A young fraudster who swindled 13 victims out of more than $200,000 was staying, under court order, at a Grace Foundation drug rehab facility when the sophisticated scheme was executed.
Ethen Brian Parks, then 20, concocted the “smishing” scam in 2022 to fund a methamphetamine habit that had been getting steadily worse since age 15.
His victims ranged from a grandmother who was left with just $15 in her account after she had been saving up to visit family to a pregnant woman who had set aside money for house payments during her upcoming maternity leave.
The scams were linked to Parks following a global sting involving a subscription-only website catering to criminals.
Despite squandering his time at the Grace Foundation, the now-23-year-old has matured and made good progress towards rehabilitation in the four years since then, his lawyer said recently as Parks was sentenced out of Auckland District Court for the now somewhat dated fraud charges.
Those recent years have been spent in prison, serving a sentence for an unrelated aggravated robbery conviction.
Lawyer Annabel Cresswell asked Judge Simon Lance for mercy, particularly in light of her client having recently been recognised for his hard work by having the Parole Board vote for his early release for the robbery charge.
Despite that decision, he remained in prison awaiting the outcome of his fraud case.
“He’s on his journey to recovery,” she said. “He’s worked hard in prison.”
But after reading statements from many of Parks’ victims, the judge said there had to be consequences for the harm he caused.
He ordered 17 months to be tacked on to the end of his existing sentence.
“Obviously, it’s for the Parole Board to then calculate the appropriate parole date [in light of the new sentence],” the judge said. “It’s not something I do.”
The scheme involved multiple people, but according to court documents, Parks was the person who organised it and did much of the legwork.
Parks started out by subscribing to LabHost – a now-defunct website that made it possible for scammers with little technological savvy to send out fake text messages designed to mimic real businesses while, in actuality, luring victims to identity theft websites.
The founder of LabHost, Zak Coyne, 25, was sentenced in the United Kingdom in April last year to eight and a half years’ imprisonment.
He was arrested following an international investigation involving law enforcement from 19 countries, including New Zealand.
It was believed thousands of criminals had coughed up a large subscription fee, enabling them to victimise over a million people in 91 countries, according to European law enforcement agency Europol.
After gaining access to the company’s servers, authorities appeared to revel in the goldmine of data they uncovered - taking the unusual step of trolling customers to let them know a crackdown was underway.
A message on the homepage of the website was endorsed with logos for New Zealand Police, the FBI, the UK’s Metropolitan Police Service and others.
Users were also sent a personalised 90-second “wrapped” video, cheekily mimicking year-end recaps made popular by music streamer Spotify and social media sites – but in this case to highlight some of the evidence authorities had gathered against each person.
It included how much money the user had paid the service, a list of the fake websites they most often used and the countries where they were most active.
In April 2024, New Zealand authorities announced numerous search warrants after identifying three locals suspected of having used the website.
Parks was able to send out text messages purporting to be from banks BNZ and ANZ, as well as the Inland Revenue Service.
Most messages from the banks preyed on victims’ existing fears of fraud to perpetrate the theft. Messages would state that unusual activity was detected and offer a link to a seemingly legit bank website to resolve the issue.
At least one text added another layer of seeming legitimacy, suggesting the recipient call the number on the back of their card or on the bank website – both of which would have stopped the scam in its tracks if followed through. But the text also offered a hotlink to a fraudulent 0800 number, with Parks hoping victims would opt for that shortcut.
“I’ve seen copies of the messages,” Judge Lance noted. “They appear very genuine.”
After fraudulently harvesting the data, Parks coordinated with others to withdraw cash from the accounts and serve as money mules.
In total, he was able to steal $213,595 over the course of about four months.
Many victims eventually received partial reimbursements from their banks, but only after months of stress in which some were initially told it was their fault and there was no financial redress available, they told the court.
Judge Lance reviewed each fraud individually, summarising the many victim impact statements as he did so. They included man who was managing his 90-year-old mother’s account when he clicked on a link, resulting in $77,000 being transferred out of the account. BNZ was able to recover $53,000, leaving him out of pocket for the rest.
A 64-year-old retiree who clicked on a fake IRD refund text before being directed to a fake KiwiBank website, told the court the scam “destroyed her trust in anything online and in herself”. The money had been set aside for visiting her children and grandchildren, but her account was cleaned out of all but $15.
Others included a university student already on a tight budget, a woman about to give birth who lost $28,000 that had been saved up for living expenses and house payments while on maternity leave, and a businessman who recalled a “long and miserable” 10-month fight for reimbursement from the bank after a nearly $20,000 loss caused a major disruption to his company.
“I’m not easily duped, but the sophistication of this scam has made me feel vulnerable,” the businessman said.
Parks faced up to seven years’ imprisonment for six representative charges of causing loss by deception and two counts of obtaining by deception.
Because he was still serving his other sentences, a cumulative term was required by law.
Crown prosecutor Amelia Mateni suggested a starting point of between three-and-a-half and four years, with an end sentence of around two years when factoring personal and aggravated and features, as well as a modest discount for his existing prison term.
She emphasised the magnitude and sophistication of the scheme.
Cresswell suggested a vastly different starting point of one year for her client, citing Parks’ “exceptional” parole hearing just two days earlier. He’s already served a long time in prison for someone so young, she argued.
“I’m trying to avoid a crushing sentence for a young man,” the defence lawyer said. “Had he been sentenced on everything together, he could well be released into the community by now.”
Judge Lance noted that Parks had already accumulated an extensive adult criminal history of 23 convictions and had been assessed as having a moderate to high likelihood of reoffending.
He left school at 15, has never held a job for more than two weeks and has developed addictions to alcohol and gambling as well as methamphetamine.
The judge ordered a three-year starting point but allowed 45% in reductions for his background, addiction issues, youth, remorse and his guilty pleas. The sentence was increased by two months for having offended while at a bail facility but then reduced by five months to account for the sentence he’s already serving.
The judge noted an apology letter the defendant had addressed to the victims, in which he commented that he did not at the time of offending think he would cause any more than an inconvenience as victims waited to be reimbursed by their banks.
“Perhaps, now having heard the victim impact, you might revise that view,” the judge said.
Craig Kapitan is an Auckland-based journalist covering courts and justice. He joined the Herald in 2021 and has reported on courts since 2002 in three newsrooms in the US and New Zealand.
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