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T.O. police take down alleged fraud operation

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CTV News: Steve Chao with details of what police call a major telemarketing fraud bust
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Date: Fri. Jun. 13 2003 12:18 AM ET

Toronto police have arrested 10 people accused of running a telemarketing scam asking victims to pay for ads in magazines for police, fire and other emergency services officials say were never printed.

"The problem just got to be big enough that it was time to do something about it," said Det. Staff Sgt. Barry Elliot of the Ontario Provincial Police Anti-rackets Squad.

Police video taken inside the operation showed rooms full of phones allegedly used by telemarketers to sell magazines.

Officials say people were asked to pay for ads in the magazines for police, fire and child safety organizations.

"The advertisements cost between $150 to $4,000 dollars," said Staff Insp. Mike Federico of the Toronto Police Service Fraud Squad.

But, the magazines were never sent and the advertisements never printed, according to police.

The operators of the telemarketing operation allegedly targeted victims from Vancouver to Moncton and at times convinced people to donate by impersonating officers.

"This case is particularly detestable because the criminals preyed on the good names of emergency services and the charitable inclinations of the community," said Federico.

Non-profit groups like Child Find say telemarketing scams create public distrust of legitimate charities, making it harder for them to help the community.

"We get misunderstood as being part of those organizations. We get linked to them unfortunately and the public doesn't know so it causes great damage," said Jan Barr of Child Find.

Bob Whitelaw of the Council of Better Business Bureaus said there is a way to ensure money given to charity actually gets where it's suppose to go.

"If you're so inclined to help the police or help the fire department, take your money directly to the fire station or the police office," he said.

Telemarketing fraud facts

  • Toronto, Montreal, and Vancouver are three of the top five centres in North America for telemarketing fruad.
  • In the Toronto area, there are up to 500 operations where telephone salespeople use high pressure tactics to solicit funds from unsuspecting victims -- so called boiler rooms.
  • In Ontario, senior citizens account for 80 percent of all victims.
  • Telemarketing fraud and other scams costs Canadians an estimated $5 billion each year.

With a report from CTV's Steve Chao

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