U.S. & Dutch Authorities Shut Down International Scam That Bilked Millions From Elderly

Simultaneous legal actions by both the U.S. Department of Justice and Dutch authorities seek to shut down an alleged mail fraud scheme that tricked elderly Americans into paying tens of millions of dollars with the false promise of winning valuable prizes in return.

According to the complaint [PDF], filed in a U.S. District Court in New York, since at least 2012 two companies based in Utrecht, Netherlands, operated “caging” services for multiple international mail fraud scams, meaning the companies receive and open responses from victims, and process payments for the scammers.

The scams themselves fell into three general categories:

• Letters that falsely claimed the victim had won some sort of lottery or sweepstakes, but that they must pay a processing fee to collect their winnings.

• Letters falsely stating that the victim had won a large sum of money, then tried to upsell them on buying a “guaranteed,” “secret” method for winning lotteries and other games of chance.

• Letters claiming to be from a person with psychic powers who promised to use their abilities to improve the victim’s financial and personal circumstances. These solicitations often stated that the psychic has seen the individual recipient winning large sums of money through the lottery. Of course, to actually make this vision come true, the victim would need to purchase some sort of bogus, supernatural good luck object or service.

The amount scammed from most victims was not huge — often between $15 to $55, according to the complaint — but the DOJ says that it added up. In just the few years that the defendants have been operating, the government estimates that U.S. citizens sent more than $18 million a year to the P.O. boxes operated by the defendants.

While the DOJ was bringing its courtroom actions against the two companies, getting a temporary restraining order and seeking injunctions, Dutch law enforcement agents executed search warrants on the defendants’ offices and the home of the companies’ owner. Dutch authorities took control of the P.O. boxes used by the defendants to receive victim funds.

“Schemes targeting elderly victims are increasingly international in scope, but geographic distance will not prevent us from seeking justice and holding bad actors accountable,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer. “Dutch authorities have done a great service to U.S. residents and elderly victims worldwide by addressing fraud facilitated within their borders.”