Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce that Pasquale Pappalardo, 60, of Coral Springs, Florida, and Audwin Lovinsky, 35, of Tamarac, Florida, were both convicted yesterday in federal court in Fort Lauderdale of conspiracy to commit mail fraud and wire fraud, in violation of Title 18, United States Code, Section 1349. Pappalardo was also convicted of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956. After the verdicts, defendants were remanded to the custody of the Bureau of Prisons. Defendants are scheduled to be sentenced on January 29, 2014.
In all, 41 defendants were charged for their involvement with a time-share resale telemarketing room called Timeshare Mega Media and Marketing Group Inc. (TMMMG). The other defendants were charged in Case Nos. 11-60190-Cr-Cohn, 11-60247-Cr-Marra, 11-60268-Cr-Hurley, 12-60019-Cr-Scola, 13-60049-Cr-Dimitrouleas, 12-60149-Cr-Scola, 13-60154-Cr-Scola, and 13-60155-Cr-Dimitrouleas. Aside from the two defendants who were found guilty yesterday, 36 defendants previously pled guilty, two remain fugitives, and one is deceased.
According to the evidence presented at trial, in February 2009, Pasquale Pappalardo, also known to the witnesses as “Patsy Ubatz” and “Posh,” and Joseph Crapella, also known to witnesses as “Joey Cigars,” started a branch office of Time Share Market Pro (TMP), a timeshare resale business. The testimony at trial was that they knew each other from a previous stint in federal prison. In June 2009, at the direction of Pappalardo and Crapella, their associates took customer files and the electronic database of TMP, among other items, without the knowledge of the owner of TMP.
Pappalardo and Crapella then took the employees and the documents seized from TMP and formed a second time share resale company called TMMMG. In November 2009 and January 2010, TMMMG hired salesmen who worked for other fraudulent telemarketing resale companies, including defendant Lovinsky, who used the phone name of Edwin Lovins. Among the lies they would tell timeshare unit owners was that they had sold their timeshare units and that they needed to pay a refundable fee to secure the sales. The salesmen would then ask the timeshare unit owners for a fee of at least $1,996 and as much as $10,000. At no time were there any buyers for the timeshare units. The testimony at trial was that both Pappalardo and Crapella were told about the lies being told by the salesmen, but Pappalardo and Crapella would not do anything to stop the salespeople from lying.
During the 10 months that TMMMG was in business, it fraudulently obtained approximately $5,000,000 from about 3,000 customers. Pappalardo received at least $300,000 in checks and hundreds of thousands of dollars in cash from the money sent by victims of TMMMG.
Pappalardo faces a maximum sentence of 40 years in prison and a fine of up to the greater of $750,000 or twice the gross gain or twice the gross loss. Lovinsky faces a maximum sentence of 20 years in prison and a fine of up to the greater of $250,000 or twice the gross gain or twice the gross loss.
Mr. Ferrer commended the investigative efforts of the FBI in connection with the investigation of this matter. Mr. Ferrer would also like to recognize the assistance provided by the Fort Lauderdale Police Department, the Federal Trade Commission, and the Broward Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Jeffrey N. Kaplan.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls.
Showing posts with label telemarketing fraud. Show all posts
Showing posts with label telemarketing fraud. Show all posts
Friday, November 22, 2013
Wednesday, September 25, 2013
Telemarketer Sentenced in Manhattan Federal Court to 75 Months in Prison for Sweepstakes Fraud That Targeted Elderly Victims
Preet Bharara, the United States Attorney for the Southern District of New York, and George Venizelos, the Assistant Director in Charge of the New York Office of the Federal Bureau of Investigation (FBI), announced that WARREN STELMAN, a/k/a “Dave Ford,” was sentenced today to 75 months in prison for his participation in a Dominican-based telemarketing fraud scheme that targeted elderly victims throughout the United States and defrauded those victims of nearly $1 million. STELMAN was arrested in the Dominican Republic in August 2012 and was subsequently extradited to the United States. He pled guilty in January 2013 to one count of wire fraud. Today’s sentence was imposed by U.S. District Judge Lewis A. Kaplan.
Manhattan U.S. Attorney Preet Bharara said: “Warren Stelman admitted scheming in the Dominican Republic to fleece elderly people in the U.S. His pitch, dangling fictitious sweepstakes winnings, was persuasive enough to victimize many of these people repeatedly. Today he has been ordered to pay for his crime against these vulnerable victims in money and time.”
FBI Assistant Director in Charge George Venizelos said: “The defendant hid behind his telephone to prey upon his victims, many of whom were elderly, with promises of money and prizes. Although the victims never met the defendant, they relied upon his representations of wealth and in exchange, turned over their hard earned money. This case should be a reminder to the public to be cautious of get-rich-quick opportunities, many of which are merely schemes to defraud and take advantage of our unsuspecting community.”
According to the indictment and other documents filed in Manhattan federal court, as well as statements made in court proceedings:
STELMAN and his co-conspirators, including his wife Lana Stelman, operated boiler rooms in the Dominican Republic, from which they telephoned victims in the United States, most of whom were elderly. They informed the victims falsely that they had won substantial amounts of cash through a sweepstakes or some other type of promotion, but that in order to claim their prize, they first needed to wire thousands of dollars in “fees” to the Dominican Republic. In reality, however, there were no cash prizes, neither STELMAN nor his co-conspirators worked in connection with a sweepstakes or other promotion, and none of the victims ever received any money in exchange for their fees.
The victims were typically told to send the money for the purported fees by, among other means, Western Union or Money Gram. After victims sent money to cover the supposed fees, STELMAN and his co-conspirators typically contacted them again and, using further fraudulent representations, persuaded them to send more money to pay for other costs. In some instances, when victims said that they had run out of money to pay additional fees, STELMAN and his associates urged the victims to come up with more money by borrowing from friends and relatives, taking cash advances on credit cards, and obtaining loans against their homes and vehicles.
The fraudulent scheme targeted U.S. residents who had previously subscribed to sweepstakes. STELMAN and his co-conspirators identified these victims by purchasing from U.S.-based brokers copies of sweepstakes entry forms the victims had previously filled out. These entry forms, which the conspirators referred to as “leads,” were typically written on narrow slips of paper that included the names, addresses, and telephone numbers for sweepstakes entrants. The conspirators used various Internet-based phone methods to mask their locations and identities, and communicated with the victims through numbers assigned to voice-mail boxes located in Manhattan. In total, 78 victims—54 of whom were over the age of 70—were defrauded out of nearly $1 million.
Four other defendants—Lana Stelman, Romeo Rawlins, Juana Santana, and Lickenson Brooks—were also charged for their participation in the scheme. Lana Stelman and Brooks pled guilty and are awaiting sentencing. Charges remain pending against Rawlins and Santana, and they are presumed innocent until and unless they are proven guilty.
In related cases, Janice Pemberton, Peter Gruman, Randy Ortzman, and Avraham Fried were charged with participating in similar telemarketing fraud schemes from the Dominican Republic. All of these defendants have pled guilty. Fried was sentenced on September 10, 2013 by U.S. District Judge William H. Pauley to 44 months in prison. Pemberton, Gruman, and Ortzman are awaiting sentencing.
Mr. Bharara praised the outstanding investigative work of the FBI.
The prosecution of this case is being handled by the Office’s Complex Frauds Unit. Assistant United States Attorneys Thomas G.A. Brown and Rosemary Nidiry are in charge of the prosecution.
Manhattan U.S. Attorney Preet Bharara said: “Warren Stelman admitted scheming in the Dominican Republic to fleece elderly people in the U.S. His pitch, dangling fictitious sweepstakes winnings, was persuasive enough to victimize many of these people repeatedly. Today he has been ordered to pay for his crime against these vulnerable victims in money and time.”
FBI Assistant Director in Charge George Venizelos said: “The defendant hid behind his telephone to prey upon his victims, many of whom were elderly, with promises of money and prizes. Although the victims never met the defendant, they relied upon his representations of wealth and in exchange, turned over their hard earned money. This case should be a reminder to the public to be cautious of get-rich-quick opportunities, many of which are merely schemes to defraud and take advantage of our unsuspecting community.”
According to the indictment and other documents filed in Manhattan federal court, as well as statements made in court proceedings:
STELMAN and his co-conspirators, including his wife Lana Stelman, operated boiler rooms in the Dominican Republic, from which they telephoned victims in the United States, most of whom were elderly. They informed the victims falsely that they had won substantial amounts of cash through a sweepstakes or some other type of promotion, but that in order to claim their prize, they first needed to wire thousands of dollars in “fees” to the Dominican Republic. In reality, however, there were no cash prizes, neither STELMAN nor his co-conspirators worked in connection with a sweepstakes or other promotion, and none of the victims ever received any money in exchange for their fees.
The victims were typically told to send the money for the purported fees by, among other means, Western Union or Money Gram. After victims sent money to cover the supposed fees, STELMAN and his co-conspirators typically contacted them again and, using further fraudulent representations, persuaded them to send more money to pay for other costs. In some instances, when victims said that they had run out of money to pay additional fees, STELMAN and his associates urged the victims to come up with more money by borrowing from friends and relatives, taking cash advances on credit cards, and obtaining loans against their homes and vehicles.
The fraudulent scheme targeted U.S. residents who had previously subscribed to sweepstakes. STELMAN and his co-conspirators identified these victims by purchasing from U.S.-based brokers copies of sweepstakes entry forms the victims had previously filled out. These entry forms, which the conspirators referred to as “leads,” were typically written on narrow slips of paper that included the names, addresses, and telephone numbers for sweepstakes entrants. The conspirators used various Internet-based phone methods to mask their locations and identities, and communicated with the victims through numbers assigned to voice-mail boxes located in Manhattan. In total, 78 victims—54 of whom were over the age of 70—were defrauded out of nearly $1 million.
***
In addition to the prison term, Judge Kaplan sentenced STELMAN, 54, of the Dominican Republic, to three years of supervised release. STELMAN was also ordered to forfeit $996,659.30 and to pay a total of $996,659.30 in restitution to 78 victims.Four other defendants—Lana Stelman, Romeo Rawlins, Juana Santana, and Lickenson Brooks—were also charged for their participation in the scheme. Lana Stelman and Brooks pled guilty and are awaiting sentencing. Charges remain pending against Rawlins and Santana, and they are presumed innocent until and unless they are proven guilty.
In related cases, Janice Pemberton, Peter Gruman, Randy Ortzman, and Avraham Fried were charged with participating in similar telemarketing fraud schemes from the Dominican Republic. All of these defendants have pled guilty. Fried was sentenced on September 10, 2013 by U.S. District Judge William H. Pauley to 44 months in prison. Pemberton, Gruman, and Ortzman are awaiting sentencing.
Mr. Bharara praised the outstanding investigative work of the FBI.
The prosecution of this case is being handled by the Office’s Complex Frauds Unit. Assistant United States Attorneys Thomas G.A. Brown and Rosemary Nidiry are in charge of the prosecution.
Monday, September 16, 2013
Three Las Vegas Residents Charged with Telemarketing Fraud in Association with Prosmising Grants to Small Business Owners
LAS VEGAS—Three Las Vegas residents have been indicted by the federal grand jury for allegedly defrauding almost 400 persons of over $5 million in connection with a grant funding telemarketing scheme, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Gregory Villegas, aka Ray Matsui, aka Ray Mathis, 34; Christine M. Gagnon, aka Lisa Foster, aka Crystal Waters, 33; and Mickey Gines, 40, all of Las Vegas, are each charged with one count of conspiracy to commit wire fraud in connection with telemarketing, and 31 counts of wire fraud. They were arrested in Las Vegas this morning and are scheduled to make initial appearances in court today before United States Magistrate Judge George Foley, Jr. at 2:30 p.m.
According to the court records, Villegas owned and controlled Executive Solutions Inc. in addition to Business Funding Services Enterprises; BFS Enterprises; Global Business Funding Inc.; The Grant People; USA Grant Team; USA Grants; National Financial Advisors; U.S. Filing Services Inc.; U.S. Filings Service Inc.; USFS Inc.; Echoe Inc.; Worldwide Asset Management; Corporate Capital Team; Business Acumen; and Kuff Ltd.
These companies were allegedly involved in the business of grant funding. Gagnon and Gines were officers in some of the companies and were also listed as employees in other grant funding companies that they or Villegas owned or controlled. Beginning in about March 2008 and continuing through May 2, 2012, Villegas, Gagnon, Gines, and others engaged in a telemarketing scheme to defraud persons of their money, including at least 10 victims over the age of 55. The defendants employed sales staff to place telemarketing calls and operate websites for the purpose of soliciting fees from small business owners who wished to obtain private and government grants. The defendants and staff allegedly used high pressure sales and lulling tactics and made many types of false statements to customers concerning their ability to deliver grants, when the defendants knew that their true intent was to obtain as much money as possible from the customers, rather than assist them in obtaining grants, and knew that none of their customers had ever received a grant.
In order to avoid lawsuits and detection by law enforcement, the defendants operated their companies under multiple and evolving names and directed their staff to use aliases which they routinely changed in communications with the customers. When the grants failed to materialize, the defendants and staff falsely represented to customers that they were only collecting money for other companies or that delays in funding were caused by circumstances beyond the defendants’ control. In some instances, the defendants agreed to provide partial refunds to customers and fraudulently required the customers to sign release forms stating that the defendants had not engaged in any wrongdoing.
The indictment alleges that through this scheme, the defendants victimized approximately 390 persons throughout the United States, 10 of whom were over the age of 55, and obtained approximately $5.2 million in fraudulently obtained funds.
If convicted, they face up to 30 years in prison on the conspiracy count, plus up to 10 consecutive years for telemarketing to 10 or more persons over the age of 55, and up to 30 years in prison on each wire fraud count, as well as fines of up to $250,000 per count.
The case was investigated by the United States Secret Service and FBI and is being prosecuted by Assistant U.S. Attorney Christina M. Brown.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
An indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to fair trials at which the government has the burden of proving guilt beyond a reasonable doubt.
Gregory Villegas, aka Ray Matsui, aka Ray Mathis, 34; Christine M. Gagnon, aka Lisa Foster, aka Crystal Waters, 33; and Mickey Gines, 40, all of Las Vegas, are each charged with one count of conspiracy to commit wire fraud in connection with telemarketing, and 31 counts of wire fraud. They were arrested in Las Vegas this morning and are scheduled to make initial appearances in court today before United States Magistrate Judge George Foley, Jr. at 2:30 p.m.
According to the court records, Villegas owned and controlled Executive Solutions Inc. in addition to Business Funding Services Enterprises; BFS Enterprises; Global Business Funding Inc.; The Grant People; USA Grant Team; USA Grants; National Financial Advisors; U.S. Filing Services Inc.; U.S. Filings Service Inc.; USFS Inc.; Echoe Inc.; Worldwide Asset Management; Corporate Capital Team; Business Acumen; and Kuff Ltd.
These companies were allegedly involved in the business of grant funding. Gagnon and Gines were officers in some of the companies and were also listed as employees in other grant funding companies that they or Villegas owned or controlled. Beginning in about March 2008 and continuing through May 2, 2012, Villegas, Gagnon, Gines, and others engaged in a telemarketing scheme to defraud persons of their money, including at least 10 victims over the age of 55. The defendants employed sales staff to place telemarketing calls and operate websites for the purpose of soliciting fees from small business owners who wished to obtain private and government grants. The defendants and staff allegedly used high pressure sales and lulling tactics and made many types of false statements to customers concerning their ability to deliver grants, when the defendants knew that their true intent was to obtain as much money as possible from the customers, rather than assist them in obtaining grants, and knew that none of their customers had ever received a grant.
In order to avoid lawsuits and detection by law enforcement, the defendants operated their companies under multiple and evolving names and directed their staff to use aliases which they routinely changed in communications with the customers. When the grants failed to materialize, the defendants and staff falsely represented to customers that they were only collecting money for other companies or that delays in funding were caused by circumstances beyond the defendants’ control. In some instances, the defendants agreed to provide partial refunds to customers and fraudulently required the customers to sign release forms stating that the defendants had not engaged in any wrongdoing.
The indictment alleges that through this scheme, the defendants victimized approximately 390 persons throughout the United States, 10 of whom were over the age of 55, and obtained approximately $5.2 million in fraudulently obtained funds.
If convicted, they face up to 30 years in prison on the conspiracy count, plus up to 10 consecutive years for telemarketing to 10 or more persons over the age of 55, and up to 30 years in prison on each wire fraud count, as well as fines of up to $250,000 per count.
The case was investigated by the United States Secret Service and FBI and is being prosecuted by Assistant U.S. Attorney Christina M. Brown.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF), which was created in November 2009 to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. Attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory, and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state, and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions, and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
An indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to fair trials at which the government has the burden of proving guilt beyond a reasonable doubt.
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