Phillip Smith, Ring Leader of a $1 Million Identity Theft Ring, Faces 22 Years in Prison

Categories: Frauds

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Phillip Smith, a 55-year-old Bronx native, pleaded guilty in Manhattan Federal Court today for his role as ring leader of a large-scale identity theft scam involving customers with credit accounts at big retail stores.

Smith faces a maximum of 22 years in prison for pleading guilty to three counts of conspiracies to commit access device fraud, to produce false identification documents and aggravated identity theft, according to a release from the New York Attorney General's Office.

For anyone not quite sure of how some of these identity theft schemes work, Smith and seven other scammers used credit information from customers with accounts at big-box retail stores -- such as Home Depot, Kohl's and Sears -- to purchase pricey products. He then sold the products to a secondary party at a price lower than market value, according to the release.

"For more than three years, these defendants methodically victimized hundreds of New Yorkers in an elaborate scheme to line their own pockets," New York Attorney General Eric Schneiderman said in a release "We will aggressively crack down on identity theft, and these guilty pleas send a message: Identity thieves will go to jail."

Schneiderman's office led the two-year investigation of the illegal operation in tandem with the Manhattan U.S. Attorney's Office and New York's Homeland Security Investigations division. The scam began in 2008 when Smith somehow got a hold of multiple forms of identification -- including social security numbers -- for thousands of people, according to the release.

Smith used that data to identify which of those people held credit accounts with retail stores. He then delivered that information to three brothers, Mahmoud Abdul Hussein, 28, Ali Abdul Hussein, 34, and Fadal Abdul Hussein, 23, who created fake driver's licenses in the names of the victims, the release says.

Eugene Smith, 39, Winston Harris, 57, and a third cohort then used the fraudulent licenses to impersonate the victims and make credit purchases in their name at retail stores in 12 different states. The products were then sold to Francis Hidalgo, 45, and Randy White, 57, for 60 percent of their original price, the release says

In a show of criminal portfolio diversity, Hidalgo also grew marijuana out of two Bronx warehouses -- from which authorities seized over 400 plants, according to the release. Hidalgo, who pleaded guilty yesterday, faces up to 55 years in prison. White faces five years in prison. The Hussein brothers are looking at a maximum of 15 years in prison, and the rest of the conspirators face up to 22 years behind bars.

"Today's guilty pleas put an end to a scam that victimized hundreds of New Yorkers and defrauded retail stores of more than a million dollars," HSI Special Agent-in-Charge James T. Hynes Jr. said in the release. "This case exemplifies HSI's, and its law enforcement partners' commitment to work as a unified force to disrupt criminal organizations bent on fraud to feed their greed."

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