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FIFTEEN DEFENDANTS CONVICTED IN $6 MILLION NATIONWIDE TELEMARKETING BOILER ROOM CASE

 SEATTLE, April 9 /PRNewswire/ -- U.S. States Attorney Mike McKay and Postal Inspector in Charge Gerald A. Miera announced today the sentencing of three more of the 15 individuals convicted for participating in a nationwide $6 million telemarketing "boiler room" fraud.
 Sentenced today before U.S. District Court Judge Thomas Zilly at Seattle were Dennis Hampton, age 36, of Houston; Larry Hampton, age 41, of Las Vegas; and Sadie Cassell, age 42, of Las Vegas. Larry Hampton, who pled guilty to one count of conspiring to commit mail and wire fraud on Jan. 13, 1993, was sentenced to one year, six months imprisonment to be followed by three years probation, and ordered to make restitution in the amount of $30,000. He was also fined $3,000. Dennis Hampton, convicted by a jury trial on 25 fraud counts on Jan. 29, 1993, was sentenced to seven years, seven months imprisonment to be followed by three years probation, and ordered to make restitution in the amount of $6 million. He was also fined $12,500. Cassell, who pled guilty to one count of conspiracy to commit mail and wire fraud on Jan. 13, 1993, was sentenced to one year, nine months imprisonment to be followed by three years probation, and ordered to make restitution in the amount of $50,000. She was fined $5,000.
 The victims were promised prizes ranging from a $3,000 cashier's check to a "beautiful" home entertainment center or executive whirlpool spa, to a new car in return for up to $999 for "taxes and handling charges." Victims who expressed any reservations about participating were told that the least valuable prize to be awarded was worth $3,000. Victims were told that their prize would be received within 10 to 21 working days.
 McKay advised that Dennis Hampton and Carol Kaplan, age 43, of Las Vegas, were the owners and operators of fraudulent telemarketing "rooms" located in Seattle, Las Vegas, Los Angeles and Chicago. The Seattle "rooms" operated under the names North Pacific Brokers and Worldwide Shipping and Supply in 1988 from offices at 1516 2nd Ave., Suite 410. During the years 1987 and 1988, this fraudulent operation defrauded thousands of victims of more than $6 million.
 Hampton and others involved in the fraudulent promotion created sales presentations called "pitch sheets" which were distributed to new employees. Using the pitch sheets, employees called potential victims, who were usually owners of small businesses and senior citizens. The victim was advised that because of his past purchase of advertising specialty items, such as pens or key chains, he had been placed in a promotion and was a guaranteed winner of one of five valuable prizes.
 In fact, Miera said, an investigation begun by Postal Inspectors in 1988 and expanded in 1990 to include the Federal Bureau of Investigation and the U.S. Secret Service showed the defendants operated the sham businesses solely to obtain victims' money without any intention of providing valuable awards. Those victims who sent in money received, if anything, cheap, inexpensive items such as costume jewelry, water purifiers and money clips, or a battery- operated "home spa," for use in a bathtub, worth approximately $50.
 McKay advised that promoters followed a pattern of "reloading" victims who had "taken the bait" and sent in money to claim a prize. Victims were contacted again and again under the guise they were "double bonus" winners eligible for two valuable prizes. Usually, a reloader solicited between $600 and $999 from the victim to cover "taxes," "shipping," and other purported expenses associated with the award or awards. Some victims were reloaded in excess of 10 times but failed to receive any item or award which approximated the amount of money sent to claim the "valuable award." One small business owner from Everett, Wash. sent in more than $40,000 to claim purportedly valuable prizes.
 "This investigation just kept growing with more `players,' phony companies and business locations identified as we developed the case. But the bottom line was -- no matter what the name or the pitch -- this promotion remained all sizzle and no steak. There was no substance behind the hype, just hot air," Miera said.
 Miera cautioned consumers to be wary of any promotion advertised through the mail, by newspaper, television or telephone which requires money be paid "up front" to qualify for a "guaranteed award." "Honest businesses simply don't require the winner to pay anything to get the prize. The only guarantee I give in cases like this is people sending money to a voice on the telephone are going to get taken," Miera said.
 A summary of 14 persons convicted and sentenced is given below. Victor Abernathy, age 33 of Tacoma, Wash., has been convicted and is awaiting sentencing.
 Name Age Town Sentence Prison Prob Restitution
 Donald Allen 21 Las Vegas 2/19/93 4 mos. 3 yrs. $25,000
 Sadie Cassell 42 Las Vegas 4/9/93 1.75 yrs. 3 yrs. 50,000
 James Corbell 24 Las Vegas 2/1/93 1 yr. 3 yrs. 30,000
 Larry Hampton 41 Las Vegas 4/9/93 1.5 yrs. 3 yrs. 30,000
 Floyd Henderson30 Las Vegas 3/26/93 5 yrs. 10,000
 Efrem Lambert 27 Las Vegas 3/19/93 2 yrs. 3 yrs. 100,000
 Mark Massagee 25 Las Vegas 3/19/93 3 mos. 0 20,000
 Daniel Medve 25 Las Vegas 3/19/93 5 yrs. 25,000
 Donald Medve 24 Las Vegas 3/19/93 10 mos. 3 yrs. 50,000
 Perry Pearson 27 Las Vegas 2/19/93 5 yrs. 176,000
 Lou Raschilla 52 Reno, NV 2/19/93 1 mo. 5 yrs. 25,000
 Keith Schmidt 28 Las Vegas 2/12/93 5 yrs. 25,000
 Carol Kaplan 43 Las Vegas 3/26/93 4 yrs. 3 yrs.6,000,000
 Dennis Hampton 36 Houston 4/9/93 7.25 yrs. 3 yrs.6,000,000
 -0- 4/9/93
 /CONTACT: G.A. Miera of the U.S. Postal Inspection Service, 206-442-6324/


CO: U.S. Postal Inspection Service ST: Washington, Nevada IN: SU:

MS-LS -- LA015 -- 4643 04/09/93 21:22 EDT
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Date:Apr 9, 1993
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