As a part of an ongoing investigation by the U.S. Secret Service, six former servers at high-end Washington D.C. and Maryland restaurants were arrested last week for allegedly copying customers’ credit card data in a year-long counterfeiting operation that has resulted in over $750,000 in fraudulent charges.

Past servers of M & S Grill, Clyde’s of Gallery Place and 701 Restaurant in D.C. and of Carrabba’s Italian Grill and the Gaylord Hotel in Maryland were charged with using “skimming devices,” which copy credit card data and are small enough to fit in an average pocket, then allegedly selling the information to 28-year old Joseph Artemus Bush III of Maryland and his two alleged accomplices, Aarron Gilbert and Erick Burton, according to Wired.

Bush, Gilbert and Burton allegedly used the data to make counterfeit credit cards, which they then used at stores such as Target and Wal-Mart to buy American Express gift cards. They then redeemed the gift cards at upscale stores like Barney’s and Gucci. All three were charged with credit card fraud after Bush was caught on surveillance videos using the counterfeit credit cards.

According to Claude Anderson, corporate operations manager of Clyde’s Restaurant Group, Clyde’s was first notified about the issue a year ago when the Secret Service approached the management concerning a chain of fraudulent transactions found following a customer’s legitimate use of a credit card at Clyde’s. The Secret Service wanted information from the management to help them to trace stolen data back to a specific server or servers.

“Every employee has a unique number they put into the register before ringing up a charge,” Paul Walker, manager of Clyde’s, told The Examiner. “With that system in place, we can point back to an employee very quickly. … It’s very traceable.”

Anderson said the guilty server stopped showing up to work shortly after the Secret Service contacted Clyde’s. In the end, the former Clyde’s server had skimmed enough credit cards to account for $107,000 of fraudulent charges.

“It was pretty embarrassing to have that staff member [commit credit card fraud]. . Since then we have been very diligent in following around our staff,” Anderson said. “We take it all pretty seriously. The security of our guests and their private information is very important to us.”

After several similar complaints of fraudulent charges from credit card companies, Secret Service Special Agent Philip Soto eventually discovered a pattern of charges leading back to the specific servers and to Bush, Gilbert and Burton, according to WTOP.

701 Restaurant owner Ashok Bajaj said he was informed in early March that one of 701’s servers, Lavelle Payne, was suspected of credit card skimming.

“She was only employed here two and a half months and the Secret Service had been on to her,” Bajaj said.

Cards Payne handled in August 2008 had a total of $38,000 in fraudulent charges.

“[Credit card fraud] is a big issue,” Anderson said. “[Clyde’s has] looked at other technology to prevent this from happening again. Because we were warned a year ago, we are probably one of the safest places to use a credit card now.”

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