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Former owner of Fort Point Channel hardware store charged with defrauding customers

A Fort Point Channel building made infamous two years ago with the strange death of an MIT-trained artist is once again the focus of a criminal investigation - this time for massive credit-card fraud.

The Suffolk County District Attorney's office today charged Erik Joseph, former owner of Seaport Hardware, 369 Congress St., with defrauding customers across New England out of several hundred thousand dollars since 2005.

The store is in the same building as that meth lab that turned out not to be a meth lab where artist Kevin McCormick died in unusual circumstances in 2005.

Joseph, a Belmont resident, pleaded innocent at his arraignment this morning in South Boston District Court, according to the DA's office. Bail was set at $75,000.

According to prosecutors, Joseph set up a series of bogus companies to suck out and launder money from the accounts of people who paid for hardware purchases with credit cards. In a statement, the DA's office cited one example:

Joseph allegedly used a dummy business – for which he had obtained an American Express merchant number, a post office box, and a bank account – to bill the customer's credit card for $8,087 in 43 separate charges of less than $200 in the weeks and months that followed. That money, [DA Dan] Conley said, was deposited into a corresponding bank account, which Joseph later emptied and closed.

Prosecutors said they, a statewide financial-crimes task force and the US Postal Service were not done investigating Joseph, but that they sought charges against him now because he sold the store last month and was emptying his legitimate bank accounts, making them worry he was getting ready to flee the area. Boston Police arrested him in Belmont on Tuesday.

Even before the indictment, Joseph, a 1980 Emerson College graduate, got a couple of bad Yelp reviews.

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Looks like you are first online with this story -- Google News doesn't find it at all, and it's not on the Globe or Herald sites yet.

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BELMONT MAN CHARGED IN CREDIT CARD FRAUD SCHEME

ALLEGEDLY USED HARDWARE STORE TO GATHER CARDHOLDERS' INFO

BOSTON, Nov. 29, 2007-Suffolk County District Attorney Daniel F. Conley today announced charges against a Belmont man who allegedly used his Seaport District hardware store to funnel fraudulent charges to customers' credit cards into bank accounts he'd created for nonexistent businesses.

ERIK JOSEPH, 52 (D.O.B. 5/24/56), was arraigned Tuesday in the South Boston Division of the Boston Municipal Court Department following his arrest on one count of larceny over $250. Prosecutors recommended that bail be set at $100,000 to ensure his appearance at his next court date; Judge Roberto Ronquillo set bail at $75,000.

The proceedings reflect evidence developed in the course of an active, ongoing, and focused investigation into the theft of thousands of dollars from an American Express account used at Seaport Hardware in September 2005, as well as evidence of similar fraudulent activity involving the credit cards of other one-time customers at the Congress Street business. The true tally of victims, Conley said, could reach more than 100.

In the 2005 case, Conley said, Joseph allegedly used a dummy business - for which he had obtained an American Express merchant number, a post office box, and a bank account - to bill the customer's credit card for $8,087 in 43 separate charges of less than $200 in the weeks and months that followed. That money, Conley said, was deposited into a corresponding bank account, which Joseph later emptied and closed.

Investigators believe that dozens of cardholders from across Boston and New England have been victimized by the scheme and that Joseph's take may have amounted to hundreds of thousands of dollars. Conley said his office, Boston Police detectives assigned to the Massachusetts Financial Crimes Task Force, and U.S. Postal Inspectors have developed significant evidence that Joseph had set up numerous "shell" companies, each with its own merchant numbers, P.O. Box, and phony contact person.

In October, Conley said, investigators learned that Joseph had recently sold his hardware store. More recently, they learned that he had consolidated and emptied his legitimate bank accounts. Fearing that he could be preparing to leave the area, Boston Police moved in and arrested him Tuesday morning at his Belmont home.

"In an age when many peoples' utility bills, insurance payments, and other expenses are linked to credit cards, an interruption in credit can be devastating," Conley said. "The scope of this scheme and its impact on individuals is shocking."

Joseph was represented at his arraignment by attorney Pat Garin. He will return to South Boston court on Jan. 11.

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Although it's pretty obvious that it's written off the press release (says so right in the second paragraph, in fact).

The DA's official press releases are here, although there's usually a lag between the time they get e-mailed to reporters (and quasi-reporters like me) and the time they're posted on the Web site.

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It couldn't have happened to a nicer guy.

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