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Financial Crimes
09/12/2013

New Jersey man pleads guilty to role in identity theft ring, tax evasion

NEWARK, N.J. — A Bergen County man pleaded guilty Thursday to charges resulting from his role in a large-scale identity-theft scheme. This case was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), the FBI, Internal Revenue Service (IRS) Criminal Investigation and the Bergen County Prosecutor's Office.

Matthew J. Kang, 44, of Englewood Cliffs, pleaded guilty to conspiracy to commit wire fraud affecting financial institutions and bank fraud, conspiracy to unlawfully produce identification documents and false identification documents, aggravated identity theft, conspiracy to commit bank fraud and tax evasion.

According to court documents, Kang, an independent loan broker, conspired with Sang-Hyun Park, aka "Jimmy," and others to obtain a Social Security card beginning with the prefix 586. These 586 Social Security cards were issued to individuals, usually from China, employed in American territories, such as Guam. Park was the leader of a criminal organization, identified in court papers as "the Park criminal enterprise," headquartered in Bergen County, that obtained, brokered and sold identity documents to customers for the purpose of committing credit card fraud, bank fraud, tax fraud and other crimes.

Park pleaded guilty Jan. 9, 2012, to his role in the enterprise and is pending sentencing.

The criminal enterprise engaged in the fraudulent "build up" of credit scores associated with the Chinese identities. They did so by adding the Chinese identity as an authorized user to the credit card accounts of various co-conspirators who received a fee for this service. By attaching the Chinese identities to these existing credit card accounts, the co-conspirators increased the credit scores associated with the Chinese identities to 700 to 800. The co-conspirators did not know the real person to whom the identity belonged or virtually any of the customers who had purchased the identities.

After building up the credit associated with these identities, Park and his co-conspirators directed, coached and assisted the customers in opening bank accounts and obtaining credit cards. Park and his co-conspirators then used these accounts and credit cards to commit fraud. Park relied on several collusive merchants who possessed credit card processing machines. For a fee, known as a "kkang fee," these collusive merchants charged the fraudulently obtained credit cards, although no transaction took place. After receiving the money into their merchant accounts from these fraudulent transactions, the collusive merchants gave the money to Park and his co-conspirators, minus their kkang fee.

Kang admitted he obtained and brokered 586 Social Security card and counterfeit driver's licenses through Park for others. Kang further admitted that co-conspirators fraudulently established credit histories and scores for customers using these 586 identities. Kang and his conspirators used these fraudulently obtained identities to obtain credit cards and bank loans. Kang also admitted that he brokered numerous commercial loans through false statements and documents. As a result, Kang and his conspirators caused more than $4 million in financial losses.

Kang admitted he committed tax evasion by receiving income, including commission and fees from loans he brokered, funneling this income through his corporate accounts, and then using these funds for personal expenses. Kang admitted around April 15, 2008, he filed an individual income tax return for tax year 2007 that declared his taxable income was $73,741. Kang admitted that this return failed to include $74,647 in additional taxable income he had received in 2007, thus having an additional tax of $28,705 due to the United States.

Kang's sentencing is scheduled for Jan. 6. If convicted, he faces 42 years in prison.