Scams more high-tech, vicious

As posted on May 27, 2011 on www.ajc.com


It’s an ingenious scam, prosecutors allege.

Three people bought a cell phone and registered it under the name “Georgia Powers,” so that’s what showed up on caller ID.

Then, they started calling elderly people, convincing them that calls were coming from their longtime utility company, prosecutors say. Their victims turned over credit card numbers and other personal information.

Ingenious, and also vicious. But running con games on the elderly is always vicious, and it’s also a growth industry.

Consumer watchdogs and prosecutors say cons are swindling the elderly out of their savings at an alarming rate. A 2009 study by the MetLife Mature Market Institute estimates that victims of elder financial fraud lose at least $2.6 billion a year.

In the alleged “Georgia Powers” scam, laid out in a DeKalb County indictment, two defendants are expected to stand trial this summer on charges of racketeering, identity fraud, financial transaction fraud and elder exploitation.

In recent years, local prosecutors have obtained convictions against an Atlanta investment manager who defrauded a 90-year-old woman with Alzheimer’s out of her life savings; an Atlanta CPA who swindled his girlfriend’s mother out of $120,000; and a Marietta attorney who raised more than $40 million in a Ponzi scheme that targeted retirees.

In September, five people, including three from Cobb County, are set to stand trial on charges they ran a telemarketing scheme that defrauded consumers out of $25 million.

John Sours, administrator of the Governor’s Office of Consumer Protection, said elderly victims are frequent targets because they are growing in number, are more trusting, and have free time and disposable income.

“Certainly the volume of calls and complaints we receive involving telephone and Internet scams is growing exponentially and this includes those targeting the elderly,” he said. “The perpetrators of these schemes have become so sophisticated.”

The DeKalb DA’s office has one of the few task forces in the state that focus almost exclusively on elder exploitation cases, with three dedicated prosecutors — up from one two years ago.

“Everyone has a grandmother, grandfather or elderly person who has played an important role in their life,” said District Attorney Robert James. “The lowest common denominators in society are those who target our elderly and try to take the money they’ve saved for their golden years.”

Internet and telephone hoaxes continue to abound. This includes fake check scams in which victims receive an advance on a sweepstakes jackpot and are asked to pay taxes on the winnings before they can collect their prize.

“There seems to be no limit on their creativity,” said Sharon Merriman-Nai, co-manager of the National Center on Elder Abuse. She called the allegations set out in the DeKalb indictment in the “Georgia Powers” case “scary good.”

Donald Crane, Santee Roberts and Charlene Merkerson orchestrated the scam over a five-month period beginning in March 2009, the indictment alleges.

Crane, who has pleaded not guilty, is represented by public defender Juwayn Haddad, who declined comment. Gerald Griggs, who represents Roberts, said his client is not guilty and will be exonerated at trial. Merkerson, remains at large.

Using a cellphone they bought from MetroPCS under the fake name, the three called at least 86 people and told them that because their bills were overdue, their electricity would be cut off if they didn’t make immediate payment, the indictment alleges.

After getting some credit card numbers, the three immediately bought electronics and gift cards and made cash advances, prosecutors said.

A 76-year-old Chamblee woman, a victim named in the indictment, said she divulged her Social Security number to a woman she thought was a Georgia Power official and who also asked for credit card numbers. The Chamblee woman said she refused to share that information.

“I knew better, but she was very convincing and very threatening,” said the woman, who asked that her name be withheld out of concern she would be victimized again.

On some occasions, the defendants went even further — telling victims their credit cards had been compromised and to place them in their mailboxes, the indictment said. Some people did this, and the defendants retrieved the cards and used them at restaurants, hotels, ATMs and department stores, according to the indictment.

After receiving calls from alarmed consumers, Georgia Power opened an investigation and learned calls had been placed throughout the metro area, spokesman Jeff Wilson said.

Roberts, 31, was arrested after getting out of a car that had just left the home of a victim in Fulton County, the indictment said. Crane, 42, was arrested later.

Carriers who sell prepaid cellphones are not required to verify a customer’s actual name and address, MetroPCS spokesman Drew Crowell said. As a result, some customers provide fictitious names when signing up.

While the company does not verify customers’ actual identities, providing false information is a violation of MetroPCS terms and conditions of service, and the company works with local authorities to stop any fraud that is uncovered, Crowell said.