Scam on elderly has roots in T.O.

…has earned Canada an international reputation as the world’s telephone scam capital. Cross-border fraud remains one of the most pervasive forms of whit-collar crime in Canada and the U.S., according to law enforcement agencies…“Eighty per cent of Americans that are victimized through telemarketing send their money to Canada,”

The Toronto Star
September 14, 2004

Scam on elderly has roots in T.O.
Phone fraud sweeping U.S. started in Bloor St. boiler room. Tip leads cross-border task force to arrest 25-year-old man.
Betsy Powell

Joan-Marie Scheet was at home in North Dakota when a man identifying himself as Chris Smith called from the social security office.

He told her there had been a policy change so she would be receiving her first social security cheque ahead of her 65th birthday in February. Since he’d provided his “badge” and phone numbers and his office hours, Scheet felt at ease supplying her chequing account number “for a direct deposit cheque.”

“I feel embarrassed that I was duped, because I know never give that out, but you know, social security, that threw me off,” she said on the phone from Rugby, the small rural community where she lives.

She later “wised up” and contacted the real social security office in Grand Forks, N.D., though, fortunately, her bank ha already stopped payment on a cheque for $299 (U.S.) before the scam artist was able to drain her account.

Toronto police say Scheet was one of thousands of Americans in several states, many of them seniors, who have fallen victim in a telemarketing scam that originated in a Bloor St. W. boiler room operation in Toronto, the kind that has earned Canada an international reputation as the world’s telephone scam capital.

Cross-border fraud remains one of the most pervasive forms of whit-collar crime in Canada and the U.S., according to law enforcement agencies. The PhoneBusters national call center estimates there are between 500 to 1,000 criminal telemarketing boiler rooms, grossing about $1 billion a year, operating in Canada.

“Eighty per cent of Americans that are victimized through telemarketing send their money to Canada,” Detective Jim White of the Toronto Police Service’s telemarketing squad said yesterday.

In this latest bust, police estimate at least $1 million (U.S.) had been electronically debited from accounts from people who received calls traced to the Toronto apartment above a store in a nondescript west-end building.

An investigation by a multi-agency, cross-border task force, called the Toronto Strategic Partnership, led to Friday’s arrest of a 25-year-old man after a tip from a social security office in Wisconsin. Victims heard various misleading pitches, including being told to pay a one-time fee of $299 (U.S.) in order to receive a drug plan offering cheaper Canadian prescription drugs. Packages that were forwarded to victims contained nothing more than a list of Canadian pharmacies offering discounts to seniors.

Alan Krause, an investigator with the Midwestern region of the Federal Trade Commission, says it’s understandable so many consumers were fooled because there has been considerable media attention and some confusion over changes that, for the first time, find U.S. seniors receiving prescription drugs as part of their medical care coverage.

There is also continuing controversy about Americans buying cheaper prescriptions in Canada, where priced can be 80 per cent lower.

“With these telemarketers, you take the front page of the newspapers over a month period and you can normally pick out what the next scam will be,” said White.

Police allege that since Jan. 1, 2003, the accused operated his scam under companies called Millennium Consulting, Med-Supply, Xtel Marketing, Extel Marketing and Pharm-Assist.

Ten telemarketers, working from a calling list, available on the Internet for a fee, were arrested but released unconditionally, White said. They hadn’t been paid for a month, he added.

Charged with fraud over $5,000 is Navin Varma Baboolal, of Toronto. He was released on bail and scheduled to appear in court next month.


Risks: Outright scam, Fraud, Telemarketing fraud, Slap on the wrist for white-collar crime, Canada: white-collar crime haven, Canada, 20040914 Scam on

Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-ShareAlike 3.0 License