Costa Rica News: Costa Rican Business Fraud Used Offices in US

[BCampbell]

Two men were arrested last week in Costa Rica on charges of selling phony business franchises for greeting cards and coffee stands out of offices in Colorado and other states.

John White, an American, and Kerry Michael Deevy, a Canadian, are part of alleged ring to fleece people out of at least us$10,000 each for the franchises, including helping them start, maintain and operate the businesses starting in 2005.

The business names included USA Beverages Inc., Twin Peaks Gourmet Coffee Inc., Cards-R-Us Inc., Premier Cards Inc., The Coffee Man Inc. and Nation West Distribution Company, according to the U.S. Attorney's Office.

"Each company operated for several months, and after one company closed, the next opened," federal prosecutors said in a media release.

The men used aliases and told customers they could expect big profits, based on the companies' familiarity with the respective markets. They also falsely promised they had secured high-traffic locations for franchises

They allegedly rented office spaces to make it appear the businesses were located in the United States, prosecutors said.

Twin Peaks was registered as a Florida and Colorado corporation and rented office space in Fort Collins. Premier Cards was registered as a Colorado and Pennsylvania corporation and rented office space in Philadelphia. The Coffee Man and Nation West were registered in Colorado and rented office space in Denver.

White and Deevy were indicted by a federal grand jury in Miami on Nov. 29.

They face charges of conspiracy to commit mail and wire fraud by telemarketing. If convicted, they could spend decades in prison as a result of the various counts, prosecutors said.

"Business opportunity fraud is a serious crime. Fraudsters carefully construct legitimate-sounding self-employment opportunities, complete with professional-looking materials and convincing but fake research to back up their claims, then target hardworking individuals who are looking for a chance to make life better for themselves and their families," Tony West, an assistant attorney general for the Justice Department, stated.

[gulfcoastplayer]

Gotta be smarter running a boiler room! Gotta have many layers between you and the money.