11 Defendants Charged in Credit Card “Bust Out” Scheme

Five complaints were unsealed yesterday in federal court in Brooklyn charging 11 defendants in a scheme to defraud banks by using fake, or “synthetic,” identities to obtain credit cards, and making approximately $3 million in charges that were never repaid to the issuing financial institutions.  Three of the defendants were also charged with money laundering conspiracy, designed to conceal the source of the proceeds of their scheme.  Nine defendants were arrested yesterday.  Eight defendants made their initial appearances before United States Magistrate Judge Lois Bloom and were released on bond.  One defendant will appear today before Magistrate Judge Bloom.  Two defendants are not in custody.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, Angel M. Melendez, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Linda A. Lacewell, Superintendent, New York State Department of Financial Services (DFS), announced the charges.

“As alleged, the defendants operated a ‘bust out’ scheme using fraudulently obtained credit cards to finance expenses, ranging from furniture to real estate and totaling $3 million. Now they will be held accountable,” stated United States Attorney Donoghue.  “Together, with our law enforcement partners, we stand committed to protecting financial institutions from fraud.”

“Those arrested today allegedly engaged in fraudulent activities aided by shell companies and collusive merchants to carry out their ‘bust out’ schemes and the laundering of its proceeds, defrauding financial institutions of millions of dollars” stated HSI Special Agent-in-Charge Melendez.  “As revealed in this investigation, synthetic identity fraud is ever evolving in sophistication and frequency, creating more challenges for law enforcement and anti-money laundering professionals.  HSI New York’s El Dorado Task Force and its partners remain vigilant for emerging criminal trends in its efforts to secure our country’s financial system.”

“While this alleged scheme may seem like a victimless crime, fraud hurts the entire financial system, including banks and credit card companies, with the costs passed down to consumers.  DFS is pleased to have partnered with the U.S. Attorney’s Office to bring these defendants to justice, and we will continue to use all of the resources at our disposal to combat fraud,” stated DFS Superintendent Lacewell.

As alleged in court filings, between January 2013 and December 2017, the defendants  used synthetic identities created by using various types of personal identification information (names, dates of birth and Social Security numbers) from different individuals to create a fake identity and obtain credit cards from financial institutions.  They then used those cards for expenditures that they had no intention to repay, including mortgages on three residential properties in Queens, New York.  The defendants also used shell companies, that did little or no legitimate business, to record hundreds of thousands of dollars on the fraudulently obtained credit cards, and then received payment for the sham transactions from financial institutions and credit card processors.

Defendants Bahader Thiara, Hafeez Ali, Mohammad Akhtar, Nadezhda Epshteyn, Cyrus Shroff, Anis Khan, Daljeet Singh, Zainoelbaks Karimbux and Gursimardeep Singh Rai are  charged with access device fraud.  Bahader Thiara, Perminder Thiara and Shaila Khondkar are also charged with money laundering conspiracy. 

If convicted, the defendants charged with access device fraud face up to 10 years’ imprisonment, and up to 20 years for money laundering conspiracy.

The charges are allegations, and the defendants are presumed innocent unless and until convicted.

The government’s case is being handled by the Office’s General Crimes Section.  Assistant United States Attorneys Temidayo Aganga-Williams and David Lizmi are in charge of the prosecution.  Assistant United States Attorney Tanisha Payne of the Office’s Civil Division is handling forfeiture matters.

The Defendants:

E.D.N.Y. Docket No. 19-MJ-583

MOHAMMED AKHTAR
Age:  43
Flushing, New York

HAFEEZ ALI
Age:  54
Fort Hamilton, Brooklyn

E.D.N.Y. Docket No. 19-MJ-566

SHAILA KHONDKAR
Age:  48
Jamaica, New York

BAHADER THIARA
Age:  42
Queens Village, New York

PERMINDER THIARA
Age:  40
Queens Village, New York

E.D.N.Y. Docket No. 19-MJ-570

NADEZHDA EPSHTEYN
Age:  44
Rockaway Park, New York

CYRUS SHROFF
Age:  45
Rockaway Park, New York

E.D.N.Y. Docket No. 19-MJ-1029

ZAINOELBAKS KARIMBUX
Age:  50
Bellerose, New York

GURSIMARDEEP SINGH
Age:  34
Bronx, New York

E.D.N.Y. Docket No. 19-MJ-571

ANIS KHAN
Age:  32
Sheepshead Bay, New York

DALJEET SINGH (also known as “Akhtar Iqbal”)
Age: 46
College Point, New York