Prosecutors open attack on alleged global fraud ring 3-year probe links phony bank accounts, two slayings in region


From the start, NationsBank account No. 2362283 looked like trouble.

Investigators spotted suspicious deposits to the Maryland account. They saw a stream of checks coming in from around the country. They traced wire transfers to banks in England, Nigeria, and the Czech Republic.

But when they discovered the battered body of the woman who opened the account dumped in a field in Southern Maryland, the investigators knew they had real trouble on their hands.

"A brutal murder," U.S. postal investigator Robert F. Jones Jr. called it.

What began as a modest bank probe nearly three years ago turned into a large international fraud case, leading to the indictments of nearly a dozen Nigerian nationals, many of them operating out of homes and storefronts in Maryland and Washington.

Beginning today, seven members of the alleged ring are scheduled to go on trial together in federal court in Baltimore, where jurors will hear prosecutors describe a complex conspiracy that supposedly swindled people around the nation and in Canada out of millions of dollars through phony bank and credit card accounts.

Dale E. McKendry was one of the dozens of victims.

"If someone steals my car, that's fine," said McKendry, 59, a Fort Lauderdale, Fla., investment adviser. "But when they steal your name, you've got trouble."

The ring members, according to court documents, stole birth dates, Social Security numbers and other information to recreate the identities of their victims. Using the information, they applied for credit cards, opened bank accounts and went on spending sprees, court records claim.

Ring members allegedly obtained the information by stealing bank statements, credit card reports and other financial information, and by using paid contacts within mortgage companies, car dealerships and credit-reporting agencies, according to court records.

Using a sophisticated national network of go-betweens, cash and money orders allegedly were sent from Chicago, New York, New Jersey, Georgia and Florida to mail drops in Maryland and Washington. Once there, court records say, the money was sent overseas, to accounts in Korea, Nigeria, London, Belgium, Taiwan and Italy.

Prosecutors and defense attorneys, who declined to discuss the case or did not return messages, say the trial could last two months. If convicted, members of the alleged ring would face up to 20 years behind bars.

The case is a window into the burgeoning world of electronic fraud and highly organized criminal rings operated largely by immigrants from Nigeria, a West African nation considered to be among the most corrupt in the world.

The rings have become so pervasive that the Secret Service, the Postal Inspection Service and other agencies and banks have formed task forces in cities such as Baltimore and Washington. Federal agents say Nigerian nationals are tied to more than two-thirds of their cases.

"There's a growing pattern of con games, scams and fraud here," said Benedict J. Ferro, chief of the U.S. Immigration and Naturalization Service in Maryland, one of the agencies that belongs to the task force. "They are working in a highly organized way."

The case about to unfold in U.S. District Judge Catherine C. Blake's courtroom illustrates just how organized the rings have become. Agents executed two dozen search warrants in six states, and they placed wiretaps and secretly recorded more than 200 telephone conversations -- many conducted in the Yoruba dialect of Nigeria.

The Maryland case started with a hunch nearly three years ago, according to sworn affidavits and hundreds of other court records.

A NationsBank fraud investigator noticed unusual transactions in an account belonging to Beverly Rene Mitchell, 26, a Northern Virginia woman who worked as a customer representative for a Bethesda investment firm. The investigator discovered that Mitchell had another NationsBank account with equally suspicious activity.

The investigator contacted the fraud task force.

While agents were investigating, a man looking at property in La Plata in Charles County found a body March 23, 1995. It was Mitchell's. To this day, homicide investigators have not solved the slaying, despite a $10,000 reward raised by her friends.

Mitchell's murder wasn't without clues. Agents searched her home. They discovered that when Mitchell wasn't working for the investment firm, she was moonlighting as a bookkeeper for an alleged international Nigerian fraud and money-laundering ring.

"Found in her bedroom were very detailed records concerning her laundering of over $1 million," according to a sworn affidavit filed by Internal Revenue Service Agent Donald C. Semesky Jr.

Prosecutors will be permitted to tell jurors that Mitchell died, but they will be barred from telling the panel that she was killed. None of the 13 people indicted last year in the case has been charged in connection with the slaying.

Within days of Mitchell's death, police learned of another murder.

The body of Temitayo Ikudayisi, an alleged member of the ring, was discovered in a van parked in Washington. He had been abducted from a party, and detectives say he was tortured before he was slain. Like Mitchell's, his murder is unsolved.

Agents continued to follow the paper trail.

It led them to Columbia, where they searched the home of another Nigerian national suspected of credit card fraud. They also searched a storage bin he rented in Oxon Hill. Inside locker G4F was a second cache of documents -- stolen checks, credit cards and numerous names and account numbers.

The records revealed the name of a key indicted conspirator -- Christopher Omotunde, 30, a Nigerian national who arrived in the United States in 1991 and settled in Upper Marlboro in Prince George's County.

Agents learned that Omotunde, one of the defendants scheduled to go on trial today, paid for the funeral of the slain ring member, Ikudayisi. He also went to the funeral, warning those who attended that anyone who cooperated with police would wind up like Ikudayisi, according to court records.

Prosecutors say that Omotunde was a central figure in the ring. His lawyer, C. Michael Walls, was on vacation last week and unavailable for comment.

Investigators got another break when they found Nigerian national Christopher Polycarp Tizhe, 36. He was charged in 1995 with entering the United States illegally. He pleaded guilty and agreed to cooperate with agents investigating Nigerian fraud cases. Among them: the case against Omotunde.

While he was cooperating, Tizhe became the target of a Drug Enforcement Administration probe into heroin trafficking in New York. Agents placed a tap on Tizhe's Washington phone. It produced a bonanza for both the DEA and fraud investigators. Tizhe is now charged as a member of the fraud conspiracy and with helping to launder narcotics money, and he faces heroin charges in New York.

Agents spent months reviewing the records they seized, piecing together a complicated puzzle of fraud and deceit. Targets of the probe had assumed the identities of other people, taking out loans, applying for credit cards, renting homes, all in the names of unsuspecting victims.

Agents learned that one of the alleged kingpins of the operation was Nigerian national Adeniyi Momodu Allison. He was named in the 21-count indictment in Baltimore, charged with laundering proceeds from the ring and orchestrating where the cash should be sent.

For months, Allison was a fugitive. Constables in England were alerted that there was an international warrant out for his arrest. They found him at a car rental agency, where they were called to sort out a dispute he got into over a car.

Allison was promptly arrested. He is awaiting an extradition hearing in London.

For investigators, tracking Nigerian fraud and heroin rings has become a full-time job.

Last fall, the chief of the Secret Service's financial crimes division testified before Congress that Nigerian financial fraud has become a worldwide problem. And according to a State Department report last year, Nigerian drug traffickers were responsible for nearly 40 percent of all heroin entering the United States.

Nigeria, an oil-rich nation of 101 million people, is the largest U.S. trading partner in sub-Saharan Africa. It's also known for its culture of corruption. In June, a group of international business people voted Nigeria the most corrupt nation in the world.

Federal agents say the corruption has been spilling over into the United States, where the explosion of computers, credit cards, and automated-teller-machine cards is creating the perfect climate for fraud.

Investigators say the rings work in similar ways. Members often follow postal carriers and then rifle through mailboxes, looking for bank statements, bills, anything to recreate personal and financial histories.

Ring members also rely on help from well-placed criminals willing to sell information -- from loan applications, mortgage refinance statements and credit reports.

With the information, ring members contact banks and credit card companies, applying for new cards, checking accounts and lines of credit. They change the victim's address.

When the cards and checks arrive, the spending starts. Sprees can last for months before victims realize what's happening, because bills and collection notices are sent to the changed addresses.

Secret Service agents say they are constantly asked how consumers can protect themselves.

"It's a difficult question," said Thomas F. Grupski, the assistant agent in charge of the agency's Maryland office and a supervisor of the Baltimore fraud task force. "The best advice is, safeguard the documents you have, and never blurt out your personal information to people who don't need it."

Anyone can be a target.

McKendry, the Florida investment adviser, said he had no idea that members of the Maryland ring had applied for a Discover card and American Express card in his name and run up nearly $50,000 in charges.

McKendry said he didn't find out until a Discover card worker called him.

"She said, 'When are you going to pay your bill?' " McKendry recalled.

"I told her, 'I don't have a Discover card,' " he said. "I was ready to shoot someone."

Reporting fraud

To report suspected mail, credit card or check fraud, call:

U.S. Secret Service, Maryland field office, (410) 962-2200.

U.S. Postal Inspection Service hot line, (800) 654-8896.

Or contact one of the three national credit reporting agencies: Equifax, (800) 525-6285; Transunion, (800) 680-7289; or Experian, formerly called TRW, (800) 422-4879.

Pub Date: 1/06/97

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