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Financial Crimes

Escondido woman indicted for Internet fraud

Federal probe uncovers sophisticated scam targeting Yahoo and Craigslist users

SAN DIEGO - A federal grand jury here has indicted an Escondido, Calif., woman on 17 felony counts for conspiring to defraud individuals who made transactions on websites, including Craigslist and Yahoo.

Kathleen Wurts, 59, was arraigned Thursday on the charges, which include conspiracy, mail fraud, wire fraud, bank fraud and access device fraud. The court set bail at $50,000 and scheduled Wurts to appear in court again June 13. The indictment is the result of an investigation led by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) and the U.S. Postal Inspection Service (USPIS).

According to the indictment, Wurts conspired to defraud individuals who used websites to find employment, buy and sell items, and rent or purchase property. She created hundreds of fake bank checks, travelers checks and counterfeit money orders that were sent to her by co-conspirators outside the United States, including Nigeria and Abu Dhabi. Co-conspirators also sent Wurt names, addresses, stolen bank account and credit card numbers via emails and chat logs that she used to create the fake checks.

To orchestrate the scheme, Wurts mailed the counterfeit money orders or checks to victims for an item they were selling online. She used stolen credit cards to pay for the postage and sent a money order or check in an amount that exceeded the asking price for the item. The victims were directed to deposit the monetary instruments into their bank accounts and use a wire-transfer to send the excess amount to an overseas account.

Wurt is accused of receiving more than $800,000 in counterfeit money orders and travelers checks, and creating more than $17.2 million in fraudulent checks using stolen bank account numbers.

 Agents say the investigation began two years ago after their counterparts at U.S. Customs and Border Protection intercepted packages with counterfeit U.S. Postal Money Orders and fraudulent cashier's checks at two international mail facilities in Los Angeles and Memphis, Tenn.

ICE and USPIS agents executed a search warrant at Wurts' residence in April 2010 where they seized additional fraudulent monetary instruments and a lap top computer.