Bucks County Couple and Telemarketing Firm Agree to Pay Penalty to Resolve False Claims Act Allegations
PHILADELPHIA - U.S. Attorney William M. McSwain announced today that the United States filed a civil complaint against John Paul Ryan and Mary Motz Ryan, a married couple in Bucks County, Pennsylvania, and a telemarketing company that they operate together, Scholars in Print. The civil complaint alleges that they violated the False Claims Act by shipping unordered textbooks to the Federal Bureau of Prisons and demanding payment. Also today, the government filed a joint motion asking the court to enter a stipulated order and consent judgment to resolve the matter. The proposed resolution will require the court’s approval before it takes effect.
The government’s complaint alleges that Scholars and Print, acting through the Ryans, made unsolicited telemarketing calls to Bureau of Prisons facilities throughout the country in an attempt to sell textbooks for use in prison libraries. According to the complaint, most facilities said no, but Scholars in Print shipped textbooks anyway and then sent unpaid bills to collection agencies. When confronted, Scholars in Print allegedly stated that the facilities had ordered the textbooks during the telemarketing calls. The complaint alleges that those assertions were false. Other times, Scholars in Print allegedly offered to send the facilities a free sample, and then invoiced them—a classic bait and switch.
The complaint contains several examples of false claims. In one of them, a Bureau of Prisons official allegedly refused to purchase textbooks from Scholars in Print during an unsolicited telemarketing call. John Ryan allegedly hung up on him, prompting the official to email the company to confirm his refusal to order textbooks. A few weeks later, the company allegedly sent textbooks to the same official. During a subsequent call to report the delivery, Ryan allegedly described himself, falsely, as “Dr. Ryan, one of the volunteers here,” and falsely claimed to be “reading from a conversation” presumably documenting that the official had ordered the textbooks.
On another occasion, Ryan allegedly identified himself as Edward Teach—more famously known as Blackbeard, the eighteenth century pirate—and offered a free sample of textbooks to a prison psychologist. The complaint alleges that Ryan then invoiced the prison $331 for these “free” textbooks. According to the complaint, Ryan told investigators that he sometimes identified himself as Edward Teach during telemarketing calls because “you don’t want people to know your name.”
On still another occasion, Scholars in Print demanded that a prison facility pay $680.90 for textbooks that the facility did not order. This demand prompted the facility to send a letter asking the company to stop shipping books for review. Scholars in Print then sent the same facility additional books and an invoice demanding another $435.00.
If approved by the court, defendants will pay a civil penalty of $75,689 for submitting false claims. They will also refrain from marketing products to any federal agency through unsolicited communications or telemarketing.
“The False Claims Act is a powerful tool to stem the tide of fraud against the government, and the allegations in this complaint fall squarely in that category,” said U.S. Attorney William M. McSwain. “Those who try to cheat a federal agency out of taxpayer money will not get away with it, and this case demonstrates our Office is ready, willing, and able to put a stop to this kind of behavior.”
“The OIG is committed to investigating individuals who attempt to defraud taxpayers and the Bureau of Prisons. We will work tirelessly with our law enforcement partners to ensure those who try to cheat the system are held accountable,” stated Lewe F. Sessions, Special Agent-in-Charge of the U.S. Department of Justice Office of the Inspector General’s Fraud Detection Office.
Assistant U.S. Attorney Michael S. Macko handled the case, which arose from an investigation led by the U.S. Department of Justice, Office of the Inspector General.
The allegations against the Ryans and Scholars in Print are allegations only and not findings of liability.