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Nichole Michelle Merzi of Operation Phish Phry gets 5 years

Back in 2009, this blog ran the story FBI's Biggest Domestic Phishing Bust documenting Operation Phish Phry and explaining what was then known of the structure of an international phishing operation with more than 100 members. Yesterday Nichole Michelle Merzi, one of the ring-leaders, was finally sentenced to five years:

Defendant is committed on Counts 1, 34, 35, 38, 39, 48, and 51 of the Indictment to the Bureau of Prisons for 36 months. This term consists of 36 months on each of Counts 1, 34, 35, 38, 39, and 51; 36 months on Count 48, to be served concurrently; and 24 months on Count 46, to be served consecutively; for a total of 60 months. Defendant shall receive credit for any time served. Supervised release for three years.

The case began all the way back on September 30, 2009 with the filing of an indictment that charged:

  • Kenneth Joseph Lucas (1) count(s ) 1-9,
  • Nichole Michelle Merzi (2) count(s ) 1,
  • Jonathan Preston Clark (3) count(s ) 1,
  • Jarrod Michael Akers (4) count(s ) 1,
  • Kyle Wendell Akers (5) count(s ) 1,
  • Wayne Edwards Arbaugh (6) count(s ) 1-2,
  • Demorris Brooks (7) count(s ) 1,
  • Antonio Late Colson ( 8 ) count(s ) 1,
  • Kenneth Crews (9) count(s ) 1,
  • Manu T Fifita (10) count(s ) 1,
  • Jennifer Anabelle Lopez Gonzalez (11) count(s ) 1, 7-9,
  • Tinika Sabrina Gunn (12) count(s ) 1,
  • Jason Marcellus Jenkins (13) count(s ) 1,
  • Sylvia Johnson (14) count(s ) 1,
  • Remar Ahmir Lawton (15) count(s ) 1,
  • Kyle Brandon Martin (16) count(s ) 1,
  • Franklin Anthony Ragsdale (17) count(s ) 1, 4-6,
  • Steven Aaron Saunders (18) count(s ) 1,
  • Rynn Spencer (19) count(s ) 1,
  • Raquel Raffi Varjabedian (20) count(s ) 1,
  • Candace Marie Zie (21) count(s ) 1,
  • Ashley A Ager (22) count(s ) 1,
  • Latina Shaneka Black (23) count(s ) 1,
  • Michael Dominick Gunn Dacosta, Jr (24) count(s ) 1,
  • Virgil Phillip Daniels (25) count(s ) 1,
  • Tramond S Davis (26) count(s ) 1,
  • Shontovia D Debose (27) count(s ) 1,
  • Joshua Vincent Fauncher (28) count(s ) 1,
  • Krystal Fontenot (29) count(s ) 1,
  • Anthony Donnel Fuller (30) count(s ) 1, 5-6,
  • Michael Christopher Grier (31) count(s )1,
  • Bryanna Harrington (32) count(s ) 1,
  • Shawn K Jordan (33) count(s ) 1-3,
  • Billy Littlejohn Kelly (34) count(s ) 1,
  • Reggie B Logan, Jr (35) count(s ) 1,
  • Ikinasio Lousiale, Jr (36) count(s ) 1,
  • Raymond V Mancillas (37) count(s ) 1,
  • David P Mullin (38) count(s ) 1,
  • Vincent Nguyen (39) count(s ) 1,
  • Ario Plogovii (40) count(s ) 1,
  • Brandon R Ross (41) count(s ) 1,
  • Alan Elvis St. Pierre (42) count(s ) 1,
  • Courtney Monet Sears (43) count(s ) 1,
  • Me Arlene Settle (44) count(s ) 1,
  • Paula W Sims (45) count(s ) 1,
  • Jamie Smith (46) count(s ) 1,
  • Brandon Kyle Thomas (47) count(s ) 1,
  • Christopher Uhamaka (48)  count(s ) 1,
  • James Michael Viorato (49) count(s ) 1,
  • Jovon Darnell Weems (50) count(s ) 1,
  • David D Westbrooks (51) count(s ) 1,
  • Bridget Deque Wilkins (52) count(s ) 1,
  • Marcus Deshaun Williams (53) count(s ) 1.

In a conspiracy, we have to show "Overt Acts" committed by each member of the conspiracy in support of the conspiracy, which is how we end up with an 86 page Operation Phish Phry Indictment.

The indictment charges:

18 USC § 134: Wire and Bank Fraud Conspiracy
18 USC § 1344(1): Bank Fraud
18 USC § 1028A: Aggravated Identity Theft
18 USC § 371: Computer Fraud Conspiracy
18 USC § 1030(a)(4): Computer Fraud
18 USC § 1956( h ): Money Laundering Conspiracy
§ 2: Aiding and Abetting and Causing an Act to Be Done

There are 335 Overt Acts charged in the Indictment, such as:

Overt Act No. 14: On July 31, 2008, defendant ZIE sent an SMS message to defendant LUCAS, in Los Angeles County, to transmit the account number and account holder name for the one checking account and one savings account that unindicted coconspirator K.M. opened that day at BOA, which transmission was for the purpose of causing defendant LUCAS, to make and to cause an unauthorized transfer of funds to those accounts and for the purpose of allowing unindicted coconspirator K.M. to withdraw the transferred funds.

Overt Act No. 16: On July 31, 2008, in Los Angeles County, defendant LUCAS caused a computer transfer of funds from a victim bank account at BOA, which neither BOA nor the victim had authorized, into defendant LOGAN's checking and savings accounts.

(In Overt Acts 17 and 18 Logan then withdraws $900 of that money from checking and $400 from savings.)

Overt Act No 70: On August 20, 2008, in Los Angeles County, defendant LUCAS caused computer transfers of $350 from a victim bank account at BOA, which neither BOA nor the victim had authorized, into defendant NGUYEN's checking account and $1,200 from a victim bank account at BOA, which neither BOA nor the victim had authorized, into defendant NGUYEN's savings account.

Overt Act No. 181: On December 11, 2008, in Los Angeles County, defendant JENKINS drove unindicted coconspirator A. J. to a Wells Fargo bank branch located in Los Angeles County to withdraw the $1,000 that defendant LUCAS caused to be deposited into unindicted coconspirator A.J.'s savings account.

Overt Act No. 186: On December 16, 2008, during a telephone conversation with defendant LUCAS< defendant MERZI advised defendant LUCAS that she had caused an unindicited coconspirator to conduct a transfer of funds from a victim bank account at Wells Fargo, which neither Wells Fargo nor the victim had authorized, and next would cause an unauthorized transfer of funds from a victim BOA account.

Overt Act No. 237: On June 14, 2007, in Los Angeles Cou8nty, defendant K. AKERS transmitted $1,900 by Western Union to unindicted coconspirator E. A.


It goes on like that for some 60 pages. From January 2007 to September 2009, the Ringleaders get victim credentials, the second tier transfer the funds around to accounts opened and controlled by the third tier, who then get driven around and sent into banks to take out the money, which gets passed up through management and wired via Western Union to Egypt, with everyone taking a piece of the pie.

For those who are interested in how you argue such a case in court, I've also posted the Operation Phish Phry Closing Arguments Power Point. Hundreds of pages of courtroom transcripts are also available from PACER.

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Reza Rafati

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