Thousands of UK victims of an international mass mailing scam are to receive compensation following a four-year joint landmark investigation by National Trading Standards and the US Federal Trade Commission, as part of a $25m global pay-out.
As a result, more than £530,000 will be returned to around 3,500 victims, marking a new approach to obtaining proceeds of crime from international fraudsters.
In the investigation, the organisations identified US-based fraudsters who targeted UK households with scam mail offering cash wins and claiming guaranteed prize pay-outs.
The personalised mailings to UK addresses deliberately targeted vulnerable people, such as older people living alone or those with long-term health conditions.
The mailings enticed victims by asking for an upfront fee ranging from £25 to £40. Many paid the fee several times before realising there was no prize, with the highest individual losses in the UK running into thousands of pounds.
The NTS investigation identified a criminal enterprise based in Kansas, US, as the source of the mailings.
Three fraudsters – Kevin Brandes, William Graham, Charles Floyd Anderson – have been convicted of sending tens of millions of deceptive personalised mailers to individuals around the world, in the so-called ‘Next Gen’ sweepstakes scheme.
They ran a classic and vintage car sales operation and held millions of dollars in a variety of bank accounts.
Working with US colleagues at the FTC, action was taken against the perpetrators in 2018, which saw them agree to forfeit $30m in cash and assets, of which $25m was made available to compensate victims around the world.
National Trading Standards has since worked to secure the first compensation scheme across international borders in the UK. Victims will be issued with a pre-loaded card, which they can spend in shops or pay into their bank accounts. The cards will be distributed through local trading standards offices.
National Trading Standards scams team head Louise Baxter said: “Today marks a major milestone in an investigation that started four years ago. Falling victim to a scam can have a huge emotional impact on individuals so I’m delighted that we can use the proceeds of these crimes to provide compensation to thousands of UK victims, with the help of our network of trading standards officers.
“Collaborating across borders with the FTC has proven highly effective. We are confident that this approach of obtaining proceeds of crimes from international fraudsters to compensate UK victims could be replicated in the future.”
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