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List Brokerage Firm Pleads Guilty To Facilitating Elder Fraud Schemes

Connecticut list brokerage firm Macromark Inc. pleaded guilty on Friday to knowingly providing lists of potential victims to fraudulent mass-mailing schemes, the Department of Justice announced.  The fraudulent schemes tricked consumers into paying fees for falsely promised cash prizes and purportedly personalized “psychic” services.  Thousands of consumers lost millions of dollars to the schemes.  

A corporate representative for Macromark appeared before Judge Alvin W. Thompson of the U.S. District Court in Hartford, Connecticut, for arraignment and to enter a plea of guilty to an information charging the firm with conspiracy to commit mail and wire fraud.

The information alleges that Macromark provided list-brokerage services for more than 11 years to clients who were running mass-mailing fraud schemes.  Macromark specifically helped fraudulent mass mailers both acquire lists of potential victims to defraud and sell their lists of victims to other mass mailers.  Macromark executives and employees engaged in this conduct despite knowing that their clients were mailing hundreds of thousands of deceptive prize notifications that misled victims into believing that they would receive a cash prize or personalized services upon payment of a fee.  The potential-victim lists that Macromark brokered were essential to its fraudulent mass-mailer clients, allowing them to more effectively reach consumers who were susceptible to their schemes.  Many victims who lost money to the schemes were elderly and vulnerable.  In pleading guilty, Macromark admitted that the lists it provided to fraudulent clients resulted in losses to victims of at least $9,500,000.

 “Protecting seniors from fraud is a top priority of the Department of Justice,” said Acting Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Civil Division.  “Working with our law enforcement partners, we will hold accountable companies like Macromark that help foreign and domestic criminals identify and scam elderly Americans.”

According to the information, Macromark facilitated fraud schemes from 2005 until September 2016, when Inspectors with the U.S. Postal Inspection Service executed search warrants on the company’s offices and the Civil Division’s Consumer Protection Branch obtained a federal court order enjoining the company from facilitating mass-mailing fraud.  The court order resulted in a permanent injunction that permanently prohibited Macromark from dealing in certain promotions or solicitations that purport to offer prizes or services for a fee, including sweepstakes reports, wealth-building programs or psychics.  Macromark was also required to hire a compliance officer, and to audit a sample of all list orders for five years. 

“List brokers and service providers such as Macromark who facilitate these schemes are especially dangerous,” said Inspector in Charge Delany DeLeon-Colon of the U.S. Postal Inspection Service’s Criminal Investigations Group.  “Data firms such as this have extraordinary access to consumer’s personal information, not just their mailing address.  The sale and distribution of this data exponentially magnifies the scale and impact of these schemes.  Postal Inspectors are proud of our work to stop the targeting of our most vulnerable Americans.”

Macromark’s plea follows a separate guilty plea by former Macromark Executive Vice President Steven Keats in July 2018 to conspiracy to commit mail and wire fraud while working at Macromark.  Also, in March 2020, former Macromark Senior Vice President Norman Newman was indicted by a Connecticut Grand Jury for conspiracy to commit mail and wire fraud, along with fifteen counts of wire fraud.  Newman is scheduled for trial on March 1, 2021.  An indictment is an accusation by a federal grand jury and is not evidence of guilt.  The defendant should be presumed innocent unless and until proven guilty.

Under the terms of Macromark’s guilty plea, the company would be sentenced to three years of probation, forfeiture and fines totaling $1,000,000, and be required to cooperate with any related government investigation or prosecution.  The final sentence awaits a ruling from the federal court overseeing the case.

Trial Attorneys Alistair Reader and Ehren Reynolds of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Heather Cherry of the U.S. Attorney’s Office for the District of Connecticut are prosecuting the case.  The United States Postal Inspection Service investigated the case.

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 January 2020, the department designated “Preventing and Disrupting Transnational Elder Fraud” as an Agency Priority Goal, one of its top four priorities.  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 also conducted hundreds of trainings and outreach sessions across the country since the passage of the Act. 

The department’s extensive efforts to combat elder fraud seek to halt the billions of dollars seniors lose each year to fraud schemes, including those perpetrated by transnational criminal organizations.  The best method for prevention, however, is sharing information about the various types of elder fraud schemes with relatives, friends, neighbors, and other seniors who can use that information to protect themselves.

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 7 days a week from 6:00 a.m. to 11:00 p.m. eastern time. English, Spanish and other languages are available.

For more information about the Consumer Protection Branch and its enforcement efforts, visit its website at http://www.justice.gov/civil/consumer-protection-branch.