The Royal Canadian Mounted Police, working with U.S. law-enforcement authorities, have dismantled a Montreal-based telemarketing ring that victimized as many as 500 people a week, many of them U.S. citizens, for up to $13 million.
U.S. Immigration and Customs Enforcement (ICE) spokeswoman Kadia H. Koroma said the eight-month investigation, known as “Project Colt,” culminated this week when nearly 200 Canadian police officers, led by the RCMP, conducted 50 raids, primarily in the Montreal region, that targeted the “boiler rooms” used to make misleading telephone calls.
Forty Canadian citizens were arrested on suspicion of fraud.
“These fraudulent telemarketers prey on some of our most vulnerable citizens, often victimizing them repeatedly until their savings are depleted,” said Marcy Forman, ICE director of investigations. “This collaboration with our Canadian law-enforcement partners and other U.S. agencies continues to yield significant results, both in shutting down the criminal networks and in restoring some funds to the victims.”
Ms. Koroma said the ring engaged in two types of telemarketing fraud: a lottery scheme and a mass telemarketing fraud. In the lottery scheme, she said, the fraudulent telemarketers persuaded their victims that they had won a large sum of money. In order to claim their prizes, the victims were told, they had to send in payments ranging from $1,500 to $60,000 to cover various costs, including customs charges, taxes and insurance.
In the mass telemarketing fraud, she said, the ring used various approaches, either telling persons they called that they were eligible to receive a $7,000 grant, or selling them health care kits or billing them for services never rendered. A common feature of every scheme of this kind is that the victims are asked to pay less than $500.
All the telemarketing schemes required the victims to send money in the form of a certified check or money order. Nearly 90 percent of the victims in this case were over 60 years of age.
The investigative task force included ICE, the U.S. Postal Service, the U.S. Federal Trade Commission and the FBI working with the RCMP, the Surete du Quebec, Service de police de la Ville de Montreal and the Competition Bureau of Canada.
Since its inception, the task force has recovered more than $15 million for U.S. victims of telemarketing fraud. ICE agents were instrumental in getting evidence from victims of the lottery scheme in the United States.
“Investigators draw connections between various forms of crime and link certain crime groups such as street gangs and traditional organized crime with the leaders of a telemarketing fraud ring,” said Saverio Orlando, RCMP officer in charge of the Montreal commercial crime section. “This investigation shows that the fight against commercial crime is one of our priorities.”
The Canadian anti-fraud call center estimates that 500 to 1,000 criminal telemarketing boiler-room operations are conducted on any given day in Canada, grossing about $1 billion a year.
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