Georgia Man Admits Role in $1.3 Million Phishing Fraud Scheme

Hackers Used Personal Financial Information to Steal from Bank and Payroll Processing Accounts in New Jersey, Elsewhere

NEWARK, NJ—Waya Nwaki today admitted his role in an Internet fraud ring that stole more than $1.3 million after “phishing” confidential account information from Internet users, New Jersey U.S. Attorney Paul J. Fishman announced.

Nwaki, a/k/a “Shawn Conley,” a/k/a “usaprince12k,” 31, of Atlanta, pleaded guilty to one count each of wire fraud conspiracy; wire fraud; aggravated identity theft; and conspiracy to gain unauthorized access to computers—counts one, nine, 14, and 20 of the indictment against him. Nwaki entered his guilty plea before U.S. District Judge William J. Martini in Newark federal court.

According to documents filed in this case and statements made in court:

The ring employed “phishing” attacks, which use fraudulent web pages that mimic the legitimate web pages of e-commerce companies such as banks and payroll processors. Unwitting customers of those companies visit the fake web pages and provide confidential personal and financial information—dates of birth, Social Security numbers, mothers’ maiden names, and online account user names and passwords. These stolen identifiers are then used to make unauthorized withdrawals from victims’ accounts.

Nwaki received phished stolen identifiers from others charged in the Indictment, including Karlis Karklins, a Latvian national who worked with Charles Umeh Chidi and others, to deploy phishing websites across the Internet. Nwaki then provided the stolen identifiers via e-mail to Marvin Hill, Osarhieme Obayagbona, Alphonsus Osuala, and others.

Nwaki and his co-conspirators then used the information to make unauthorized withdrawals from victims’ accounts. Some of the stolen identifiers were used to create fake driver’s licenses the conspirators could use to impersonate victims at bank branches. Nwaki admitted he worked with others to hire “soldiers” to go into the banks and impersonate real customers using fake licenses made with the soldiers’ pictures.

The ring also used the information to gain access to the victims’ online accounts, where they could view victim signatures on check images in order to forge them on checks and withdrawal slips.

Nwaki admitted he used stolen identifiers to intercept and respond to e-mails—sometimes sent by banks to customers when an unfamiliar computer or IP address accesses an account—to impersonate the real account holders.

Nwaki also admitted he was asked as part of the scheme to impersonate company payroll officers in conversations with ADP, a national payroll processing company headquartered in New Jersey.

Chase Bank, Bank of America, ADP and Branch Bank & Trust Co. together lost approximately $1.3 million to the fraud ring.

Nwaki was arrested in Atlanta on Dec. 29, 2011, and has been detained since his arrest. Obayagbona and Hill are awaiting trial on the Indictment. Osuala is in custody on unrelated federal charges in Georgia. Jones is detained in Nigeria. Karklins and Chidi are at large.

The wire fraud conspiracy and wire fraud counts to which Nwaki pleaded guilty each carry a maximum potential penalty of 20 years in prison; the aggravated identity theft carries a mandatory two years in prison, to be consecutive to the sentence imposed on the wire fraud conspiracy count; and the computer fraud conspiracy count carries a maximum potential penalty of five years in prison. Each count also carries a maximum $250,000 fine. Sentencing is currently scheduled for Aug. 15, 2012.

U.S. Attorney Fishman praised special agents of the FBI, under the direction of Special Agent in Charge Michael B. Ward in Newark, with the investigation leading to today’s guilty plea. He also thanked special agents of the FBI in Atlanta, under the direction of Special Agent in Charge Brian D. Lamkin, and the Alpharetta (Georgia) Police Department for their assistance in the investigation.

As for the remaining defendants, the charges and allegations contained in the Indictment are merely accusations, and they are considered innocent unless and until proven guilty.

The government is represented by Assistant U.S. Attorneys Seth B. Kosto, of the U.S. Attorney’s Office Economic Crimes Unit, and Andrew Pak, of the Office’s General Crimes Unit in Newark.

Defense counsel: Dennis Cleary, Esq., Newark