THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Thursday, May 30, 1996 TAG: 9605300360
SECTION: LOCAL PAGE: B3 EDITION: FINAL
SOURCE: BY LYNN WALTZ, STAFF WRITER
DATELINE: NORFOLK LENGTH: 56 lines
The ringleader of the largest cellular ``clone-phone'' operation in Hampton Roads has pleaded guilty in federal court to defrauding local phone companies of as much as a half-million dollars.
Derrick ``Dashon'' Wilson and his girlfriend, Kisha Miller, both of the 3200 block of Lakecrest Road in Virginia Beach, face up to 10 years in federal prison.
Clone-phone operations steal legitimate cellular phone numbers from the airwaves, then program them into other phones. They then sell the phones on the black market to people who use them to make free, illegal calls charged to others' phone bills.
Originally, local phone companies estimated a loss of a quarter-million dollars, but Wilson's guilty plea indicates the loss is between $350,00 and $500,000.
Wilson pleaded guilty Tuesday to trafficking in illegal cell phones. Miller pleaded guilty Wednesday to using an illegally cloned phone.
During a raid at Wilson's house earlier this month, Secret Service agents seized 40 phones and 1.4 grams of opium. About 20 other phones were seized in four other raids.
The guilty pleas culminate a yearlong joint investigation into cellular phone fraud, which mushroomed from about $10,000 per month in 1994 to about $250,000 per month in 1995. About 650 phones have been cloned in Hampton Roads since January. Other operations still exist in Hampton Roads, but Wilson's is believed to be the largest, federal authorities say.
``This represents the efforts of several agencies working together,'' said Lawrence Kumjian, Secret Service agent in charge. ``This is a complex investigation, and we couldn't have done it without the help of the FCC (Federal Communications Commission), Norfolk P.D. and GTE Mobilnet. We had the support of the the U.S. Attorney's office throughout. They really helped us put this case together.''
Wilson intercepted phone numbers between March of 1995 and May of 1996, court papers indicate. Using computer equipment, he programmed the numbers - a combination of serial numbers and phone numbers - into cellular phones, creating a replica of the original legitimate phone.
Wilson then sold the phones to customers for a monthly fee. The cloned numbers were from Hampton Roads, California, North Carolina and Pennsylvania, court papers indicate. Most fraudulent phone bills are now caught before they go to customers. GTE Mobilnet said some bills have been as much as $150,000.
On May 6, federal agents raided three Virginia Beach residences used by Wilson and his family, and two businesses Wilson owns.
Agents seized 63 phones and a laptop computer containing data logs for programming numerous cellular telephones. Most of the phones had been altered.
Wilson faces fines up to $250,000 or twice the value of the fraud. He will be sentenced Sept. 16. Miller will be sentenced Sept. 17. by CNB