North Carolina Division of Aging and Adult Services
TO NC SENIOR CONSUMER FRAUD TASK FORCE MEMBERS
Feds Go After U.S. Sweepstakes Mailings Firm, Dominican Republic Sweepstakes Fraud Ring
Two important court actions involving alleged sweepstakes scammers have just been announced.
Case #1. The Federal Trade Commission announced yesterday that a federal court granted it an order shutting down and freezing the assets of a Nevada company, Applied Marketing Sciences, LLC, that allegedly mailed millions of deceptive notices to people in the U.S. and around the world informing them that they had won a sweepstakes or other contest. The Commission’s announcement of the court filing reads, in pertinent part:
According to the FTC’s complaint, Liam O. Moran, a resident of Ventura, California, and his companies, mass mail personalized letters to millions of consumers telling them that they have won a large cash prize, typically more than $2 million with bold, large-type statements such as “Over TWO MILLION DOLLARS in sweepstakes has been reserved for you.” Consumers are told that they can collect the prize by sending in a small fee of approximately $20 to $30. The letters often indicate that recipients are “guaranteed” to receive the prize money if they pay the fee, and they create a sense of urgency by stating that it is a limited-time offer.
As has been mentioned in previous Alerts, the names and contact information of people who respond to such mailings often go on lists that are sold to sweepstakes scammers based overseas. Those scammers extract large sums from their victims. (See Case #2, below)
Case #2. Also yesterday, the U.S. Attorney in New York City and the Assistant Director in Charge of that city’s FBI office announced that a telemarketer from the Dominican Republic, Warren Stelman, a/k/a David Ford, had been sentenced to a prison term of 6.25 years by a federal judge for defrauding U.S. seniors with claims that they had won a sweepstakes contest and needed to wire substantial sums of money to the Dominican Republic in order to collect their prize. Whenever a senior wired thousands of dollars to the Dominican Republic in response to those representations, Stelman and his colleagues would call again and inform him or her that additional fees and payments needed to be sent before the prize could be released. They told the victims to go back to the Western Union or MoneyGram counter at their local store and send thousands more. The court also sentenced Stelman to three years of probation and ordered him to make restitution to 78 victims in an amount just under one million dollars. Several other defendants have been charged in the case, have pled guilty and are awaiting sentencing. The U.S. Attorney’s announcement of Mr. Stelman’s sentence can be found at http://www.fbi.gov/newyork/press-releases/2013/telemarketer-sentenced-in-manhattan-federal-court-to-75-months-in-prison-for-sweepstakes-fraud-that-targeted-elderly-victims?utm_campaign=email-Daily&utm_medium=email&utm_source=fbi-in-the-news&utm_content=261986
******End of Alert******
Date: September 25, 2013
David N. Kirkman
NC Senior Consumer
Fraud Task Force
Trade Commission Alerts