A man from Lawrence was convicted on Friday for defrauding
thousands of customers through the unauthorized use of credit and debit card
numbers obtained from previous purchases made at the now-defunct discount
clothing Internet business Classic Closeouts, LLC.
Daniel Greenberg, 40, operated the online business from
Hempstead and made $5 million of unauthorized charges.
Greenberg was convicted on all 13 counts for defrauding
customers by a federal jury in Central Islip, which included eight counts of
wire fraud, one count of access device fraud, one count of aggravated identity
theft, and three counts of money laundering.
“When his business ran into trouble, Greenberg helped
himself to his customers’ credit card numbers and then had the audacity to
fight them when they tried to have the charges removed,” according to Loretta
E. Lynch, United States Attorney for the Eastern District of New York.
Fraudulent charges of $49 or more were made to customers’
cards from approximately June 2008 through April 2009, and involved over 60,000
transactions. In many of the incidences, cards were charged multiple times over
the course of several weeks and months.
Attempts by customers to dispute unauthorized charges to
their credit card company and banks were declined in many incidences as
Greenberg falsely asserted that customers enrolled in an alleged “frequent
shopper club” that required a one-time
charge and that the charges were valid.
The investigation and case against Greenberg was assisted by
the Postal Inspection Service and the Federal Trade Commission who also filed a
parallel civil action.
Greenberg faces up to 20 years imprisonment for each count
of wire fraud, 15 year imprisonment for access device fraud charge, up to 10
years imprisonment for money laundering charges, and two years of mandatory
imprisonment on the aggravated identity theft charge to run consecutive to
sentences for the other charges.
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