Serious Prison Time for Hackers Behind Wolf & Associates Breach

They Stole the Identities of 9,000 Santa Barbara Residents and Collected $2 Million in Bogus Unemployment Claims

Gordon Welterlen and Nicole Milan | Credit: SBSO Photos

A pair of habitual offenders behind one of the biggest data breaches in Santa Barbara County history pleaded guilty last week to multiple felony counts that will send them to prison for a combined 33 years. 

San Diego residents Gordon Welterlen, 37, and Nicole Milan, 31, admitted to hacking a computer network belonging to the Wolf & Associates Property Management company and stealing the identities of more than 9,000 clients. They used the information to file over 300 unemployment claims with the state and as a result collected more than $2 million that they spent on cars, including a Mercedes and two Jaguars, swanky apartments, and drugs. 

On March 19, Welterlen, who has a lengthy criminal history of fraud and theft and extensive illegal dealings on the “dark web,” will be sentenced to 18 years in prison. Milan, also with a long rap sheet, will be sentenced to 15 years. Their codefendant, a 40-year-old Santa Barbara woman named Rosa Bradley, will be given probation for two years for receiving some of the stolen money.

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Court records reveal the brashness with which Welterlen carried out the scheme. He boasts in text messages to a fourth accomplice named William Gormley, who remains at large, how easy it was for him to steal identities and create fake driver’s licenses. Gormley had thanked Welterlen for cutting him in on the action and showing him some of his tricks. “I was blessed with this ability to never be broke again,” says Welterlen. “So I figure pass it on to people like me who have been out there in the trenches taking chances for that check.” “Your [sic] so good to me,” Gormley responds. “Thank you man.”

When San Diego police, accompanied by Santa Barbara detectives, arrested Welterlen and Milan at an apartment complex in the Pacific Beach neighborhood, they noticed a computer at the residence was actively hacking an unknown server. They also found large quantities of heroin and methamphetamine.

In a phone conversation intercepted by officials at the Santa Barbara County Jail, Milan asks her mother to dispose of evidence at another friend’s house. She describes a box of cat food in a manner that suggests the box contains something other than cat food. “Throw it away,” Milan asks. “Okay, I got you,” her mother responds. Police were ultimately able to recover the evidence, which included fraudulent cashier’s checks and a laptop with files that further incriminated Milan.

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