4 Canadians indicted in US ATM fraud that could reach $250K

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MONTPELIER, Vt. — Four Canadians facing charges they crossed into the United States to fraudulently skim money from ATM machines in Vermont could have stolen almost $250,000, U.S. court documents say.

A federal grand jury in Burlington indicted the four men late Thursday on a charge they acquired bank account information belonging to others and put it on the magnetic strips of gift cards that were then used at ATMs in the Burlington area to get cash advances.

Prosecutors initially said they obtained about $54,000 fraudulently in cross-the-border travels from March through October, but more recent court documents say 378 gift cards found in a storage unit in Vermont could have potentially been used to steal $680 each, raising the total to nearly $250,000. The operation also could have been going on much longer than previously believed, the documents say.

“The fact that tens of thousands of dollars was simply left in the storage unit (alongside the tools of the fraud trade) while the conspirators returned to Canada strongly suggests that they were stealing far more than that over the course of the scheme,” prosecutors said in a court filing arguing the four suspects should remain in custody pending trial.

In most instances, Montreal-area account information was stolen, court documents say. The men then traveled from Quebec to Burlington where they used NBT Bank ATM machines in Essex and Burlington to get cash advances on cards, the documents say. Prosecutors allege the men either wired the money back to Canada or carried cash across the border.

On Oct. 31, 2015, officials with the Canada Border Service Agency found about $11,656, most of it in a sleeping bag belonging to Nicolau Manfredi, 21, of Montreal, who told agents he didn’t know how the money got there, the court document said. The money was seized. Manfredi had been in the Burlington area earlier that day, the document said.

Manfredi was arrested Oct. 24, along with Mathieu Baaklini, 21, Safwan Bensalma, 21, and Brandon Lo, 24, all from the Montreal suburb of Laval, while trying to enter the United States. They remained in custody Friday and are to appear in court Monday.

Court documents, dated three days later, say federal agents found $33,000 in a Williston storage unit, card-reading equipment and 378 gift cards with markings indicating they contained account information.

Douglas Kallen, Manfredi’s attorney, said his client will plead not guilty and contest the charges. Bensalma’s lawyer, Craig Nolan, said Bensalma will plead not guilty and seek to be released so he can “return home to his parents and to his full-time schooling.”

Attorneys for Baaklini and Lo did not return emails Friday seeking comment.

Curt Binns, executive director of the Canadian branch of the ATM Industry Association, said such ATM crimes, known as “skimming” are common, but have been greatly reduced in Canada since ATM cards have switched to chips rather than just magnetic strips.

“They can almost track it dollar for dollar that it went south of the border, which is northern U.S. states,” Binns said of how the new chips generally provide security.

The cards in the U.S. are still transitioning to the use of security chips.