International Telephone Hacking Conspiracy Busted; Indictment in the United States,...

International Telephone Hacking Conspiracy Busted; Indictment in the United
States, Arrests and Searches in Italy, and Continued Operations in the
Philippines

NEWARK, N.J., June 12 /PRNewswire-USNewswire/ -- An indictment was unsealed
today against three individuals who allegedly hacked into the telephone
systems of large corporations and entities in the United States and abroad and
sold information about the compromised telephone systems to Pakistani
nationals residing in Italy, Acting U.S. Attorney Ralph J. Marra, Jr.
announced.

In conjunction with the unsealing of the indictment, Italian law enforcement
conducted searches of approximately 10 locations in four regions of Italy and
arrested the financiers of the hacking activity. Those financiers allegedly
used the information to transmit over 12 million minutes of telephone calls
valued at more than $55 million over the hacked networks of victim
corporations in the United States alone.

"This was an extensive and well-organized criminal network that worked across
continents," said Marra. "The hackers we've charged enabled their
conspirators in Italy and elsewhere to steal large amounts of
telecommunications capacity, which could then be used to further or finance
just about any sort of nefarious activity here or overseas."

"We are extremely grateful to the FBI and authorities abroad with which we
worked closely in developing this case," Marra said.

Charged in the New Jersey indictment are Mahmoud Nusier, 40, Paul Michael
Kwan, 27, and Nancy Gomez, 24, all currently residing in the Philippines, with
conspiracy to commit wire fraud and unauthorized access to computer systems
and other counts, described below. Nusier is a Jordanian national; Kwan and
Gomez are Philippine nationals. In connection with this international
investigation, each of the defendants were previously arrested on March 10,
2007, by authorities in the Philippines, where they remain. The Department of
Justice will work cooperatively with the Philippine authorities to hold the
defendants accountable in the United States for their alleged criminal
conduct.

Operations unfolded earlier today in Italy, where at least five individuals,
all Pakistanis, were arrested during early-morning raids. Searches occurred
at at least 10 telephone call centers and other premises. A news conference
announcing the details was held by the chief of Brescia Police, the Brescia
prosecutor, head of the Italian national police counter-terrorism division
from Rome and officials from the Divisione Investigazioni Generali e
Operazioni Speciali.

The names and other information on those arrested in the Italian operation are
appended at the bottom of this news release.

The investigation has been ongoing since 2006 and relates to conduct ranging
from October 2005 through December 2008.

As described in the indictment, M.Z and S.K, residing in Italy, were among the
financiers of the hacking and owned and operated call center operations in
Italy from which their customers would make calls throughout the world. To
increase their profits, M.Z. and S.K. made efforts to incur as little costs as
possible in routing their customers' telephone calls to the intended
call-recipient.

M.Z. and S.K. recruited Nusier, Kwan, Gomez and others to hack into the
telephone networks of unsuspecting large corporations and entities so that
telephone calls from the call centers could be transmitted over the hacked
networks. To accomplish their mission, the hackers gained an intimate
familiarity with the programming of the public branch exchange (PBX) telephone
systems.

As the hackers dialed into the systems, they were able to identify the type of
PBX system by the prompts and were thereby able to begin a process, known as a
brute force attack, by which they sought to attack vulnerable points of the
PBX systems. Often, the vulnerable points consisted of telephone extensions
with default passwords still in place. After using a couple of methods to
exploit the information they gained regarding the hacked PBX systems
(described in greater detail in the indictment), the hackers transmitted the
information about the hacked system back to the financiers. The hackers --
Nusier, Kwan, Gomez and others -- were then paid approximately $100 per hacked
telephone system.

In March 2007, the Philippines National Police executed search warrants and
arrested seven individuals, including Nusier, Kwan and Gomez, in connection
with the present investigation. As part of the Philippines investigation, it
was revealed that the PBX systems of over 2,500 victim corporations in the
United States, Canada, Australia and Europe were infiltrated. The searches
yielded dozens of notebooks full of the telephone numbers and access codes to
the victim PBX systems.

"We will continue to work with law enforcement officials overseas in Italy,
the Philippines and elsewhere to prosecute those individuals currently charged
and to identify others involved in this international conspiracy," said Weysan
Dun, Special Agent in Charge of the FBI Newark Division. "The recent
cooperation and coordination illustrates law enforcement's ability to adapt to
the ever-changing landscape of international cybercrime."

The losses in this case, which exceeded $55 million, were borne by the victim
corporations and entities, and AT&T and other long distance carriers, which
provided the long-distance telephone service for the victims. (AT&T was not
hacked but was among the companies that carried the long-distance calls.)

The U.S. Attorney's Office and FBI thanked AT&T and the victim corporations
for their extensive and critical cooperation in the investigation.

In addition to the conspiracy count, each of the defendants is charged with
two counts of unauthorized access to a computer system for purposes of
committing fraud, and with the possession of unauthorized access devices,
including passcodes to U.S. telephone systems. The defendants face maximum
prison sentences of five years on the conspiracy count, five years on each of
the two respective unauthorized computer access counts, and 10 additional
years on the access device count. In addition, each is subject to a maximum
fine of $250,000 on each count for which they are named, or twice the gain
resulting from the offense, whichever is greater.

The indictment has been assigned to U.S. District Judge Mary L. Cooper in
Trenton. No hearings are currently scheduled before the court, as defendants
Nusier, Kwan and Gomez are residing in the Philippines and would only make an
appearance in the United States subject to their self-reporting or
extradition. The individuals arrested in Italy will be prosecuted in Italy.

Marra credited the Special Agents of the FBI, under the direction of Special
Agent in Charge Weysan Dun, for their work in the investigation.

The case is being prosecuted by Assistant U.S. Attorney Erez Liebermann of the
U.S. Attorney's Office Computer Hacking and Intellectual Property Section,
part of the Commercial Crimes Unit in Newark.

The following individuals were arrested during operations in Italy:
-- Mohammad, Zamir, 40, place of birth, Jhelum, Pakistan, residing in
Brescia, Italy.
-- Kanwal, Shabina, 38, place of birth, Jhelum, Pakistan, residing in
Brescia, Italy.
-- Waseem, Ahmed, 40, place of birth, Kharabad, Pakistan, residing in
Mogliano, (Macerata-Marche), Italy.
-- Shah, Zahir, 39, place of birth Swat, Pakistan, residing in Civitanova
Marche (Macerata-Marche), Italy.

-- Iqbal Khurram, 29, place of birth, Pakistan, residing in Corridonia
(Macerata-Marche), Italy.

SOURCE U.S. Department of Justice

Michael Drewniak of the Office of Acting United States Attorney Ralph J.
Marra, Jr., District of New Jersey, +1-973-645-2888