2002-06-12 -- Qareen, Ali Mahd Ayed et. al. -- Criminal Complaints -- News Release

Five Arrested for Roles in Credit Card "Bustouts" for Running Up Millions in Debt and Seeking Bankruptcy

NEWARK - A recruiter of individuals who engaged in credit card scams was arrested today on charges that his recruits ran up more than $1 million in fraudulent credit card charges and sought to eliminate the debt by filing for bankruptcy, U.S. Attorney Christopher J. Christie.

Four others were arrested and charged separately in criminal complaints. Those defendants allegedly committed similar but unrelated so-called credit card "bustouts."

The recruiter solicited others and convinced them to provide copies of their credit cards, social security numbers and other identifying information, according to a criminal complaint. Such recruiters typically entice the card holders with the prospect of charging hundreds of thousands of dollars in cash, household appliances, jewelry and other valuable merchandise to their credit cards, and then wiping out their debt by filing for bankruptcy, according to the complaint.

Special Agents of the FBI and Secret Service and U.S. Postal Inspectors executed arrest warrants in Paterson, Clifton, Fairview and Fort Lee. The agents and inspectors made the arrests on criminal complaints that were unsealed today. The four defendants were scheduled to make initial appearances before U.S. Magistrate Judge Ronald J. Hedges today at 2:30 p.m. The fifth defendant, the recruiter of others, was scheduled to appear before U.S. Magistrate Judge Stanley R. Chesler at 3:30 p.m.

The primary object of the defendants' schemes - known as credit card "bustouts" - was to obtain hundreds of thousands of dollars in cash and merchandise from banks and retailers, according to the complaints.

In many cases, those recruited for the scams allegedly established credit card accounts by misrepresenting their earnings. They used the charge cards to obtain airline tickets, computer equipment, household furnishings and cash advances, according to the complaints.

In some cases, when the total amount of the defendants' purchases reached their credit limits, they submitted checks to the credit card companies, knowing that the checks would not be honored. Then, after the fraudulent payments were posted to their accounts, but before the checks were returned, the defendants made additional purchases and took more cash advances.

In doing so, the defendants made purchases and cash advances in amounts equal to their fraudulent payments and exceeded their credit limits.

In some instances, suspects sent in extra payments, to temporarily increase an available credit limit, thereby allowing new charges well in excess of an established credit limit.

Shortly after the credit card "bustouts" were accomplished, the defendants filed bankruptcy petitions with the United States Bankruptcy Court in New Jersey, for the purpose of wiping out their debts.

Qareen was charged with credit card fraud, which carries a maximum penalty of 10 years in prison and a $250,000 fine.

Each of the other defendants was charged with bankruptcy fraud, which carries a maximum penalty of five years in prison and a $250,000 fine. Only some of the defendants' alleged activities are described below. A detailed account of the alleged crimes and variations on the different schemes can be found in each defendant's criminal complaint. The defendants are presumed innocent unless and until convicted of the crimes charged.

Those charged are:

• Ali Mahd Ayed Qareen, 47, an alien of Jordanian descent, who resided in Fort Lee. He is the alleged recruiter of other persons who were not arrested today. At a bail hearing today, Assistant U.S. Attorney Robert Kirsch advised the court that Qareen has an outstanding arrest warrant for premeditated murder in Israel, as well as two fraud-related arrest warrants in Las Vegas. Judge Chesler ordered Qareen detained without bail.

• Qasem Abedrabbo, 35, of Paterson. He filed a bankruptcy petition on Oct. 20, 1999, listing total debts of $414,000. Most of the debts were incurred on as many as 35 credit cards. Between May and July 1998 alone, Qasem Abedrabbo allegedly used his credit cards to obtain more than $76,400 in cash advances and about $100,000 in computers and electronic equipment, jewelry, clothing and home furnishings. Judge Hedges set bail for Abedrabbo at $100,000 to be secured by cash or property.

• Sayel Abedrabbo, 38, of Clifton. He filed a bankruptcy petition on June 19, 1998, listing $380,000 in credit card and other debts owed to more than 35 creditors. Between December 1997 and January 1998 alone, Sayel Abedrabbo allegedly used his credit cards to obtain more than $51,600 in cash advances and charge over $16,700 in computers and electronic equipment, more than $15,000 in jewelry; and more than $89,000 in other items, including airline tickets, gift certificates, clothing and home furnishings. Judge Hedges set bail for Sayel Abedrabbo at $100,000 to be secured by cash or property.

• Soud Almuhtadi, 46, of Clifton. He filed a bankruptcy petition on Jan. 27, 2000, listing $250,000 in credit card and other debts that he owed to more than 35 different creditors. Between May and July 1999 alone, Almuhtadi used his credit cards to run up over $146,000 in new credit card debt, including $43,600 in cash advances, more than $64,000 in airline tickets and electronics and other merchandise worth more than $38,000. Judge Hedges set bail for Almuhtadi at $100,000 to be secured by cash or property.

• Labib Elaridi, 49, of Farview. He filed for bankruptcy on Nov. 12, 1999, listing $318,000 in credit card and other debts that he owed to more than 23 different creditors.

Between November 1998 and January 1999 alone, Elaridi used his credit cards to obtain over $85,000 in cash advances, $48,000 in jewelry, and over $68,000 in other merchandise. Judge Hedges ordered Elaridi detained without bail pending a detention hearing on Wednesday.

Christie credited Special Agents of the FBI, under the direction of Special Agent in Charge Louis F. Allen; Special Agents of the U.S. Secret Service, under the direction of Special Agent in Charge Jan Gilhooly; and Postal Inspectors of the U.S. Postal Inspection Service, under the direction of Postal Inspector In Charge Kevin J. Burke, for bringing the cases against the defendants.

Christie also credited the staff of the Office of the United States Trustee, under the direction of Donald F. Walton, acting U.S. Trustee. The Trustee's office handles the administration of bankruptcy cases.

The case against the recruiter Ali Quareen is being handled by Assistant U.S. Attorney Robert Kirsch. The remaining cases are being handled by Assistant U.S. Attorney Gallucio, as well as several other Assistant U.S. Attorneys of the U.S. Attorney's Fraud and Public Protection Division, in Newark.

-end-

Defense Counsel:

Ali Mahd Ayed Qareen: Tonianne Bongiovanni, Esq., Federal Public Defender's Office

Sayel Abedrabbo: Kevin Carlucci, Esq., Federal Public Defender's Office

Qasem Abedrabbo: Carlucci

Almuhtadi: Lorraine Gauli-Rufo, Esq. Federal Public Defender's Office

Elaridi: Gauli-Rufo