District food servers charged in theft of patrons' credit card numbers
Monday, May 24, 2010
Three servers at the Cheesecake Factory restaurant on Wisconsin Avenue in the District allegedly stole credit card numbers from patrons as part of a scheme that racked up more than $117,000 in fraudulent charges between 2008 and last year, authorities say.
Investigators with the U.S. Secret Service allege the servers were working for a larger fraud ring and were using electronic devices to "skim" the credit card numbers of customers they served at the restaurant. The devices were handed off to others, and the stolen numbers were used to make fake credit cards and later used to buy gift cards and merchandise in the Washington area, according to court records in U.S. District Court in Alexandria.
Federal officials became aware of the scheme in April of last year, when Citibank investigators reported numerous fraudulent charges on cards that had been used at the Cheesecake Factory at 5345 Wisconsin Ave. in Friendship Heights, just south of the Maryland line. Because servers at the restaurant have to swipe a server card unique to them before processing a credit card, investigators were able to narrow the transactions to three servers, according to court documents.
Secret Service agents interviewed two servers, identified in court documents only by their initials because they are cooperating with the investigation, who said they were recruited by Nicole L. Ward, another server at the restaurant. Ward allegedly provided the servers with "skimmers" to capture the credit card numbers and would then hand off the devices to two men, known only as "Slim" and "G."
Investigators also interviewed Ward, in November at another District restaurant, and say in court documents that she admitted her role.
"Nicole Ward stated that 'Slim' had approached her after work one day about a potential scheme to earn some extra money," wrote Special Agent Nathan Fleisher. "Nicole Ward stated that 'Slim' had provided her with a skimmer in order to capture credit card account numbers" and that they worked together for about a month.
Ward was supposed to be paid $40 per stolen card, and the other servers told investigators that Ward recruited them and paid them $25 for each stolen number. But when "Slim" wasn't timely with his payments, Ward began working for "G," who was higher up the chain. "G" would give Ward the skimmers, pick them up two weeks later and return them in a day or two.
Ward told investigators she thinks she made about $5,000. It was unclear from court documents how many card numbers were stolen or how many patrons were affected, but officials estimated the fraudulent charges were at least $117,172.
The Washington Examiner first reported the case Sunday.
Ward, who is in her late 20s, was arrested Wednesday and appeared in federal court in Alexandria last week on charges of conspiring to commit bank fraud. She was released and ordered not to have any contact with the other suspects. Ward, reached by telephone Sunday in Prince George's County, declined to comment.
Investigators pointed to one particular case as an example, in which one of Ward's recruits allegedly stole the number of a Chevy Chase Bank credit card at the Cheesecake Factory on Nov. 14, 2008. About a month later, an alleged co-conspirator used the number at a Sam's Club in Woodbridge to buy $1,717.25 worth of goods.