Telemarketer Who Conned Seniors With Phony Bonds Gets Nine Years

telemarketerA Canadian telemarketer who conned thousands of elderly consumers out of millions of dollars with bogus foreign bonds and lies of easy prize money was sentenced to nine years in prison by a California federal judge.

The U.S. Attorney's criminal case followed action by the Federal Trade Commission, which accused John Raymond Bezeredi of fraud in 2005. The FTC said the Vancouver, Canada-based scammer promised consumers he conned into buying worthless bonds they would be entered into monthly drawings for substantial winnings or regular cash payments.

Bezeredi, who did business as Dominion Investments, Eurobond Fidelity Ltd., and Imperial Investments, was also ordered to pay $4.6 million to compensate his 4,500 elderly victims by the judge, who condemned his "cold, calculating, callous behavior."Bezeredi's telemarketing operation typically contacted elderly U.S. consumers, offering them the chance to invest in European bonds involving monthly cash prize drawings, According to the FTC's complaint. His telemarketers convinced consumers they had a good chance to receive regular cash winnings of at least $50 if they bought the bonds over the phone.

Many victims were on the National Do Not Call Registry, and some were contacted more than once to persuade them to send multiple payments for additional bonds.

Consumers duped into buying the so-called bonds received a variety of fake documents on letterhead bearing a Hungarian address. The documents included a cover letter congratulating them for participating in the phony bond program and explained the "value" of their worthless membership program.

Victims also received an information sheet claiming their bond purchase was registered with the "European Central Union Bank," even though no such bank exists. And the European Central Bank, which sets monetary policy in the 12 European countries that use the Euro as their currency, doesn't operate a "prize bond" program.

Thousands of elderly consumers paid Bezeredi between $400 and $5,950 for the phony bonds his telemarketers peddled, and few, if any of them, the FTC said, ever received anything of value in return.

The FTC says Bezeredi violated the FTC Act, the Telemarketing Sales Rule and illegally called consumers on the National Do Not Call Registry, maintained by the FTC and the Federal Communications Commission. As a result of the FTC complaint, a federal district court banned Bezeredi from fraudulent telemarketing in 2007, and penalized him $4.76 million to refund victims.

The FTC's Criminal Liaison Unit then sent the case to the U.S. Attorney for criminal prosecution, and in September 2009, Bezeredi pleaded guilty to one criminal count of mail fraud and admitted targeting elderly victims with his telemarketing scheme.

The investigation that led to the dismantling of Bezeredi's operation was conducted by the British Columbia Telemarketing Task Force, known as Project Emptor. Besides the FTC, agencies who participated in Project Emptor included the Royal Canadian Mounted Police, Consumer Protection BC (British Columbia), the Canadian Competition Bureau, the FBI, the U.S. Attorney's Office for the Central District of California, and the U.S. Postal Inspection Service.

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