U. S. Department of Justice

U. S. Attorney’s Office

Southern District of Texas

Donald J. DeGabrielle, Jr. •United States Attorney

TWO HOUSTON RESIDENTS CHARGED WITH OPERATING FRAUDULENT WEB SITE TO ACCEPT DONATIONS FOR HURRICANE KATRINA RELIEF

 

HOUSTON - Steven Anyanwu Stephens, 23, and Bartholomew Stephens, 26, both of Houston, have been charged in a nine-count indictment with conspiracy, wire fraud and aggravated identity theft in connection with their operation of "mailtowww.salvationarmyonline@yahoo.com," a Web site that falsely purported to raise money for a "Salvation Army Relief Fund" for Hurricane Katrina victims, U. S. Attorney Don DeGabrielle announced today.

Both men were arrested by special agents with the Federal Bureau of Investigation (FBI) at separate locations in Houston this morning and are expected to appear before U. S. Magistrate Judge Calvin Botley later today.

According to allegations in the indictment, on Sept. 4, 2005, Steven and Bartholomew Stephens registered www.salvationarmyonline.org, a Web site that was represented as "The Salvation Army International Home Page" and falsely purported to solicit charitable donations for Hurricane Katrina, and later Hurricane Rita, relief. The site provided a link directing donors to PayPal, a service that allows for online money transfers. The defendants allegedly created numerous accounts with PayPal, such as salvationarmyonline@yahoo.com, and registered those accounts using the names and identification information, including Social Security numbers, of other individuals not involved in the fraudulent scheme. However, the PayPal accounts were linked to bank accounts belonging to one or both of the defendants. According to the indictment, to deceive PayPal into believing the linked bank accounts belonged to the registered person's named on the PayPal accounts, the defendants submitted copies of their bank statements to PayPal that had the names and addresses of the other individuals pasted over the defendants' information.

The defendants are accused of transferring to their personal bank accounts more than $48,000 in funds that were donated via the www.salavationarmyonline.org Web site through the fraudulently obtained PayPal accounts.

The Stephenses are charged with conspiring to commit wire fraud and aggravated identify theft, six counts of wire fraud and two counts of aggravated identity theft based on their use of others' Social Security numbers to register the PayPal accounts involved in the scheme. Upon conviction, the conspiracy count carries a punishment of up to five years in prison. Each of the six wire fraud counts carries a punishment of up to 20 years in prison upon conviction. The aggravated identity theft counts carry, upon conviction, a mandatory prison term of two years that must run consecutive to any other sentence. Each of the nine counts carries a possible fine of up to $250,000.

The investigation leading to the indictment of both defendants was initiated by the FBI in late October 2005, upon receipt of a fraud allegation concerning the Web site received from the National Cyber Forensics and Training Alliance. The case will be prosecuted by Assistant U. S. Attorney Gregg Costa.

The return of this indictment brings the total number of individuals charged with fraud offenses relating to Hurricanes Katrina and Rita to 26 in the Southern District of Texas.

The U. S. Attorney's Office for the Southern District of Texas is a member of the Department of Justice's Hurricane Katrina Fraud Task Force, created by Attorney General Alberto R. Gonzales to deter, detect and prosecute unscrupulous individuals who try to take advantage of the Hurricane Katrina and Hurricane Rita disasters. Headed by Assistant Attorney General Alice S. Fisher, the Task Force is comprised of federal, state and local law enforcement investigating agencies and the U. S. Attorney's Offices in the Gulf Coast region and nationwide.

Anyone suspecting criminal activity involving disaster assistance programs can make an anonymous report by calling the toll-free Hurricane Relief Fraud Hotline, 1-866-720-5721, 24 hours a day, seven days a week until further notice. Information can also be emailed to the Inspector General at dhsoighotline@dhs.gov or sent by surface mail, with as many details as possible, to:

Department of Homeland Security

Washington, DC. 20528

Attn: Office of Inspector General, Hotline