A Hesperia man was indicted for placing credit card skimming devices on hundreds of pay terminals in 99 Cent Only stores, according to federal officials. He and a Victorville man were among the dozens indicted as part of Operation Power Outage which targeted the international crime organization, the Armenian Power gang.
The Eurasian Organized Task Force announced on Wednesday that as a result of two federal indictments, 74 members of the gang and it's associates were arrested Wednesday morning, according to authorities. A total of 99 defendants were charged with a variety of crimes including kidnapping, extortion, bank fraud, identity theft and narcotics trafficking.
Gustavo "Bam Bam" Ortega, 40, of Hesperia was charged with Rico violations, bank fraud, aggravated identity theft and access device fraud, according to the one 212-page indictment.
Joseph Mares, 25, of Victorville was charged with bank fraud and aggravated identity theft.
According to documents, Ortega worked with Mher "Hollywood Mike" Darbinyan in creating fraudulent checks on the accounts of several unsuspecting victims as well as installing several credit card skimming devices on the pay terminals at 99 Cent Only stores throughout southern California.
"...Darbinyan, in a telephone conversation using coded language, asked defendant Simon Antonyan ... how many unauthorized access devices they were supposed to give to defendant Ortega for his work in the scheme to install and remove skimming devices," the indictment read. "... And Antonyan said they were supposed to give Ortega approximately 500..."
It's unclear is any of the devices were placed at local 99 Cent Only stores, but Thom Mrozek, spokesman for the United States Attorney's Office said most of the crimes were committed in Los Angeles, San Diego and Riverside counties.
It's estimated the gang took in $2 million through the skimming devices. The gang then took the information gathered and created fraudulent cards and checks.
In addition to the 99 Cents Only Stores skimming crime, Armenian Power members allegedly engaged in a large-scale check fraud, according to officials. At times, members would to victims' homes and steal blank checks that had been mailed to them to gather the victim's banking information.
Mares was often times used as a "check runner," someone who would cash the fraudulent checks.
One victim was scammed out of more than $15,000. It was unclear if the victim was local, officials said.
"We are concerned with the increased level of fraud committed by these organized groups," said Glenn Ferry, special agent in charge for the Office of Inspector General of the Department of Health and Human Services. "The charges levied here today are similar to the identity theft schemes we are seeing in health care fraud investigations, that allow criminals to steal millions from the Medicare and Medi-Cal programs. We intend to aggressively pursue those who are committing these acts."
A federal grand jury in Los Angeles returned the 134-count racketeering indictment three weeks ago which charged a total of 70 people. The second indictment came from a federal grand jury from Orange County charging 20 others, documents show.
The Eurasian Organized Crime Task Force — made up of several organizations including the FBI, the United States Secret Service, ICE, the Los Angeles County Sheriff's Department and Glendale and Burbank police departments — worked for five years on Operation Power Outage.
"The investigation has been a collective effort of our Orange County Resident Office and the Los Angeles Field Office for over the past 5 years," Wayne Williams, special agent in charge of the United States Secret Service said in a written statement.
Authorities have also become concerned over the Armenian Power gang because according to intelligence, the crime organization has begun to work alongside the Mexican Mafia, according to officials.
San Bernardino County court documents show Ortega has an extensive criminal past. He's been arrested for burglary, inflicting corporal injury on a spouse or cohabitant, shooting into an inhabited dwelling, driving while under the influence and several other violations.
A search of Mares' records was inconclusive.
If convicted, those indicted for Rico violations face up to 20 years in federal prison.
Beatriz E. Valenzuela may be reached at 951-6276 or at BValenzuela@VVDailyPress.com.