Coupon fraud adds up to $250 million

[Kelemvor]

Feds: Coupon fraud adds up to $250 million

The nation's largest coupon handler and several of its executives have been charged in federal court with scheming to defraud stores and manufacturers of at least $250 million over 10 years, according to an indictment unsealed in Milwaukee today.

The 25-count indictment says International Outsourcing Services, with offices in Bloomington, Ind., and El Paso, Texas, defrauded manufacturers in Wisconsin and across the country by submitting coupons for reimbursement that were never used by consumers, but rather were cut up by coupon "chop crews."

The 18-page indictment charges the company, nine of its officers and two people from a second company that is accused of being in on the scam.

The indictment was unsealed this morning as defendants were being arrested around the country. The first court appearance is expected later today.

The case is being prosecuted by the U.S. Attorney's Office in Milwaukee because the complaint that kicked off the case came from here, prosecutors said.

The Milwaukee office of the FBI conducted that initial investigation as well as contributing to the current one, they said.

Charged in the indictment are Thomas Balsiger, Bruce Furr, Steven Furr, Lance Furr, William Babler, Ovidio Enriquez, David Howard, Howard McKay, James Currey, Daxesh Patel and Bharatkumar Patel. If convicted, the defendants face up 20 years in prison and a $250,000 fine for each of the 25 counts, but under federal sentencing guidelines are unlikely to receive close to the maximum.

That a hell of a lot of coupons since the average is what? $.50?

 

[FoBoT]

"chop crew" , sounds like a fun job

 

[Demon-Xanth]

That makes it sound like ATHD is part of an international fraud ring now.

 

[moshquerade]

what low life.

 

[kranky]

It wouldn't take but 10 minutes or so to cut every coupon out of the Sunday paper supplements. And the redemption house gets face value + a handling fee for each one. So you could generate a lot of money per hour doing it.

And add to that the fraud from cashiers accepting every coupon from friends in the checkout line whether they bought the products or not. It's got to be huge.

 

[imported_weadjust]

A lot of small grocery stores and convience stores remove all the coupons from the Sunday papers and submitt every coupon.