TWO CANADIAN BROTHERS SENTENCED FOR CROSS BORDER FRAUD SCHEME WHICH TARGETED U.S. VICTIMS.

Two Vancouver men were sentenced in June and July 2008 in U.S. District Court in Los Angeles for operating a large scale fraud which victimized U.S. residents, many of them elderly, who collectively suffered approximately $3 million in monetary losses, announced Salvador Hernandez, Assistant Director of the FBI in Los Angeles, Thomas O’Brien, United States Attorney in Los Angeles and Gordon McRae, Superintendent and Officer In Charge of the Commercial Crime Section of the Royal Canadian Mounted Police (RCMP).

The brothers, Stephen Ironside, 53 and Bruce Ironside, 51, both pleaded guilty to operating a fraudulent telemarketing business from Vancouver, British Columbia, doing business as Newport Group and West Star. Through their business, the brothers defrauded victims who were told they had been chosen as winners of a foreign lottery, or were among those with an excellent chance of winning. The Ironsides employed numerous telemarketers who used fictitious names when speaking with the victims.

On June 2, 2008, Stephen Ironside was sentenced by Judge Stephen Wilson to forty-one months imprisonment for mail fraud in connection with the telemarketing schem; he was also ordered to pay restitution of more than $1.8 million.

On July 21 st, 2008, Bruce Ironside was sentenced by Judge Stephen Wilson to 51 months imprisonment for wire fraud in connection with the telemarketing scheme; he was also ordered to pay restitution of more than $1.8 million.

Cross-border fraud is a growing crime problem where victims receive phone calls or letters of congratulations advising them that they are winners of a particular lottery.

RECENT TRENDS IN CROSS BORDER SCAMS AND CONSUMER ADVISORY:

Law enforcement has seen a recent trend of counterfeit checks that appear to be drawn from U.S. banks sent to victims by individuals operating fraudulent cross-border enterprises. The checks are typically sent with instructions directing victims to deposit the counterfeit checks in order to help pay fees associated with their lottery winnings. These checks may have legitimate account and routing numbers but are worthless once the bank eventually detects the fraud. Fraudulent telemarketing cross-border enterprises, whose operators may establish phony Internet websites to lend legitimacy their schemes, instruct their victims to use well-known money transfer services to send funds.

The U.S. government’s partnership with the RCMP Project Emptor Task Force and the RCMP Project Colt Task Force has resulted in more than 60 indictments of subjects who operated in Montreal and British Columbia, twenty of whom have been convicted. The RCMP Task Forces in Canada include members from the Royal Canadian Mounted Police – Commercial Crime Section, the FBI, the Federal Trade Commission, the U.S. Postal Inspection Service, the United States Attorney’s Office, the British Columbia Business Practices & Consumer Protection Authority and the Canadian Competition Bureau.

MEDIA CONTACT:

FBI: Laura Eimiller: 310 996-3343

AUSA Ellyn Lindsay: 213 894-2041

RCMP is Sergeant Sue Green, (604)543-4940

TIPS FOR PREVENTING VICTIMIZATION BY CROSS BORDER FRAUD SCHEMES

The FBI and its partners recommend the following tips to those who may be targeted for cross-border fraud or advance-fee fraud solicitations.

Be suspicious of any offer that sounds too good to be true.

Fraudulent telemarketers may misrepresent themselves as government officials, law enforcement officers, banking representatives and attorneys to convince a potential victim to send money. Additionally, they may attempt to send documents falsely representing their company or governmental agency.

If you have legitimately won a lottery or sweepstakes prize, you will never have to pay money in advance of receiving your winnings.

Hang up on anyone who solicits your money or personal information in advance of awarding a prize.

Never provide personal information over the telephone, including your date of birth, social security number, or bank account or credit card information.

Do not attempt to deposit checks sent by companies whose representatives claim the check is being sent to pay fees or taxes on lottery winnings. These checks may appear to be legitimate but they are not. Some of the checks may even be drawn on legitimate accounts and may include actual routing numbers so that they appear to be authentic even when presented for deposit at a bank.

Fraudulent telemarketers will apply high-pressure sales techniques by falsely representing that the fees are required immediately in order to obtain the winnings.

Report cross-border or advance-fee scams to authorities at:

● the FBI's Internet Crime Complaint Center: www.ic3.gov
● Phonebusters, (888) 495-8501
● the Federal Trade Commission, (877) 382-4357.

Visit the following websites for more information and helpful tips:

● www.fbi.gov

● www.ftc.gov/crossborder