November 14, 1996
(Government Services and Lands)

Telemarketing Fraud Conviction

The Department of Government Services and Lands has been advised by Project Phonebusters, a national task force combating telemarketing fraud, that Darrel Alan Dorsey of Kingston, Ontario has plead guilty to a telemarketing offense. Mr. Dorsey was charged with misrepresenting to the public that they had won valuable prizes contrary to Section 380(a) of the Criminal Code of Canada.

Mr. Dorsey was originally arrested on November 17, 1993 in Montreal, where he was operating a telemarketing room. He was convicted on November 4, 1996 to 12 months in jail for fraud over $5,000.

Operating out of Montreal between 1991 to 1993, Dorsey was involved with the following telemarketing companies; Great Dane, Fantasy Productions, and Ivan's Endeavours.

In Canada, 779 victims sent money to the above-named companies on the promise of winning a prize. Victims called by phone were led to believe they had won a vehicle. In order to collect their prize, however, they were required to send $400 to cover shipping and handling costs, as well as other charges. Twenty-three Newfoundlanders were defrauded out of $25,308.32. The dollar loss for all Canadians was $953,870.25.

Consumer Affairs officers with the Trade Practices Division of the Department of Government Services and Lands maintain contact with Project Phonebusters in an effort to curb telemarketing fraud in the country and regularly refer victims to Project Phonebusters, coordinated by the Ontario Provincial Police.

Ernest McLean, Minister of Government Services and Lands, said: "The Trade Practices Division has made telemarketing fraud a priority issue. Consumer Affairs officers report a decrease in the number of consumers who complain they have been victims but a substantial increase in the number of inquiries regarding the legitimacy of such offers. This is partly due to government's commitment to a safe and healthy marketplace, through such avenues as the department's consumer awareness program."

While anyone can be targeted and victimized by these scam artists, senior citizens are especially vulnerable. Almost 50 per cent of reported cases on file with Project Phonebusters for the past year have involved senior citizens. The amounts which consumers pay out to these scams range from the price of a 1-900 telephone call, usually about $35, to several thousands of dollars. Some seniors have lost their entire life savings.

The number of scams which are actually reported is considered to be a very small representation of those which actually occur. Consumers are often embarrassed to admit they have been duped into sending money for a bogus offer, while others have admitted to being afraid to tell family members that they are sending large amounts of money to unknown sources.

It is very easy to become a victim of these scams. The operators of these schemes appear to be very sincere and convincing to unsuspecting consumers. Consumers who receive an offer either in the mail or by telephone which suggests that they have won a prize but must pay out money in order to collect that prize should immediately contact consumer affairs officials of the Trade Practices Division for advice.

Contact: Rick Callahan, Director of Communications, 729-4860 or Carol A. Furlong, Policy Planning and Research Analyst, Trade Practices Division, 729-4196.