US Sprint Sues ‘Ring’ of Hackers for $20 Million : Telephone Firm Says Stolen Codes Were Resold Nationally
US Sprint said Friday that it has filed three lawsuits seeking more than $20 million for losses from a multistate ring of computer hackers who allegedly stole long-distance telephone service using illegally obtained authorization codes.
The complaints, filed Thursday in U. S. district courts in Los Angeles, Seattle and Kansas City, Mo., are evidence of yet more woes plaguing the fast-growing long-distance telephone company.
Kansas City-based Sprint, a joint venture of GTE Corp. and United Telecommunications Inc., has been plagued by thousands of customer-billing problems that contributed to a $76-million loss in its second quarter and the departure of the firm’s president.
Sprint spokesman Syd Courson said the alleged ring used computer equipment to identify Sprint long-distance authorization codes, the numbers that customers dial in some circumstances to use the long-distance system.
$20 Million in Calls
Once the ring obtained the codes, Courson said, it placed more than $20 million worth of long-distance calls on the Sprint network, with the calls billed to the parties actually assigned the codes. Some of the stolen codes were sold to business users through elaborate marketing programs, he said.
Defendants named in the lawsuits include Gyan P. Syal and Karlheinz Mueller of the Los Angeles area; Paul Lindahl, Ralph Purdy III and Kenneth J. Sheridan, all of the San Francisco area, and Frederick M. Deneffe III and Burton Leroy Andrews of the Portland, Ore., area, Sprint said.
The defendants allegedly conducted business under various company names, including Unitel Systems, California Discall and Hello America, the suit charged. Criminal charges previously were filed against some of the defendants by federal authorities, Sprint said.
Long-distance theft costs the entire industry more than $500 million a year, Sprint said.
