Federal Investigation of GBEN Pump-and-Dump Scheme Results in Conviction of Eight Men and Recovery of over $400,000 for Victim Restitution
U.S. Attorney Justin Herdman announced today that a federal grand jury sitting in Toledo has returned a nine-count indictment charging John Tyler Pla, 25, and Johnny Lee Palmer, 25, both of Tampa, Florida, with conspiracy to commit wire fraud and wire fraud.
“Protecting our district’s elderly and vulnerable populations from scammers and fraudsters is an important part of the work we do every day at the Justice Department,” said U.S. Attorney Justin Herdman. “Manipulating and exploiting our district’s elderly in any way, for any reason, will be met with swift prosecution.”
"These scammers demonstrate the ever-increasing need to watch over and protect our elderly population,” said FBI Special Agent in Charge Eric B. Smith. “The FBI encourages everyone to educate their elderly family and friends on financial scams such as this. These two fraudsters played on the heart-strings of grandparents. Discussions prior to receiving a possible phone call from scammers can prevent your loved one from being a victim."
According to the indictment, from July 20, 2020, to August 28, 2020, the defendants are accused of conspiring together to orchestrate a “Grandparent scam” on elderly victims in Brecksville, Parma, Gates Mills, Lorain, Mansfield, Fairview Park, Westlake and Mentor. To conduct their alleged scheme, the defendants are accused of calling elderly victims in these areas claiming to be a relative, such as a grandson, granddaughter, or an attorney for the relative, and informing the victim that he or she had been arrested and needed money for bail.
The indictment states that the conspirators would then arrange for a purported courier to pick up the money in person. The defendants would then rent a U-Haul vehicle and travel to the victims’ residence to collect the money in person. In total, the victims suffered a combined loss of $383,932.00.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation.
In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigation preceding the indictment was conducted by the Cleveland Division of the FBI and Westlake Police Department. This case is being prosecuted by Assistant U.S. Attorney Brian McDonough.
Since President Trump signed the bipartisan Elder Abuse Prevention and Prosecution Act (EAPPA) into law, the Department of Justice has participated in hundreds of enforcement actions in criminal and civil cases that targeted or disproportionately affected seniors. In particular, in March 2020, the department announced the largest elder fraud enforcement action in American history, charging more than 400 defendants in a nationwide elder fraud sweep. The department has likewise conducted hundreds of trainings and outreach sessions across the country since the passage of the Act. For more information about the Elder Justice Initiative, please visit https://www.justice.gov/elderjustice.
If you or someone you know is age 60 or older and has been a victim of financial fraud, help is standing by at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311). This U.S. Department of Justice hotline, managed by the Office for Victims of Crime, is staffed by experienced professionals who provide personalized support to callers by assessing the needs of the victim, and identifying relevant next steps. Case managers will identify appropriate reporting agencies, provide information to callers to assist them in reporting, connect callers directly with appropriate agencies, and provide resources and referrals on a case-by-case basis. Reporting is the first step. Reporting can help authorities identify those who commit fraud and reporting certain financial losses due to fraud as soon as possible can increase the likelihood of recovering losses. The hotline is staffed seven days a week from 6:00 a.m. to 11:00 p.m. eastern time. English, Spanish and other languages are available.
This case is part of the Justice Department’s 2020 national Money Mule initiative. The Money Mule initiative seeks to stop the financial exploitation of the nation’s elderly and vulnerable populations.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at https://www.justice.gov/history.