CITRUS HEIGHTS, Calif. – The FBI broke up a sophisticated credit card ring in Northern and Southern California Wednesday, serving search warrants at multiple businesses and homes on Wednesday.
Agents served search warrants at the home of Mihran Melkonyan on Shaver Court in Citrus Heights and at his trucking business on Auburn Boulevard nearby. Agents also served a search warrant at the home of Rouslan Akhmerov in Studio City, Calif.
The pair allegedly submitted fraudulent charges on stolen American Express credit card accounts. According to the federal criminal complaint, both Melkonyan and Akhmerov conspired to defraud American Express by, "establishing a fraudulent business, obtaining victims' American Express credit card information and using the illegally obtained credit card information to bill American Express."
Roughly 23,000 American Express credit cards were compromised, according to the complaint.
At Melkonyan's residence in Citrus Heights, a woman who opened the door said only, "he's not home. I don't know where is he."
One neighbor said he'd watched federal agents go in and out of the home on Wednesday.
"There were a lot of police vehicles – militarized-looking police vehicles," said the man who did not want to be identified.
The same man said he and other neighbors had noticed expensive vehicles parked outside the modest duplex.
"They got Mercedes and Land Rovers, you know what I mean? It's a little out of place," the man said.
According to the complaint, "he perpetrators directed American Express or Paypal to process numerous fraudulent credit card transactions," creating credit balances to their American Express or Paypal accounts, the funds were deposited into linked bank accounts and then the suspects took the money from those accounts.
The success of the scheme depended on a short life cycle, the complaint said. Some credit card holders may complain to American Express, which can lead the company to reverse charges and an effort to collect the money from merchants. For that reason, the complaint said, the suspects submitted large numbers of transactions in a short time and took the money out soon after it was deposited, leaving the accounts depleted before American Express could recover any losses.
The complaint mentioned a search warrant turned up, "in excess of 50 Academic Reports from San Juan Unified School District in Carmichael, California, containing personal identifying information," and that some of the reports, "have written credit card names and numerical figures on the back of the report." But the complaint does not mention whether any of the credit card information was compromised.