Breaking News in the Industry: February 10, 2017

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Chief of staff implicates Congresswoman in $800K scholarship fraud

A chief of staff for former Rep. Corrine Brown, D-Fla., pleaded guilty for his role in a college scholarship fraud scheme, implicating the congresswoman in the plot. 

Elias “Ronnie” Simmons, 51, of Laurel, Maryland, pleaded guilty on Feb. 8 to charges of conspiracy to commit mail and wire fraud, in addition to a count of theft of government property. 

As part of a plea deal, Simmons admitted  that he and Brown solicited more than $800,000 in donations for the One Door for Education – Amy Anderson Scholarship Fund, which was to be used for college scholarships but instead went to their personal use. 

Simmons detailed how Brown used her position to solicit donations from individuals and corporations by falsely making them think the charity was a registered 501(c)(3) non-profit. The former chief of staff testified that “tens of thousands of dollars” in donations ended up as cash deposits in Brown’s personal bank accounts.

The congresswoman also allegedly used $200,000 of the funds to pay for a litany of events, “including a golf tournament in Ponte Vedra Beach, Florida; lavish receptions during an annual conference in Washington, D.C.; the use of a luxury box during a Beyoncé concert in Washington, D.C.; and the use of a luxury box during an NFL game between the Washington Redskins and the Jacksonville Jaguars in the Washington, D.C. area.” 

In one instance, Simmons said that Brown used an employee’s outside consulting company to funnel One Door funds back to Brown for personal use. 

Out of the more than $800,000 raised by One Door, Simmons said only $1,200 went toward two college scholarships awarded. 

Simmons’ sentencing has yet to be scheduled. Former One Door president Carla Wiley previously pleaded guilty to wire fraud conspiracy on March 3, 2016, and will be sentenced on June 12. 

Brown, who lost her seat to in a 2016 primary to former State Sen. Al Lawson, will go on trial on April 24.  [For more: Federal Times]

Detroit teen “has change of heart,” returns items stolen from Troy store

An 18-year-old Detroit man is charged with second-degree retail fraud after he tried to steal $295 worth of merchandise from a Troy store, but returned and gave the item back to a loss prevention officer.

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Troy police said the 18-year-old walked into the store with another man and both tried to steal $295 worth of merchandise. When the men were fleeing the store, the 18-year-old turned around and returned to the store, telling the loss prevention officer who was in pursuit of them that he had had a change of heart and was sorry he had stolen the item, police said.

The second man escaped and fled south toward the Somerset Apartments, police said.  The 18-year-old was arrested by Troy police and charged with second-degree retail fraud.  The loss prevention officer didn’t have a description of the other man.  [For more: ClickOnDetroit]

LP Worldwide: UK retail giant Sports Direct suffered data breach affecting 30,000 Employees

Sports Direct, a British retailing group suffered a massive security breach back in 2016 in which a hacker stole personal details of 30,000 of its employees. Another negative aspect of this incident is that the company did not inform its workers about the breach, reports The Register.
The breach took place in September last year when a hacker exploited vulnerabilities in Sports Direct’s employee portal that was using DNN (formerly DotNetNuke) based content management system.

An anonymous source told The Register that the stolen data contains unencrypted data of employees including emails, phone numbers, names and postal address. The source also claimed that the hacker left a phone number in Sports Direct’s system for the owners to get it touch with them. However, it is still unclear if the data is being sold on the Internet or leaked on the Internet.  What’s worse about this breach is that although the company found out about the breach in December, it didn’t bother to inform the employees affected by the breach itself; it did, however, inform the authorities.

Wieland Alge, GM and VP EMEA at Barracuda Networks said that “the employee portal breach at Sports Direct highlights that not enough is being done to get the correct security procedures and systems in place. Although it does not seem like the attackers were able to get their hands on financial information, only gaining access to email addresses, full names and phone numbers can lead to serious problems, perhaps leaving employees open to targeted phishing attacks.”

This is not the first time that Sports Direct has been in the news regarding its employees. According to an undercover investigation by The Guardian, it was revealed that the owner of the company Mike Ashley, 22nd richest man does not only pay workers below the minimum wage but also involved in the mistreatment of employees.  [For more: Hack Read]

South Dakota video game store manager hid money in ceiling, charged with grand theft

The manager of a Mitchell video game store was arrested after he allegedly hid money and video surveillance in the store’s lowered ceiling in what police say was an attempt to steal more than $1,600. Aaron Cooper, 34, of Mitchell, was charged with grand theft after allegedly hiding cash and bank deposits in the video game store’s ceiling and calling police to report the incident as a robbery.

“It appears that the robbery report was made to cover up an embezzlement by Cooper,” said Det. Lt. Don Everson.  Cooper called police to say a man who claimed to have a gun entered the store and took two bank deposits and cash totaling more than $2,000, as well as the contents of the employee’s wallet, and placed them in a blue backpack, authorities said. Surveillance footage from a nearby business and a following investigation discredited the employee’s claims, and $1,647.55 in cash, GameStop receipts, keys to GameStop locks and a binder of 2017 bank deposits was found hidden in the store’s lowered ceiling in a blue-colored backpack, police said.

Cooper was arrested and charged with grand theft valued between $1,000 and $2,500, a Class 6 felony, punishable upon conviction by up to two years in prison and a $4,000 fine; and false reporting to law enforcement, a Class 1 misdemeanor, punishable upon conviction by up to one year in jail and a $2,000 fine.  [For more: InForum]

Indiana Walmart employee foiled massive credit card scheme

Police say they’ve foiled an elaborate credit and debit card scam scam spanning two states and countless victims, with thousands of dollars stolen each day. And it was a Walmart employee who helped them crack the case.

Police say the suspects would steal debit or credit card information  from people who never saw it coming — through skimmers. They would then clone that account into the strip on the back of a Walmart gift card. After that, they’d use the Walmart card to purchase a prepaid debit card, walking out with a card that was just as good as cash. “It’s elaborate, very elaborate,” Miller said. “This is not something you just do on your home computer.” In fact, it’s so elaborate, Miller says he’s never seen anything like it in his career.  A Walmart employee matched the fraudulent gift cards to video of the transactions. Now, Cuban nationals Greisis De La Paz Ochoa and Miguel Martinez Gonzales are behind bars. Court records say they hit Walmarts up and down I-65 from Salem to Corydon, Seymour to Scottsburg, and the Bashford Manor store in Louisville.  Miller said the U.S. Secret Service joined the investigation, believing this same team may be tied to skimmers and stolen credit and debit card information throughout the region, including those recently reported in Greenville and Henryville.

Court records say that, when questioned, Gonzales said he did it “because he has kids in Cuba and needed the money.”  “I believe they’re definitely part of a larger team,” Miller said. The team was stealing anywhere from four thousand to seven thousand dollars a day according to Miller.  They’re charged with fraud. Police still need the public’s help finding and identifying the man in the image included with this story. They say he may be the ringleader.  [For more: WRBD]

Illinois man charged in string of robberies from Lowe’s, Kmart, Target

A 27-year-old Westland man has been charged in a string of robberies as several stores around the city.  Police said Jared Jones, 27, was arrested Feb. 1 after images of him committing retail frauds at Lowe’s and Kmart were released via surveillance video.  Police said further investigation revealed Jones was also responsible for retail frauds at the Westland Target.

Jones was charged Feb. 2 with four counts of retail fraud, four counts of receiving and concealing stolen property and one count of assault and battery for an altercation with a store employee during one of the incidents. Jones is being held on $10,000 bail. He is scheduled to return to court Feb. 16 for a pretrial hearing. Police thanked community members for sharing the pictures on Facebook and helping to identify Jones.  [For more: ClickOnDetroit]

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