The mastermind of a roughly $3 million credit card scheme involving nine Jersey City or Secaucus residents was arrested today, Acting Attorney General John Jay Hoffman announced.
By John Heinis/Hudson County View
Mohammad Shahid Zaman, 42, of Staten Island, N.Y., was picked up this morning in New York by detectives of the New Jersey Division of Criminal Justice (DCJ) and agents of the ICE Homeland Security Investigations, the U.S. Postal Inspection Service and the U.S. Social Security Administration Office of Inspector General, assisted by the New York City Police Department.
He consented to return with the DCJ detectives to New Jersey, where he was placed under arrest on charges of first-degree money laundering, second-degree theft by unlawful taking and third-degree fraudulent use of credit cards. He was lodged in the Union County Jail with bail set at $1 million, with no 10 percent option.
The other 12 defendants, many of whom live in Secaucus and Jersey City and were charged in December, allegedly created â€œsyntheticâ€ identities by pairing real Social Security numbers with fictitious names and birth dates, using them to open numerous checking and credit card accounts, officials said.
Zaman allegedly provided one of the defendants arrested in December, Naim Tahir, 47, of Clark, with stolen Social Security numbers and other personal identifying information used to open accounts, authorities said.
The participants allegedly opened the accounts online so as to avoid face-to-face interaction with the financial institutions. Bad checks were deposited into the bank accounts so that the accounts could be used to make payments on the credit cards, which temporarily inflated the lines of credit on the cards, officials said.
Additionally, funds were withdrawn from the bank accounts via ATM and U.S. Postal Money Order Purchases before the bad checks were discovered. Allegedly, the defendants ultimately â€œbusted outâ€ the credit cards by running up the unpaid balances until they reached or exceeded the credit limits.
The scheme included a group of â€œmerchantsâ€ who in many cases ran shell businesses set up solely for the purpose of participating in this fraud, authorities said.
The merchants swiped the fraudulent credit cards using point of sale terminals and received reimbursement from credit card processing companies via wire transfer, while never actually providing any merchandise or services, officials said. The ring members allegedly then split the proceeds.
The bank accounts of the shell companies set up by the merchants also allegedly were used to launder the proceeds of the scheme, with checks being written from one company to another as if they were conducting business.
The following 12 defendants were charged by complaint in December with first-degree money laundering, second-degree theft by unlawful taking, and third-degree fraudulent use of credit cards:
Naim Tahir, 47, of Clark
Hassan Shahbaz, 42, of Jersey City
Aqeel Ahmed, 60, of Secaucus
Shama Munir, 49, of Secaucus
Faisal Mushtaq, 37, of Secaucus
Mohammad Shakeel, 46, of Jersey City
Muhammad Farooq Bhatti, 64, of Jersey City
Rilvan Junaid, 49, of Spring Valley, N.Y.
Shakeela Ahmed, 56, of Secaucus
Aqeel Sheikh, 54, of Secaucus
Mohamed Khan, 53, of Piscataway
Huda Ahmed, 27, of Secaucus
All of the defendants, with the exception of Khan, were arrested on December 8 and 9 and were lodged in the Union County Jail with bail for each initially set at $1 million, no 10 percent option.
All were granted bail reductions and posted bail, with the exception of Shahbazz and Bhatti. Sheikh posted bail but was taken into custody by ICE on a federal detainer,Â Khan was arrested on Jan. 14 and was released after posting $450,000 bail, officials said.
Authorities executed search warrants in December and seized cash and bank accounts totaling approximately $1.9 million.
It is alleged that Tahir was primarily responsible for creating the synthetic identities and applying for the bank accounts and credit cards, using personal identifying information supplied by Zaman.
Shahbaz is the owner of USA United Trading, a business in Jersey City that he allegedly opened for the sole purpose of defrauding financial institutions.
The indictment says that USA United Trading conducted approximately $1.6 million in fraudulent credit card transactions. USA United Trading held itself out as a carpet retailer, with a store front at 150 Monticello Avenue in Jersey City.
The investigation began when the U.S. Postal Inspection Service (USPIS) received a referral from Wells Fargo Bank about a bad check case the bank was investigating.
USPIS enlisted agents of the Social Security Administration and ICE Homeland Security Investigations in Newark, who in turn enlisted the state agencies.