Five people indicted on federal charges they hacked Target gift cards, stole nearly $800,000

SEATTLE  — Authorities say five people have been indicted on charges they hacked Target Corp. gift cards to the tune of nearly $800,000.

According to the indictment unsealed Tuesday, between May 2017 and December 2017, the fraud ring allegedly stole gift card balances worth more than $785,000, and often sold illegally purchased goods or store gift cards for bitcoin on an internet marketplace.

The co-conspirators allegedly used a special algorithm to reverse-engineer and identify unique bar code numbers of thousands of authentic gift cards sold by Target to legitimate customers.

Members of the scheme then used the retailer’s automated customer service telephone system to verify balances linked to the various stolen gift card numbers.  They then loaded active gift card numbers onto a mobile or electronic wallet app on their phones, which the co-conspirators used to purchase merchandise and legitimate gift cards at various Target store locations across at least five states: Washington, Oregon, California, Nevada and Colorado.

For example, on one occasion in November 2017, the ring used roughly 180 compromised gift card numbers to make $6,900 in purchases at the Southcenter Mall Target store in Tukwila.

When the actual cardholders later tried to use their gift cards, they discovered that they had zero balance.  Target changed its gift card system last December in response.

Two defendants — Jeffery Douglas Mann, 29, of Marysville, and Joshua Newman, 33, of Kirkland — pleaded not guilty Tuesday, and one — Corey Mosey, 30, of Lynnwood — is in state custody on other charges. Authorities say they are searching for two other defendants, 22-year-old Kennady Weston and 26-year-old Derrick Quintana, both of Everett.