Couple pleads guilty to federal credit card fraud

ATLANTA — A California couple arrested at Hartsfield-Jackson Atlanta International Airport and held in Clayton County Jail have pleaded guilty to federal charges and face several years in prison.

Deje D. Silas, 21, of San Francisco pleaded guilty on May 21 to one count of conspiracy to possess 15 or more counterfeit or unauthorized credit cards. She was sentenced on Aug. 28 to serve three years and five months in federal prison.

Silas had been in Clayton County Jail from April 9 until May 8 when she agreed to waive indictment and appeared in federal court on a criminal information pursuant to a negotiated plea agreement, officials said.

Her boyfriend, Elton Lee Flenaugh, 34, of Richmond, who also uses the aliases Josh Ford and Ali Waheed, pleaded guilty this week to one count of possession of 15 or more counterfeit or unauthorized access devices and one count of aggravated identity theft.

U.S. Secret Service agents took Flenaugh into federal custody March 4 at Clayton County Jail after authorities indicated that Flenaugh had posted bond and would be released from custody. A federal complaint was filed against him later that day.

The court ordered Flenaugh detained as a flight risk and as a danger to the community March 7, and he has remained in custody since then. A federal grand jury indicted Flenaugh on the instant charges April 2.

Flenaugh admitted in court that he is responsible for $200,000 to $400,000 in fraudulent charges, officials said.

The charge for possession of counterfeit or unauthorized access devices carries a maximum sentence of 10 years in federal prison, and the aggravated identity theft charge carries a mandatory minimum sentence of two years in federal prison, which is required to be imposed consecutive to any sentence imposed on the possession charge.

Each of the charges also authorizes a fine of up to $250,000.

In determining the actual sentence, the court will consider the U.S. sentencing guidelines, which are not binding but provide appropriate sentencing ranges for most offenders.

Sentencing for Flenaugh is scheduled for Feb. 27 at 2 p.m. before Senior U.S. District Judge Orinda D. Evans.

U.S. Attorney Sally Quillian Yates said the case highlights the need for aggressive prosecution in similar cases.

“This case highlights the need for aggressive federal investigation and prosecution of credit card fraud and identity theft crimes,” she said. “We commend the U.S. Secret Service for synchronizing local law enforcement activities in multiple cities to bring this brazen, multi-state scheme to a halt and these defendants to justice.”

Yates said the testimony and evidence showed that Flenaugh and Silas had a romantic relationship dating back several years. On Feb. 9, they were scheduled to fly from Atlanta to Los Angeles.

During the pre-flight security screening process, TSA security officers noticed a suspicious package in Flenaugh’s carry-on bag and, upon further inspection, found nearly 100 fraudulent credit cards secreted inside of a double-sealed manila envelope, which had been hidden inside an empty, foil-lined Lay’s potato chip bag, said Yates.

Thirty-three of the cards were embossed in Silas’ name, 28 were embossed in three different aliases used by Flenaugh and 21 were blank.

“Subsequent searches by the Atlanta Police Department revealed fraudulent driver’s licenses inside of the protective case attached to Silas’ cellphone, and underneath the removable insole of one of Flenaugh’s shoes in the carry-on bag,” said Yates.

Yates said an additional investigation revealed fraudulent credit cards, licenses and stolen credit card account and identity information of hundreds of people.

“These were found in personal items seized from and during searches of Google email accounts controlled by Flenaugh and Silas, an Apple iPad seized from them at the airport, and a 2007 BMW M6 automobile registered to one of Flenaugh’s aliases,” she said.

The investigation showed that the scheme began at least by early 2012 and continued until Flenaugh and Silas’ arrests in Atlanta, said Yates. The scheme involved getting credit and debit card account information of hundreds of people, which were then used to manufacture fraudulent credit cards. The cards were made to appear as if they had been issued by major financial institutions such as Chase Bank, U.S. Bank and Capital One.

The defendants also got personal identifying information — including Social Security numbers, dates of birth and credit information — of dozens of people, which were used to create fraudulent driver’s licenses to use with the fraudulent credit cards.

The fraudulent credit cards were then embossed with the names used on the fraudulent driver’s licenses. The issuing banks and the names embossed on the fraudulent credit cards were merely a front to make them appear legitimate.

The magnetic stripes on those cards were encoded with the actual debit and credit card account information of account holders at dozens of financial institutions throughout the country, but primarily at credit unions located in California, Florida, Georgia, Oregon and Washington.