2 charged in "Screwber" app scheme over ride-share drivers collecting fake surge fees, prosecutors say

NEW YORK -- Two men are facing charges for allegedly selling hacked smartphones to ride-share drivers so they could rake in fake surge pricing fees and higher fares.

Eliahou Paldiel, 52, of Queens, New York, and Carlos Arturo Suarez Palacios, 54, of Brick Township, New Jersey, were indicted Wednesday on wire fraud and money laundering charges. 

The FBI and the U.S. Attorney for the Eastern District of New York say the men operated the scam for nearly six years, enlisting over 800 drivers, who earned more than $40 million.

According to court documents, the men compared their services to drugs, writing in a text message, "once you get into it you'll get withdrawals when you can't get your fix," and in another, "I get them hooked on the software, even a drug deal[er] throws in a few extra grams of weed in the beginning."

GPS spoofing and "Screwber" app

Paldiel and Suarez allegedly sold drivers cellphones that had been "jailbroken" or "rooted" to bypass the latest security updates. This way, they could install a fake GPS app to make it seem like drivers were in areas with surge pricing when they were not.

They are also accused of installing a so-called "Screwber" app that let drivers cherry-pick more lucrative rides. 

The duo allegedly told drivers how to avoid detection, with instructions like, "Using 2 iphones with FakeGPS is very very risky. If you need FakeGPS for airport I recommend doing it one time a day. Do it when you wake up in the morning before you go to the airport."

It's unclear exactly how much they made from the scheme, but investigators say it was upwards of $1.5 million. If convicted, they face up to 20 years on each count.