16 Treasure Valley residents indicted for drug trafficking, money laundering after FBI raids
Ten Idaho residents, including members of a Treasure Valley family, have been indicted on federal charges for an alleged decade-long counterfeit phone selling scheme.
Prosecutors say the defendants sold counterfeit Apple and Samsung phones and devices on Amazon, eBay and on their own websites from January 2008 through earlier this month.
The defendants are:
The indictment said the individuals listed with the last name of Babichenko are also known as Babitchenkos.
The defendants are charged with 34 counts of crimes including mail fraud and money laundering.
With the money, prosecutors say, they bought nine vehicles, six Ada County residential or commercial properties, and foreign property including seven residential apartment buildings in Brazil.
The indictment says they “obtained and controlled” at least $10 million in property that was transferred, used, shared or otherwise can’t be recovered.
They also had a total of 54 bank accounts; prosecutors are including bank accounts held by Morning Star Church in Boise on that list. The church’s phone went unanswered Wednesday.
Prosecutors say the Babichenkos and others got the phones smuggled from Hong Kong and China, repackaged them to look like the real devices, then sold them as “authentic” products.
The Idaho U.S. Attorney’s Office confirmed Wednesday that law enforcement was serving search warrants at different properties but would not release any other information. Spokeswoman Cassie Fulghum said the office will hold a news conference Thursday morning regarding several federal indictments and arrests.
The Wednesday morning raids
Two homes in Eagle, just west of North Locust Grove Road in Wedgewood Estates, were part of the raid. One home, on the corner of Pasa Tiempo Way and West Stafford Street, is owned by Pavel Babichenko and is worth about $983,200, according to the Ada County Assessor’s Office. The other home, across the street, is owned by Gennady Babichenko and is assessed at $802,440.
Three residents who live near the Babichenkos said they saw as many as 40 law enforcement vehicles, some unmarked, outside the two large homes as early as 8 a.m. Investigators appeared to be wrapping up their searches of the houses around noon. One neighbor said the Babichenkos have lived in the neighborhood for a dozen years.
Another raid occurred at a Boise commercial property, at 12586 W. Bridger St., with warehouses. A Boise Police Department mobile substation and evidence trailer were parked outside the building, located west of the West Family YMCA and Boise City Aquatic Center. Authorities wearing gloves were seen going in and out of the building.
The Babichenkos and others with that last name have owned or been listed as managers of dozens of businesses registered in Idaho in recent years. A man who gave his name as Paul Babichenko told the Statesman in 2006 that his family had been living in Idaho off and on for about 14 years, but originally hailed from Georgia, a country formerly part of the Soviet Union.
Sued twice over cellphone businesses
Pavel Babichenko was a co-defendant, along with other people with the last name Babichenko, in a 2006 lawsuit brought by Virgin Mobile. The company accused all of the defendants of participating in the “unlawful” buying and reselling of Virgin Mobile cellphones within the U.S. and abroad.
“Defendants are participants in a scheme wherein large quantities of Virgin Mobile-branded handsets are acquired for non-personal use, then resold in bulk for profit,” the lawsuit alleged.
That case settled, with Babichenko and the other defendants agreeing to never buy, resell, hack, repackage or distribute Virgin Mobile-branded phones.
Babichenko and several of the same people were sued again in 2009, by Tracfone Wireless. The lawsuit accused them of “unlawful business practices involving the unauthorized and unlawful computer unlocking or reflashing of TracFone/NET10 prepaid phones,” altering the software on the phone and “trafficking” the phones for profit.
“Defendants’ conduct, together with that of currently unknown civil and criminal co-conspirators, is causing TracFone to suffer millions of dollars in losses and has caused immediate and irreparable injury to TracFone,” the lawsuit said.
That case was settled in 2010. The terms were not public.
Numerous businesses, properties
There are 14 businesses located at the Bridger Street address that are owned by Pavel Babichenko, or others with that last name.
One of those businesses is Babichenko LLC, founded in 2005 by Pavel and Gennady Babichenko.
That business owns a $349,900 property on Cole Road in Boise. It also owned a piece of undeveloped land in Meridian worth at least $147,500 when it was sold in 2013 to another company.
In addition to the Ada County home, Pavel Babichenko owns a piece of property in Payette.
Gennady Babichenko owns properties in Canyon County worth at least $402,760, including properties that currently house a rental car business and a denture business.
Another business at the Bridger Street building is named SaharaCase. SaharaCase’s Facebook page includes a video, in which Peter Babichenko explains what the business does, asking for kickstarter funds, and it pictures the building that was raided Wednesday.
The SaharaCase website names the founders of the company.
“Our founders, Peter, Paul, and Tim (Babichenko) were born into a large family in the country of Georgia, and immigrated to the U.S. in the 1980s. Entrepreneurs from a young age, they carried a spirit of work and innovation into the phone repair industry, where they learned how and why phones break,” according to the website.