Colby Stafford, fraud victim, said, “When you’re my age, you think you are reasonably street savvy, the answer to that is, no I wasn’t.”
Colby learned a hard lesson about trust when his business lost $10,000 in a telemarketing scam.
“At that point in time I was growing so fast, which is a good thing, but you’re spending all your cash,” said Colby.
So, Colby took out a $50,000 loan to have more money readily available. But - “that” loan left him vulnerable to telemarketers calling with a pitch.
US Postal Inspector Camille Hammonds explained, “The telemarketers cold called prospective clients and promised for a fee they would collect their business debts.“
The owner of the debt collection agency was Neil Madison who used some strongarm tactics.
“He threatened to take them into involuntary bankruptcy, to take away their homes their vehicles, and to see that they were criminally charged with fraud,” said Hammonds.
Madison was ruthless in getting the money. But instead of returning it to business owners as promised, he kept it all for himself.
“The funds were used to buy a yacht, numerous luxury vehicles, a house in Laguna Beach CA, occasional prostitutes for top employees,” Hammonds explained.
As part of his scheme, Madison created promotional flyers, including something called a tri-con report - which supposedly showed a debtor’s ability to pay.
“In reality, the report was totally bogus and made up. The Tri-con report was an inside joke known to the employees as ‘we will try to con the client,” said Hammonds
For a while the con was successful, Colby Stafford and more than 600 other victims lost more than $6 million dollars.
Those victims included business owners who thought they had paid off their debts to other companies and others who thought the money they were owed had been collected.
Eventually, Madison was caught and sentenced to 8 years in prison, but Colby Stafford believes Madison could have made his money without cheating other people.
“If you work that hard at something… my god I pay a lot of money to people who work hard for me. Why don’t you come work for me? You’re working so hard to con people, and by the way if you come and work for me you don’t have to go to jail,” said Colby.
Postal inspectors say always carefully check out every company you do business with. The state attorney general’s office or the Better Business Bureau are good references for finding information about all companies.
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