On paper, Atef Alkhateeb was unemployed. His family lived off his wife’s nursing salary. And, it turns out, other people’s money, The San Diego Union-Tribune reports.
While other people were at legitimate jobs, Alkhateeb drove around Southern California, surreptitiously installing card-skimming devices and hidden cameras on Wells Fargo ATMs to steal the bank account information from thousands of customers. He would then return to his home office and create duplicate cards.
By the time authorities searched his Moreno Valley home and trio of storage lockers, they found stolen information encoded on more than 2,000 plastic cards. On his computers, investigators found data from thousands more accounts.
He ultimately admitted to compromising 12,156 Wells Fargo bank cards and 1,040 cards issued by other banks from 2014 to 2016. The government has only been able to notify 1,162 victims.
On Friday, Alkhateeb, 43, was sentenced in San Diego federal court to seven years and three months in prison for his prolific scheme.
While the victims ultimately were reimbursed by Wells Fargo for any unauthorized spending, the bank lost nearly $1.1 million — funds Alkhateeb has been ordered to pay back as restitution. Bank of America also reported $1.7 million in losses, according to prosecutors.
The theft had an especially profound impact on one family. It led them to believe their son was murdered and launched a homicide investigation.
According to sentencing documents by the U.S. Attorney’s Office, Alkhateeb made an unauthorized withdrawal from the Wells Fargo account of a man in December 2015. But the account holder had been found dead in Fallbrook months earlier.
A search began for a potential killer, thought to be the man seen in the ATM surveillance video wearing a T-shirt with the phrase “SON OF A NUTCRACKER.”
It wasn’t until April 2017 — more than a year later — that a U.S. Homeland Security Investigations agent visited the Sheriff’s Department to retrieve a file related to the card skimming and he heard about the homicide investigation. He saw the surveillance image and immediately recognized Alkhateeb, as well as the T-shirt, which had been seized from his house.
Investigators concluded the victim had committed suicide and that Alkhateeb’s use of the card was a tragic coincidence, but the man’s parents still are convinced otherwise, prosecutors said.
Card skimming continues to be a growing problem in the U.S., with the number of bank cards compromised at ATMs and businesses rising 39 percent in the first half of the year compared to the same time last year, according to credit-scoring company FICO. The actual number of reported compromises was not disclosed.
In court documents, authorities describe how Alkhateeb operated.
He bought card-skimming equipment off eBay and Amazon and used a computer program, “Card Reader Factory,” to make the final product. On the ATMs, he would place a fake card reader over the real card reader, capturing the information stored on the cards’ magnetic stripes. Hidden cameras would be pointed at the keypad to get the customers’ PINs. For example, one video showed customers entering their PINs at an ATM in the Costco and Ikea shopping center in Mission Valley on Dec. 5, 2015.
He would return several hours later to retrieve the equipment, then watch the video to match up PINs with the time stamp of inserted cards. When investigators searched his home, they found on a desk a magnifying lens, soldering equipment, epoxy and a faceplate mold for a Wells Fargo ATM card reader.
In storage lockers, they found bags of cards encoded with stolen data, blank magnetic cards, machinery to encode cards, fake speakers to conceal cameras and Wells Fargo cards embossed with his and his wife’s names.
But authorities say he made several mistakes that led to his eventual arrest.
He sent 80 MoneyGram wire transfers overseas from Walmarts in San Diego and Riverside counties using fake names and addresses to hide his identity. But he had to use the real names of the recipients. Department of Homeland Security immigration records showed several of the beneficiaries in Jordan shared the last name “Alkhatib,” including one young woman who on a visa application had listed Alkhateeb as a relative and stated she would be staying at his home in the U.S. That visa was refused in 2014, with the remarks “doubt of intent,” according to the complaint.
DMV records matched surveillance footage from Wells Fargo and Walmart, allowing investigators to identify Alkhateeb as the suspect, according to prosecutors.
His red Saturn Vue also gave him away. The car was repeatedly seen in surveillance video at banks, and license plate readers helped identify him as the owner. The car was also seen parked at his home. He had tried to hide his ownership, though. DMV records listed the car’s owner as Iurii Topciu and gave a UPS store as his address. But Alkhateeb also used the alias to rent a storage locker, and it was there that the Saturn was found when the locker was searched by agents.
He had also received a traffic citation in 2013 while driving the Saturn, authorities said.
Investigators put GPS trackers on the Saturn and his wife’s gold Mercedes, and the driving patterns lined up with Wells Fargo ATM locations, authorities said.
Agents also tracked many of the fraudulent charges. On one day in 2015, there was a $300 ATM withdrawal in Bonsall, a $750 wire transfer in Oceanside, a $42 gas station charge in Perris, a $92 Chuck E. Cheese outing with a little girl resembling Alkhateeb’s daughter in Moreno Valley and a $73 Walmart shopping trip in Riverside, according to court records.
Assistant U.S. Attorney Sabrina Fève said identity theft takes a psychological toll on victims, making them feel exposed and vulnerable.
“While defendant enjoyed this comfortable lifestyle, his theft left people who were living paycheck to paycheck in a precarious position, forcing them to hope that their banks would quickly believe them when they discovered and complained about defendant’s unauthorized charges,” she said in her sentencing memorandum.
Alkhateeb’s attorneys, Marc Carlos and Brian Watkins, argued for a lenient sentence, pointing to his early willingness to cooperate and plead guilty to bank fraud, access device fraud and aggravated identity theft.
He came to the U.S. from Jordan in 2000 at the age of 26 and was given permanent resident status in 2005 following his marriage, his lawyers said in sentencing papers. His criminal history consists of a misdemeanor shoplifting conviction 15 years ago and two disturbing the peace infractions, his lawyers said.
With these felonies, his residency in the U.S. is uncertain.
“Though Mr. Alkhateeb has undoubtedly made profound mistakes in the past, his duty to his children and his desire to be a present and positive role model for them motivates him to make amends and turn his life around,” the attorneys said.
