H.B. man among 7 convicted in $126-million office supplies fraud scheme
A Huntington Beach man is among seven people who were convicted Friday in federal court in Santa Ana for their roles in a decades-long fraud scheme that authorities say bilked more than 50,000 victims out of tens of millions of dollars.
The scheme to illegally switch printer and toner customers to Culver City-based business IDC Servco dates to 1988, according to the U.S. attorney’s office. Over a six-year span, customers were tricked into sending more than $126 million to telemarketers involved in the scam, federal prosecutors said.
Following a seven-week trial, jurors convicted James Milheiser, 53, of Huntington Beach; Gilbert Michaels, 77, of West Los Angeles, the owner of IDC Servco; Leah Johnson, 54, of Ignacio, Colo.; Jonathan Brightman, 52, of Westlake Village; Sharon Scandaliato Virag, 54, of West Hills; Tammi Williams, 44, of Chino Hills and Francis Scimeca, 54, of Woodland Hills.
All the defendants were convicted of one count of conspiracy to commit mail fraud. Michaels was additionally found guilty of 10 counts of mail fraud and five counts of money laundering, while Milheiser, Johnson, Brightman and Scimeca were also found guilty of mail fraud.
Sentencing is set for May 29.
In the scheme, telemarketers would call businesses and claim to be their regular printer and toner suppliers offering a price cut, but in reality, they would be sent forms to switch their business to IDC Servco and pay two to 10 times more, prosecutors said.
Fourteen other defendants pleaded guilty previously.
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