HELOC fraudster convicted for duping CUs, banks

NEWARK, N.J. (5/12/09)--A New York man pleaded guilty Friday to selling Social Security numbers to an identity theft ring that targeted large home equity lines of credit (HELOCs) and siphoned off at least $2.5 million from dozens of credit unions and banks in New Jersey.

Yomi Jagunna, 44, pleaded guilty in a U.S. District Court in Newark of setting up a sham collection agency to gain access to a commercial database and selling 39 Social Security numbers for $30 each to the group.

Prosecutors said they had evidence he mined more than 100,000 Social Security numbers, a statement disputed by the defense attorney (Star-Ledger via nj.com May 9).

Jagunna is among eight people charged in New Jersey between August and November 20089 in connection with the alleged ring. They are part of a larger, nationwide ring. So far, 17 people have been charged nationally.

The group targeted victims with large HELOCs, and often transferred more than $100,000 and as high as $800,000 in transfers from the HELOCs.

Members of the theft ring fooled financial institution employees into transferring funds to accounts in at least seven countries. Authorities are still trying to recover the funds.

In the scheme, the ring thwarted credit unions' and banks' attempts to verify the transfers with telephone calls. Some allegedly posed as the victims and persuaded phone company employees to reroute the victims' calls. Then, when the credit union called to verify the transfers, thieves' cell phones would ring and they would "verify" the transfers.

In early 2008, CUNA Mutual Group warned credit unions about the sophisticated fraud scheme. At the time, 18 credit unions had reported losses or fraud attempts totaling more than $6.5 million, and the losses were expected to increase (News Now Jan. 16, 2008).

courtesy of cuna.org