Tuesday, June 23, 2015

Medford man pleads Guilty for Fraud against the MBTA

Massachusetts- Office of the Attorney General Announces:

Distributed More than 3,000 Passes Yielding More than $60,000 in Profit and Depriving MBTA in Excess of $225,000 in Revenue
WOBURN A Medford man has pleaded guilty and been sentenced to three years in state prison in connection with a scheme to manufacture and distribute counterfeit Massachusetts Bay Transportation Authority (MBTA) passes, Attorney General Maura Healey announced today. He distributed more than 3,000 counterfeit passes, making more than $60,000 in personal profit and depriving the MBTA of revenue in excess of $225,000.

            Casey Kolenda, age 28, of Medford, pleaded guilty today in Middlesex Superior Court to the charges of Counterfeiting (7 counts). After the plea was entered, Judge Thomas P. Billings sentenced Kolenda to three years to three years and a day in state prison, with three years of probation to serve upon his release.  

            “This scheme resulted in significant revenue loss for the MBTA and was patently unfair to riders who paid the full cost of their transit passes,” said AG Healey. “Schemes such as this one, in which an individual commits crimes for personal gain at the expense of the public, will not be tolerated.”

“Let this serve as a strong reminder that the MBTA and the Transit Police will not tolerate fraud,” said Acting Transit Police Chief Kenneth Green. “Hardworking, honest, fare paying MBTA customers deserve and expect our full attention to such criminal behavior. The successful prosecution of this case is the result of a collaborative partnership between Transit Police detectives and the Attorney General’s Office.”

The investigation began in August 2013, after the MBTA Transit Police discovered the existence of hundreds of unauthorized tickets in use by riders on the MBTA’s subway and bus systems. The AG’s Office and the Massachusetts State Police joined the investigation into the production and distribution of alleged counterfeit tickets in September 2013. Through that investigation, authorities identified multiple monthly LinkPasses that were purchased legitimately and subsequently used to create hundreds of counterfeit tickets used by riders.

The investigation revealed that Kolenda orchestrated a scheme to fraudulently create counterfeit $70 monthly MBTA subway and bus passes, known as “LinkPasses,” between October 2013 and March 2014. The electronic data stored on the LinkPass magnetic stripe was copied using a magnetic stripe reader, also known as a “skimmer.” That data was then downloaded onto the magnetic stripes of hundreds of MBTA stored-value cards that were purchased for as little as five cents at ticket kiosks.

Kolenda then disguised the counterfeit passes by applying contact paper that bore the production history of the original LinkPass, as well as the MBTA’s trademarked “T” logo. Similar in appearance and now encoded with the electronic data copied from the LinkPass, the counterfeit cards could be used at any MBTA fare gate in the same manner as the original pass.

Kolenda was arrested in March 2014 without incident at his Medford home by Massachusetts State Police assigned to the AG’s Office and MBTA Transit Police Detectives. He was indicted by a Statewide Grand Jury in July 2014.

At the time of his arrest, Kolenda had more than 60 counterfeit April 2014 LinkPasses and almost $7,000 in cash on his person. State Police executed a search warrant at his residence and seized additional counterfeit April 2014 LinkPasses, hundreds of MBTA five-cent cards, three skimmers, and the material and computer equipment used to manufacture the counterfeit passes. 

The MBTA estimates that Kolenda is responsible for over 3,000 counterfeit MBTA passes in circulation from October 2013 through March 2014. The joint investigation revealed that these counterfeit passes bearing the electronic data of the original were distributed and used on a monthly basis by MBTA riders, sometimes more than 15,000 times in one month. Investigators estimate that the lost revenue attributable to the counterfeit tickets manufactured and distributed by Kolenda was in excess of $225,000. 

This case was prosecuted by Assistant Attorney General Gina Masotta of the AG’s Public Integrity Division. The investigation was handled by MBTA Transit Police detectives and State Police assigned to the AG’s Office, with assistance from the AG’s Financial Investigations Division, the AG’s Victim Services Division, and the AG’s Digital Evidence Lab.