Fraud ring smashed by feds

By Karen Zautyk
Observer Correspondent

A Lyndhurst man was among 18 people named last week in connection with an international crime ring described by U.S. Attorney Paul Fishman as “one of the largest credit card fraud schemes ever charged by the Department of Justice.”

The suspect, Vinod Dadlani, 49, was arrested Feb. 5 by federal agents who conducted sweeps in New Jersey, New York, Pennsylvania and Connecticut following an 18+-month investigation by the FBI.

In addition to Dadlani, New Jersey arrestees included residents of Iselin and Jersey City. The other defendants live in Staten Island, Queens, Long Island and Philadelphia.

According to Fishman’s office, those charged were allegedly involved in “a sprawling criminal enterprise that stretched across dozens of states and numerous countries.”

At a press conference in Newark, Fishman said, “The losses in this case are, in a word, massive.”

The current confirmed loss is $200 million, but final figures may grow beyond that, Fishman’s office said.

The primary suspects “allegedly fabricated identities to obtain credit cards and doctored credit reports to pump up the spending and borrowing power associated with the cards. They would then borrow or spend as much as they could . . . and not repay the debts, looting businesses and financial institutions,” Fishman’s office reported.

The ring is said to have created 7,000 phony identities, more than 25,000 phony credit cards and hundreds of fake driver’s licenses and Social Security cards. It also allegedly moved millions of dollars through accounts under its control, and wired millions overseas to Pakistan, India, the United Arab Emirates, Canada, Romania, China and Japan.

Dadlani’s reputed role was as the owner of a Jersey City store, Tanishq Jewels, one of what the complaint termed “complicit businesses.” Two other Jersey City stores, owned by three other defendants, were also cited: Asha Jewels and Raja Jewelers.

The businesses allegedly “would allow the defendants to conduct sham transactions [with the fraudulent cards] and would then receive the proceeds from the credit card companies and split them with the other conspirators.”

“These complicit businesses maintained multiple credit card merchant processing accounts at the same time,” the charge reads. It alleges the jewelry stores “had terminals in alternate business names and using contact names of numerous people other than the actual owners.”

The proceeds from the terminals were deposited into different business checking accounts and then paid out to Dadlani and others “to purchase large amounts of gold jewelry,” the charge says.

From around July 2008 to December 2008, more than 69% of the charges at two of the Tanishq Jewels terminals were fraudulent, authorities said. “The total amount processed in fraud just through these two terminals during this time frame was approximately $325,000,” the charge reads.

All of the defendants are charged with one count of bank fraud, which is punishable by 30 years in prison and a fine of $1 million.

Fishman cited special agents of the FBI’s Cyber Division, postal inspectors, the U.S. Secret Service and the Social Security Administration for the roles they played in the investigation.

The Observer Staff