Two Long Island brothers and a Queens man led an international fraud ring that scammed more than $2 million from thousands of victims across the United States, according to prosecutors and court papers unsealed Monday in Central Islip federal court.
The documents charge Kamal Zafar, 51, of South Huntington, his brother, Jamal Zafar, 48, of Huntington, and Armughanul Asar, 68, of College Point, Queens, with conspiracy to commit wire fraud and conspiracy to launder money. The three defendants each pleaded not guilty to the charges when they appeared Monday before U.S. District Judge Steven I. Locke. Lawyers as well as relatives of the defendants declined to comment afterward.
Prosecutors said the Zafar brothers and Asar worked with co-conspirators who operated call centers in New Delhi to steal $2.3 million from thousands across the United States between January and September 2018. The victims included a Missouri man who was scammed out of $70,000 from a memorial fund established after his wife and two daughters were killed in a traffic accident, and a 76-year-old woman who lost her retirement savings.
Kamal and Jamal Kafar were unrepentant con artists, prosecutors said. Kamal Zafar had been charged in a Brooklyn health care fraud case and was free on $1.5 million bond when he allegedly committed the crimes described in federal court papers. Jamal Zafar had just completed probation in a 2015 fraud case, the court papers said.
“These defendants remotely used ruthless scare tactics and threatened innocent citizens, including the elderly, widows, and professionals, under the guise of having to pay off unfounded financial obligations to the U.S. government for their own personal gain,” said Jonathan D. Larsen, IRS Criminal Investigation special-agent-in-charge.
Richard P. Donoghue, U.S. attorney for the Eastern District, said the defendants had operated a “transnational fraud scheme.”
The call center co-conspirators, claiming to be employees of the IRS, Social Security Administration and the Drug Enforcement Administration, told victims they owed money to the agencies and would be arrested if they did not promptly pay the debts. Those calls would sometimes be followed up by someone impersonating a police officer who told victims arrest warrants had been issued in their names.
Asar and the Zafar brothers recruited people to open bank accounts in the names of inactive businesses and shell corporations, according to the court papers. The victims would wire payments to those bank accounts and the money would then be withdrawn and laundered through additional bank accounts.
None of the victims identified so far are Long Island residents, according to a law enforcement source. Police and prosecutors in Nassau and Suffolk have issued warnings about such scams in recent years and say they have seen a surge in telephone and internet fraud targeting the elderly.
Court papers did not give ages for the victims but the indictment comes after Nassau County Legis. William Gaylor III (R-Lynbrook) introduced legislation this month that would create an 11-member commission to study the effectiveness of existing statutes and teach older residents how to protect themselves from scam artists. Nassau police have said they received 275 phone scam reports from January through mid-July.
Nassau County District Attorney Madeline Singas has said her office provided bank officials in the county with training to help them identify potential victims by asking customers why they might suddenly be withdrawing large amounts of cash.
Suffolk police received 522 scammer reports during the first six months of 2019, up from 320 during the same period in 2018, Commissioner Geraldine Hart said earlier in August at a news conference to raise awareness of scams. The police department has also launched radio public service announcements in both English and Spanish warning the public about potential scams.
Prosecutors Monday asked the judge to hold the three men without bail, saying they had the resources and contacts in Pakistan and China to flee the country. Locke ordered Asar held on $500,000 bond, while Kamal and Jamal Zafar were released on $750,000 bond with electronic monitoring. Asar is a citizen of Pakistan, according to court papers, while the Zafar brothers are U.S. citizens.
If convicted, all three could face up to 20 years in prison.
With Ellen Yan
HOW THE SCAM WORKED
- Defendants worked with co-conspirators who operated a call center in India. Call center co-conspirators would contact victims, tell them they were from a federal agency, and tell the victims they faced arrest if they did not promptly pay debts owed to the government.
- Victims would sometimes receive a follow-up call from someone claiming to be an official with local law enforcement and telling them arrest warrants had been issued in their names.
- Defendants also recruited people to open bank accounts in the name of inactive businesses or shell corporations. Victims would wire money to those accounts. Those funds would then be withdrawn and laundered through other bank accounts.
HOW TO PROTECT YOURSELF
- Be wary of anyone claiming to be a representative of a government agency or utility and threatens arrest or other consequences if you do not immediately send them money.
- Be wary of anyone who demands payment with gift cards. Courts and police don’t accept Amazon gift cards for bail. PSEG doesn’t accept Best Buy cards for electric bills.
- Be wary of anyone who says a loved one has been arrested or injured and you need to immediately send them payment for bail, legal fees or medical care. Check with your loved one — or somebody close to them — to confirm the story.