Faces of Fraud: Cases and Lessons from a Life Fighting Fraudsters

Chapter 9

A Tale of Deceitful Pitches and Vendor Kickbacks

I spent many years as a federal agent investigating and prosecuting boiler rooms. Boiler rooms are the dark and evil side of telemarketing, and fraudulent pitches and deception are the mainstays of these operations. The scam artists who work in these operations will say and do anything to make a sale. Boiler room salespersons' use of the telephone to facilitate their fraudulent pitches and misrepresentations provide them a false sense of safety and security. They often believe that their physical and perceived distance from the victims make them immune from prosecution and accountability. When boiler room scam artists add kickbacks to their repertoire of tricks, even more damage can be done to individual and corporate victims. My investigation of one such fraudulent operation over several years exposed the fraud and evil that we often see in boiler rooms.

American Chemical Industries (ACI) was a boiler room operation that used high-pressure sales tactics, lies, kickbacks, and extortion to sell its products through telephone solicitations. Salespeople at ACI and its related businesses induced purchasing agents and procurement officers of victim companies to purchase chemicals and computer products at grossly inflated prices by sending them kickbacks in the form of cash and merchandise. The cash and other merchandise were referred to as premiums. These kickbacks were sent to the purchasing agents' homes to avoid detection ...