Jewelry store owners Vijay Verma, 49, and Tarsem Lal, 78, both of Iselin, New Jersey were charged today for orchestrating one of the largest credit card fraud schemes ever right out of their store.
The two were indicted in October of 2013 for playing their roles in a scheme to fabricate more than 7,000 false identities to obtain tens of thousands of credit cards. The other contributors in the operation were in charge of altering the credit reports in order to pump up the spending and borrowing power associated with the cards. They then borrowed or spent as much as they could, based on the phony credit history, but did not repay the debts.
This alone caused more than $200 million in confirmed losses to businesses and financial institutions and they were all traced back to Verma’s jewelry store, and other locations that Verma would allow fraudulently obtained credit cards to be swiped in phony transactions.
The plan involved a three-step process. First, the defendants would make up a false identity by creating fraudulent identification documents and a fraudulent credit profile with the major credit bureaus. Next, they would boost the credit of the false identity by providing false information about that identity’s creditworthiness to those credit bureaus, then they would run up large charges and never pay back the debt.
Across the country, they maintained more than 1,800 “drop addresses,” including houses, apartments and post office boxes. They used them as the mailing addresses for the false identities which required those involved in the scheme to create an elaborate network of false identities.
Verma and Lal each admitted that they were allowing others who came to their Jersey City, New Jersey store to swipe cards that they knew did not legitimately belong to them. Verma and Lal would then split the proceeds with these other conspirators.
They were sentenced to 14 months in prison and 12 months of home confinement. In addition to the prison terms, Verma is sentenced to three years of supervised release and Lal to three years of probation. Each defendant was fined $5,000 and ordered to pay forfeiture of $451,259.
Both previously pleaded guilty to one count of access device fraud. Judge Thompson imposed the sentence today in Trenton federal court.
*This case is part of efforts underway by the Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorney’s offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.