Dozens of Canadians defrauded in U.S. telemarketing scam
Published Wednesday, July 24, 2019 9:52PM EDT
An American man was sentenced to 20 months behind bars for his role in an elaborate telemarketing scheme that ripped off more than 1,000 timeshare owners, including dozens of Canadians.
Approximately 58 Canadians were defrauded an estimated US$21,710 in the decade-long scheme, the U.S. Attorney’s Office for the District of Nevada told CTVNews.ca. The victims came from Ontario, Manitoba, Alberta, B.C., Saskatchewan, New Brunswick and Quebec.
Michael Kroger, 60, pleaded guilty to conspiracy to commit mail fraud and wire fraud in the scheme. In total, he defrauded victims out of more than US$780,000. A judge said Kroger showed no remorse for his role in the crimes and ordered him to pay more than US$212,000 in restitution.
According to documents filed in court, the scam preyed on people looking to sell their timeshares. Fake contracts made by fake companies were used to lure in timeshare owners, who were asked to pay a fee to process the documents.
But the money was never used to process a sale, and no timeshares were ever sold. Instead, prosecutors say that Kroger and his co-conspirator, Michele Paonessa, pocketed the cash and used it to further the scheme.
“Before victims would contact law enforcement or the Better Business Bureau, Kroger and Paonessa would abandon that business and create a new business which they continued to use to perpetrate the fraud,” the Attorney’s Office said in a statement, noting that approximately 29 fictitious companies were created.
Paonessa has also pleaded guilty. She is expected to be sentenced next month, and could face up to 20 years in prison.