Five National Guard Members Charged for Bitcoin Fraud

Recently returned and unsealed indictments accused Five National Guard guardsmen for Bitcoin, credit card, or access device fraud. All four defendants used Bitcoin to purchase stolen debit and credit cards from the internet. Then, according to the indictment, the men encoded blank cards with the stolen ones and made fraudulent purchases at Army and Air Force Exchange Service (AAFES) stores on military bases.

One indictment named three men from the District of Columbia Army National Guard: Derrick K. Shelton, James C. Stewart, and Quentin T. Stewart. Another indictment named Vincent Anthony Grant, another guardsmen from the D.C. Army National Guard, for involvement in two different cases for the same crimes. And the last indictment from a separate case named Jamal Alexander Moody for the same or similar crimes; he already pleaded guilty to several crimes and is preparing for a sentence hearing.

The Shelton Stewart indictment accused Shelton, J. Steward, Q. Stewart—and their co-conspirator, Moody—of several types of fraud. They bought stolen credit and debit card numbers from the internet using Bitcoin. According to the indictment, the group targeted members of federal credit union accounts with addresses near or in Maryland. They purchased magnetic stripe encoders, along with encoding software, to write the stolen card numbers to blank credit or debit cards.

With the newly encoded cards, the group purchased items from AAFES stores on army bases and elsewhere. They then either sold the goods or kept them for personal use. This activity occurred between July 2014 and May 2015.

The Grant indictment accused Grant, Moody, and others of operating a similar scheme to the one above. Both bought Bitcoin online to buy stolen credit card numbers. They encoded and used the stolen card numbers between July 2014 and April 2015.

From an earlier indictment and trial, Moody pleaded guilty to access device fraud and aggravated identity theft. He purchased another magnetic stripe encoder and re-encoded credit cards in the same manner. He encoded more than 100 cards with stolen card numbers from July 2014 to April 2015.

Shelton, J. Stewart and Q. Stewart face a maximum sentence of 20 years in prison for conspiring to commit wire fraud. And a minimum of two years in prison for aggravated identity theft. Grant faces a maximum sentence of seven years in prison for device fraud conspiracy and a minimum of two years for aggravated identity theft.

Moody awaits sentencing for the access device fraud and aggravated identity theft charges. A maximum of 15 years in prison can be imposed for access device fraud and a mandatory two years comes with the aggravated identity theft charge.