Friday, December 28, 2012

Holiday Bank Robber Lacking in Christmas Cheer

The FBI Bank Robbery Task Force needs your help to identify a holiday bank robber who brandished a black semi-automatic handgun during the armed robbery of a Houston bank earlier this evening. Bank surveillance photographs of the robber are below.
The bank robbery happened at the Chase Bank located at 1351 West 43rd Street in Houston, Texas shortly after 5:00 this evening. The bank robber walked up to the counter, grabbed a deposit slip, and wrote a threatening note on it demanding cash. He then walked up to a teller, showed her the note, and pulled out a black semi-automatic handgun from his waistband. The teller gave the man some cash. He was last seen walking away from the bank on foot. No one was physically hurt during the robbery.
The armed bank robber was described as a white male in his mid-30s, about 5’8” to 5’9” tall, 200 pounds, with a medium build. He was clean-shaven and possibly had acne scars on his face. He had light brown short to medium-length hair with thin, light brown eyebrows. He wore a dark jacket and a black ball cap with a 1st Calvary Division logo on the front. He carried a black semi-automatic handgun during the robbery.

Crime Stoppers is offering up to $5,000 for information leading to the charging and arrest of this robber. If you have information about this case, please call the Crime Stoppers tip line at 713-222-TIPS (8477), or the Houston office of the FBI at 713-693-5000.

New York Man Convicted of Hacking AT&T’s Servers

NEWARK—A federal jury today convicted the head of a self-described “security research” hacking group of breaching AT&T’s servers, stealing e-mail addresses and other personal information belonging to approximately 120,000 Apple iPad users, and disclosing that information to an Internet magazine, U.S. Attorney Paul J. Fishman announced.
Andrew Auernheimer, 27, of New York, was convicted of both counts of a superseding indictment: conspiracy to access AT&T’s servers without authorization and disclose that information to a reporter at Gawker magazine and possession and transfer of means of identification for more than 120,000 iPad users. Auernheimer was tried before U.S. District Judge Susan D. Wigenton in Newark federal court. His co-conspirator, Daniel Spitler, 27, of San Francisco, California, previously pleaded guilty to the same charges and is awaiting sentencing.
According to documents filed in this case and the evidence at trial:
The iPad is a touch-screen tablet computer, developed and marketed by Apple Computers Inc., that allows users to, among other things, access the Internet and send and receive electronic mail. Since its introduction in January 2010, AT&T has provided iPad users with Internet connectivity via AT&T’s 3G wireless network. During the registration process for subscribing to the network, a user is required to provide an e-mail address, billing address, and password.
Prior to mid-June 2010, AT&T automatically linked an iPad 3G user’s e-mail address to the Integrated Circuit Card Identifier (ICC-ID), a number unique to the user’s iPad, when he or she registered. Every time a user accessed the AT&T website, the ICC-ID was recognized and the e-mail address was automatically populated for faster, user-friendly access to the site. AT&T kept the ICC-IDs and associated e-mail addresses confidential.
At that time, when an iPad 3G communicated with AT&T’s website, its ICC-ID was automatically displayed in the Universal Resource Locator, or URL, of the AT&T website in plain text. Seeing this, and discovering that each ICC-ID was connected to an iPad 3G user e-mail address, hackers wrote a script termed the “iPad 3G Account Slurper” and deployed it against AT&T’s servers.
The Account Slurper attacked AT&T’s servers for several days in early June 2010 and was designed to harvest as many ICC-ID/e-mail address pairings as possible. It worked by mimicking the behavior of an iPad 3G so that AT&T’s servers would be deceived into granting the Account Slurper access. Once deployed, the Account Slurper used a process known as a “brute force” against the servers, randomly guessing at ranges of ICC-IDs. An incorrect guess was met with no additional information, while a correct guess was rewarded with an ICC-ID/e-mail pairing for a specific, identifiable iPad 3G user.
From June 5, 2010 through June 9, 2010, the Account Slurper stole for its hacker-authors approximately 120,000 ICC-ID/e-mail address pairings for iPad 3G customers.
Immediately following the theft, the hacker-authors of the Account Slurper provided the stolen e-mail addresses and ICC-IDs to the website Gawker, which published the stolen information in redacted form, along with an article concerning the breach. The article indicated that the breach “exposed the most exclusive e-mail list on the planet” and named a number of famous individuals whose e-mails had been compromised, including Diane Sawyer, Harvey Weinstein, New York Mayor Michael Bloomberg, and then-White House Chief of Staff Rahm Emanuel. The article also stated that iPad users could be vulnerable to spam marketing and malicious hacking. A group calling itself “Goatse Security” was identified as obtaining the subscriber data.
Goatse Security is a so-called “security research” group, composed of Internet hackers, to which both Spitler and Auernheimer belonged.
During the data breach, Spitler and Auernheimer communicated with one another using Internet Relay Chat, an Internet instant messaging program. Those chats not only demonstrated that Spitler and Auernheimer were responsible for the data breach, but also that they conducted the breach to simultaneously damage AT&T and promote themselves and Goatse Security. As the data breach continued, so too did the discussions between Spitler, Auernheimer, and other Goatse Security members about the best way to take advantage of the breach and associated theft. On June 10, 2010, immediately after going public with the breach, Spitler and Auernheimer discussed destroying evidence of their crime.
Each count on which Auernheimer was convicted is punishable by a maximum potential penalty of five years in prison and a fine of $250,000.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Michael B. Ward in Newark, with the investigation leading to the charges. He also thanked special agents of the FBI, under the direction of Special Agent in Charge Valerie Parlave in Little Rock, Arkansas, and the U.S. Attorney’s Office for the Western District of Arkansas, under the direction of U.S. Attorney William Conner Eldridge.
The government is represented by Executive Assistant U.S. Attorney Michael Martinez and Assistant U.S. Attorney Zach Intrater of the Computer Hacking and Intellectual Property Section of the U.S. Attorney’s Office Economic Crimes Unit.

Konawa Man Sentenced for Attempting to Destroy or Damage Property Using an Explosive

MUSKOGEE, OK—The United States Attorney’s Office for the Eastern District of Oklahoma announced that Daniel Wells Herriman, age 41, of Konawa, Oklahoma, was sentenced to 63 months’ imprisonment, followed by 36 months of supervised release, for attempting to destroy or damage property by means of an explosive, in violation of Title 18, United States Code, Section 844(i); and illegal making of a destructive device, in violation of Title 26, United States Code, Sections 5861(f), 5822 and 5871.
Herriman was indicted in September 2011 and was found guilty by a federal jury in May, 2012.
The charges arose from an investigation by the Okfuskee County Sheriff’s Department, Seminole County Sheriff’s Department, Creek Nation Lighthorse Police, the Oklahoma Highway Patrol, and the Federal Bureau of Investigation.
The evidence presented at the trial established that in July and August 2011 the defendant, without lawful authority, made an improvised explosive device or IED. The defendant maliciously attempted to damage and destroy a natural gas pipeline near Okemah, Oklahoma, when he placed the device under the pipeline and set the timer on the device. The device was discovered by a pipeline employee and was disrupted by the Oklahoma Highway Patrol Bomb Squad.
The defense claimed Herriman was legally insane at the time of the crime.
The Honorable James H. Payne, District Judge in the United States District Court for the Eastern District of Oklahoma, presided over the trial and sentencing.
Herriman will remain in the custody of the United States Marshals Service pending transportation to the designated federal prison at which he will serve his non-parolable sentence.
Assistant United States Chris Wilson represented the United States.

Grand Island Man Sentenced to 70 Months' Imprisonment for Selling a Rifle to a Felon

United States Attorney Deborah R. Gilg announced that Luis Cruz, 32 years old, from Grand Island, Nebraska, was sentenced on Wednesday, November 14, 2012, to a term of 70 months’ imprisonment, followed by three years of supervised release upon completion of his prison sentence, and a $100 special assessment by the Honorable U.S. District Court Senior Judge Richard Kopf. Cruz pled guilty to transferring a firearm to someone he had reason to believe was a convicted felon on July 13, 2012.
Cruz was among several people arrested in the Grand Island area in November of 2010 as the result of an investigation into criminal street gang activity. This case was investigated by the Central Nebraska Drug and Safe Streets Task Force, an organization comprised of the Federal Bureau of Investigation, Department of Homeland Security, Hall County Sheriff’s Department, Grand Island Police Department, Nebraska State Patrol, Adams County Sheriff’s Department, Hastings Police Department, and the Kearney Police Department.

Robbery of SunTrust Bank Branch in Washington, D.C.

At approximately 10:15 a.m. on Wednesday, December 26, 2012, an unknown male entered the SunTrust Bank at 624 H Street NW in Washington, D.C. The subject passed a note demanding money and threatened the bank teller. The teller complied with the demand, and the subject left with a sum of money.
The subject is described as a black male, 5’8”-5’9” tall, 28-35 years old, and weighing approximately 140-160 pounds. He wore large, brown sunglasses with gold frames; a brown ski mask with openings for the eyes; and a hoodless, black rain jacket. The subject left on foot towards the Metro at 7th Street NW and H Street NW.
The subject, pictured below, should be considered armed and dangerous.
The FBI’s Violent Crimes Task Force is investigating this bank robbery with the Metropolitan Police Department and requests that anyone with information call the FBI at 202-278-2000 or MPD at 202-727-9099. Anonymous information may be submitted to tips.fbi.gov or to MPD by texting 50411.

Thursday, December 27, 2012

Fifteen Members of Alleged Drug Ring Arrested

NEWARK, NJ—Two members of an alleged drug trafficking ring based in Elizabeth, New Jersey and operating throughout the Northeast and Puerto Rico made their initial court appearances today, U.S. Attorney Paul J. Fishman announced.
Nelson Yordan, a/k/a Carlos, 27, of Waterbury, Connecticut, and Michael Rosario, 28, of Hagerstown, Maryland, were both charged by complaint with conspiracy to distribute controlled substances. They made their initial appearances today before U.S. Magistrate Judge Mark Falk in Newark federal court.
Yordan and Rosario are among 15 people arrested over the past three weeks by FBI agents and local police in connection with a drug trafficking organization responsible for distributing cocaine and heroin in the Elizabeth, New Jersey; Allentown, Pennsylvania; Hartford, Connecticut; and Hagersville, Maryland areas.
Also charged by complaint in connection with the alleged drug operation are: Roberto Rentas Negron, a/k/a El Duro; Kelmit Velazquez; Antonio Vazquez, a/k/a Panta; Fernando Duarte Castro; Julio Martinez Jr., 43, of Elizabeth; Lorenzo Carballo, 28, of Elizabeth; Hector Espinoza, a/k/a Will, 27, of Elizabeth; William Crespo, a/k/a Negro, 33, of Allentown, Pennsylvania; Melvin Gerena, a/k/a Flaco, 29, of Elizabeth; Marco Rodriguez, 26, of Elizabeth; Jerel Evans, a/k/a Gigante, 25, of Elizabeth; Robert Evans, a/k/a Gigante’s Brother; and Christian Reyes, a/k/a Enano. Each defendant is charged with one count of conspiring to distribute controlled substances.
According to documents filed in this case and statements made in court:
Three of the defendants—Negron, Velazquez, and Vazquez—were arrested November 30, 2012, after FBI agents learned that Negron and Velazquez were plotting to murder a rival drug dealer who had reportedly stolen one kilogram of heroin from the organization. They made their initial court appearances before Judge Falk on December 3, 2012 and were ordered detained pending trial. After their arrests, many of their co-conspirators reportedly took measures to evade law enforcement, including changing cell phones and fleeing to other states.
As part of a coordinated operation, federal, and local law enforcement authorities subsequently located and arrested: Duarte Castro on December 3, 2012 in Newark; Carballo and Espinoza on December 13, 2012 in Elizabeth; Crespo in Allentown; Yordan in Hartford; and Rosario in Hagersville; on December 14, 2012. After fleeing to Puerto Rico, Rodriguez turned himself in to the FBI in San Juan on December 19, 2012.
Martinez and Gerena were previously arrested by the Elizabeth Police Department on unrelated charges and remain in state custody pending their transfer to face the federal charge. The other three defendants remain at large.
Between November 2011 and November 30, 2012, law enforcement was involved in an investigation into a drug trafficking organization (DTO) operating in the Elizabeth and Newark areas. The organization had people in Puerto Rico and elsewhere coordinating shipments of cocaine and heroin through the U.S. mails to New Jersey, New York, Pennsylvania, and Connecticut. The narcotics would be concealed in items such as candles and children’s toys. Individuals in New Jersey would coordinate these shipments, process or “cut” the narcotics, and distribute the narcotics to locations in New Jersey, Pennsylvania, Connecticut, Maryland, and other locations.
Law enforcement in New Jersey identified Rentas Negron as the person who coordinated the acquisition of the drugs, the processing and packaging of the cocaine and heroin, the resale of the narcotics, and the distribution of the proceeds from drug sales. Vazquez frequently supplied narcotics to Rentas Negron. Reyes coordinated shipments of narcotics from Puerto Rico. The other members of the DTO cut, processed, packaged, stored, and distributed the narcotics and occasionally traveled to Florida, Pennsylvania, Connecticut, Maryland, and other states in order to obtain cocaine to distribute in the Elizabeth area.
The counts with which Yordan, Rosario, Negron, Velazquez, Martinez, Carballo, Espinoza, Crespo, Jerel Evans, Robert Evans, Gerena, and Rodriguez are charged carry a minimum potential penalty of five years in prison and a maximum of 40 years in prison and a $5 million fine. The counts with which Vazquez and Reyes are charged carry a minimum potential penalty of 10 years in prison and a maximum of life in prison and a $10 million fine. The count with which Duarte Castro is charged carries a maximum potential penalty of 20 years in prison and a $1 million fine.
U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in charge Michael B. Ward; U.S. Postal Inspectors, under the direction of Phillip R. Bartlett; law enforcement officers from the New Jersey National Guard Counter Drug Task Force, under the direction of the Adjutant General, Brig. Gen. Michael L. Cunniff; the Union County Prosecutor’s Office, under the direction of Prosecutor Theodore J. Romanko; and the Elizabeth Police Department, under the direction of Police Director James Cosgrove, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorneys Adam N. Subervi and David Eskew of the U.S. Attorney’s Office Criminal Division in Newark.
The charges and allegations contained in the complaints are merely accusations and the defendants are presumed innocent unless and until proven guilty.

Tuesday, December 11, 2012

Eco-Terrorist Surrenders

After a decade as an international fugitive, Canadian citizen Rebecca Rubin gave up life on the run last week when she turned herself over to the FBI at the international border in Washington state.
The 39-year-old alleged member of the domestic terrorist cell called “The Family” will face federal arson charges for her role in the largest eco-terrorism case in U.S. history, known as Operation Backfire. With Rubin in custody, only two Family members remain at large.
Along with a dozen other conspirators, Rubin is charged with multiple crimes from 1996 through 2001 in the West and Pacific Northwest, including in Oregon, Colorado, and California. The Family committed an estimated $48 million worth of arson and vandalism under the names of the Animal Liberation Front and the Earth Liberation Front.
The cell’s most notorious crime was the 1998 arson of a Vail, Colorado ski resort that caused more than $24 million in damages and drew international attention to eco-terrorists—those who break the law in the misguided attempt to protect the environment and animal rights. The FBI took the lead in the Vail investigation, working closely with local, state, and federal law enforcement partners, and in 2004, multiple eco-terrorism investigations were condensed into Operation Backfire.
In July 2011, one of Rubin’s conspirators, Justin Solondz, was turned over to U.S. authorities by the Chinese government. Solondz had been imprisoned in China on drug charges. That leaves two Operation Backfire fugitives still at large, and there is a reward for information leading to their arrest.
“Two years ago we had four fugitives. Now we have two—so we are halfway there,” said Special Agent Tim Suttles, who works in our Portland Division and has been investigating the eco-terrorist group since 2005.
Although Suttles said it is “very satisfying” to see Rubin surrender and submit herself to the judicial process, the Operation Backfire investigation will not be closed until the last two fugitives—Joseph Dibee and Josephine Overaker—are in custody.

Fire at Vail Ski Resort

Wednesday, December 5, 2012

Counterintelligence Awareness

The FBI vigilantly investigates cases of industrial espionage and theft of intellectual property, but the Bureau also places great emphasis on preventing such crimes by educating industry on ways to keep trade secrets safe. One such innovative program in North Carolina’s Research Triangle is a collaborative effort with other federal partners called RED DART.

Learn More

The threat to America’s trade secrets—and to our national security—is real, whether it comes in the form of international spies, hackers probing online security systems, or disgruntled employees out for revenge. RED DART seeks to mitigate the threat by raising counterintelligence awareness.
Through briefings to cleared defense contractors and others in technology-rich North Carolina, RED DART makes executives and employees aware of how counterintelligence works and how they can spot suspicious activity both inside and outside their companies.

Protecting Your Business from Espionage
Here are a few precautions business executives and employees can take to protect trade secrets:
Recognize there is an insider and outsider threat to your company.
Identify trade secrets and implement a plan for safeguarding them.
Secure physical and electronic versions of your trade secrets.
Confine intellectual knowledge to a need-to-know basis.
Provide training to employees about your company’s intellectual property plan and security.
Do not store private information vital to your company on any device that connects to the Internet.
Use up-to-date software security tools. Many firewalls stop incoming threats but do not restrict outbound data.
Educate employees on e-mail tactics such as spear phishing. Establish protocols for quarantining suspicious e-mail.
Remind employees of security policies on a regular basis through active training and seminars. Use signs and computer banners to reinforce security policies.
- Ask the FBI or other security professionals to provide additional awareness training.

“Everybody wants to emulate U.S. technology,” said Brent Underwood, a special agent with the Naval Criminal Investigative Service who helped create RED DART. “If countries can shortcut 10 or 20 years’ worth of research and development by stealing our technology, that puts them at an obvious advantage.”
Despite the occasional high-profile case where a spy accesses highly classified documents, the majority of stolen technology is unclassified, said FBI Special Agent Lou Velasco, who manages the program out of our Charlotte Division. “With the right amount of information,” he explained, “state actors can reverse-engineer our products or build them from scratch.”
When that happens, our adversaries can be more competitive on the battlefield as well as in the global marketplace. “A big part of our program is putting information out there about the threat so that people understand just how serious it is,” Velasco said. “When a company’s trade secrets are compromised, it can threaten national security, but it can also hurt that company’s bottom line and its ability to keep people employed.”
The threat from inside a company may be employees secretly sent by foreign countries to steal secrets. RED DART briefings help employees spot suspicious behavior, such as a staffer working odd hours, asking inappropriate questions, or making frequent trips overseas. Externally, foreign agents may pose as potential investors or customers to gain access to technical information that could compromise a company’s trade secrets. And weak online security is always an invitation to hackers.
Griff Kundahl, executive director of the Center of Innovation for Nanobiotechnology in North Carolina, a state-funded organization that fosters new technology in the region, has worked closely with the RED DART program to help educate the center’s members.
“Our core constituents are early-stage companies,” Kundahl said. “They developed a product that might treat cancer, for example. They are trying to raise money and get their product to market. They don’t have much time or the resources to consider security risks. If RED DART can get them to understand these risks, it helps everybody. When they realize that all their efforts could be for naught if their technology is stolen or compromised, it can be eye-opening for them.”
“Our challenge is to show how real the threat is,” Velasco said. “We arm people with tools so that they can make appropriate business decisions.”
Michelle Brody, a special agent with the Defense Security Service and a founding member of RED DART, added, “When RED DART helps a company protect itself a little better, it not only helps them, it helps our national security.”

Protect Information graphic

Stopping a Would-Be Terrorist

The 20-year-old Saudi Arabian man living in Lubbock, Texas was intent on waging jihad against Americans—possibly even a former U.S. president—and he was one ingredient away from being able to build a powerful bomb.
But Khalid Ali-M Aldawsari’s deadly plans began to unravel when a shipping company’s suspicions were raised—illustrating once again how the FBI relies on private industry and the general public in the fight against terror.

Setting Tripwires
The FBI depends on private industry and the general public to help fight terrorism. Weapons of mass destruction coordinators in each of the 56 FBI field offices, along with other agents, regularly meet with representatives from industry and academic institutions, public health officials, local law enforcement, and first responders to raise awareness about threats to our national security.
These efforts are known as setting tripwires, and the intent is to establish an early-warning network where those closest to an emerging situation—such as the Lubbock shipping company in the Aldawsari case—are aware of potential risks and are prepared to inform the FBI when suspicions are raised.
“If not for those established tripwires and the liaison with the local police department—and them making the right decision to notify the FBI—I shudder to think what might have happened in the Aldawsari case,” said Special Agent Frazier Thompson. “If Aldawsari was able to get the phenol, there is no doubt in my mind he would have manufactured a very potent explosive device.”
Thompson added, “Establishing and maintaining tripwires is critical to our national security, and the cooperation we received across the board on the Aldawsari case proved it.”

In early February 2011, a Lubbock shipping firm received a package from a North Carolina chemical company containing 10 bottles of phenol intended for Aldawsari. Combined with just two other chemicals, phenol can be used to make a potent explosive. Delivering such poisonous chemicals to an individual’s home is not common, so the shipping company contacted the North Carolina firm. Both decided that the phenol should not be delivered and that local law enforcement should be alerted. A Lubbock Police Department officer was called to the scene.
“That officer and his supervisor—because of their relationship with the FBI (see sidebar)—decided that this was something we needed to know about,” said Special Agent Frazier Thompson, who works in our Dallas Division. “Our initial focus was to identify Aldawsari to see if he had a legitimate reason for purchasing phenol.”
In a matter of days, members of our North Texas Joint Terrorism Task Force learned that although Aldawsari had once been a chemical engineering student at Texas Tech, he was no longer enrolled there and had no affiliation with the university.
“He was trying to pass himself off as a Texas Tech student doing research on cleaning products,” said Special Agent Mike Orndorff, who worked the investigation. “Those credentials, if legitimate, would have allowed him to buy the phenol.”
Most alarming was that Aldawsari had already purchased the two other chemicals needed to make his bomb, along with test tubes, beakers, and protective gear. Through covert operations, investigators learned he had disassembled clocks and cell phones and stripped the wires off Christmas lights in apparent attempts to fashion timers and initiating devices.

“His apartment bedroom was basically a storage room where he kept his chemicals and equipment,” Thompson said. “He was sleeping in the living room on the couch or the floor.”

The investigation revealed troubling things about Aldawsari, who had come to the U.S. legally in 2008 on a student visa. “Based on evidence from the Internet and his journal entries,” Thompson said, “Aldawsari was radicalized before he ever came to the U.S. It appears he started planning this attack when he was a teenager and sought a scholarship to study specifically in America.”
By this point, surveillance teams were monitoring Aldawsari around the clock. “He was searching online for large targets such as dams and electrical plants,” Thompson said. He also searched for ways to conceal explosives in baby dolls and carriages and even sought the Texas address of former President George W. Bush.
On February 23, 2011, after agents were certain that Aldawsari was working alone, he was arrested and charged with attempted use of a weapon of mass destruction. In November, after being convicted by a jury, he was sentenced to life in prison.
“Aldawsari wanted to take out a lot of people,” Thompson said. “It scares me to think what might have happened if we hadn’t stopped him.”


Preying on the Weak

It was a despicable scheme—stealing identities of terminally ill individuals to fraudulently obtain millions of dollars from insurance companies and bond issuers.
Attorney Joseph Caramadre, president and CEO of his own estate planning company in Rhode Island—along with Raymour Radhakrishnan, an employee—pled guilty earlier this month in federal court to conspiracy to commit identity theft and wire fraud.
Caramadre’s investment strategies depended on lying to terminally ill individuals and their loved ones to obtain identity information. He abused two financial instruments—variable annuities and death put bonds (see sidebar)—to carry out these strategies. In addition to buying annuities from insurance companies listing terminally ill individuals as annuitants, he also purchased bonds of distressed companies for significantly below face value listing terminally ill individuals as “co-owners.” When the terminally ill person died days or weeks later, he would exercise the death benefits associated with the investments.
Caramadre recruited investors by falsely telling them he found a loophole which permitted the use of terminally ill patients as annuitants on annuities and co-owners on brokerage accounts used to purchase death put bonds. He then entered into profit-sharing agreements with them, but received a significant percentage of the profits himself.

Financial Instruments Misused in the Scam
- Variable annuities: Investments akin to mutual funds with death benefits. These death benefits include a guaranteed return of all money invested plus a guaranteed profit—even if the market went down—and various other bonuses and enhancements upon the death of the person named as the annuitant.
- Death put bonds: Corporate bonds with survivor options purchased through a brokerage account. Under the terms of these bonds, the owner of a bond is able to redeem it at face value years or even decades prior to the bond’s maturity date upon the death of the bond’s co-owner.
The financial success of Caramadre’s schemes depended entirely on the imminent death of the person named as the annuitant or co-owner.

In recruiting terminally ill individuals for his scheme, Caramadre was only interested in those with a life expectancy of six months or less. He looked for victims in several ways: visiting AIDS facilities, putting ads in a local religious newspaper offering cash to terminally ill individuals, and even looking through his own company files.
The ads purchased by Caramadre were especially fruitful…in them, he claimed to be a philanthropist and offered the terminally ill a few thousand dollars to assist with their funeral expenses. The ads also got him access to hospice care facilities, nurses, and social workers who could spread the word about his offer.
Radhakrishnan would visit patients and their families to supposedly determine whether they qualified for the donation, but he was actually assessing their life expectancies…the shorter the time, the better for the scheme.
Patients who accepted Caramadre’s cash offer were asked to sign a document, ostensibly because the philanthropist needed it for tax records, but in reality it was so their signatures could be forged later on. Sometimes, they were asked to sign signature pages from actual annuity and brokerage account applications that were disguised as something else. Sometimes, they were told that actual accounts would be open, but that all profits would go to other terminally ill people. And they were always asked for personal information, like Social Security number, birthdates, driver’s license numbers, etc.
Once armed with the fraudulently obtained identity information, Caramadre purchased annuities and death put bonds. And both he and Radhakrishnan took numerous steps to deceive the insurance companies and brokerage houses to hide Caramadre’s true ownership interest.
Caramadre’s scheme went on for about 15 years—from 1995 to 2010—until some of the insurance companies and brokerage houses he defrauded filed complaints, and investigators with the FBI, U.S. Postal Inspection Service, Internal Revenue Service, and U.S. Attorney’s Office began looking into the matter.
Lesson to be learned. If you or a family member is suffering, physically or financially, don’t make quick business decisions….you still need to do your due diligence.