Telemarketing Fraud

ACCORDING TO the U.S. Department of Justice, telemarketing fraud “refers to any scheme to defraud in which the persons carrying out the scheme use the telephone as their primary means of communicating with prospective victims and trying to persuade them to send money to the scheme.” The first widespread fraudulent telemarketing scheme involved the activities of Fifty States Distributors in the mid-1970s in Las Vegas, Nevada. Initially started as a legitimate company, Fifty States sold office supplies to businesses. Barry Schrader, the owner of Fifty States, learned that his office supplies were easier to sell when jewelry or some other item was falsely promised along with the supplies. Eventually, he employed up to 300 people in the scheme to rip off businesses. Fifty States was ...