• United States



by Dave Gradijan

Huge Telemarketing Fraud Ring Quashed by Law Enforcement

Dec 20, 20062 mins
CSO and CISOData and Information Security

A telemarketing scam that bilked more than 500 victims a week for an annual net of $8 million to $13 million has been shut down due to the joint efforts of U.S. and Canadian authorities.

Project COLT, which spearheaded the eight-month investigation, is made up of members of Immigration and Customs Enforcement (ICE), the U.S. Postal Service, U.S. Federal Trade Commission and the FBI, working with the Royal Canadian Mounted Police, Surete du Quebec, Service de police de la Ville de Montreal and the Competition Bureau of Canada. 

According to a news release from ICE, two types of telemarketing fraud were used: a lottery scheme and a mass telemarketing fraud. “In the lottery scheme, the fraudulent telemarketers persuaded their victims that they had won a large sum of money,” ICE said. “In order to claim their prizes, the victims were told they had to send in payments ranging from $1,500 to $60,000 to cover various costs, including customs charges, taxes and insurance. Approximately 90 percent of the victims in this case were over 60 years of age.”

The telemarketing scam involved selling health-care kits or billing victims for services never rendered, ICE says. Victims of the scams were required to send fees, usually less than $500, as a certified check or money order.

“These fraudulent telemarketers prey on some of our most vulnerable citizens, often victimizing them repeatedly until their savings are depleted,” said Marcy Forman, director of investigations for ICE. “This collaboration with our Canadian law enforcement partners and other U.S. agencies continues to yield significant results, both in shutting down the criminal networks and in restoring some funds to the victims.”

COLT encourages reporting any information on fraudulent scams to 1-866-347-2423.

-Compiled by Shawna McAlearney