US Attorney – Arrest In Internet Gift Card Scheme

LAWFUEL.COM – Legal Newswire –
LEV L. DASSIN, the Acting United States Attorney for
the Southern District of New York, and RONALD J. VERROCHIO,
Inspector-in-Charge of the New York Office of the United States
Postal Inspection Service (“USPIS”), announced that OLEKSANDR
VEROVKIN, 50, of Brooklyn, New York, was arrested last evening at
JFK Airport by Inspectors of the United States Postal Inspection
Service on a charge of conspiracy to commit mail and wire fraud.
As alleged in the criminal Complaint unsealed today in
Manhattan federal court:

From May 2007, through December 2007, OLEKSANDR
VEROVKIN and his co-conspirators engaged in a scheme to defraud
consumers, through use of the website,, into
purchasing purportedly discounted gift cards for use at various
retail establishments.

The website claimed that it was the largest reseller of
gift cards online with the best prices and selections, including
gift cards for Best Buy, Home Depot, Gap, Costco, Barnes & Noble
and Lowe’s. The Website claimed it sold and bought gift cards
and that its “sell prices [were] on average 15% below face value
and on the other side our buy prices about 20% below face value.”
Over one hundred customers mailed or wired payment and
never received their purchases; other customers received cards
when they first ordered, but did not receive cards when they
delivered money to make additional purchases.

Over one hundred customers from at least 36 states have
filed complaints related to the Website. Based on these
complaints alone, over $155,000 was stolen.

VEROVKIN is charged with one count of conspiring to
commit mail and wire fraud, which carries a maximum sentence of
thirty years in prison and a fine of the greatest of $1 million
or twice the gross gain or loss derived from the offense. He is
expected to be presented before a United States Magistrate Judge
in Manhattan federal court later today.

Mr. DASSIN praised the work of the USPIS in this case.
Assistant United States Attorney JENNIFER E. BURNS is
in charge of the prosecution.
The charges and allegations contained in the Complaint
are merely accusations and the defendant is presumed innocent
unless and until proven guilty.
09-060 ###

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