4 July – LAWFUEL – The Law News Network – R. Alexander Acosta, United States Attorney for the Southern District of Florida, and Enrique Gutierrez, Inspector in Charge, United States Postal Inspection Service, Miami Division, announced today that defendants, Steven Mishkin, Martin Geller, and William Judd, were sentenced to prison terms for their involvement in fraudulent business opportunity sales.
Mishkin and Geller were sentenced by United States District Court Judge James I. Cohn in Ft. Lauderdale, Florida. Mishkin, a resident of Hallandale, Florida, was sentenced to eighty-one (81) months’ imprisonment, to be followed by three (3) years of supervised release. Geller, a resident of Miami Beach, Florida, was sentenced to seventy-eight (78) months’ imprisonment, to be followed by two (2) years of supervised release. Hearings to determine the amounts of restitution Mishkin and Geller owe have been set for August 12, 2005.
Judd was sentenced In a separate hearing before United States District Court Judge Patricia A. Seitz in Miami, Florida. Judd, a resident of Hallandale, Florida, was sentenced to seventy (70) months’ imprisonment, to be followed by three (3) years of supervised release. He was also ordered to pay $2,316,068.43 in restitution to ninety-five (95) victims. A final restitution determination will be made on September 1, 2005, to allow time for any additional victims to come forth.
Mishkin, Geller, and Judd were initially charged on February 18, 2005. Mishkin was charged with one (1) count of criminal contempt, in violation of Title 18, United States Code, Section 401(3), and one (1) count of conspiracy to commit mail fraud, in violation of Title 18, United States Code, Section 371. Geller and Judd were charged with mail fraud, in violation of Title 18, United States Code, Section 1341. On March 31, 2005, Mishkin and Geller pled guilty to the above charges. Mishkin’s criminal contempt charge was based upon a violation of a court order entered by the United States District Court for the Southern District of Florida in June 2000, in a consumer fraud civil case filed by the Federal Trade Commission. Judd pled guilty to mail fraud on April 7, 2005.
According to charging documents, Mishkin and Geller engaged in the fraudulent sale of business opportunities through a firm called AmeriP.O.S. Inc. AmeriP.O.S. engaged in the sale of point-of-sale (“P.O.S.”) terminal business opportunities. For a minimum purchase price of approximately $12,000, potential purchasers were told they would receive several P.O.S. terminals, and assistance in establishing, maintaining, and operating a P.O.S. terminal business. The defendants falsely claimed that a business opportunity purchaser, known as a “distributor,” would earn substantial profits when members of the public purchased products, such as pre-paid debit cards, pre-paid phone cards, and pre-paid Internet services, from the distributor’s P.O.S. terminals. Mishkin was a leader and organizer of AmeriP.O.S., and Geller was one of the firms’ administrators. Mishkin, Geller and others fraudulently induced over 1,500 consumers to invest a total of approximately $20 million in AmeriP.!
Judd was charged with engaging in a very similar type of scheme in connection with a firm called Global Resources, Inc. According to the charging document, Global Resources, like AmeriP.O.S., engaged in the sale of business opportunities involving terminals that featured various sorts of pre-paid products. For a minimum purchase price of approximately $14,000, potential purchasers were told they would receive a pre-paid product terminal, along with assistance in establishing, maintaining, and operating a terminal business. According to Global Resources, a business opportunity purchaser, known as a “distributor,” would earn substantial profits from commissions generated whenever members of the public purchased products from the distributors’ terminals.
“These cases are part of a large group of fraudulent business opportunity prosecutions in this District and should serve as a caution to the public,” United States Attorney Acosta said, “Just because a business opportunity firm advertises on radio, television, and through the Internet, does not mean that the claims should be trusted by the public. Indeed, the U.S. Attorneys Office has filed charges against individuals involved in seven different business opportunity scams. But prevention of these scams is necessary as well. Consumers need to be vigilant and vet these firms before investing their hard-earned money.”
Inspector in Charge Enrique Gutierrez added that many of the companies involved in these cases used phony references to help defraud consumers. “If a firm gives you two or three names to call as references, that’s a good indication that the company might be fraudulent. Federal law requires legitimate firms to provide would-be investors with a disclosure statement naming existing franchisees. Many bogus firms do not comply with this requirement, and simply provide multiple phony references instead.”
Mr. Acosta commended the investigative efforts of the Postal Inspection Service. These cases are being prosecuted by Richard Goldberg, Trial Attorney, United States Department of Justice, Office of Consumer Litigation, and Special Assistant United States Attorney Steven Gurwitz. The Federal Trade Commission has additional information on its website that can be helpful in identifying the sorts of business opportunity firms that are fraudulent. A brochure is available at http://www.ftc.gov/bcp/conline/pubs/invest/vending.htm. Information on related topics can be found at http://www.ftc.gov/bcp/menu-fran.htm.
A copy of all press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls . Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on .