DOJ office indicts fraudsters in prepaid scheme

On May 9, 2013, a New York division of the U.S. Department of Justice reported the arrest and indictment of seven masterminds behind a large and sophisticated fraud scheme involving prepaid cards that netted the fraudsters $45 million. According to the United States Attorney's Office for the Eastern District of New York, the cybercriminals hacked into the prepaid card processing systems associated with two foreign banks to manipulate withdrawal limits on prepaid card accounts and hit ATMs in 26 countries with fake cards encoded with the hacked accounts.

The seven defendants in the case, all residents of Yonkers, N.Y., and an eighth who was reportedly murdered in late April 2013 in the Dominican Republic, apparently orchestrated two separate "Unlimited Operation" fraud schemes conducted between approximately October 2012 and April 2013. Unlimited Operations are characterized as such by their way of allowing fraudsters to abscond with virtually unlimited criminal proceeds.

The office of U.S. Attorney Loretta E. Lynch said the first scheme targeted the computer network of an unnamed processor of MasterCard Worldwide-branded prepaid cards issued by the National Bank of Ras Al-Khaimah PSC (RakBank) in the United Arab Emirates, and netted the fraudsters nearly $400,000. The second attack against the Bank of Muscat, located in Oman, resulted in about $40 million being withdrawn from ATMs in 24 countries.

ElectraCard Services, headquartered in Pune, India, and reportedly a processor of travel cards for RakBank, admitted it was hacked in the first attack, but not the second.

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