Nine people arrested in credit card number theft ring

Those arrested are accused of stealing an undisclosed number of credit card numbers at businesses in Collier, Lee and Charlotte counties. The credit card owners included residents and businesses in Florida, throughout the country and in the Caribbean and Europe. Banks in the U.S. and Europe also were victimized, according to investigators.

The extent and success of this type of crime ring has never before been seen in the five-county area, State Attorney Steve Russell said Saturday. Investigators said the crime ring was responsible for an estimated $20,000 in losses to legitimate businesses per week.

"This operation, locally, is unprecedented," said Russell, flanked by two rows of investigators working on the case.

Authorities began making the arrests at 5 a.m. Saturday. Those arrested were charged with a total of 465 counts of racketeering, conspiracy to violate the Racketeer Influenced and Corrupt Organization Act, fraudulent use of a credit card, participating in a scheme to defraud, petit theft, dealing in stolen property, obtaining fuel fraudulently and unlawful transportation of fuel.

The two Collier County residents arrested are Dairi Cardenas, 33, 1495 Everglades Blvd. N., and Ubaldo Suarez, 28, 1495 Everglades Blvd. N.

Also arrested were Jose Hernandez, 54, 1814 Hanson St., Fort Myers; Nivaldo Gonzalez, 30, 6990 Rich Road, North Fort Myers; Ricardo Lee, 40, 1427 S.E. 10 Terrace, Cape Coral; Juan Palenzuela, 47, 4029 Skyline Blvd., Apt. 101, Cape Coral; Angel Perez, 44, 1006 N.W. 8th Terrace, Cape Coral; Jose Ramon Simon, 42, 1320 S.E. 24 Ave., Cape Coral; and Luar Perez, 23, 4900 S.W. 107th Ave., Miami.

Russell said the organization, which he said is larger than the nine people arrested Saturday morning, obtained the credit card data through a process called credit card skimming.

In skimming, a device that resembles a pager is hooked up to legitimate credit card swiping machines and downloads the credit card information. The skimming device then transfers the credit card numbers to machines that produce fraudulent cards under those numbers.

Investigators said the theft ring produced an undetermined number of credit cards and used these cards to buy tens of thousands of gallons of gasoline each month for an undetermined number of years, and used trucks and tractor-trailers to haul the gasoline, which they later resold for a profit.

When the nine were arrested, search warrants revealed nine trucks, two tractor-trailers, an undisclosed number of fuel storage tanks, cash, computers, boxes of fraudulent credit cards and equipment used to make the cards. Further details on the confiscated items will not be disclosed while the investigation continues further, investigators said.

"This strikes at the financial well-being of innocent citizens," Russell said. "It threatens the economy by providing illicit mass amounts of fuel from illegitimate businesses."

Investigators said the ring members also bought personal items but would not detail the natures of the items or the total cost.

The nine were transported to the Lee County Jail on Saturday; however, three — Suarez, Cardenas and Luar Perez — remained to be booked at press time. Their jail status and bond amounts were unavailable Saturday night.

The remaining six were being held without bond.

More arrests are expected and the case remains under investigation, said Assistant State Attorney Bob Lee, the agency's senior economic crimes trial lawyer.

Lee said investigators don't know yet to whom all of the gasoline has been resold, or from where all the gasoline was obtained. Some of those arrested worked for businesses at which the credit card information was stolen, he said. He said investigators don't know how many credit cards were reproduced.

"We've got victims," he said. "We have to stop this as quickly as we can."

Lee said most of the victims should know about the thefts by now.

The fuel is unlicensed and unregulated, prompting investigators' concerns about whom the fuel would be sold to in the post-Sept. 11 world.

The theft of such a large quantity of fuel does spark concerns about whether terrorists could have bought any of the fuel, Russell said. However, it wasn't the focus of the investigation, he added.

Lee said investigators cannot disclose how the nine arrested Saturday originally met.

Cape Coral Police and the State Attorney's Office's Economic Crimes Unit led the investigation, which included the Collier and Charlotte County Sheriff's offices, the Department of Environmental Protection, U.S. Secret Service, the U.S. Postal Service, the Office of the Inspector General and the Cape Coral Fire Rescue District. The investigation began in earnest in July 2003 after an anonymous tip to Southwest Florida CrimeStoppers in March 2002 about possible credit card skimming.

Cape Coral Police Chief Daniel Alexander said the invesigation will send a message that this type of crime is not tolerated.

"The criminal enterprise has been halted," Alexander said. "If you're involved in an ongoing criminal scheme, Southweest Florida law enforcement is prepared to stand shoulder to shoulder with whatever comes our way."