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A confidential informant working undercover for the Postal Service managed to get himself recruited by Igor Kogan. It wasn't exactly a smooth beginning; in early meetings, the informant wore a recording device, but most of the conversations captured were in Russian. So the inspectors had to wait not only for the informant to turn in audiotapes, but also for the tapes to be translated. In the meantime, no one but the criminals and the informant knew what was going on.
Eventually, though, agents from the Postal Service, the FBI, and state and local law enforcement agencies formed a task force that included people fluent in Russian. Also, the informant began wearing a type of "wire" that transmitted a radio signal; at last, agents could listen in while they followed the criminals around.
This new access gave the agents fresh insight into the way the Russians harvested credit cards. Cells of two to five thieves would hit a neighborhood; one or two would stand watch while the rest rifled the mail, feeling envelopes for credit cards. After a thief found an envelope containing a credit card, he'd open it, removing the card and the mailer that the card arrives in from the bank; that mailer contains the name, address, and account number of the recipient. The thieves often wrapped the mailer around the card and put both inside an empty cigarette box for camouflaged safekeeping. Some of the recruited thieves were paid a set amount for each card stolen; others, like Kogan, worked for themselves.
The success of the Russian network depended on a couple of gifts from corporate America. The Russians knew that banks and credit card companies mailed replacement cards to good customers before their old cards expired, and that the companies also sent cards unsolicited to addresses in wealthy ZIP codes, hoping to entice potential new, and desirable, customers.
Because other mail would be left undisturbed, and the credit card mailings were not necessarily expected, most of the cards could be stolen, used, and discarded without the owners knowing the cards were missing -- until a bill showed up a month later.
Over time, federal investigators followed the thieves as they took recruits "shopping" with stolen credit cards -- at Macy's, Nordstrom, and computer stores -- and then lurked somewhere close enough to watch the purchases, just in case things went wrong. If a shopper were arrested, bail could be arranged quickly, limiting the chance that he or she might talk to authorities. Shoppers typically got a negotiated cut -- say, 15 percent -- of what they bought, depending on their performance and the degree of difficulty involved in the transaction.
And finally, the feds were able to watch targets dispose of the stolen goods, handing over a computer in a parking lot, giving merchandise to a known fence, selling it to someone looking to buy something cheap, or returning it for credit to the account of a non-stolen card.
Mikhail Moiseev was arrested in 1996 after he attempted to return merchandise at a Macy's store in Corte Madera. The sales clerk became suspicious when the credit card that Moiseev gave her for the return (his own) didn't match the account number on the receipt from the original purchase, which had been made with a stolen credit card. Police arrested him with a shopper in the parking lot, eventually connecting him to several credit card thefts and a round robin of purchases and returns.
The case was delayed, however, when Moiseev was picked up by the Immigration and Naturalization Service and detained for several months. The agency was unable to confirm the details of Moiseev's case. Following a hearing on the matter, though, Moiseev avoided deportation and resumed his role as defendant in Marin County. In April 1997, he pleaded no contest to felony charges of burglary and receiving stolen property and was paroled after serving nine months in jail.
Court records show, however, that after completing probation in June 2000, Moiseev successfully petitioned the court to reduce his crimes to misdemeanors, which may prove to have been a particularly prudent legal move. Federal law mandates that a hearing be held to determine whether noncitizens may remain in the country after a felony conviction. Prior felony convictions could hurt the chances for Moiseev to stay in the country, since he is not a U.S. citizen.
In 1999, after federal agents began watching the day-to-day operation of the Russian identity theft network in San Francisco, a satellite theft operation caught their attention, one that they'd heard referenced on tape.
Dortch received word that a Russian couple had been using stolen credit cards at a Smart & Final store on Seventh Avenue. The woman got away, but her husband was caught by police, who notified the feds. The postal inspector thought he recognized the 58-year-old man from a taped conversation among Igor Kogan and his associates. This man, Dortch figured, was the one they called dedko (Russian for grandfather), someone who drove a white Jeep and, supposedly, was involved in credit card theft in north Marin and Sonoma counties.
More investigation led to the Quality Market on Irving Street near 15th Avenue, a part of San Francisco's Sunset District where Russian and Chinese immigrant communities overlap. As it turned out, Boris and Betya Kogan (no relation to Igor Kogan), who operated the market, were attempting to use stolen credit cards to buy cigarettes and other supplies from Smart & Final (along with furnishing their own household). The cards belonged to residents of Glen Ellen and Santa Rosa.
On March 17, 1999, a contingent of federal and local investigators split up, one team heading for the market and another for the Kogans' Richmond District home on Geary Boulevard. But Boris Kogan left the house before the cops were ready to enter, so they followed his car as he picked up a shopper and then drove to a Beverages and More store in Colma, where he was arrested. The shopper he'd picked up had a familiar face. Dortch had interviewed her, and watched her in action on tape. She was among the highest paid of the shopper profession, reportedly because of her ability to throw angry fits, boldly asking store clerks to call security on her behalf and engaging in other antics that nearly always resulted in a successful return, refund, or purchase of illicitly bought merchandise.
