Finally a plea deal has been worked out with one of the defendants named in a 2009 criminal complaint filed by the United States of America.
In the complaint, Timothy Arent and Neil Wieczkowski were running a fake debt collection agency and taking in millions of dollars from consumers that were frightened to pay debt they did not owe.
If you are a frequent reader of this site you will notice many similarities between their story and some of the questionable debt relief companies I write about. The use of fake names and mail drops seems to be pervasive in the modus operandi of many a scam.
This scheme operated by acquiring the names and contact information of consumers who at one time had owed a debt. Arent and Wieczkowski would then use this fraudulently obtained information and contact consumers claiming to be law enforcement officers. They would tell the person they were coming to arrest them unless the consumer paid up, now.
Consumers were then given telephone number of purported attorneys to assist them to stay out of jail but these numbers simply routed back to Arent and Wieczkowski. So by this point Arent and Wieczkowski had falsely portrayed they were both law enforcement officers and lawyers. Nice.
The pair, in an attempt to remain untraceable, frequently changed their business names. Some of the name the operated under were Alden & Associates, Acquired Card Services, Consumer Debt Services of North America, Debt Management Services, Feldstein Feldstein Rubin & Associates, Fittinger and Dunn, Ginsburg and Miller, Grigsby Cross and Rose, Greenman & Donohue, Harmon and Maier, International Portfolio Management, Kaplan White Hirschbaum, Kellerman Weiss & Associates, Levi & Rothstein, Mayfair Cohen Rivera and Stone, Rosenthal and Colby, Smithfield & Ross, The Topeka Holding Company.
A good portion of the companies had no corporate records on file, just as many of the companies I investigate currently are operating loosely.
The companies were operating out of temporary mail drops through Regus office which was then forwarded to yet another address, typically a post office box in Buffalo, New York.
Money fraudulently obtained by Arent through Consumer Debt Services was then used to pay his day-to-day living expenses, including mortgage and utility payments, remodeling of his home, school tuition, car payments, luxury items, antiques, furniture, jewelry, artwork, vacations, and an inground pool. Arent also used the money to buy Wieczkowski a Jaguar XK8.
Trash
As part of the investigation the trash was collected from one of the addresses and examined. In the trash, damning evidence was found. Personal correspondence to Arent was recovered along with letterhead and overnight envelopes to a number of the fake companies.
Typed pages with consumer information and handwritten notes was recovered as well. The information contained names, dates of birth, social security numbers, telephone numbers, employer information and credit card data. The notes in the margins appeared to be reminders which bank Arent told the consumers they owed.
Part of the Debts Scamed Involved Settlement
Some of the debts Arent attempted to collect on had been previously settled. In one case, Deanna Joy, in Florida, received a voicemail from a male claiming to be with the Broward County Sheriff’s Office and advised Ms. Joy that she owed $8,162 on a previously settled debt. The caller advised Ms. Joy she could avoid further legal action if she paid $2,695.50.
In another case the duo told a consumer they would settle their debt for pennies on the dollar and collected post-dated checks. Unfortunately Arent was neither authorized to collect on the debt nor authorized to settle it. The consumer subsequently discovered they still owed the full debt.
Yet another victim had withdrawn from a bankruptcy filing and expected her creditors to contact her. A male claiming to be with the Sheriff’s Office said she owed $13,479.22 and there was a felony warrant out for her. Out of fear the consumer gave the scammers a CD worth $11,000 to avoid the legal troubles they scared her with.
And the scenario was very similar with many of the other victims as well.
Trial Transcript
The following are excerpts of the trial transcript.
In addition, pretending to be attorneys, using names of actual attorneys and sort of melding them into different law firms. This is a sophisticated scheme, Judge, that Mr. Arent constantly adapted to avoid detection.
One of the things that I recently found out, Judge, is that Mr. Arent has a nickname in the business of debt collection. He’s known as “The Beast,” and he’s known as “The Beast” because of the way he beats on people on the telephone.
And, in fact, Mr. Arent has a tattoo on his arm in a foreign language, I’m not sure what it is, but that he proudly informed law enforcement means “The Beast.”
This is not somebody who doesn’t know what he’s doing or is lawfully collecting debt. This is somebody who beats on people on the phone, uses threats and intimidation, false impersonation by pretending to be a sheriff, pretending to be a lawyer, getting them to send him substantial amounts of money.
The money that Mr. Arent got again, you know, as I said in the beginning, $8 million in the accounts; $744,000 goes to Mr. Wieczkowski; Mr. Arent buys him a car; over $1 million in purchases of luxury items, not to mention personal expenses.
Mr. Arent doesn’t know how to do anything other than debt collection. This is what he does. If he gets out, Judge, he’ll go back to what he’s always done, and he’ll do that not only because he has a history of employment in debt collection, and that goes back to working for Great Lakes, and then Great Lakes became I believe NCO, and he worked there as a debt collector; and then he went out on his own, and on his own he has been doing the debt collection business since, I believe, around 2002, with or without a partner. Mr. Wieczkowski got involved later on. – Source
The Data Leak is Named
In the plea agreement entered into by Arent it was disclosed that an employee, Thomas Rice, was working at Capital Management Services, a debt collection business in Buffalo. Wieczkowski told Rice he wanted to buy the names of people who had recently paid off their debt. Rice sold the scammers the information for about $4,000 a month. Another Capital Management Services employee, Jon Pytlewski, also played in the same scam.
As part of the plea agreement Arenet was calculated to over over $780,000 in back taxes from his fraudulent income. He is most certainly going to receive jail time and the loss of all his personal property as a result of his criminal enterprise.
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