South Carolina Man Arrested On Federal Charges For "Synthetic Identity" Fraud Scheme
CHARLOTTE, N.C. – A South Carolina man was arrested today on bank, wire, and mail fraud charges in connection with a “synthetic identity” fraud scheme that defrauded financial institutions of more than $340,000, announced Jill Westmoreland Rose, U.S. Attorney for the Western District of North Carolina. The criminal bill of indictment against Charles Whitlock, Jr., 50, of Rock Hill, S.C. was returned by a federal grand jury on April 20, 2017, and was unsealed today following the defendant’s court appearance.
David M. McGinnis, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service (USPIS) and John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, join U.S. Attorney Rose in making today’s announcement.
According to allegations contained in the indictment, from least in or about December 2013, through in or about April 2017, Whitlock engaged in mail fraud, wire fraud and bank fraud by executing a synthetic identity fraud scheme, through which he fraudulently obtained more than $340,000 from one or more financial institutions. According to the indictment, a synthetic identity is a fictitious identity created with a combination of real and fabricated information about people, or sometimes entirely fictitious information about people, including names, social security numbers (SSN), dates of birth (DOB), addresses and telephone and cell phone numbers. As alleged in the indictment, Whitlock submitted more than 750 new credit card applications to financial institutions via the Internet and by telephone, using synthetic identity information. The credit cards issued by financial institutions in connection to Whitlock’s synthetic identity fraud scheme had credit limits ranging from $100 to more than $500.
The indictment alleges that in some instances, Whitlock used “pollinated synthetic identities” when he submitted new credit card applications containing synthetic identity information to financial institutions. Pollinated synthetic identity means a synthetic identity is added as an authorized user of an existing credit card account. This enables fraudsters to inherit the credit history of the existing credit card account holder, and makes it easier to get multiple new credit card accounts and higher credit limits. As alleged in the indictment, Whitlock was able to obtain multiple new credit cards in the names of synthetic identities, and to obtain higher credit limits for new credit cards issued under the names, SSNs and DOBs of synthetic identities.
The indictment further alleges that, in order to evade the financial institutions’ new credit card fraud detection systems, Whitlock filled out the false and fraudulent applications using hundreds of addresses, including addresses of residences located within the Western District of North Carolina. The indictment alleges that Whitlock also used the online U.S. mail forwarding services of the United States Postal Service to divert fraudulently-obtained credit cards mailed by financial institutions to mailing addresses controlled or accessible to Whitlock.
The indictment alleges that Whitlock used the fraudulently-obtained credit cards to obtain money, goods and services through electronic payments at point-of-sale (POS) terminals; money from automated teller machines (ATMs); and to obtain money through one or more online merchants controlled by or accessible by the defendant.
Whitlock had his initial appearance today before U.S. Magistrate Judge David Keesler and is currently detained pending his detention hearing scheduled for Thursday, May 11, at 2:00 p.m.
sge.penalty for the bank fraud charges carries a maximum penalty of 30 years in prison and a maximum $1 million fine. wire fraud and mail fraud charges each carry a maximum penalty of 20 years in prison and a maximum $250,000 fine.
The charges contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The investigation was led by USPIS and the FBI. Assistant U.S. Attorney Thomas O’Malley, of the U.S. Attorney’s office in Charlotte, is prosecuting the case.