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Two men sentenced in widespread HELOC frauds
NEWARK, N.J. (1/13/10)--Two men who admitted to participating in an international identity theft scam that targeted home equity lines of credit (HELOCs) at credit unions and banks in New Jersey and several other states were sentenced Monday in a Newark federal court to prison. Derrick Polk, 47, was arrested in 2008 with three others and charged with targeting homeowners with big HELOCs at financial institutions, including Citibank and JPMorgan Chase and credit unions in Basking Ridge, Bridgewater and Toms River, N.J. He was sentenced to five years and 10 months in prison (The Star-Ledger Jan. 11). Oludola Akinmola, 39, who also pleaded guilty, was sentenced to four years and three month in prison. Since he is an illegal immigrant from Nigeria, he could eventually face deportations, the newspaper said. The men used stolen personal data and technological tricks to fool employees at financial institutions into transferring funds to accounts in at least seven countries, the paper said. The plot involved at least 17 people nationally. Two others were arrested with Polk and Akinmola in 2008 for siphoning off at least $2.5 million from HELOCs. It was predicated on victims’ personal information including Social Security numbers, mothers’ maiden names and online passwords, authorities said, according to the paper. The two other suspects also pleaded guilty. Adekunle Adejuyigbe was sentenced to 46 months in prison; Oluwajide Ogunbiyi was sentenced to 15 months in prison. From early January to March 1, 2008, credit unions reported to CUNA Mutual Group 43 incidents of losses or fraud attempts totaling $8.8 million related to HELOCs (News Now March 25, 2008). In one case, according to court records, they transferred $675,000 from Affinity CU in Basking Ridge to a bank in Tokyo. In 2008, the National Credit Union Administration issued an alert that noted some of the scams involved a high level of sophistication, which enabled the fraudsters to bypass certain authentications controls (News Now Jan. 30, 2008). For example, in one case, the imposter had the ability to fool Caller ID software by making it appear that the call initiated from the account holder’s valid phone number. In other cases, imposters were knowledgeable of recent account activity--such as deposits or withdrawal amounts--and used the information to authenticate themselves as the account holder to the credit union representative.
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