Ex-Telecom Employee Charged With Large-Scale Cell Phone Unlocking Program | USAO-NJ
NEWARK, NJ – A former telecommunications company employee has been indicted for his role in a scheme to fraudulently unlock the Subscriber Identification Module (SIM) cards of thousands of cell phones, U.S. Attorney Philip announced today. R. Sellinger.
Richard Forrest Sherman, 43, formerly of Salem, Oregon, and now Boerne, Texas, is charged by wire fraud conspiracy complaint in federal court in Newark. He was arrested today in Texas, made his first appearance before U.S. Magistrate Judge Henry Bemporad in federal court in the Western District of Texas and released on an unsecured bond of $30,000.
According to documents filed in this case and statements made in court:
Sherman worked at a multinational telecommunications company. There, he managed an account for a client who received an exemption to unlock mobile device SIM cards. Sherman exploited this exemption by creating a series of customer accounts in the carrier’s system to make the accounts look like an affiliate of the customer who actually received the exemption. Sherman and others then submitted mass unlock requests through these fake affiliate accounts that Sherman created before he left the telecommunications company.
Sherman, through its entities, received payments from others in exchange for the fake affiliate accounts successfully sending International Mobile Equipment Identity (IMEI) numbers en masse to the carrier. The carrier, believing that the fake affiliate was entitled to the unlock exception, unlocked these IMEIs en masse. Unlocking these IMEIs allowed others involved in the program to resell the phones for profit – the phones would otherwise have remained locked or required payment of a fee to be unlocked. Sherman created the fake affiliate accounts around 2013; he and his conspirators operated the fraud scheme until it was discovered in August 2020.
The wire fraud conspiracy count carries a maximum of 20 years and a fine of $250,000 or double the monetary gain to the defendant or loss to the victims, whichever is greater. .
U.S. Attorney Sellinger credited U.S. Secret Service Seattle Field Office Special Agents, under Special Agent in Charge Robert Canestrari, with the investigation leading to the prosecution.
The government is represented by Assistant U.S. Attorney Jamie L. Hoxie of the Cybercrime Unit in Newark.
The accusation and allegations contained in the complaint are only accusations and the defendant is presumed innocent until proven guilty.