readers will remember that Wiz is a national ring of some 200 light-fingered scammers that kept police around the country on their toes for at least two years. The group was led by Clyde Austin Gray Jr., 52, of Waldorf, Maryland, who went by the names ?Big Head? and ?Poochie.” Gray pleaded guilty in July to conspiracy to commit bank fraud in a scheme that resulted in losses of at least $2.1 million from 10 financial institutions. Nine other co-conspirators have been charged to date.

Based in Chicago, but prone to wandering around the country, the gang specializes in stealing identity and bank account information through pickpocketing and other means, including smuggling checks out of a Washington, D.C., charity-fundraising group, and paying an employee at a D.C. medical office to copy patients’ bank account information.

Some members of the ring allegedly traveled to sporting events, such as the Final Four basketball games in Detroit in April, to pickpocket fans. The gang then used the information to cash checks through the victims? bank accounts in several states. They reportedly kept ID-producing gear and laptops in the their cars, so as to rapidly crank out fake driver’s licenses to exploit stolen credit cards and checks within minutes of lifting them.

According to court document, the crooks were particularly adept at bank fraud scheme known as ?split deposits.” They?d write a check to one victim?s bank account on checks stolen from another victim, then withdraw the money and disappear. This is exactly what occurred to Bernanke and his wife, Anna.

According to Newsweek, last summer, just as Bernanke was beginning to deal with the first round of the financial crisis that struck Wall Street and the banking industry, he learned that his wife’s purse had been snatched by a thief. Anna Bernanke was at a Starbucks near Capitol Hill when the crook grabbed her purse from the back of her chair. It contained a checkbook for the couple’s joint Wachovia bank account, as well as her driver’s license, Social Security card, and four credit cards. The checks listed the couple’s bank account number, name, home address and phone number.

Six days later a suspect named George Lee Reid entered a Bank of America branch in Prince George’s County and posed as another identity-theft victim, identified in a federal affidavit as “K.N.”, who had previously reported his wallet stolen.

Reid allegedly deposited two fraudulent checks in the amount of $900 into K.N.’s bank account — one of which was a check from Bernanke’s checkbook. Once the checks were deposited, he then allegedly cashed two other fraudulent checks in the amount of $4,500 that were made out to K.N. from a third victim. He left the bank with $9,000 in cash, according to court records. Bernanke, who had reported the theft, suffered no financial loss, according to Newsweek.

When the pickpocket gang was busted earlier this year, victims were identified only by their initials. Bernanke was referred to in court documents only as “B.B.” But Newsweek found a separate criminal complaint against Reid filed last year in D.C. Superior Court, which named one Ben S. Bernanke as a victim in Reid’s scams.

“Identity theft is a serious crime that affects millions of Americans each year,” Bernanke said in a statement provided to Newsweek. “Our family was but one of 500 separate instances traced to one crime ring. I am grateful for the law enforcement officers who patiently and diligently work to solve and prevent these financial crimes.”

Bernanke has not responded to a call from Threat Level.

See also:

• Feds Swoop In on Nationwide Pickpocket, I.D. Theft Ring
• Ringleader of High-Tech Pickpocket Gang Pleads Guilty

Full post as published by Threat Level on August 26, 2009 (boomark / email).