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Man criminals sure find simple but ingenious ways to screw people out of money!
What's this got to do with government? I think there is a Federal law requiring companies that have 800 numbers to pay the owners of pay phones each time a call is made from the pay phone to their 800 number. I wouldn't have a problem with that if it a private agreement, that wasn't mandated by the government. Feds: "Robocall" fraud netted businessman $4M By Crimesider Staff (CBS/AP) WASHINGTON - Federal prosecutors say a businessman rigged pay phones in Wash., D.C. and Maryland to robotically call toll-free numbers with each call netting him about 50 cents. They say Nicolaso Kantartzis netted $4 million in the scheme over six years. Here's how they say it worked. Kantartzis allegedly programmed dozens of pay phones to make phantom calls over and over again to toll-free numbers belonging to companies and the government. Such calls are free to legitimate users - but someone still has to pay for the cost of using the telecommunications hardware that carries them. Thus Kantartzis was owed a fee each time his phones rang the numbers, even if no one was on the other end of the line. Authorities say the scam included 8 million bogus calls. Kantartzis, 62, is charged with wire fraud, which could carry a prison term of up to 20 years and a $250,000 fine. Court documents suggest a plea deal is in the works. Prosecutors say in court documents that Kantartzis has owned a pay-phone company since 1995 and controlled at least 165 phones in Washington and nearby Maryland. Starting in January 2005, he used a computer at his home in Bethesda to program the phones to place calls to toll-free numbers for government agencies, companies including Dell and multiple airlines, the documents say. Pay phone operators are allowed to collect 49.4 cents for each toll-free call placed from their equipment. But in Kantartzis' case, prosecutors say the calls were not being made by real people. The documents don't say how Kantartzis was caught, but a spokeswoman for the U.S. Attorney's Office, Vickie LeDuc, said that an investigation by the General Services Administration and the FBI led to the charges. Kantartzis declined to comment when reached by telephone on Monday - ironically enough.
Pay phone owner pleads guilty to ringing in $4 million in fraud that used programmed phones By Associated Press, Published: September 20 GREENBELT, Md. — A businessman pleaded guilty Tuesday to rigging pay phones he owned to robotically call toll-free numbers repeatedly so he could collect the 50-cent fee owed for each call, illegally racking up $4 million. Nicolaos Kantartzis acknowledged using more than 100 pay phones he controlled in the Washington area to make phantom calls to toll-free numbers belonging to companies and the government. Because the calls are free to legitimate users, the entity on the receiving end must pay costs that include a cut for the company that operates the pay phone. As a result, Kantartzis was paid each time his phones rang the numbers, even though most calls lasted only a few seconds and no one was on the other end of the line. Authorities say the scheme spanned six years and 8 million bogus calls. Kantartzis, 62, pleaded guilty Tuesday in federal court in Maryland to wire fraud, which could carry a prison term of up to 20 years and a $250,000 fine. His attorney, David Irwin, said after the hearing that Kantartzis has repaid the money he earned from the scheme and agreed to forfeit his phones, which have been disconnected. He said federal sentencing guidelines would recommend a sentence of five or six years, though he plans to ask for less when Kantartzis is sentenced Jan. 4. Irwin said he believed his client’s business declined as cell phones became more popular, one factor that may have led him to make the fraudulent calls. He said his client regrets taking a shortcut to make a profit. “He’s an electrical engineer who came up with a program,” he said of his client. Prosecutors wrote in court documents that Kantartzis has owned a pay-phone company since 1995 and controlled at least 165 phones in Washington and nearby Maryland. Starting in January 2005, he used a computer at his home in Bethesda to program the phones to place calls to toll-free numbers for government agencies, companies including Dell and multiple airlines, the documents say. Pay phone operators are allowed to collect approximately 50 cents for each toll-free call placed from their equipment. But in Kantartzis’ case, prosecutors say the calls were not being made by real people. Kantartzis was caught after an employee at the government’s General Services Administration noticed an irregular pattern of incoming calls on the agency’s toll free line and an investigation was launched, said GSA spokeswoman Sarah Breen. “By auto-dialing, this fraudster exploited a public service and essentially, ‘dialed for taxpayer dollars,’” GSA Inspector General Brian Miller said in an emailed statement. His scheme isn’t unique, however. Two Wisconsin men were charged in April with a similar operation. Prosecutors say they fraudulently obtained more than $1 million over three years.
Pay phone operator pleads guilty in $4m robocall fraud case By: Emily Babay | 09/20/11 8:05 PM Examiner Staff Writer | Follow her: @emilybabay A Bethesda pay phone operator has admitted that he fraudulently made $4 million by setting up his phones to robotically place calls to government agencies and businesses. Nicolaos Kantartzis, owner of Federal Telephone Corporation Incorporated, pleaded guilty in federal court in Greenbelt on Tuesday to wire fraud. From January 2005 until July 2011, he programmed his pay phones to place calls to toll-free numbers, according to plea documents. Kantartzis, 62, received a compensation fee of about 50 cents from the recipient of each call, the documents say. In total, he netted $4 million over the six years. Operators of pay phones receive what's called a "dial around" compensation fee of 49.4 cents for toll-free calls that are made from their phones, paid by the owners of the toll-free numbers. Kantartzis admitted that he rigged his phones to automatically make millions of such calls. Court documents say he programmed the phones to place calls to government agencies that included the General Services Administration, the Department of Labor, the Department of Education and the Internal Revenue Services. The robocalls were also made to private businesses such as Dell Corporation, Fidelity Brokerage Services, financial institutions and airlines, according to court records. Prosecutors said more than 200 agencies and businesses were called. Court records say video surveillance shows that no user was placing a phone call when many of the robocalls were made. Many calls made from pay phones at the Rockville Sportsplex and a barbecue restaurant were programmed to be made while the establishments were closed, court documents say. "There were no actual callers, but owners of the toll-free numbers, including many government agencies, were required by law to pay Mr. Kantartzis 49 cents for each sham call," Rod Rosenstein, the U.S. attorney for Maryland, said in a statement. Kantartzis could not be reached. He controlled at least 165 pay phones in Montgomery and Prince George's counties, court records say. He has agreed to forfeit all the phones, as well as more than $2.8 million and any other future profits from the fraudulent calls. He could face up to 20 years in prison, according to his plea agreement. ebabay@washingtonexaminer.com |