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CREDIT CARD CON:
Canadian Man Gets 10 Years for $12 Million Telemarketing Scam

11/28/03

Canadian Man Gets 10 Years for $12 Million Telemarketing Scam.Imagine getting a call from a telemarketer who claims to be from a credit card company. This person tells you how easy it is to steal a credit card number, especially over the Internet. He or she offers to sell you "protection" so you wouldn't have to pay if thieves run up a huge tab on your account. The person says that if you don't get this protection, you'll have to foot the bill for any "unauthorized charges."

Then, the kicker. You are asked: "May we have your credit card number, please?" Later, a charge of between $199 and $389 appears on your account, even if you didn't sign up for the service.

Outrageous? Well, yes it is. The scheme was bogus and entirely unnecessary (most major credit card companies protect you from fraudulent charges). Still, thousands of Americans were victimized by this scam or some version of it. An overwhelming majority were among our nation's most vulnerable citizens: the elderly. The victims lived across the country, from Massachusetts to West Virginia to California and Hawaii. In all, they were defrauded out of more than $12 million.

Who Would Engineer Such a Scheme? Philip Arcand and his wife, Roberta Galway, that's who. Arcand wrote high-pressure scripts to lure in victims, arranged for companies to make the pitch, and set up front businesses to process the illegal monies. Using their ill-gotten gains, the Canadian couple lived a life of luxury. They owned two beautiful homes, one in British Columbia and one in Las Vegas. They had a Mercedes, Corvette, and Ferrari in their driveways. They took frequent trips around the world. Both thought they could skirt justice by preying on Americans thousands of miles away. They were wrong.

Cracking Down. Arcand and Galway were ultimately caught through a combination of alert citizens, who reported their suspicions and complaints to authorities, and a partnership of Canadian and American law enforcement that relentlessly investigated and pursued the criminals. The key players? The Royal Canadian Mounted Police (RCMP), the FBI's Los Angeles Field Office, and the Federal Trade Commission. All three participated in a joint investigation through an RCMP telemarketing task force called "Project Emptor." In August 2002, the couple was arrested by FBI Agents while living in Las Vegas. The case shows once again the increasing frequency of crime-border crime -- and why international partnerships are crucial to defeating it.

Doing Time. On November 17, Arcand was sentenced to 10 years in federal prison. Earlier, his wife Roberta Galway had pled guilty and was sentenced to six months in jail for her part in the scheme. Both are also expected to stand trial in Alabama next year on a 158-count indictment by the Secret Service. The couple also paid a $100,000 civil judgment in a case initiated by the FTC.

The Bottom Line: Don't give out your credit card number over the telephone, unless you initiate the call. Check your account statements carefully. Close all unused credit card accounts. And if you think you have been scammed, report it to the FBI or other law enforcement authorities!