Weather Forecast


'Card cracking' case cracked by Hudson police

A Hudson woman allegedly tried to bilk a financial institution out of thousands of dollars in a fraud scam known to law enforcement as "card cracking."

St. Croix County prosecutors charged Gerguita B. Lauderdale, 21, with felony wire fraud against a financial institution, felony attempting fraud against financial institution and obstructing an officer Oct. 3. If convicted, the maximum penalty could land her in prison for up to six years.

According to the complaint:

Lauderdale reported fraudulent activity on her Royal Credit Union bank account to the Hudson Police Department Wednesday, Aug. 16. She said the fraudulent charges began Aug. 10 when 10 checks from Arby's in Hudson were deposited into her account and those funds withdrawn. She told an officer she works at Burger King in Hudson, not Arby's, so she didn't know where those deposits came from.

READ MORE: Maiden Rock man charged with sixth OWINorth Hudson man charged with sex assault

She also told police she had lost her debit card a while ago, but couldn't pinpoint when and where. Someone online, unbeknownst to her, was using her online RCU account and PIN in Colorado after cashing the Arby's checks in her name at Walmart stores, she said. She speculated that since her PIN is her birthday, that someone looked it up on her public Facebook profile and retrieved that information.

Police spoke to an RCU risk analyst, who said it was suspicious that somebody unknown to Lauderdale could "penetrate five layers of account protection to be able to answer security questions correctly" to access the account.

The employee explained that 10 Arby's checks had been deposited to Lauderdale's account using a mobile app; then, ATM withdrawals from Aurora, Colorado, occurred a short time later through the physical use of Lauderdale's debit card she had reported as missing. The employee said a cloned card could not be used as Lauderdale's original card had a chip in it.

The employee added that someone had called multiple times to access mobile banking and logged into the banking application from different IP addresses; each time five forms of ID are required to access the account. Also, when different phone numbers were added for account access, Lauderdale would've had to approve those as the bank sends a verification code to her registered phone number in order for a transaction to continue. Each time, the verification code and all five security questions were answered correctly.

The risk analyst said the fraudulent transactions resulted in an RCU loss of $3,652.22. Lauderdale denied logging in or answering security questions. She also denied giving her banking information to another party.

Upon police review, the deposited Arby's checks appeared to be made on a computer. Comparison to a real Arby's check highlighted differences such as logo size, routing number and border. The checks deposited to Lauderdale's account totaled $6,914.98. The ATM withdrawals in Colorado totaled $3,652.22.

Police questioned Lauderdale about a failed log-in attempt tracked to an IP address in Milwaukee; however, within minutes Lauderdale's phone had replied with the required responses to allow that device to log in.

Records showed Lauderdale had also requested her account be put into "travel mode" for three days in Colorado, Aug. 10-13, from a phone registered to a Rebecca Farrar at 7:22 a.m. Aug. 10. The request was approved, and records show Lauderdale tested it from a phone in Minneapolis at 9:20 a.m. Beginning at 11:07 a.m., four account log-ins were documented coming from a phone in Denver.

Then, at 11:46 a.m. that same day, Lauderdale's registered phone replied to a text allowing a new phone in Denver to make online deposits. At 12:03 p.m., two checks were deposited into her accounts from a new phone in Dallas, Texas, totaling $700 in savings and $750 in checking. At 12:18 p.m., check card purchases of $803, $803 and $903 were made at a Walmart in Aurora, Colorado, followed by more check deposits totalling $2,816.32 in Dallas again. The cycle then continued of transferring money from savings to checking, followed by another check card purchase in Colorado for $803 and an ATM withdrawal of $302. Police were uncertain if two separate people were actually performing the transactions in Colorado and Texas, or if it was someone using spoofing software to disguise a location.

During a Sept. 7 phone call with police, Lauderdale admitted she had willingly provided her banking information to a man she met on Instagram named "Riqothemenace." She said she attends school at University of Wisconsin-Milwaukee, where she was contacted by a person who asked if she wanted to earn extra money. She mailed her debit card to a 22nd Street address in Milwaukee; her boyfriend lives at 1130 N. 22nd St. in Milwaukee. She denied his involvement in the scheme and denied he is "Riqothemenace," who she alleged instructed her to report her debit card as stolen and the account activity as fraudulent as a means of being reimbursed by her bank.

According to the report, this type of fraud is called "card cracking" and originated as organized crime in Chicago.

Lauderdale will make her initial appearance in St. Croix County Circuit Court at 1 p.m. Dec. 7.

Sarah Nigbor

Sarah J. Nigbor serves as a regional editor for RiverTown Multimedia, a position she began in April 2017. She joined RiverTown Multimedia in October 2013 as a news reporter for the New Richmond News, before being appointed editor of the Pierce County Herald in February 2015. She graduated from the University of Wisconsin-River Falls with a Bachelor of Fine Arts in Spanish and French in 2001. She completed a minor in journalism in 2004. 

(651) 301-7881