citizen who operated a call center in San Pedro, was convicted in August 2013. In 2010, a man in Hawaii unidentified in court documents wired $210,000 to the fraud in Costa Rica after he was convinced to liquidate his retirement savings account to pay insurance fees on a non-existent $3 million prize scam run by Glen Adkins. Mangarella was sentenced to 50 years in prison in September 2009.ĭespite the crackdown, other boiler rooms using the “Lloyds of London of Costa Rica” script continued to pop up like a game of whack-a-mole.įollowing the 2006 arrests, another call center sprung up in the San José districts of Zapote and San Pedro. On May 16 2006, Mangarella and four others were arrested in Costa Rica by Judicial Investigation Police (OIJ) on charges of wire fraud, money laundering, money laundering conspiracy, and conspiracy. IF YOU HAVE THE SLIGHTEST SUSPICION THAT YOU ARE SPEAKING WITH SOMEONE SLIGHTLY INTELLIGENT, BEING RECORDED, ON A THREE WAY CALL, BEING TRACED, SPEAKING WITH LAW ENFORCEMENT, AND SO ON, DO NOT EVEN ATTEMPT TO USE IT!! THIS COULD KILL AN OFFICE Reminders were posted in the call centers warning: Sweepstakes Security Bureau” in Washington, D.C. Sweepstakes Security Commission” or the “U.S. In one version of the scheme, callers would be told if they did not pay the bogus insurance fee they would be committing “insurance fraud” or “defrauding a Federal agent” if the caller impersonated a representative of the “U.S. Their targets lost an average of $1,200 each to the fraud. Callers were awarded between 20 and 40 percent of what they brought in – as much as $3,600 in cash weekly – according to an affidavit. Scammers convinced their victims to wire money via Western Union to accounts in Costa Rica, and Antigua and Barbuda. Often victims were told that their prize amount had been increased from $450,000 to $4.5 million and that a larger insurance policy would need to be purchased before the check could arrive. Once victims were convinced of their winnings and had made an initial payment, another conspirator would “re-load” the victim, playing them for more money. Victims were told that before they could claim their prize, they would need to pay a “refundable insurance fee” directly to “Lloyd’s of London of Costa Rica” to insure its safe delivery. As many as 80 different Internet phone numbers were leased by Mangarella’s operation. Instead of Costa Rica’s country code (506), victims would see a more familiar (202) area code for Washington, D.C., for example. Mangarella and his co-conspirators operated between eight and 12 call centers between 20 responsible for at least $10 million in losses for victims.Ĭallers in Costa Rica used voice over Internet protocols (VoIP) - Internet telephone numbers - to disguise the calls’ country of origin. Headed by Brooklyn, New York native Michael Attilio Mangarella, the scheme employed dozens of English-speaking callers, known as “openers,” who convinced mostly elderly retirees in the United States that they had won large cash prizes, between $350,000 and $450,000, according to a July 2012 indictment. federal agencies and the fake company, “Lloyd’s of London of Costa Rica.” Starting in 2002, the fraud would play off the reputation of Lloyd’s of London, the famed British insurance market known for underwriting unusual and extremely large policies, to trick victims into buying fake insurance to collect non-existent sweepstakes prizes. One of the call center operations, also known as “boiler rooms,” that moved to Costa Rica claimed to represent U.S. “Since then, telemarketers running these scams have gone offshore to various places, including Costa Rica,” Carr said in an email. A series of prosecutions targeting predatory telemarketers took place in Buffalo, New York San Diego, California and Las Vegas, Nevada in the early 2000s. The roots of this style of scam started in the United States. The investigation remains open, according to Peter Carr, a spokesman for the U.S. citizens - most over the age of 55 - of upwards of $20 million. Prosecutors in the Western District of North Carolina have convicted 46 defendants from the United States related to the sweepstakes fraud to date.īetween 20, several call centers carried out this scam despite repeated arrests, claiming to represent the bogus company “Lloyds of London of Costa Rica.” The Lloyds of London scam stood out for its scope and longevity, and those who perpetrated it: U.S., Canadian and other English-speaking expats living in Costa Rica. Costa Rica was home to a massive telemarketing scam that defrauded thousands of U.S. The only thing you need to do to claim your prize is pay this insurance fee…Ĭall centers are one of the fastest growing sectors of the Costa Rican economy, but this boom industry has a dark side. What if I told you that you have won $450,000?
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