A suspected money-launderer in Toronto is among at least 10 people who have been arrested in an international crackdown on a cyberfraud ring alleged to have compromised 1,600 accounts of the online ticket seller StubHub.
New York County authorities announced on Wednesday they had indicted six men, including Vadim Polyakov, a 30-year-old Russian citizen who is portrayed as the man who directed the operation and who was arrested while he was travelling in Spain.
According to a 63-page indictment unsealed in Manhattan on Wednesday, the six face 117 criminal counts for charges ranging from possession of stolen goods to larceny and identity theft.
The person arrested in Toronto is alleged to have laundered money for the operation, and is not among the six charged by New York authorities, a source said.
The RCMP executed a search warrant in Toronto and said its London, Ont., detachment was also involved in the probe.
The fraud was detected more than a year ago, according to a communiqué from the office of Manhattan District Attorney Cyrus Vance, Jr.
StubHub, which resells tickets to concerts and other popular events online, discovered in March, 2013, that log-in and credit card information from more than 1,000 of its users had been stolen by people who used the accounts to buy tickets.
Even after the company tried to freeze the accounts, the fraudsters continued to make illicit purchases using more stolen information.
Mr. Polyakov and another Russian citizen, 21-year-old Nikolay Matveychuk, are accused in court documents of defrauding the U.S.-based company of about $1-million (U.S.) by using stolen card information to buy 3,500 electronic tickets to events such as rock concerts, professional sports events and Broadway shows.
Mr. Polyakov is alleged to have directed three other indicted suspects living in New York and New Jersey – Daniel Petryszyn, 28, Laurence Brinkmeyer, 29, and Bryan Caputo, 29 – to resell the tickets.
The proceeds were funnelled through PayPal accounts and multiple bank accounts in the United Kingdom and Germany, U.S. prosecutors allege, adding that one of the accounts belonged to 37-year-old Russian citizen Sergei Kirin, who kept a percentage as his fee.
Some of the wire transfers transited through London in Britain, and Toronto.
Three men aged 27, 39 and 46, were arrested in Britain by London police.
The RCMP refused to give more information about the person they arrested because U.S. law-enforcement agencies are leading the investigation. U.S. officials would not give details about the Toronto suspect either because that person is not among those they have indicted so far.
The suspects stole users’ passwords and account information from breaches at other websites or from key-loggers or other malware, not from StubHub’s computer systems, company spokesman Glenn Lehrman told the Associated Press.
In a statement posted on LinkedIn, former StubHub official Robert Capps, who is a senior director at the security firm RedSeal Networks, said the case was made possible because the ticketing company initiated an electronic crime investigation team two years ago.
“A tremendous amount of hard work and dedication from all parties went in to the co-ordinated apprehension of suspects that we witnessed today,” Mr. Capps said.