Compensation roll-out begins following landmark investigation
Thousands of UK victims of an international mass marketing scam are set to receive compensation from monies recovered following a four-year investigation that saw National Trading Standards (NTS) assist the US Federal Trade Commission. As a result of this collaborative working, a total of more than £530,000 will be returned to more than three and a half thousand victims, marking a new approach to obtaining proceeds of crime from international fraudsters.
In a landmark investigation, the NTS Scams Team worked closely with the Federal Trade Commission to identify US-based fraudsters who targeted UK households with scam mail offering alleged cash wins and claiming ‘guaranteed’ cash prize pay-outs. The personalised mailings to UK addresses – estimated to be more than seven million in the four years from 2014 – deliberately targeted vulnerable people, such as older people living alone or those with long-term health conditions. The mailings enticed victims by asking for an upfront fee ranging from £25 to £40. Many paid the fee several times before realising there was no prize, with the highest individual losses in the UK running into thousands of pounds.
The NTS investigation identified a criminal enterprise based in Kansas, USA, as the source of the mailings. The criminals: Kevin Brandes, William Graham, Charles Floyd Anderson and their companies had sent tens of millions of deceptive personalised mailers to individuals around the world, in the so-called ‘Next Gen’ sweepstakes scheme. They ran a classic and vintage car sales operation and held millions of dollars in a variety of bank accounts.
Working with US colleagues at the Federal Trade Commission, action was taken against the perpetrators in 2018, which saw them agree to forfeit $30 million in cash and assets, of which $25 million was made available to compensate victims around the world. National Trading Standards, which was commended by the US Attorney General for its role in the investigation, has since worked to secure the first compensation scheme across international borders in the UK. Victims will be issued with a pre-loaded card, which they can spend in shops or pay into their bank accounts. The cards will be distributed through local trading standards offices.
Louise Baxter, Head of the National Trading Standards Scams Team, said:
“Today marks a major milestone in an investigation that started four years ago. Falling victim to a scam can have a huge emotional impact on individuals so I’m delighted that we can use the proceeds of these crimes to provide compensation to thousands of UK victims, with the help of our network of trading standards officers.
“Collaborating across borders with the Federal Trade Commission has proven highly effective. We are confident that this approach of obtaining proceeds of crimes from international fraudsters to compensate UK victims could be replicated in the future.”
Lord Michael Bichard, Chair, National Trading Standards, said:
“Mass marketing mail fraud represents a persistent threat to UK consumers, and particularly to vulnerable and elderly people. This investigation and approach to obtaining the proceeds of crime sends a clear message that fraudsters, wherever they are based, can be caught. It is testament to the work of the National Trading Standards Scams Team, working alongside local trading standards officers, that money will be returned to so many victims.”
Samuel Levine, Director of the Federal Trade Commission’s Bureau of Consumer Protection, said:
“The FTC appreciates the support provided in this case by the National Trading Standards Scams Team and our other international partners. Their assistance contributed to the success of the FTC’s case and helped ensure that victims worldwide benefit from this refund program.”
If you think you have been targeted by a mail scam you should report it to your bank and Action Fraud on 0300 123 2040. For advice you can call the Citizens Advice Consumer Service on 0808 223 1133. You can also learn how to protect yourself and your loved ones from scams by completing National Trading Standards’ free Friends Against Scams awareness training at www.FriendsAgainstScams.org.uk.