The short and legendary computer hacking career of Edwin Andres Pena peaked around 2005, when he lived in an exclusive Miami neighborhood, drove souped-up cars and dropped bets in Atlantic City like a silk-suited high roller.
But those days were long over as Pena sat shackled Friday in yellow jail scrubs before a federal judge in Newark, waiting to hear his fate for masterminding a dizzyingly complex scheme to steal and resell internet telephone service.
“You were a crook,” said U.S. District Judge Susan D. Wigenton. “You were very intelligent about what you were doing. You bought world-class BMWs. You were gambling. You were flying. I hope you enjoyed it.”
Then Pena stood, and the judge sentenced him 10 years in prison, ending a ground-breaking cyber-crime case involving more than 10 million long-distance minutes, a 40-foot yacht and an international manhunt that concluded with a tip from a jilted lover.
At the center of it all was Pena, a 27-year-old self-taught computer virtuoso who grew in abject poverty in South America. After moving to Miami as a teenager, Pena learned the telecommunication business from a family friend. By the time he was 21, in 2003, Pena had figured out a way to leave the competition in the dust, authorities said.
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He took advantage of a growing trend of routing telephone calls over the Internet, rather than old-fashioned copper wires. Pena, a stout and dark-haired Venezuelan citizen, launched a company that brokered wholesale long-distance service. It is common for small firms to buy long-distance service for big carriers and resell it for a profit. But Pena was not buying it.
Instead, he enlisted a hacker who broke into legitimate internet phone providers and then routed calls Pena was selling through their systems.
By stealing long-distance service, Pena could sell minutes cheaper than anyone in the business. His victims — which include Net2Phone, a subsidiary of Newark-based IDT — lost more than $1.4 million in less than one year. The losses forced one firm out of business, authorities said.
Pena, meanwhile, lived like a playboy in Miami. He bought real estate, a 40-foot Sea Ray Mercruiser, a 2005 Cadillac Escalade SUV and two BMWs, including one he gilded with $83,000 in modifications. “He didn’t care about the money because it wasn’t his. Money grows on trees when you steal,” said Erez Liebermann, an assistant U.S. attorney.
But Pena’s world collapsed in 2006, after the telecom firms noticed his scheme and called investigators. He was charged by federal prosecutors in New Jersey, marking the first time authorities charged someone with this type of theft of internet phone service, authorities said.
When he posted bail, Pena complained the electronic monitoring device chafed his ankle. So he convinced his girlfriend and her mother to post their homes in Florida as extra collateral. Then Pena fled the country, and the government filed an order for his girlfriend and her mother to forfeit their homes.
For three years, the FBI and U.S. Marshals chased Pena across South and Central America. Finally, they landed a tip from another of Pena’s girlfriends in Mexico who was angry he had been unfaithful, authorities said. After eight months in a Mexican jail, Pena was extradited to New Jersey and pleaded guilty. Eventually, he faces deportation.
“Mr. Pena is resourceful and intelligent and he is going to channel that into something productive after he finishes prison,” said Mike Chazen, his lawyer.