Ruth Linehan’s first sign of trouble was a notice that her checking account was overdrawn.
Someone had stolen a box of her checks from the mailbox of her south Minneapolis apartment building and had cashed six or seven checks totaling thousands of dollars.
That was in 2008.
Five years later, federal authorities are wrapping up the prosecution of one of the largest identify theft rings ever caught in Minnesota, a criminal enterprise that was hatched here but sprawled over 14 states and involved more than 100 people.
Through break-ins, thefts and insider information, the thieves acquired private identification data and used it to steal more than $2.5 million, victimizing hundreds of people plus banks and major retailers.
The last of six ringleaders, Gordon Moore, 42, who lived in the Twin Cities, was sentenced to 25 years in prison on Wednesday by U.S. District Judge Paul Magnuson. Moore is one of 33 participants convicted in federal court, with about 25 more convicted in state court. Magnuson differed with Moore’s attorney, who described the operation as a garden-variety crime ring while asking for leniency.
“This is, in my experience, the most complex, involved, massive conspiracy for fraud and identity theft that I have seen,” Magnuson said. “Frankly, it was the most sophisticated in my experience.”
Moore, who has a lengthy criminal history, fled during his identity theft trial in April and was convicted in absentia. He was arrested July 8 at a hotel in Milwaukee.
Five other ringleaders were previously sentenced for terms ranging from 10 to 25 years.
“These defendants breached [public] trust and wreaked havoc in our community and our institutions,” said Nicole Enisch, chief of the criminal division of the U.S. attorney’s office. “It is one of the largest identity theft cases our office has ever prosecuted.”
The bravado of the operation was staggering.
Robin Finger, a receptionist with the state Board of Psychology who was drawn into the conspiracy by Moore, stole personal information, including Social Security numbers, of 60 psychologists. She fed the data to ringleaders who used a phalanx of individuals to breach the psychologists’ checking accounts.
Other participants in the ring worked at the St. Paul Postal Credit Union; Sonus, a hearing aid company; Wells Fargo Bank; and Pearson, an education company.
More information was obtained by thieves who broke into businesses, homes and cars, stealing checkbooks, mail and purses.
“These defendants caused immeasurable hardship to innocent victims,” said Kelly Jackson, special agent in charge of IRS criminal investigations in the St. Paul field office.
Investigation a team effort
Working on the investigation, dubbed Operation Masquerade by federal officials, were U.S. Postal Inspector Barry Bouchie, Sgt. Russ Wicklund of the Baxter, Minn., police and a member of the Minnesota Financial Crimes Task Force, and IRS special agent Kelly Petricka. The case was prosecuted by Assistant U.S. Attorneys Karen Schommer and Michelle Jones.
Kara Derner, a psychologist who works at a community health center in St. Peter, Minn., learned her identity had been stolen when U.S. Bank’s White Bear Lake office called to tell her that a woman claiming to be her had tried to deposit a check for $6,800. The woman wanted $4,000 back in cash, but the teller refused, and the woman left the bank, Derner said.
“The same person went to a U.S. Bank in Apple Valley. She had a check in my name and a deposit slip with all my correct information on it and a driver’s license in my name.” The license photo was of the woman trying to cash the check. That teller also turned her down.
Derner said she had to close all her checking accounts, change her automatic deposits and billing and contact the credit bureaus.
“I was pretty upset,” she said. “I have to go to the Board of Psychology to get a license. I assume they would do background checks” on new hires.
But until 2012, the board lacked the authority to do background checks, said Angelina Barnes, board executive director. She said Finger also stole cashier checks.
Internal controls have been improved, Barnes said, and the Legislature granted them and other state health boards the right to do background checks.
Finger, 44, of St. Paul, was sentenced in June to two years, 10 months in prison. The check casher, Lee Vang, 32, of St. Paul, who tried to access Derner’s account, was sentenced to 2½ years in prison.
How the scheme worked
Vang admitted cashing fake checks as well as buying merchandise from such retailers as Wal-Mart, using phony checks and driver’s licenses with the names of real people.
Typically, operatives in the scheme returned the merchandise, often high-end electronic equipment and jewelry, and were given cash refunds or gift cards. Vang was responsible for at least $154,591.85 in fraudulent purchases and attempted purchases, she said in her plea agreement.
The ring leaders, using special equipment and software, printed the fake checks and IDs and lined up between 8 and 10 people as recruiters who enlisted more than 100 people as check cashers and buyers of merchandise.
It was not unusual for a ringleader to accompany a check casher to a bank, wait in the car and split the proceeds, according to court documents.
Two of the check cashers became cooperating federal witnesses and were wired to record conversations with ringleaders.
The scheme drew in family and friends. One ringleader, Joel Powell Jr., 48, of St. Louis Park, sentenced to 25 years, used two sons as recruiters: Trey Powell, 20, who got 4¾ years and Joel Powell III, 20, who received 3½ years.
Michael McGlennen, attorney for Desmon Burks, 38, who was sentenced to 21 years as one of the leaders, argued that Burks’ intent was to defraud Wal-Mart, not the banks, and as a result he should be charged in state court, not federal court. His case is on appeal to the 8th U.S. Circuit Court of Appeals.
“At his sentence, he said that through the trial he learned how much identity theft affected and hurt people’s lives,” said McGlennen. “He had remorse and did not deny the facts of the matter.”
Staff writer Abby Simons contributed to this article.