Bellflower man sentenced to federal prison for credit card scam
City News Service | 8/5/2013, 5:47 p.m.
LOS ANGELES, Calif. — A Bellflower man was sentenced today to 8 1/2 years in federal prison for helping operate a $650,000 fraud scheme in which he and his brother impersonated people to get and use credit cards in their names.
Clayton Stewart, 47, pleaded guilty in November to conspiracy to commit bank fraud, access device fraud and money laundering. The brothers persuaded banks to send them replacement credit cards in the names of real and fictitious individuals and businesses.
The swindle was “deliberate, calculated and wide-ranging,” according to U.S. District Judge Gary A. Feess, who ordered Stewart to pay part of more than $400,000 in restitution to banks. When his sentence is complete, Stewart will be on supervised release for five years.
Such crimes are “a very serious and growing problem in our society,” Feess said, adding that identity theft schemes were becoming increasingly sophisticated.
In his plea, Stewart admitted that he and his older brother, Johnny Stewart, 51, of Marina Del Rey, and co-defendant Dexter Hardy, 47, of Los Angeles County, conspired to defraud Bank of America, Chase Bank USA, and Capital One Bank through the use of fraudulent credit card applications.
“These unscrupulous defendants thought they had figured out a clever scheme to steal identities and enrich themselves with their ill-gotten gains,” said Jose A. Gonzalez, special agent in charge of the IRS criminal investigation office in Los Angeles.
According to court documents, Clayton and Johnny Stewart made calls to the bank in the names of other people to ask about cards opened in the names of businesses.
Once the Stewarts got credit cards by mail, they began making unauthorized bank ATM withdrawals and buying items easy to resell, including department store gift cards and Apple iPads, documents show.
The brothers also created fictitious entities so that charges could be made with fraudulent credit cards on merchant processors. The dollar loss associated with the scheme is about $650,000, prosecutors said.
Johnny Stewart was convicted in November by a federal jury of 18 felony counts, including bank fraud, access device fraud, money laundering, and aggravated identity theft. He was sentenced to 12 years in federal prison.
Hardy pleaded guilty a year ago to one count of bank fraud conspiracy, receiving a sentence of 33 months in prison.
Five years ago, Clayton Stewart was sentenced in U.S. District Court to three years in federal prison after pleading guilty in an access device fraud scheme.
“You would have thought that would have been a real wake-up call,” Feess said.
Fred Shuster | City News Service