FOUR MEN PLEAD GUILTY TO MULTI-STATE FRAUD SCHEME TO OBTAIN MORE THAN $330,000 IN NEW CELL PHONES

FOUR MEN PLEAD GUILTY TO MULTI-STATE FRAUD SCHEME

TO OBTAIN MORE THAN $330,000 IN NEW CELL PHONES

BOSTON – Four men pleaded guilty today in U.S. District Court in Boston in connection with a fraudulent scheme to obtain and re-sell more than $330,000 in new cell phones. 

       

Jimmy Phan, 29 of Boston; David Hul, 34 of North Arlington, NJ; Curtis Peebles, 26 of Boston and New York, NY; and Lee Tran, 29 of Waltham, pleaded guilty to wire fraud conspiracy.  U.S. District Court Senior Judge Mark L. Wolf scheduled sentencing for May 23, 2016.

At today’s hearing, the defendants admitted that they and their co-conspirators gained access to T-Mobile customer records, including customer names, phone numbers, and information regarding those customers’ eligibility for free phone upgrades.

From at least January 2014 through October 17, 2014, Phan, Hul, Peebles, and other co-conspirators called T-Mobile customer service centers and, impersonating T-Mobile employees, used dealer codes that enabled them to add any name as an authorized user on T-Mobile accounts.  They then recruited “runners”, including Tran and others, to go into T-Mobile stores and impersonate the customers.  Phan, Hul, and Peebles used the dealer codes, among other methods, to cause either the runners’ real names or false identities to be added the customer accounts, sometimes using false names that closely matched the runners’ real names to reduce the likelihood of T-Mobile detecting the fraud.

Runners then went to T-Mobile stores in Massachusetts, Nevada, New Hampshire, New York, Pennsylvania, Rhode Island, New Jersey, Florida, and elsewhere, presented identification in the real or assumed names, and acquired one or more new cell phones on accounts that were eligible for upgrades.  Runners then returned the new phones to Phan, Hul, Peebles, and others, who paid them a portion of the phone’s value.  Although T-Mobile regularly alerted its customers to changes to their accounts, the affected customers frequently did not learn of the fraudulent modifications in time to prevent the distribution of the phones.

       

Phan, Hul, and others re-sold the cell phones to other co-conspirators for distribution in the United States and abroad.  In total, Phan, Hul, Peebles, Tran, and other co-conspirators obtained at least $330,000 worth of new cell phones by defrauding T-Mobile.

       

The charging statute provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000.  Phan, Hul, Peebles and Tran agreed to pay restitution and to forfeit proceeds from the offense and various items seized from Phan’s house in connection with his arrest.  Actual sentences for federal crimes are typically less than the maximum penalties.  Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

Co-defendants Kevin Johnson, 24, of New York, NY, and Khoa Doan, 32 of Manchester, NH, are currently slated to stand trial.

United States Attorney Carmen M. Ortiz; Matthew J. Etre, Special Agent in Charge of Homeland Security Investigations in Boston; and Lisa Quinn, Special Agent in Charge of the U.S. Secret Service’s Boston Field Office, made the announcement today.  The U.S. Attorney’s Office acknowledges T-Mobile for its assistance with the investigation.  The case is being prosecuted by Assistant U.S. Attorney Seth B. Kosto of Ortiz’s Cybercrime Unit.