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Australian pleads guilty to federal identity theft in shipping fraud case

New IdentityTheft Scam

An Australian man who was living in Madison will likely spend two years in federal prison after pleading guilty Friday to aggravated identity theft in connection with a two-year scheme he carried out to defraud a parcel insurance company by filing claims for phantom missing packages.

Scott Reaston, 40, was indicted and arrested in January on a nine-count indictment that detailed a scheme he carried out between February 2013 and July 2015 in which Reaston made phony parcel insurance claims for packages that he claimed he had sent to customers through Amazon Marketplace.

Reaston instead pleaded guilty Friday to a single count of aggravated identity theft connected to fraud. U.S. District Judge William Conley hinted that he has some reservations about the plea agreement, which he will decide whether to formally accept at a sentencing hearing for Reaston that is scheduled for Aug. 2. 

The aggravated identity theft conviction carries both a mandatory minimum and a maximum penalty of two years in prison, so Conley said he must decide whether he is convinced that the charge under the agreement is adequate. The original charges that Reason faced carried 10- and 20-year maximum sentences. 

“There might be a reason I’d consider not to accept the plea agreement,” Conley said, shortly after also asking Assistant U.S. Attorney Anthony Trillo whether victims identified in the case had raised any concerns or objections. about the agreement. Trillo said none had.

According to court documents, Reaston submitted $480,000 worth of claims to a St. Louis company called Brown & Brown of Missouri, which offers a shipping insurance plan called the Parcel Insurance Plan (PIP). The claims Reaston submitted were for cellphones he claimed to have sold online through Amazon Marketplace that were lost, damaged or shorted during delivery to customers.

The insurance was offered to customers of Stamps.com, an online postage seller that Reaston used. 

PIP sent checks to Reaston under a variety of names, both real and fictitious, totaling $364,183, including a check in May 2013 for $31,350 to a friend of Reaston. Reaston admitted in court that money from checks that were sent to friends ended up in his hands. 

“At that time I was not working and started selling things online,” Reaston told Conley. The scheme to file insurance claims “just got out of hand, I guess.”

Conley urged Reaston to be honest with a federal probation agent who will write a pre-sentence report about Reaston, expressing some skepticism over the fact that earlier in the hearing, Reaston had difficulty explaining where he went to college in Australia and could not remember how to spell the name of the high school he attended there.

“Any inaccurate information would be concerning to me,” Conley told Reaston.

Source: on 2018-05-11 16:03:45

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