Docs: Suspect in $1 million identity theft ring pleads guilty

The western New York state man Suffolk prosecutors said was the mastermind of a scheme that netted more than $1 million from financial institutions by creating new identities with stolen information pleaded guilty to two counts of second-degree grand larceny and other charges Monday, officials said.

Adam D. Arena, 44, was the leader of a ring that used Social Security numbers stolen from people unlikely to check their credit histories, including children, recent immigrants, the elderly, the incarcerated and even the dead to create synthetic — or fraudulent — identities, Suffolk District Attorney Timothy Sini’s office said. The defendants used those synthetic identities to get loans and establish credit.

The scammers used their own names and dates of birth along with the stolen Social Security numbers and random addresses in Suffolk County to obtain loans and other credit while defrauding financial institutions, prosecutors said.

Arena, of Great Valley, New York, as well as 12 other people and three corporations were charged in a 108-count indictment unsealed in September. At least 10 of the defendants were Long Island residents. Three corporations affiliated with the scheme also plead guilty Monday.

Arena’s attorney, Robin Yanes of Culver City, California, declined to comment. Arena is scheduled to be sentenced on May 3.

Arena is expected to be sentenced to four to 12 years in prison. Arena and the corporations will also be required to pay restitution in the amount of approximately $523,000 through restitution judgment orders to the financial institutions impacted by this scheme.

Sini’s office said Arena created shell corporations that falsely reported the fraudulent identities to credit reporting agencies to boost the credit ratings of the fake identities, law enforcement officials said.

"Mr. Arena played a key role in this national fraud ring," Sini said. "He opened shell corporations for the sole purpose of improving credit scores for these fake identities, allowing them to borrow large amounts of money in loans that they would never pay back. Our message to fraudsters is that no matter how sophisticated you think your operation is, you can’t outsmart the law."

Authorities said last September that local losses topped $1 million dollars, and that the same schemers amassed a credit limit of hundreds of millions of dollars across the country.

With fake credit histories established, the scheme's participants allegedly used the synthetic identities to get loans that weren't repaid and to max credit cards — what authorities said is known as a credit "bust out."