Source: United States Department of Justice News
A federal jury convicted three Nevada men yesterday for perpetrating a prize-notification scheme that stole more than $6 million from victims. The notices led victims to believe that they could claim a large cash prize if they paid a fee of $20 to $30. This was false; victims who paid the fees did not receive anything of value. Many of the schemes’ victims were retirees or other older adults.
According to court documents and evidence presented at trial, Mario Castro, 55, and Miguel Castro, 58, of Las Vegas, and Jose Luis Mendez, 49, of Henderson, Nevada, produced the fraudulent prize notices at their business in Las Vegas. The three defendants also were partners in companies that sent the fraudulent prize notices. The defendants used money from victims to print and mail prize notices and also received a share of the profits.
“This verdict demonstrates the Department of Justice’s commitment to pursuing and holding accountable those who participate in scams that defraud consumers,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to protecting consumers from deceptive mass-mailing schemes.”
“The defendants mailed fraudulent prize notices to prey upon and trick victims, many of them elderly, out of millions of dollars,” said U.S. Attorney Jason M. Frierson for the District of Nevada. “This guilty verdict should be a warning to individuals who commit fraudulent acts. We are committed to working together with the Civil Division’s Consumer Protection Branch and the U.S. Postal Inspection Service to identify and hold fraudsters accountable. We will continue to protect older Americans and prosecute individuals who seek to carry out fraudulent schemes targeting seniors.”
“Vulnerable and older Americans have been victimized for far too long by individuals who hide in the shadows to commit their crimes,” said Inspector in Charge Eric Shen of U.S. Postal Inspection Service’s (USPIS) Criminal Investigations Group. “This verdict unmasks these criminals and holds them to account for their conduct. The U.S. Postal Inspection Service is proud to have contributed to this result and will be relentless in protecting American consumers from fraud through the U.S. Mail.”
The defendants operated the scheme from 2010 to February 2018, when postal inspectors executed multiple search warrants and the Department of Justice obtained a court order shutting down the fraudulent mail operation. Mario Castro, Miguel Castro, and Jose Luis Mendez worked at the printing and mailing businesses that sent the fraudulent mail and shared the profits from the fraudulent prize notices. The defendants and their co-conspirators ignored multiple cease and desist orders from the U.S. Postal Service that prohibited their companies from sending fraudulent mail. The defendants responded by changing the names of their companies and using straw owners to hide their continuing fraud.
Mario Castro was convicted of conspiracy to commit mail fraud and seven counts of mail fraud. He was found not guilty of five counts of mail fraud.
Miguel Castro was convicted of conspiracy to commit mail fraud and five counts of mail fraud. He was found not guilty of seven counts of mail fraud.
Jose Luis Mendez was convicted of conspiracy to commit mail fraud and eleven counts of mail fraud. He was found not guilty of one count of mail fraud.
A fourth defendant, Salvador Castro, was acquitted by the jury on all charges.
The convicted defendants are scheduled to be sentenced on Aug. 23 and face a maximum penalty of 20 years in prison on each count of mail fraud and conspiracy to commit mail fraud. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Four other people previously pleaded guilty to conspiracy to commit mail fraud in connection with this prize notice scheme: Patti Kern, 65, of Henderson, Nevada; Andrea Burrow, 43, of Las Vegas; Edgar Del Rio, 45, of Las Vegas; and Sean O’Connor, 54, of Las Vegas.
The USPIS investigated the case.
Trial Attorneys Timothy Finley and Daniel Zytnick of the Justice Department’s Consumer Protection Branch and Assistant U.S. Attorney Mina Chang for the District of Nevada are prosecuting the case.
The Department urges individuals to be on the lookout for lottery, prize notification, and sweepstakes scams. If you receive a phone call, letter, or email promising a large prize in exchange for a fee, do not respond. Fraudsters often will use official-sounding names or the names of real lotteries or sweepstakes, or pretend to be a government agent purportedly helping to secure a prize.
If you or someone you know is age 60 or older and has experienced financial fraud, experienced professionals are 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, can 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 open Monday through Friday from 10:00 a.m. to 6:00 p.m. ET. English, Spanish and other languages are available. The Federal Trade Commission also provides a hotline at 877-FTC-HELP_and a website at www.ftccomplaintassistant.gov_to receive consumer complaints.
More information about the Department’s efforts to help American seniors is available at its Elder Justice Initiative webpage. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at https://www.justice.gov/civil/consumer-protection-branch. The Department of Justice provides information about a variety of resources relating to elder fraud victimization through its Office for Victims of Crime, which are available at https://www.ovc.gov.