It’s annual pet scammer week! That’s a lie. But it sure feels like it.
Eric Stein was charged with running an investment scam through Return-A-Pet LLC. Return-A-Pet was a New York company that allegedly facilitated the return of lost pets to their owners.
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Stein was out on supervised release for a previous investment fraud scheme and netted at least $500,000 from this new pet scheme. Stein supposedly deceived dozens of consumers into purchasing sham Return-A-Pet distributorships using false and misleading advertisements.
According to the Complain unsealed in court:
Return-A-Pet purportedly provided enrolled pet owners with access to a toll-free number that was staffed 24 hours-a-day and printed on the pet’s ID tag, in order to help lost pets be returned to their owners. From June 2007 to January 2010, Stein allegedly sold sham Return A-Pet “distributorships” for upfront fees that ranged from $5,000 to $50,000. He sold distributorships to individuals who lived all over the United States and abroad, including in Texas, Georgia, Kentucky, North Carolina, and South Africa. Stein personally communicated with prospective distributors, often falsely identifying himself as “Robert Philips.”
To lure investors into paying him the upfront fees, Stein allegedly made fraudulent statements and representations in Internet and print ads and provided phony references to convince victims that they were purchasing a bona fide business opportunity. However, after making payments to Return-A Pet, the victims never received the materials and services promised to them as part of the distributorships. Rather, Stein simply kept their money, taking in at least $500,000 over the course of the fraud scheme.
Stein also referred prospective distributors to phony references – people whom he allegedly recruited to pose as distributors to provide fake testimonials of their positive experiences with Return-A-Pet. He rarely, if ever, returned victims’ money when they demanded refunds. Instead, in an effort to delay and appease victim-distributors, Stein hired an employee to provide false information.
As set forth in the Complaint, Stein was publicly interviewed by a Wall Street Journal reporter in 2004, and on the television program “American Greed” in 2008, concerning an investment fraud scheme he operated in Nevada for which he was previously convicted. In the interviews, Stein described how he had lured investors into believing that his business was legitimate by, among other things, paying people to give phony, “wonderful” references – similar to his alleged operation of Return-A-Pet. In the Wall Street Journal interview, he stated “it’s all about the packaging and the picture that you paint for them – the image, all about the dream you’re making for them.”
Stein has been charged with one count of mail fraud and one count of wire fraud. He faces 20 years in prison on each count.
Manhattan U.S. Attorney Preet Bharara said: “As a business venture, reuniting people with their lost pets must have sounded like a real moneymaker to the victims of Eric Stein’s alleged fraud who thought ] they were purchasing Return-A-Pet distributorships. But as they quickly discovered, they were in business with a con artist who allegedly use phony Internet and other advertising to market his scheme. He will now be brought to justice” – Source.
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