Erik Joseph, the former owner of Seaport Hardware arrested on a single larceny charge last month, now faces 46 fraud charges related to abuse of customer credit-card information.
And that's only the beginning, according to the Suffolk County District Attorney's office: The grand jury that indicted Joseph only looked at American Express transactions; another grand jury is looking into Visa and MasterCard transactions. DA Dan Conley says that today's charges involved $291,000 in alleged thefts from customer accounts:
Evidence suggests that Joseph began the scam in 2001 and continued it for the next six years. Prosecutors believe he set up dozens of shell businesses, each with its own credit card merchant number, bank account routing number, and mailing address; using the credit card numbers of his hardware storeâ€™s customers, he would then key in transactions that billed unsuspecting cardholders for multiple sales that were just under $200.
At the beginning of the scheme, Conley said, Joseph would wait four to six months before billing the victims; in 2006 and 2007, the time delay disappeared and accounts were being maxed out within days of the cardholders' visits to Seaport Hardware. Once the credit card company had transferred funds to the bank account linked to the transaction, evidence suggests, Joseph would drain the account and leave the victims unable to reclaim the money.
Joseph is scheduled for arraignment Jan. 15 in Suffolk Superior Court on today's charges.