A former U.S. Navy petty officer at Fort Worth's Joint Reserve Base accessed secret military databases and compromised the identities of 8,000 sailors and reservists, police said.
Investigators said the information was used to make fraudulent checks and identification cards. More than $1 million was stolen, police said.
"She worked in intelligence," said Euless police Lt. John Williams. "She had access to all the bank information."
Dixon was assigned to the Naval Air Station Joint Reserve Base Fort Worth but also stole personnel records from a military base in San Antonio, police said.
Police said the ringleaders spent the millions of dollars they stole at Dallas strip clubs and by living large.
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"They had Mercedes, BMWs, motorcycles (and) took trips to Vegas," Williams said. "They just blew the money like it was water. Of course, it wasn't their money, so it didn't matter."
Euless detectives investigated the ring for nearly two years, along with the U.S. Secret Service and the Naval Criminal Investigative Service.
Police described Dixon's boyfriend, Seneca Wills, as the group's ringleader.
Wills dropped by Dallas shelters to find homeless people to do the dirty work, investigators said.
"He took them to a motel, cleaned them up (and) took their pictures," Williams said. "He put their pictures on these fake IDs, gave them checks and then drove them around and had them cash the checks."
The investigation started in January 2007 almost by accident.
Irving police said Zachariah Long refused to move his car from a fire lane and was arrested. Police said officers found counterfeit checks and fake IDs inside his car.
Investigators stumbled across more fake identification in a shoe box at a shoe store at Valley View Center in Dallas. It wasn't clear how it got there.
The investigation spiraled and eventually led to more than 70 suspects, many of them homeless people who were used to cash the checks, investigators said.
Angel Mitchell, a former Bank of America teller, was also arrested. Police said she gave ring members confidential bank account information. She accepted $100 per account, investigators said.
Bank auditors discovered her computer login had been used to access a number of compromised accounts, police said.
The Joint Reserve Base, formerly known as Carswell Field, is an airfield run by the U.S. Navy in West Fort Worth.
Police said the identity theft ring was one of the largest ever discovered in North Texas.