Four Banks Lose $1 Million (€ 700,000) Due to Fraud Scheme

A 44-year old resident of Jersey City admitted to his role in a bank fraud scheme as a result of which a number of four financial institutions are counting losses that total around $1 million (€ 700,000).

For his involvement in the scheme, Syed Rehman faces a maximum penalty of 30 years in prison and a fine that's worth about the same as the funds he stole from the banks.

“It was the primary objective of the scheme for the defendant Syed Rehman and others to enrich themselves by using social security numbers and other identity information that defendant Syed Rehman unlawfully obtained from the Social Security Administration to open accounts at various financial institutions and obtain credit cards, mortgage loans, and other financial credits and services, intending not to repay the financial institutions,” reads the file on the suspect.

It turns out that Rehman paid an employee of the Social Security Administration to obtain the social security numbers that belonged to children. They used this tactic since this way the SSNs couldn't have belonged to someone with bad credit history.

Furthermore, he allowed other participants in the scheme to utilize his auto repair business called ZHN to claim false employment histories and high salaries when applying for credit cards and loans.

JP Morgan Chase, Bank of America and Citigroup were targeted starting in 2004 when the whole operation commenced.

Inspectors from the U.S. Postal Inspection Service and agents of the Social Security Administration-Office of Inspector General participated in the investigation which forced the suspect to admit his crimes.

There is no mention if other individuals involved in the scheme were prosecuted, but the Attorney's Office seems pleased with the bust.

Another cleverly designed identity theft operation was taken down by US law enforcement agencies but unfortunately, as days go by, we learn of more schemes to defraud banks and other institutions.