An ambitious and disciplined identity-theft ring recruited waiters at steakhouses and other high-end New York restaurants to steal diners' credit-card information, then used it for luxury shopping sprees, authorities said Friday.
Some 28 people have been indicted on various charges, including racketeering, conspiracy and grand larceny.
The group had seven waiters use so-called "skimming" devices to copy at least 50 restaurant-goers' American Express credit-card data surreptitiously while running their tabs at such powerhouse eateries as Smith & Wollensky and Wolfgang's Steakhouse, Manhattan District Attorney Cyrus R. Vance Jr. said.
The ring made up counterfeit credit cards with the stolen information, then had associates fan out to buy big-ticket items, including Rolex and Patek Phillippe watches, Hermes and Chanel handbags, Jimmy Choo shoes, vintage wine and even a Roy Lichtenstein lithography of Marilyn Monroe, making purchases from Boston to Los Angeles to Palm Beach, Fla., Police Commissioner Raymond Kelly said.
Directed by 41-year-old ringleader Luis Damian "D.J." Jacas, the group was choosy and careful, authorities said.
The waiters were told to focus on cards with high spending limits -- such as the Amex gold or jet-black Centurion card -- so their raft of pricey purchases wouldn't prompt American Express to call the cardholders. Even so, Jacas didn't allow more than $35,000 in purchases on any one card and would ditch each after about three days' use, Kelly said.
The ring's shoppers were instructed on how to dress and act like customers accustomed to spending big, and they were equipped with fake Maryland and Pennsylvania drivers' licenses to back up their phony identities, authorities said. They made sure the cards were still valid by using them in a taxi or coffee shop before going into chic stores, and leaders went along to direct the purchases, officials added.
"This group was certainly well organized and very selective," Kelly said at a news conference as he and other officials stood in front of a table strewn with some of the more than $1 million in watches, 100 handbags and $1.1 million in cash they said they had confiscated in various searches.
The ring kept some of the loot for its own use and sold the rest, sometimes stashing it in a Manhattan storage locker, authorities said.
Jacas and 21 other defendants pleaded not guilty Friday. The name of Jacas' lawyer wasn't immediately available, and no one immediately responded to a message left at a possible former telephone number for his Manhattan home.
The rest were awaiting arraignment or hadn't yet been arrested. One of those still at large has a criminal record that includes a 1980s drive-by necklace-snatching in which the victim was dragged to her death, authorities said.
Police began piecing the scheme together when Detective Kenneth Baker traced one of the compromised accounts to a legitimate purchase at a Manhattan location of The Capital Grille, a chain of upscale eateries, Kelly said. They and prosecutors later joined forces with the U.S. Secret Service, which had been working on another aspect of the case, he said.
The Capital Grille said two employees tied to the alleged scam were no longer working there, though the chain declined to say whether they had quit or been fired. The restaurant group, owned by Orlando, Fla.-based Darden Restaurants Inc., said it had it had aided authorities' investigation and conducted its own.
Representatives for the Boston-based Smith & Wollensky Restaurant Group and New York-based Wolfgang's Steakhouses didn't immediately return calls. New York-based American Express Co. said it was working with authorities and noted that cardholders don't have to pay for any fraudulent charges.
About three inches long and half an inch wide, the skimmers can be concealed in a palm and used unobtrusively.
"The fame of some of the restaurants and the dazzle, perhaps, of the American Express black cards, makes this an interesting story, perhaps, but it's not an unusual story," Vance said. "Hopefully, a case like this lets the restaurant industry know that this is an important issue that they should address."
Portable credit-card swiping machines, designed to be brought to diners' tables so they can swipe their own cards, can help fight such fraud, city Consumer Affairs Commissioner Jonathan Mintz said. The devices are widely used in Europe and Canada.