A Whitestone man was arrested for allegedly making and distributing forged modem devices filled with malware that mimics legitimate cable and streaming services in a takedown of a major cable theft operation in Flushing and Whitestone, Queens District Attorney Melinda Katz announced on Tuesday.
Kong Gao, 35, of 154th Street in Whitestone, was arraigned in Queens Criminal Court on Nov. 15 on a criminal complaint charging him with fraudulent making of an electronic device and criminal possession of forgery devices after approximately 200 of the fraudulent modem devices were seized from his home.
According to the charges, Charter Communications launched an external investigation into the widespread theft of streaming and W-Fi services concentrated in the Flushing area in April. Around 6,000 unique accounts were identified to have been cloned from Sprectrum and used in an unauthorized manner.
In August, company officials learned of multiple advertisements offering Wi-Fi internet services and installation of modems written in Chinese near Main Street in Flushing. Following additional intelligence gathering and undercover buys through the employment of a private investigative firm, Charter officials linked the sale of fraudulent devices to Gao. After attempting to disrupt the service to the unauthorized devices, Charter observed that Gao would meet with his clients and swap out the old devices for new ones with the same type of malware that provided illegal access. Charter then referred the case to the Queens District Attorney’s office for further investigation and enforcement.
On Friday, Nov. 14, members of the DA’s Detective Bureau executed a court-authorized search warrant at Gao’s Whitestone home. The search revealed 200 modems for potential sale, soldering irons, and other tools to create forged access devices as well as the malware program to infiltrate Charter’s services. The lost service revenue associated with the scheme is estimated to exceed $1 million.
“The defendant is accused of stealing network cable services for his own personal gain,” Katz said. “By design, the devices he allegedly manufactured house malware that compromise security and cause substantial business losses, which can result in higher costs for law-abiding citizens.”
Queens Criminal Court Judge Marty Lenz ordered Gao to return to court on Jan. 16. He faces a potential maximum sentence of seven years in prison if convicted of the top count.
“My office will continue to ensure the safety and security against such fraudulent schemes,” Katz said.
