The operations of cross-border con artists who targeted senior citizens in an international lottery scam have been temporarily shut down by the Federal Trade Commission and a team of state and Canadian law enforcement officials. Operating from boiler rooms in Canada, the telemarketers convinced consumers to send them hundreds -- sometimes thousands -- of dollars to enter lotteries they were told they were likely to win, "guaranteed" to win, or had already won. Buying and selling foreign lottery tickets is illegal in the United States.
The FTC and the Attorneys General of Arizona and Washington have filed a complaint and a motion for a temporary restraining order against Win USA Services Ltd., IRAL Services Inc., IRAL Enterprises Inc., Michael Ghirra and Bobby Ghirra. The complaint seeks a permanent injunction barring defendants' lottery telemarketing activities, as well as restitution to consumers or disgorgement of ill-gotten gains, and civil penalties, where appropriate. The investigation was conducted with the cooperation of the Royal Canadian Mounted Police (RCMP) and the British Columbia Ministry of Attorney General.
"Cross-border lottery scams are costing U.S. consumers millions of dollars a year," said Jodie Bernstein, Director of the FTC's Bureau of Consumer Protection. "These telemarketers tell consumers they have a good chance to win, or they have a '1 in 6 chance' to win, or they have already won, and should send in a 'processing' fee. All of it's untrue. And what they don't tell consumers is that buying and selling international lottery tickets is illegal in the United States. Through cross border cooperation between law enforcement authorities, we're working to close these cons down."
The agencies allege that the telemarketers told consumers -- many of whom were elderly -- that they had been specially selected as one of a small pool to win a large cash award or that their odds of winning a large cash award were one in six, or "guaranteed." They told other consumers that they had already won, and conned them into sending hundreds or thousands of dollars in "processing" fees to claim their winnings. The 10-count complaint filed in federal court charged them with violations of the FTC Act, the Telemarketing Sales Rule and Arizona and Washington state law.
The Commission vote to file the complaint was 4-0. The case was filed by the FTC's Seattle Regional Office with the invaluable assistance of the Attorneys General of Arizona and Washington; the Royal Canadian Mounted Police, Vancouver Commercial Crimes Section; and the British Columbia Ministry of Attorney General. The complaint was filed in U.S. District Court for the Western District of Washington in Seattle.
NOTE: The Commission files a complaint when it has "reason to believe" that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.
Copies of the complaints and a free Consumer Alert, "International Lottery Scams," are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC-HELP (202-382-4357); TDD for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.
(FTC File No. 982-3610)