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Justice News

Department of Justice
U.S. Attorney’s Office
District of Minnesota

FOR IMMEDIATE RELEASE
Wednesday, October 28, 2020

Sixty Defendants Charged In $300 Million Nationwide Telemarketing Fraud Scheme

More than 150,000 elderly, vulnerable victims nationwide targeted by criminal conspiracy

United States Attorney Erica H. MacDonald today announced three separate indictments charging 60 defendants for their roles in a $300 million nationwide telemarketing fraud scheme that targeted elderly and vulnerable victims. The charges include conspiracy, mail fraud, wire fraud, and violating the Senior Citizens Against Marketing Scams Act of 1994 (the “SCAMS Act”). The defendants are located in 14 states, 16 judicial districts, and two Canadian provinces.

“This case represents the largest elder fraud scheme in the nation. More than 150,000 elderly and vulnerable victims across the United States have been identified in what is essentially a criminal class action,” said United States Attorney Erica H. MacDonald. “Unfortunately, we live in a world where fraudsters are willing to take advantage of seniors, who are often trusting and polite. It’s my hope that this prosecution is a call for vigilance and caution. Combatting elder fraud and abuse is one of the Justice Department’s top priorities and I applaud our investigative partners for their grit and dedication in tackling, at the systemic level, this widespread fraud.”

“The thieving greed of fraudsters who target senior citizens knows no bounds,” said FBI Minneapolis Special Agent in Charge Michael Paul. “Using a tactic like telemarketing magazine sales, these deceitful scam artists bilk hard earned money from their aging victims – leaving so many financially devastated in their retirement years and without recourse for recovery. The FBI is working intently to help ensure our elderly fellow citizens are protected and not defrauded.”

“When the U.S. Mail is used for the purposes of committing fraud, and in this case, a particularly insidious type of fraud- elder fraud, it's the job of the Postal Inspection Service to aggressively investigate and ensure America's confidence in the integrity of the U.S. Mail,” said Inspector in Charge Ruth Mendonҫa.

According to allegations in the indictments and documents filed with the court, over the past 20 years, the defendants devised and carried out a telemarketing scheme to defraud more than 150,000 victim-consumers located across the United States, many of whom are elderly and vulnerable. The scheme was carried out by a network of dozens of fraudulent magazine sales companies located across the United States and in Canada. The companies operated telemarketing call centers from which their employees made calls using deceptive sales scripts designed to defraud victim consumers by inducing them—through a series of lies and misrepresentations—into making large or repeat payments to the companies.

The indictments allege that the defendants used fraudulent sales scripts to carry out their scheme. Many of the defendants used a fraudulent “renewal” script in which the telemarketers falsely claimed to be calling from the victim-consumer’s existing magazine subscription company about an existing magazine subscription package. The telemarketers often claimed—falsely—to be calling with an offer to reduce the monthly cost of an existing subscription. In reality, the company had no existing relationship with the victim-consumers and was actually fraudulently signing the victim-consumers up for expensive and entirely new magazine subscriptions.

The effect was that a single consumer went from having one magazine subscription to, at times, more than a dozen, all with different fraudulent magazine companies, each “sold” under the auspices of “reducing” the consumer’s monthly rate.

United States v. Rahm, et al., 20-cr-232, charges 43 defendants with carrying out a conspiracy to use the fraudulent renewal scripts to defraud more than 125,000 victims out of more than $300 million.

The indictments further allege that some of the defendants employed a “cancellation” script. The cancellation scripts targeted people who had previously fallen victim to a fraudulent magazine sales scam. Taking advantage of the victims’ desperation to make the magazine subscriptions stop, defendants using the cancellation script falsely claimed to be calling from the magazine “cancellation department.” The defendants offered to consolidate and cancel the victim-consumers’ existing magazine subscriptions and to pay off the victims’ “outstanding balance” in exchange for a large lump-sum payments. In reality, the companies had no relationship with the victim-consumer and the victim-consumer did not owe any money to the company. The “balances owed” were completely made up and the defendants stole the victims’ money.

United States v. Timmerman et al., 20-cr-233, charges nine defendants who worked for one of three Canadian companies that used the cancellation script to defraud more than 20,000 victim-consumers in the United States out of approximately $30 million.

United States v. Mathias et al., 20-cr-231, charges eight defendants in Mississippi and Georgia who used the cancellation script to defraud more than 13,000 victims of approximately $4.5 million.

The indictments charge defendants at all levels of the conspiracies, including Scheme Leaders, Company Owners, Call Center Managers, Telemarketers, and Lead Brokers. The Scheme Leaders provided an array of services to companies involved in fraudulent magazine sales, including customer relationship management (“CRM”) software programs that tracked orders, sales, and other customer information for companies involved in the fraudulent magazine sales scheme. The Scheme Leaders also provided leads to the Company Owners and sent out confirmation letters, invoices, bills, and collections letters to victim-consumers who had been defrauded by fraudulent magazine sales companies. The Company Owners operated telemarketing call centers and provided lead lists and fraudulent sales scripts to their telemarketing employees. These companies were operating in 14 states across the country, including Minnesota, Florida, Georgia, Mississippi, California, Iowa, Kansas, Missouri, Illinois, Colorado, Arizona, New Mexico, North Carolina, and Arkansas. The Call Center Managers trained the Telemarketers to use the fraudulent sales scripts to defraud victim-consumers. The indictment also charges Lead Brokers, who bought and sold lead lists of victim-consumers to fraudulent magazine sales companies. Many of the consumers on this list were elderly and susceptible to fraudulent and deceptive sales tactics and particularly valuable to companies engaged in fraudulent magazine sales. Accordingly, the lead lists commanded a significant premium and sold for as much as $10 or $15 per name.

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The following defendants are named in the United States v. Rahm, et al. indictment:

  • RUSSELL JASON RAHM, 50, of Kansas City, Kansas, owner and Chief Executive Officer of several Kansas-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • TERRY LYNN CHRISTENSEN, 73, of Fort Myers, Florida, a call center manager, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JANNICE KRISTINA LAUR, 39, of Fort Lauderdale, Florida, a call center manager, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • PETRA JINETTE LABOY, 42, of Cape Coral, Florida, a call center manager, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • DAVID JOHN MOULDER, 57, of Prior Lake, Minnesota, owner and Chief Executive Officer of several Minnesota-based companies that provided an array of services to companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • ANTHONY EUGENE MOULDER, 59, of Fort Myers, Florida, owner and operator of several Florida-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • RHONDA JEAN MOULDER, 60, of Cape Coral, Florida, a call center manager, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • BARBARA ANN MOULDER, 55, of Minneapolis, Minnesota, a telemarketer, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • LUIS ORLANDO MENDIZABAL, 41, of Cape Coral, Florida, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JEFFREY LEE SMOLIAK, 45, of Cape Coral, Florida, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JOHN MICHAEL BLALOCK, 53, of Cape Coral, Florida, owner and manager of a Florida-based company involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • LLOYD JOSEPH LOFTIS, 60, of Cape Coral, Florida, a call center manager, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • BRYANT JARODE CRITTEN, 33, of Cape Coral, Florida, a call center manager and telemarketer, is charged with conspiracy to commit mail fraud and violating the SCAMS Act.
  • NATESHA JAHMELIA MARSON, 33, of Lehigh Acres, Florida, a call center manager and telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • THOMAS ATHANASIOS KIRITSIS, 64, of North Fort Myers, Florida, a call center manager and telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • DANIEL MORRIS KLIBANOFF, 65, of Asheville, North Carolina, a lead broker, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • BRIAN DOUGLASS COX, 50, of Locust Grove, Georgia, a lead broker, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JOHN THOMAS HARBERT III, 58, of Albuquerque, New Mexico, a lead broker, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • AMONDO ANTOINE MILLER, 44, of Littleton, Colorado, a lead broker and owner of a company involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • KILEY MARIE SAINDON, 39, of Lakewood, Colorado, a call center manager, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • HENRY ARAGON, 50, of Golden, Colorado, owner of several Colorado-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • LUCILLE J. PATTERSON, 68, of Denver, Colorado, owner of several Colorado-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JAMES ANTHONY SIERRA, 55, of Littleton, Colorado, a call center manager, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • TARA NICOLE CREASON, 34, of Grand Blanc, Michigan, a call center manager and telemarketer, is charged with conspiracy to commit mail fraud and violating the SCAMS Act.
  • YVONNE PATTERSON, 60, of Thayer, Missouri, owner and operator of a Missouri-based company involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • CHARITIE A. SEELYE, 47, of Pekin, Illinois, a call center manager, is charged with conspiracy to commit mail fraud and wire fraud. BONNIE LEE COLBERT, 56, of Alton, Missouri, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JENNIFER LYNN GIRARDIN, 48, of Englewood, Colorado, owner and operator of a Missouri-based company involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JESSICA MARIE PRINCE, 40, of Thayer, Missouri, call center manager, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • BRIAN JAMES WILLIAMS, 41, of Long Lake, Minnesota, owner and operator of several Minnesota-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • TASHENA LAVERA CRUMP, 36, of Minneapolis, Minnesota, a call center manager and telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • JARED THOMAS MICHELIZZI, 37, of Ramsey, Minnesota, owner and operator of several Minnesota-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • ERIC PATRICK MCGARRITY, 36, of Minneapolis, Minnesota, a telemarketer, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • ANDREW JOHN LANDSEM, 34, Minneapolis, Minnesota, a telemarketer, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • BALLAM HAZEAKIAH DUDLEY, 34, of Plymouth, Minnesota, a telemarketer, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • CAITLIN COLLEEN SCHLUSSLER, 28, of San Diego, California, call center manager and telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • MONICA SABINA SHARMA-HANSSEN, 52, of Excelsior, Minnesota, owner and operator of a Minnesota-based company involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • TIMOTHY PAUL HANSSEN, 54, of Excelsior, Minnesota, owner and operator of a Minnesota-based company involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • CORLOS KENTRELL SMITH, 41, of St. Louis Park, Minnesota, a telemarketer, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • STACEY LEIGH PERSONS, 34, of Andover, Minnesota, owned and operated two Minnesota-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, mail fraud, wire fraud, and violating the SCAMS Act.
  • PATRICIA NICHOLE SHINN, 33, of Cambridge, Minnesota, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • LEEANN GARCIA, 26, of Cambridge, Minnesota, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • ERIC STEPHEN ESHERICK, 37, of Andover, Minnesota, owner and operator of a Minnesota-based company involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.

The following defendants are named in the United States v. Timmerman, et al. indictment:

  • CODY WAYNE TIMMERMAN, 37, of Maricopa, Arizona, owner and operator of Arizona-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit wire fraud, wire fraud, and violating the SCAMS Act.  
  • IRMA BEATRICE TIMMERMAN, 47, of Maricopa, Arizona, owner and operator of Arizona-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit wire fraud, wire fraud, and violating the SCAMS Act.
  • SIARRA IRIS DAWN GALLEGOS, 29, of Hemet, California, a telemarketer, is charged with conspiracy to commit wire fraud, wire fraud, and violating the SCAMS Act.
  • JUSTIN DONALD SUHAJDA, 33, of San Jacinto, California, owner and operator of a California-based company involved in fraudulent magazine sales, is charged with conspiracy to commit wire fraud, wire fraud, and violating the SCAMS Act.
  • TODD ALLEN HUGHES, 47, of Holstein, Iowa, a telemarketer, is charged with conspiracy to commit wire fraud, wire fraud, and violating the SCAMS Act.

The following defendants are named in the United States v. Mathias, et al. indictment:

  • DANIEL MATHIAS, 62, of Oxford, Mississippi, owner and operator of Mississippi-based companies involved in fraudulent magazine sales, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act. 
  • VASEAN BERIOISOVA RICKS, 53, of Oxford, Mississippi, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • DIANA REPELL LOGAN, 36, of Abbeville, Mississippi, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • IVORY DENISE ALEXANDER, 26, of Oxford, Mississippi, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • ANGEL WILSON, 49, of Oxford, Mississippi, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • SHARON DENISE MCEWEN, 54, of Abbeville, Mississippi, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • RONALD OLLO COLEMAN, 59, of Powder Springs, Georgia, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.
  • RITA ANTOINETTE ALBRITTON, 49, of Stockbridge, Georgia, a telemarketer, is charged with conspiracy to commit mail fraud, wire fraud, and violating the SCAMS Act.

United States Attorney Erica H. MacDonald thanks the FBI and the United States Postal Inspection Service for their collaboration and skilled investigative work in bringing these indictments. Additional assistance was provided by the Treasury Inspector General for Tax Administration (TIGTA) and the Minnesota Attorney General’s Office.

Based on the evidence obtained in this investigation, authorities believe there may be additional victims of the alleged conduct. Report suspected fraudulent activity to MagazineVictims@FBI.GOV or visit FBI.gov/MagazineVictims.

These indictments are related to the cases United States v. Dahl, 18-cr-305 and United States v. Oelrich, 20-cr-128.

Assistant U.S. Attorneys Joseph H. Thompson, Harry M. Jacobs, and Melinda A. Williams are prosecuting the case.

The charges contained in the indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

 

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United States Attorney’s Office, District of Minnesota: (612) 664-5600

Updated October 28, 2020