2 Convicted of Fraud in Telemarketing Scam

Two San Fernando Valley men were convicted on federal fraud charges in connection with a telemarketing scam that bilked elderly victims out of millions of dollars.

George Richard Hallett, also known as Stephen Bishop, and Brian Francis were found guilty Wednesday by U.S. District Judge Carlos Moreno, said Ellen Lindsay, the assistant U.S. attorney who handled the case.

Hallett was the manager and Francis a telemarketer at American Fortune 900, a company that solicited investments to establish and advertise a pay-per-call 900-number phone service that would generate revenue for investors, Lindsay said. The company operated in Woodland Hills, Reseda and Westlake Village.

About 150 people were lured into the scam, losing about $3.5 million in the venture, she said. Rather than paying investors, she said, American Fortune used the bulk of the money to pay commissions to telemarketers who solicited other investors.

Hallett and Francis are scheduled to be sentenced April 26. Hallett, 47, was convicted on nine felony counts and faces a maximum sentence of 45 years in federal prison. Francis, 33, who was found guilty on 10 felony counts, faces up to 50 years in prison. Both defendants could also be ordered to pay up to $70 million in fines.

The court will probably order them to pay restitution, Lindsay said.

“Whether [the victims] will see any of the money, I sincerely doubt,” she said.

The case came to light after complaints were made to the Federal Trade Commission, which shut the operation down in January 1996, authorities said. The commission referred the case to the FBI.

The owner of American Fortune, Rory Cypers, 27, and six other people affiliated with the firm previously pleaded guilty.