Leader of Target gift card fraud ring sentenced to prison

The leader of a gift card fraud ring that cost Target and its customers more than $700,000 — and involved the Lynnwood Target as well as Lynnwood police — has been sentenced to five years in prison, the U.S. Attorney’s Office reported.

Jeffery Douglas Mann, 30, of Marysville, was arrested last year in Snohomish County. He was sentenced Monday in U.S. District Court in Seattle to five years in prison and three years of supervised release for his scheme.

According to an announcement from U.S. Attorney Brian T. Moran, Mann led a group of five people who used a system to decipher gift card identifying numbers and used them across five western states for fraud. U.S. District Judge James L. Robart ordered Mann to pay more than $214,000 in restitution, saying Mann, “is obviously talented and used that talent to break the law… This is not a victimless crime — it impacts real people.”

Lynnwood Police Detective Brad Reorda said that the Lynnwood Target reported the incidents to the Lynnwood Police Department first. “After the initial investigation I suggested that Target meet with Secret Service as the scope of the investigation was getting larger and larger to include more and more city jurisdictions  as well as other states as well,” Reorda said.

According to records filed in the case, between May 2017 and December 2017, the ring stole gift card balances worth more than $700,000, and often sold illegally purchased goods or store gift cards for bitcoin on an internet marketplace. The co-conspirators used a formula to reverse-engineer and identify unique bar code numbers of thousands of authentic gift cards sold by Target to legitimate customers.

Members of the scheme then used the retailer’s automated customer service telephone system to verify balances linked to the various stolen gift card numbers. They then loaded active gift card numbers onto a mobile or electronic wallet app on their phones, which the co-conspirators used to purchase merchandise and legitimate gift cards at various Target store locations across at least five states: Washington, Oregon, California, Nevada and Colorado. For example, on a single occasion in November 2017, Mann and others used roughly 180 compromised gift card numbers to make $6,900 in purchases at the Southcenter Mall Target store in Tukwila, the U.S. Attorney’s office said.

When the actual cardholders later tried to use their gift cards, they discovered that they had zero balance. In December 2017, Target modified its gift card system in response to the fraud, putting an end to the scheme. Target reimbursed customers for their losses.

Mann pleaded guilty to wire fraud in March 2019. Four other defendants have resolved their criminal charges: Corey Mosey was sentenced to 46 months in prison; Joshua Newman was sentenced to 38 months in prison and Derrick Quintana was sentenced to 27 months in prison. Kennady Weston is resolving her case with participation in federal drug court. Those defendants agreed to pay a total of roughly $263,000 in restitution in addition to that ordered from Mann.

The case was investigated by the U.S. Secret Service, with assistance from the Kirkland, Lynnwood, and West Linn (Ore.) Police Departments.

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