KANSAS CITY, Mo. —Federal authorities in Kansas City moved Friday to strike at the heart of a nationwide illicit travel industry.
Prosecutors here announced indictments against more than three dozen defendants who allegedly created an illegal black market in deeply discounted airline tickets by purchasing them with stolen identities.
The schemes, which operated from December 2001 until March 2010, charged as little as $75 for tickets that were worth many times that amount, prosecutors alleged.
U.S. Attorney Beth Phillips estimated the total loss to airlines, banks, merchants and credit card holders at more than $20 million.
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"What began as a local law enforcement investigation ultimately exposed an extensive nationwide black market for airline tickets," Phillips said.
Here's how prosecutors alleged that it worked:
Customers of the scheme would call what authorities described as a "black-market travel agent" or the agent's broker and order airline tickets. Using stolen credit card information, the black-market agent then would book the seats in the customer's name, often over the Internet.
The agents would book flights close to the departure dates to ensure that airlines, credit card companies or identity theft victims would not detect the fraudulent purchases, according to court records.
"As a result, a passenger could often complete his or her trip before the credit or debit card was detected as being compromised," prosecutors noted in court records.
The scheme's customers then would pay the agent up to $250 per ticket, while the identity theft victim would receive the bill for the real cost of the travel, often thousands of dollars.
How much the victims actually ended up paying depended on their individual agreements with their credit or debit card issuer, Phillips said.
She said the various conspiracies generally depended on brokers to round up buyers for the black-market airline tickets.
"Any advertising was minimal," Phillips said. "This mostly was spread through word of mouth."
Charges contained in the indictment generally included credit card fraud and identity theft.
In announcing charges against 38 men and women, prosecutors alleged conspirators sometimes purchased the stolen identities from sources in Bangladesh and Vietnam.
Conspirators also obtained identities from their work at hotels in Overland Park; Long Beach, Calif.; and the Atlanta area, court records alleged. The hotels weren't identified. Other conspirators purportedly harvested private credit card information from their jobs at credit card customer service call centers.
Few of the alleged conspirators were from the Kansas City area, although one former area resident figures prominently in the cases.
Prosecutors described Demetria Harrison, 40, as one of the black-market travel agents. She once lived in Kansas City but later moved to Union City, Ga. She is identified as a defendant in three of the six related cases announced Friday. Court records suggest that her alleged activities stretched back to 2001.
The event that triggered the investigation came in November 2005 when two area women, Sabrina Bowers, 29, of Kansas City, Mo., and Deidre Turner, 27, of Peculiar, Mo., allegedly stole a laptop from an Overland Park home.
Overland Park and Shawnee police later seized mail and credit card numbers, one of which had allegedly been used to purchase a number of airline tickets.
The case soon expanded from coast to coast.
Other defendants lived in Georgia, Florida, New York, Illinois, California, Indiana, Pennsylvania and Michigan. Authorities alleged that the thousands of victims they preyed on lived in more than 40 cities in more than half the states of the union; Washington, D.C.; and Saskatchewan in Canada.
Legitimate travel agents were surprised to learn of the charges.
"Something like this is quite extraordinary, to have this many people involved over such a period of time in so many cities," said Paul Ruden, a senior vice president of the 7,000-member American Society of Travel Agents.
Bruce Bishins, a board member of the Association of Retail Travel Agents, said there are sophisticated systems for detecting fraud in the air travel business.
"That's why I'm a little bit surprised that so much of this was successful," Bishins said.