This case, tried to the Court without a jury, involves the confluence of criminal law, domestic relations, and consumer credit. Defendant is charged with multiple counts of Attempted Identity Theft and Attempted Petit Larceny, as well as one count of Attempted Possession of Personal Identification Information in the Third Degree, all class B misdemeanors, as to which she moved at the end of testimony for a trial order of dismissal. As will be seen, while the amounts involved in this prosecution aggregate less than $5000, the trial raised legal issues under the identity theft statutes, Penal Law § 190.77, et seq., as to which few decisions have been published, and thus the Court writes on both Defendant's motion and the trial verdict.

Defendant is charged with charged with six counts of Attempted Petit Larceny (PL § 110/155.25); six counts of Attempted Identity Theft (PL § 110/190.78(1)); and one count of Attempted Unlawful Possession of Personal Identification Information in the Third Degree (PL § 110/190.81), all class B misdemeanors, for transactions between January 25, 2008, and June 9, 2009. After summations, Defendant moved for a trial order of dismissal contending, inter alia, that Defendant had no intent to defraud or to deprive the Complainant of property, and, thus, the People had not proven the charged crimes beyond a reasonable doubt.

Some of the facts set forth below are disputed and required the Court to make determinations as to credibility. However, the essential facts are either uncontroverted or, to the extent disputed, are those testified to by Defendant herself. While the Court does not fully credit the testimony of Defendant, it relies upon her testimony unless otherwise specifically indicated, together with uncontroverted and incontrovertible documentary evidence, to support its verdict and decision. Moreover, while the Court declines to credit much of Complainant V. N.'s testimony as to events prior to August 2008, concerning the account opened in his name with [*2]Dell Financial Services ("Dell"), the Court does not find it necessary to rely on V. N.'s testimony as to any of the disputed facts in order to support its verdict. The Court will endeavor to specify those facts which are disputed, in contrast to those which are either undisputed or established by unchallenged documentary evidence.

The People called three witnesses: Complainant V. N., Police Officer Billy Cepeda, and Steven Holloway, manager of the fraud investigation team of Dell. Defendant testified in her own behalf, and did not call any other witnesses.

In or about 2000, Defendant and V. N. began a romantic relationship, and in 2001, Defendant gave birth to the daughter of V. N. In 2003, V. N. moved in with Defendant in her apartment on Greene Avenue in Queens. In 2006, Defendant, together with V. N., moved to a different address on the same block,^[FN1] and, in July 2006, V. N. wrote a check for $800, to be used for rent. He continued to pay approximately half of the rent on the apartment until early 2008.

According to Defendant, her relationship with V. N. was "on again, off-again," which was similar to V. N.'s categorization of their time together. During much of this time, V. N. worked for the New York City Parks Department, earning approximately $1000 every two weeks, according to his testimony, although it was not specified as to whether this was gross earnings or net of taxes and other deductions. Defendant was employed as a legal secretary during the times relevant to this case.

While V. N. was living with Defendant, he also maintained a mailing address at his parents' residence on Jefferson Avenue in Brooklyn. He testified that he received his mail at Jefferson Avenue, and not at Greene Avenue. It is undisputed that V. N. was close with his family, and particularly with his father.

The matters at issue in this case commenced in early 2008. Defendant was desirous of purchasing a Dell computer, and , according to her testimony, she contacted Dell in an attempt to open a credit account. Defendant had previously filed for bankruptcy protection, and Dell declined to open or reopen an account for her. (Apparently, she may have had an account with Dell prior to her bankruptcy filing). At or about the same time, according to Defendant, V. N. ceased paying any portion of the rent on the Greene Avenue apartment. All of the above facts were essentially undisputed, notwithstanding some different shadings given to them by V. N. and Defendant.

Commencing January 2008, after Defendant was turned down by Dell for credit, the facts as testified to by Defendant and V. N. are sharply divergent. According to Defendant's testimony, she asked V. N., who was then employed by the Parks Department and creditworthy, to open an account in his name with Dell, which she could then use to order the computer and other electronics. According to Defendant, V. N. agreed. By contrast, V. N. denies any such agreement as claimed by Defendant, and denies any knowledge of the Dell account opened in his name.

Nonetheless, it is undisputed that on January 23, 2008, Dell opened an account in the name of V. N.. According to Holloway, who testified as the custodian of Dell's records, the account was opened by telephone, and there is neither any written application for the account, nor any recording of that telephone call. Holloway testified that only minimal information is needed [*3]to open a Dell credit account by telephone. The caller was required to provide contact information, social security number and his or her mother's maiden name, following which Dell would draw a credit report from one of the large credit agencies, such as Equifax. As long as the information provided by the caller matched that on the credit report, and the applicant was deemed creditworthy, Dell would extend credit.

The information provided by the caller, whether V. N. or someone purporting to be V. N., apparently matched, V. N. was deemed creditworthy, and Dell opened an account in the name of V. N.. Two days later, an order was placed on the account for a computer and other accessories, in the amount of $1877.50, with the computer being shipped to the Greene Avenue address then occupied by both V. N. and Defendant.

On March 12, 2008, a call was made to Dell regarding this account. According to the contemporaneous notes made by the various Dell customer representatives, which were introduced into evidence, the caller made arrangements to make a payment by telephone, and Dell agreed to waive its fee of $13.95, which it charged for telephone payments. Mr. Holloway testified that Dell would not deal by telephone regarding the account with anyone other than the account holder, unless the account holder gave specific permission to deal with a third party. As will be seen, this testimony was largely borne out by the written notes of Dell's customer relations representatives.

It appears that this initial payment was made from V. N.'s checking account at Ridgewood Savings Bank, which showed a $60 debit for an electronic fund transfer on March 13, 2008, to Dell. When questioned about this at trial, V. N. claimed to be unaware of this transaction, and said that he did not study his monthly bank statements. He further testified that he did not make this transaction, and that he did not authorize Defendant or anyone else to make any payment to Dell from his account. The People's theory, for which they offered no proof other than V. N.'s denial that he made this payment, is that this payment was surreptitiously made by Defendant from V. N.'s account. However, this payment was not a crime charged herein.

On April 7, 2008, a call was made to Dell regarding the account, by someone other than the named account holder, V. N.. According to Dell's notes, Dell initially declined to provide any information to the caller, but then the account holder, or someone who was able to convince Dell that he was V. N., authorized Dell to talk with a third person, presumably Defendant. At that time, and as a result of that call, the billing for the account was changed from paper billing to electronic billing, to be sent to an email address identified as belonging to V. N..

Subsequently, purchases were made on the account on additional dates,^[FN2] as follows:

Date

January 25, 2008

June 30, 2008 [*4]

July 28, 2008

July 28, 2008

Dec. 1, 2008

June 5, 2009

Amount

$1877.50

$249.25

$864.83

$483.14

Place to Which Goods Shipped Amount

Greene Ave.

Greene Ave.

Defendant's place of employment

The relationship between V. N. and Defendant was somewhat disputed, although it seems to fit well within what Defendant described as being "on again, off again." Defendant testified that in early 2008, she lived with V. N. and her children (in addition to the child she had with V. N., she also had a child from a prior relationship) at Greene Avenue. She further testified that V. N. left for a week after an argument, but then returned. By contrast, V. N. testified that in 2008, he had moved out of Greene Avenue, but he came back with Defendant at Greene Avenue for only a short period of time after his father passed away in April of that year following a long illness, and V. N. was seeking solace and emotional support during his grief. V. N. testified that the last time he was at Defendant's Greene Avenue residence was in May or June 2008.

According to Defendant, she tried to terminate the relationship before the Disneyworld trip, and V. N. said he would do so after their trip if she still wanted him to leave. Shortly after that trip, V. N. and Defendant ended their relationship, although they disagree as to whether the final break-up was voluntary on the part of V. N. or whether Defendant, in her words, "threw him out."

In May 2009, Defendant commenced a proceeding in Family Court, and obtained an order of protection against V. N., who had ceased paying voluntary child support. Subsequently, Family Court ordered him to pay child support of $300 per month, and V. N. apparently complied with the Family Court support order.

Meanwhile, payments on the Dell account ceased following the May 2009 payment of $150.^[FN3] Also during this time, the email address to which bills on the account were sent was changed in or about October 2008 from an e-mail account associated with V. N. to one associated with Defendant. All during this time, orders on the account could be placed by e-mail. The evidence further shows that after V. N. moved out of the Greene Avenue apartment for the last time in 2008, bills on the Dell account went to Defendant's e-mail address; orders on the account were shipped either to Defendant's home from which V. N. had vacated, or to the law firm for which Defendant worked; and the account went into default for failure to make any payments after May 2009.

Defendant testified that the account was opened in V. N.'s name with his authority, as an accommodation to her, as Dell was unwilling to extend credit to her; all of the orders on the Dell account were made with V. N.'s permission; and that at the time each order was placed she fully intended to pay Dell all sums due. By contrast, V. N. testified that he knew nothing about any of the orders, did not give Defendant permission to open the account, that Defendant stole his personal identification information, including his social security number and mother's maiden [*6]name from a file cabinet in the Greene Avenue location to which Defendant had access while they were living together, used that information to fraudulently open the Dell account in his name, and after opening the account, changed the billing on the account from paper to e-mail, and from his e-mail address to that of Defendant, all in aid of her fraudulent scheme.

Identity Theft, a relatively new statute, has a limited amount of case law associated with it. See, e.g., People v. Vandermuelen, 42 AD3d 667, 839 N.Y.S.2d 835 (3d Dept. 2007), lv to appeal denied, 9 NY3d 965, 878 N.E.2d 617, 848 N.Y.S.2d 33 (NY 2007); People v. Hayes, 71 AD3d 1187, 896 N.Y.S.2d 225 (3d Dept. 2010); People v. Essalek, 17 Misc 3d 835, 847 N.Y.S.2d 421 (Crim. Ct. NY Co. 2007).

The key element in this case, intent to defraud, has no penal law definition, but its use in related contexts provides guidance for its definition. The New York Court of Appeals, in an appeal of a criminal possession of forged instrument conviction, has stated that an intent to defraud should be "for the purpose of leading another into error or to disadvantage." People v. Briggins, 50 NY2d 302, 309, 428 N.Y.S.2d 909, 406 N.E.2d 766 (1980) (concurring opinion) (Jones, J.). The U.S. Supreme Court has indicated that "to defraud" means "wronging one in his property rights by dishonest methods or schemes, and usually signifying the deprivation of something of value by trick, deceit, chicane or overreacting." Carpenter v. United States, 484 U.S. 19, 27, 108 S.Ct. 316, 321, 98 L.Ed.2d 275 (1987) (affirming a conviction under securities and federal mail and wire fraud statutes). See also Black's Law Dictionary (6th ed. 1990) ("Intent to defraud means an intention to deceive another person, and to induce such other person, in reliance upon such deception, to assume, create, transfer, alter or terminate a right, obligation or power . . . ."). Further, particularly relevant to this case, the statute clearly states that the use of another's credit, not merely the receipt of tangible goods, is punishable under the statute.

2. Petit Larceny

A person is guilty of Petit Larceny (PL § 155.25) when he or she steals property. Larceny is defined as: "with intent to deprive another of property or to appropriate the same to himself or to a third person, he wrongfully takes, obtains or withholds such property from an owner thereof." (PL § 155.05). Here, the elements of larceny would be satisfied if the Court finds that the People have submitted proof beyond a reasonable doubt that Defendant obtained goods in the name of the Complaint without his permission.

[*7]3. Unlawful Possession of Personal Identification Information in the Third Degree

The relevant portions of Penal Law § 190.81 state that a person is guilty:

when he or she knowingly possesses a person's financial services account number or code, savings account number or code, checking account number or code, brokerage account number or code, credit card account number or code, debit card number or code, automated teller machine number or code, personal identification number, mother's maiden name, computer system password, electronic signature . . . of another person knowing such information is intended to be used in furtherance of the commission of a crime defined in this chapter.

In this case, the People need only prove that Defendant attempted to possessV. N.'s Personal Identification Information in furtherance of the other charged crime of Attempted Identity Theft. See Essalek, 17 Misc 3d 835, 838, 847 N.Y.S.2d 421, 424 ("A plain reading of the statute clearly reveals that a person need not actually use or attempt to use personal identification information to commit this crime; rather, the charge only requires that a defendant possess personal identification information and have knowledge that such information is intended to be used in the commission of a crime.").^[FN4]

Defendant cites cases, including People v. Churchill, 47 N.Y.151, 417 N.Y.S.2d 221 (l979), People v. Ferry, 149 AD2d 994, 530 N.Y.S.2d 416 (4th Dept 1988), lv to appeal denied,73 NY2d 891, 538 N.Y.S.2d 803 (1989), and People v. Rogers, 192 AD2d 1092, 596 N.Y.S. 2d 267 (4th Dept 1993), holding that no crime is committed when a purchaser fails to pay for goods unless it can be proven that the purchaser had no intent to make payment at the time the goods were ordered. Defendant cites her regular monthly payments over the course of more than a year, coupled with her testimony, while the Court credits, as clear evidence that she fully intended to make payment to Dell at the time she placed each of the orders, but ceased payments only when she ran into financial difficulty, and not as part of any fraud.

While the cases cited by Defendant are good law, they do not control our facts. Each of those cases involve parties who purchased goods in their own name, and does not involve any claim of use of the name of another, and are thus easily distinguishable. Defendant's cases would constitute a valid defense had Defendant purchased the goods in her name intending to pay, but subsequently became unable to do so; here it is undisputed that the goods were purchased in the name of V. N., and not Defendant.

According to her own testimony, Defendant was unable to obtain credit in her own name from Dell, and the account was opened in the name of V. N., either with or without his authorization, depending on whether the testimony of V. N. or Defendant is credited. If V. N.'s testimony is credited, and Defendant acted without V. N.'s consent, those acts, otherwise [*8]fraudulent, are no less a fraud or a crime merely because Defendant intended to pay for the goods when she placed the orders.

It is basic law, leaving aside exceptions not relevant here, that a vendor may choose its customers, and a creditor may choose its debtors. It was not disputed that Dell was entitled to turn down Defendant as a customer worthy of being extended credit, as long as it did not do so for some legally impermissible reason. Nor may a potential customer legally circumvent the vendor's refusal to extend credit by surreptitiously opening an account in the name of some other party who has not consented and agreed to be liable to the vendor, even if the vendor would have extended credit to the nominee, had he applied for credit.

The Court finds that the People have not proven Defendant's guilt beyond a reasonable doubt as to the transactions prior to August 2008, when V. N. left the Greene Avenue residence for the last time, and his relationship with Defendant came to an end, save for court proceedings and visitation with their daughter authorized by Family Court. Certainly as to the initial purchase of the computer in March 2008, and possibly as to some of the subsequent purchases, V. N. and Defendant maintained a relationship, rocky as it may have been. V. N. was a visitor, if not resident, in the Greene Avenue apartment and had ample opportunity to see and use the computer and other electronics purchased on the account from Dell, and to be otherwise aware of the orders.

In this regard, Defendant testified that V. N. was greatly involved with purchasing the computer that was purchased by the initial transaction, to ensure that it would be suitable for his hobby of computer games involving the racing of radio controlled automobiles. Moreover, while V. N. denies any knowledge, and further specifically denied any involvement with the initial purchase of the computer, it is undisputed that the initial $60 payment to Dell, made in March 2008, came from his bank account, notwithstanding his denial of knowledge as to the payment. As to the subsequent transactions, Defendant testified that each one was approved in advance by V. N., in that the electronic equipment was to be used, at least in part, to benefit their child. While this testimony was entirely disputed by V. N., who steadfastly denied knowledge of any of the purchases or that he authorized Defendant to make any such purchases or open any account in his name, the Court finds the testimony sufficient to create a reasonable doubt as to Defendant's guilt as to the transactions prior to August 2008, and Defendant is accordingly found not guilty of all counts involving the transactions of January 2008, March 2008, June 2008, and July 2008.

Both V. N. and Defendant testified that shortly after they returned from their August 2008 Florida trip, they essentially entered a new and highly contentious phase of their relationship. At some point, V. N. was no longer voluntarily paying child support or money to be used towards rent, and in May 2009, Defendant went to Family Court where she obtained first an order of protection against V. N., and then a support order requiring him to pay $300 per month child support.

Nevertheless, Defendant continued making purchases on credit from Dell on the account in V. N.'s name, both in December 2008, and in June 2009. She testified that he had given her permission before the August final break-up to purchase those goods, but that she did not purchase them at the time permission was purportedly given, delayed for many months, and nevertheless relied on V. N.'s prior verbal authorization notwithstanding the termination of their relationship and the Family Court litigation. V. N. denied that any such permission was given at [*9]any time, and denied knowledge of the Dell account in his name.

The Court finds it unnecessary to resolve this factual dispute. Rather, the Court holds that even crediting Defendant's testimony, for the purposes of argument, that V. N. knew about the Dell account and gave Defendant permission to place the orders in his name, that authority terminated as a matter of law when Defendant, by her own testimony, threw V. N. out of the house, and commenced a Family Court proceeding against V. N. to obtain an order of protection and support order.^[FN5] Assuming arguendo the relationship of V. N. and Defendant with regard to the Dell account was contractual or quasi-contractual in nature, Defendant's actions in throwing V. N. out of their joint residence and commencing a Family Court proceeding against him would constitute repudiation or a breach sufficient to relieve V. N. of any further contractual obligation. See Norcon Power Partners v. Niagara Mohawk Power Corp., 92 NY2d 458, 462-63, 682 N.Y.S.2d 664, 705 N.E.2d 656 (1998); See also Restatement (Second) of Contracts § 253(2) ("Where performances are to be exchanged under an exchange of promises, one party's repudiation of a duty to render performance discharges the other party's remaining duties to render performance."); Restatement (Second) of Contracts § 250(c) ("[A] voluntary affirmative act which renders the obligor unable or apparently unable to perform without such a breach" may "constitute[] an anticipatory repudiation which is a total breach of a contract.). In addition, Defendant's actions would also constitute a breach of the covenant of good faith, implied in every contract. Van Valkenburgh, Nooger & Neville v. Hayden Publ. Co., 30 NY2d 34, 45, 330 N.Y.S.2d 329 (1972), cert denied 409 U.S. 875, 93 S.Ct. 125 (1972).

Even if Defendant's testimony that V. N. gave permission on some earlier date to purchase on credit in his name the goods encompassed by the December 2008 and June 2009 orders, Defendant cannot on the one hand throw V. N. out of the house and commence a Family Court proceeding against him, where she obtained an order of protection and a support order, while on the other hand relying on permission supposedly given many months earlier to make purchases on his account.

Furthermore, Defendant's acts against V. N. are inconsistent with both parties' testimony about their relationship prior to the December 2008, and June 2009 orders; a relationship, crediting Defendant's testimony, that was "on and off." Having thrown V. N. out of the house and commenced a Family Court proceeding against him, the reasonable conclusion is that the relationship was effectively terminated, except for matters ordered by Family Court. Any prior agreement to share personal identification information did not survive the dramatic change in the relationship between Defendant and V. N.. This change, coupled with Defendant's questionable testimony about when she obtained permission to purchase the December 2008, and June 2009 orders supports the Court's finding that any permission offered by V. N. was revoked as a matter of law by Defendant's actions before the orders were placed.^[FN6] [*10]

As to the December 2008, and June 2009 orders, the People have proven beyond any reasonable doubt that the orders were placed by Defendant, using V. N.'s personal identity information, without his permission or authority. While we credit Defendant's testimony that as to these and all other orders she fully intended, at the time the orders were placed, to pay for the goods, albeit on credit terms, the Court finds that Defendant possessed the intent necessary to sustain convictions under the identity theft and petit larceny statutes. While Defendant intended to pay for the goods at the time she placed her orders, her actions clearly show beyond a reasonable doubt that she simultaneously intended that if she subsequently became unable to pay, she would not be liable to Dell, as the purchases were not made in her name. She also intended to obtain credit from Dell, surreptitiously in the name of V. N., after Dell rejected her efforts to open a credit account. By her actions, she caused financial loss to Dell when she subsequently became unable to pay, and also assumed the identity of another person, namely V. N., with the requisite intent to defraud required under the statute.

The Court further notes that Dell, while professing to be a passive victim of fraud, could have been much more vigilant, and does not appear to have expended that diligence which was due this matter. Dell apparently did not require any credit application, as no such document was offered into evidence, and did not require the person to whom it extended credit to actually sign an agreement to be liable for the purchases, or to verify that the applicant was in fact that person whom he or she represented himself or herself to be. According to the testimony of Dell's Fraud Investigator, all that was required was that basic identification information, such as social security number and the maiden name of the applicant's mother, match the information in the files of the major credit reporting agencies. It then allowed transactions to proceed by e-mail, and billing addresses to be easily changed. While this may serve to promote the easy purchase of goods, it provides few barriers to fraud by anyone with access to this basic identity information. In this regard, the media is replete with stories as to how major institutions inadvertently lose or release into the public realm supposedly confidential identity information for millions of people, making identity theft and concomitant fraud a recurring problem. See, e.g., Nick Bilton and Brian Stelter, Sony Says PlayStation Hacker Got Personal Data, NY Times, April 27, 2011, at B1.

The Court further notes that in this case, Dell put a credit limit of $4000 on the account, but nevertheless allowed purchases above the credit limit. When asked how it was that Dell allowed purchases above and beyond the stated credit line, Dell's fraud investigator, Holloway, testified that there existed a "shadow credit limit," which he described as being an amount over the limit of which the customer was advised, but which Dell would allow purchases if the account was in good standing.

The Court is also not oblivious to the monies earned by selling goods on credit. Here, Dell charged 27.99 percent interest per annum.^[FN7] At $150 per month, the most that Defendant ever paid on the account, it would take more than42 months to pay off the balance, assuming no new purchases, and Dell would receive in interest payments an amount approximately 50 percent of [*11]the purchase price of the goods, had they been paid for in cash. At $100 per month, closer to the average monthly payment made by Defendant during the time she made payments, it would barely cover interest accrued, and take more than 115 months — almost ten years — to pay the balance, with no new purchases, resulting in interest payments far in excess of the principle. And, had the balance of the account stayed at $4000, either by means of additional purchases or if the account holder paid only enough to cover accrued interest, Dell would receive approximately $1120 per year in interest alone.

For the reasons set forth above, Defendant's motion for a trial order of dismissal is DENIED in its entirety. Defendant is found not guilty of Attempted Petit Larceny (PL § 110/155.25) and Attempted Identity Theft (PL § 110/190.78(1)) for those counts relating to January 25, 2008, June 30, 2008, and July 28, 2008 (two separate purchases), but is found guilty on those counts relating to December 1, 2008, and June 5, 2009. Defendant is further found guilty of the single count of Attempted Unlawful Possession of Personal Identification Information in the Third Degree (PL § 110/190.81).The final counts of Attempted Petit Larceny and Attempted Identity Theft covering the period of January 23, 2008- June 9, 2009, are dismissed as duplicative.

This constitutes the decision and order of this Court.

Dated:May 31, 2011

Brooklyn, New York

______________________________

MICHAEL GERSTEIN, J.C.C.