A Staten Island man will spend some time in a federal prison for his role in a complex fraud scheme involving the processing of credit-card payments and transactions by consumers in western Pennsylvania.
Azad Khizgilov has pleaded guilty to one count of conspiracy to commit mail, wire and bank fraud, online federal court records show. Khizgilov, 45, was among six New Yorkers who concocted the scam, authorities said. The other defendants resided in Brooklyn and Manhattan, said the US attorney’s office for the Western District of Pennsylvania.
Officials said the defendants used credit card products and services to pay for certain “precluded activities,” including the online sales of pharmaceutical drugs and of products violating trademark laws.
Credit card companies don’t permit such purchases, but the defendants subverted those organizations’ internal controls to make it seem as though they were buying permitted goods, said authorities.
They set up shell corporations and web sites falsely claiming they sold products other than the precluded ones and applied for merchant accounts from the credit card companies, said authorities. Once the merchant accounts were established, the defendants used them to process consumers’ payments.
To hide their tracks, they sent credit-card statements to customers with the names of the shell corporations and phone numbers, said officials. They also created a telephone bank to receive consumers’ calls about billing questions, authorities said. Khizgilov was arrested in December 2017. The defendant, who is free on bond, is scheduled to be sentenced on December 8… SIlive