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ITMG Insider Threat Cases – August 24, 2020

itmg cases 8.24Former Army Green Beret Charged in Russian Espionage Conspiracy (DOJ Press Release)

A former Army Green Beret was arrested today for allegedly conspiring with Russian intelligence operatives to provide them with United States national defense information. According to court documents, from December 1996 to January 2011, Peter Rafael Dzibinski Debbins, 45, of Gainesville, a former member of the U.S. Army, allegedly conspired with agents of a Russian intelligence service. During that time, Debbins periodically visited Russia and met with Russian intelligence agents. In 1997, Debbins was assigned a code name by Russian intelligence agents and signed a statement attesting that he wanted to serve Russia. “Our military is tasked with the awesome responsibility of protecting our nation from its adversaries, and its service members make incredible sacrifices in service of that duty,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “When service members collude to provide classified information to our foreign adversaries, they betray the oaths they swore to their country and their fellow service members. As this indictment reflects, we will be steadfast and dogged in holding such individuals accountable.”

• Former Green Beret charged spying for Russia (News Report)

A former Army Green Beret living in northern Virginia was arrested Friday, charged with divulging military secrets about his unit’s activities in former Soviet republics during more than a decade of contacts with Russian intelligence. Peter Rafael Dzibinski Debbins, 45, told Russian intelligence he considered himself a “son of Russia,” according to an indictment made public after his arrest. “Debbins thought that the United States was too dominant in the world and needed to be cut down to size,” prosecutors alleged. The indictment also states that Debbins was motivated in part because of bitterness over his Army career and a desire to establish business contacts in Russia.

Former CIA Officer Arrested and Charged with Espionage (DOJ Press Release)

Alexander Yuk Ching Ma, 67, a former Central Intelligence Agency (CIA) officer, was arrested on Aug. 14, 2020, on a charge that he conspired with a relative of his who also was a former CIA officer to communicate classified information up to the Top Secret level to intelligence officials of the People’s Republic of China (PRC).  The Criminal Complaint containing the charge was unsealed this morning. “The trail of Chinese espionage is long and, sadly, strewn with former American intelligence officers who betrayed their colleagues, their country and its liberal democratic values to support an authoritarian communist regime,” said Assistant Attorney General for National Security John C. Demers.  “This betrayal is never worth it.  Whether immediately, or many years after they thought they got away with it, we will find these traitors and we will bring them to justice.  To the Chinese intelligence services, these individuals are expendable.  To us, they are sad but urgent reminders of the need to stay vigilant.”

• Former CIA Officer Charged with Espionage (News Story)

A Hawaii resident who worked for the Central Intelligence Agency in the 1980s has been charged with espionage. Alexander Yuk Ching Ma was arrested on August 14 for allegedly passing classified information to intelligence officials of the People’s Republic of China (PRC) over a ten-year period in exchange for money and expensive gifts. The 67-year-old is accused of conspiring with a relative of his who was also previously employed as a CIA officer to communicate information up to the Top Secret level. Ma was born in Hong Kong but became a naturalized US citizen. While working for the CIA from 1982 to 1989, Ma held a Top Secret clearance and signed numerous non-disclosure agreements in which he acknowledged his responsibility and ongoing duty to protect US government secrets. After leaving the CIA, Ma lived and worked in Shanghai, China, before moving to Hawaii in 2001.

FBI Attorney Admits Altering Email Used for FISA Application During “Crossfire Hurricane” Investigation

Former FBI attorney Kevin Clinesmith, 38, pleaded guilty today in the U.S. District Court for the District of Columbia to a false statement offense stemming from his altering of an email in connection with the submission of a Foreign Intelligence Surveillance Act (“FISA”) application, announced John H. Durham, Special Attorney to the Attorney General. According to court documents and statements made in court, between July 2015 and September 2019, Clinesmith was employed with the FBI as an Assistant General Counsel in the National Security and Cyber Law Branch of the FBI’s Office of General Counsel in Washington, D.C.  On July 31, 2016, the FBI opened a Foreign Agents Registration Act investigation, known as “Crossfire Hurricane,” into whether individuals associated with the Donald J. Trump for President Campaign were coordinating activities with the Russian government.  By August 16, 2016, the FBI had opened cases under the Crossfire Hurricane umbrella on four individuals, including an individual identified in this case as “Individual #1.”

Former Uber Executive Charged with Paying ‘Hush Money’ to Conceal Massive Breach

Federal prosecutors allege Uber’s former head of security organized a cover-up of a massive data breach. Federal prosecutors have charged Uber’s former chief security officer with covering up a massive 2016 data breach by arranging a $100,000 payoff to the hackers responsible for the attack. The personal data of 57 million Uber passengers and drivers was stolen in the hack. Prosecutors are charging Joe Sullivan with obstructing justice and concealing a felony for the alleged cover-up. Sullivan “engaged in a scheme to withhold and conceal” the breach from regulators and failed to report it to law enforcement or the public, according to a complaint filed in federal court in California on Thursday. “Sullivan is being charged with a corporate cover-up and Sullivan is being charged with the payment of hush money to conceal something that should have been revealed,” David Anderson, U.S. attorney for the Northern District of California, told NPR.

In a German Tech Giant’s Fall, Charges of Lies, Spies and Missing Billions

Markus Braun built Wirecard to “conquer the world,” but those aspirations attracted skeptics. Its accounting scandal has sent shock waves through Germany. In the elite corridors of corporate Germany, Markus Braun had become a legend. A little-known entrepreneur until just a few years ago, Mr. Braun had forged an obscure Bavarian company called Wirecard into a German tech icon, winning a coveted spot on the benchmark DAX stock index. Wirecard provided the invisible financial plumbing that, with a wave of plastic over a card reader almost anywhere in the world, made transactions happen. Hedge funds and global investors scrambled to buy shares. When critics raised red flags about the company’s seemingly miraculous success, questioning murky accounts and income that could not be traced, Mr. Braun, a methodical executive from Austria who was the company’s biggest shareholder, hit back repeatedly, and the stock price skyrocketed.

NJ Transit Supervisor Gets 5 Years for Stealing $2.1 Million

Acting Essex County Prosecutor Theodore N. Stephens II announced Friday 63-year-old Richard E. Schade, a supervisor at NJ Transit, is due to serve five years in New Jersey State Prison. Schade of Lumberton was a facilities supervisor when he stole $2.1 million from NJ Transit by setting up four fake companies and approving payments to them for services such as landscaping and maintenance at NJ Transit properties, according to officials. Schade entered a guilty plea on Sept. 6, 2019 to one count of second-degree conspiracy to commit theft by deception. “This defendant was a trusted employee of NJ Transit, authorized to sign off on expenses,” Assistant Prosecutor Caroline Oliveira said. “He abused that trust by engaging in a fraud that resulted in millions of dollars being diverted to undeserving companies and ultimately, to him and the others who were part of this criminal scheme.’’

Russian diplomat expelled from Norway after arrest made in spying case

Norway announced Wednesday that it has expelled a Russian diplomat days after authorities made an arrest in a spying case they have linked to Moscow. Siri Svendsen, a foreign ministry spokeswoman, said the official, who worked in the Russian Embassy’s trade section, was given until the end of the week to leave the country. “We have informed the Russian ambassador that an employee of the Russian embassy is undesirable as a diplomat and will be asked to leave Norway,” she said, according to Agence France-Presse (AFP). Svendsen said the expelled Russian official had engaged in actions “not compatible with his status as a diplomat.” Officials in Norway announced the move after earlier this week arresting a Norwegian man who is accused of meeting a Russian intelligence officer in Oslo.

Former White Sox Ticket Sellers Plead Guilty in Ticket Scam that Cost Team $1M

Two former Chicago White Sox ticket sellers pleaded guilty in federal court Tuesday to their roles in a scheme with a ticket broker to fraudulently sell thousands of tickets to the South Siders’ baseball games, costing the team about $1 million. James Costello, 67, and William O’Neil, 51, each admitted their crimes during hearings held by videoconference due to the coronavirus pandemic. Costello pleaded guilty to wire fraud, and O’Neil admitted he lied to the FBI. A third defendant in the case, prolific ticket broker Bruce Lee, still faces 11 counts of wire fraud and two counts of money laundering. His trial has been set for Jan. 25. The plea agreements for Costello and O’Neil anticipate the men will cooperate with prosecutors and that their sentencing hearings will be delayed until their cooperation is complete. The White Sox analytics team also “advised that it appears the White Sox employee or employees” were working with Lee.

Former Employee Pleads Guilty to Stealing Company Property and Selling It on Ebay

Laura Arlene Barnett, 53, of Allegan, Michigan, pleaded guilty to the interstate transportation of stolen property, U.S. Attorney Andrew Birge announced today. The sentencing before Chief U.S. District Judge Robert J. Jonker is scheduled for November 30, 2020. At sentencing, Barnett will face up to 10 years’ imprisonment. As part of her plea agreement, Barnett agreed to pay restitution of $413,903.38 to repay her employer for the parts and supplies that she stole. Barnett was an employee of Perrigo, a global consumer self-care company that manufactures over-the-counter and branded products. Barnett worked as a Maintenance Repair and Operations Coordinator in Perrigo’s Allegan maintenance department. She was responsible for ordering and processing parts used in the manufacturing facilities. Barnett used her position to gain access to equipment, parts, and supplies that the company used to operate packing machinery. She stole more than 470 items of equipment, parts, and supplies worth approximately $413,903.38 and sold the items on eBay.

Former Oil and Gas Employee Sentenced After Using Company Card For $850K Of Personal Use

A 59-year-old Bryan resident has been ordered to federal prison after he admitted to wire fraud, announced U.S. Attorney Ryan K. Patrick. James Day Burke pleaded guilty May 12, admitting he defrauded Rustex Inc., an oil and energy company in Bryan. Today, U.S. District Judge George C. Hanks handed Burke a 41-month sentence to be immediately followed by three years of supervised release. At the hearing, the court heard from Rustex’s owner as well as her two daughters who described the impact the fraud has had on her and the business. In handing down the sentence, the court explained that society needed to be protected from people like Burke, called him a “charlatan” and that he stole for no other reason except for his own selfish greed.

Former Client Relationship Manager at Bank of America Arrested on Wire Fraud and Money Laundering Charges

A former client relationship manager at Bank of America was arrested and charged today in connection with embezzling $1.5 million from a client company and using a portion of those funds to purchase luxury items. Waqas Ali, 31, of Abington, was charged in a criminal complaint with wire fraud and money laundering. Ali will make an initial appearance today via videoconference in federal court in Boston. According to court documents, Ali was the client relationship manager for the victim company, which was a Bank of America client. Ali allegedly opened a checking account in the name of the victim company without its knowledge or authorization, and between September 2016 and July 2017, fraudulently transferred over $1.5 million from the victim company’s accounts to a fraudulent account.

Former HR Director Pleads Guilty, Facing $118k Payback of Stolen Funds

The former human resources director for Oconee County, Georgia has admitted to stealing taxpayer money in a complicated paycheck scheme, said Charles “Charlie” Peeler, the United States Attorney for the Middle District of Georgia. Sherry Turner-Seila, 52, of Panama City Beach, Florida, formerly of Watkinsville, Georgia, entered a guilty plea today to one count aggravated identity theft before U.S. District Judge C. Ashley Royal.  Turner-Seila was employed as the Human Resources Director for Oconee County. As such, she was one of the few employees with access to the County’s payroll system, which transferred funds directly from the county bank account to the bank accounts of county employees. From July 6, 2016 to July 5, 2019, Turner-Seila concocted a scheme where she would use that access to temporarily change a former employee’s direct deposit information to her own personal bank account’s direct deposit information. In all, Turner-Seila stole $118,451.80 from Oconee County taxpayers.

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