Stiffer Sentences for Con Men Cheer Fraud Task Force Leaders

Condense 3 years’ worth of boiler-room battle into one sentence and it would probably read something like this: Convictions keep coming, sentences get stiffer, but the problems persist.

That’s life with the Southern California Fraud Task Force, a group of 21 federal, state and local law enforcement agencies charged with the Herculean job of stamping out telemarketing crime in the Southland.

The group’s 108-page annual report released last month paints a bittersweet picture of great success tempered with painful resignation.

On the bright side is the trend toward stiffer sentences, a practice that Robert C. Bonner, U.S. attorney for the Central District of California, contends will have a great deterrent factor. Bonner kicks off the report by congratulating his department on the hefty sentences given of late to convicted con men.

“Substantial custody sentences in telemarketing cases have become commonplace,” Bonner says, as he goes on to compare the light punishments of 1986 with 20-year sentences handed out in 1988.

During 1986, the task force’s first full year of operation, only four defendants in telemarketing cases were sentenced to 5 or more years in prison. In 1987, the report says, the number was the same: 4.

But 1988 was a banner year for sentencing: 20 defendants received sentences of 5 or more years. One of those con men was sentenced to 25 years, and three were given 20 years in prison, the report says.

A page later, however, reality kicks in:

“Members of the public continue to be defrauded by fast-talking swindlers who use the telephone to convey their pitches,” Bonner writes. “The considerable coordinated efforts of all the above agencies have still not been able to stop a nationwide crisis where frauds emanating from Southern California now victimize the public of an estimated $3 billion to $4 billion a year.”

One problem, says Assistant U.S. Atty. David Katz, the task force head, is the lack of resources and manpower.

Law enforcement experts place California at the center of the telemarketing fraud map, but the annual report says that Southern California has only a third as many FBI agents as New York City and only half the number of federal prosecutors.

“The lack of law enforcement resources is a key reason for the widespread descriptions of Southern California as ‘the fraud capital of the world’ and of the coastal area around Newport Beach as the ‘Cote de Fraud,’ ” Katz says in the report.

HOW SOUTHERN CALIFORNIA TASK FORCE HAS FARED

The Southern California Fraud Task Force has been in operation for 3 years and takes credit for disposing of nearly 300 cases. Eight of those cases have yet to come to trial, according to the task force’s annual report. Forty-seven others are either at the indictment stage or the defendants are fugitives. The convictions each year:

1986 36

1987 90

1988 74

1989 (to date) 14

The task force also contends that sentences have gotten stiffer in the years that the group of agencies has been cooperating in the fight against telemarketing fraud. Following is the number of sentences of 5 years or more in each year the task force has been in operation:

1986 4

1987 4

1988 20

1989 (to date) 2