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Cyrus R. Vance, Jr.

District Attorney, New York County

For Immediate Release
October 05, 2016

DA VANCE: LEADER OF ID THEFT RING SENTENCED TO PRISON FOR $2 MILLION MONEY LAUNDERING SCHEME

Manhattan District Attorney Cyrus R. Vance, Jr., today announced the sentencing of DAVIT KUDUGULYAN, 45, to 1-to-3 years in state prison and $750,000 in restitution for his role in a multi-state credit card skimming and cash-out scheme in which more than $2 million in criminal proceeds were illegally laundered. On June 10, 2015, the defendant pleaded guilty in New York State Supreme Court to Money Laundering in the Second Degree.

“As consumer technology advances, so do the tools used by criminals to commit theft and fraud,” said District Attorney Vance. “In this case, the defendants used Bluetooth-enabled skimming devices to scan and steal credit card data from gas station customers throughout Texas, Georgia, and South Carolina—information that was later used to perpetuate a multimillion-dollar money laundering scheme based out of New York. I encourage New Yorkers to monitor their account statements for signs of fraud and to report potential instances of identity theft directly to my Office’s Cybercrime and Identity Theft Hotline at 212-335-9600.”

As admitted in the defendant’s guilty plea, KUDUGULYAN, along with separately convicted co-defendants GAREGIN SPARTALAYAN, ARAM MARTIROSIAN, and HAYK DZHANDZHAPANYAN, coordinated the installation of credit card skimming devices at multiple RaceWay and RaceTrac gas stations in Texas, Georgia, and South Carolina. The skimming devices—which were installed inside the pumps and therefore undetectable to customers paying for gas—were Bluetooth-enabled, allowing the defendants to steal victims’ credit card information and data wirelessly.

Between March 2012 and 2013, the stolen credit card information was encoded on forged cards that were used to withdraw cash from ATMs in Manhattan. The money was then deposited into newly established bank accounts in New York and later withdrawn at banks in other states, usually in denominations of less than $10,000 in an attempt to avoid drawing attention to the source of the criminal proceeds. During this period, KUDUGULYAN and several separately convicted co-defendants laundered approximately $2.1 million using Manhattan-based banks, ATMs, and out-of-state financial institutions.

To date, all of the defendants indicted in connection with the investigation, including the four principal organizers and eight co-defendants, have been convicted of crimes related to the scheme, including Money Laundering in the Second Degree and Attempted Money Laundering in the Second Degree, among other charges.

Assistant District Attorney Robert Shull handled the prosecution of the case, under the supervision of Assistant District Attorneys Jeremy Glickman and Elizabeth Roper, Deputy Chiefs of the Cybercrime and Identity Theft Bureau, Assistant District Attorney Brenda Fischer, Chief of the Cybercrime and Identity Theft Bureau, and Executive Assistant District Attorney Michael R. Sachs, Chief of the Investigation Division. Cybercrime Analyst Christine Einerson, Principal Financial Investigator Michael Vecchio, Supervising Rackets Investigator Max Adler, and Assistant Chief Rackets Investigator Michael Wigdor provided additional assistance with the case.

District Attorney Vance also thanked the following agencies and organizations for their assistance with the investigation: the NYPD, Coweta County Sheriff’s Department, RaceTrac Petroleum, Inc., Chase Bank, Wells Fargo, Bank of America, and Capital One.

Defendant Information:

DAVIT KUDUGULYAN, D.O.B. 11/17/1970
San Fernando Valley, CA

Convicted:

  • Money Laundering in the Second Degree, a class C felony, 1 count

Sentenced:

  • 1-to-3 years in state prison
  • $750,000 restitution

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