Victims devastated in mobile advertising scam
Updated On: Dec 27 2013 06:20:00 AM EST
Advertising is one way for businesses to attract customers. As long as there are companies seeking to sell something, advertising of some sort will likely be part of the equation. So, when the company Mobile Billboards of America started looking for investors, it had no problem finding them.
"They told investors that they were going to secure advertising from major advertisers to put billboard frames up on the side of trucks," explained US Postal Inspector Mike Carroll.
To be exact, investors were told their initial investment would be $25,000 and they would make 14% on their investment.
"They took in about $70 million from investors all over the country unfortunately very little of that got back to investors," explained Carroll.
The mastermind behind the scam was using the money from new investors to pay old investors.
"The payout gets too big and it collapses and that's what happened here," Carroll said.
Based on how investors were recruited, postal inspectors say this was what's called "an affinity scam."
"Basically making someone comfortable with you by telling them they that they are part of something you are a part of," said Carroll.
In this case, it was church groups.
"He would get pastors to invest, which would in turn a whole new level of confidence for the parishioners of the church," Carroll explained.
The impact on the lives of victims was devastating.
"I know several of the victims have gone back to work at 70 or 75 years of age to make the money to provide for their families," said Carroll.
Seven people were arrested in this case. Their jail sentences range from five years to 22 years for the mastermind behind the scam.
Meantime, postal inspectors say you should always be wary of anyone promising a guaranteed return on your investment. Every investment has risk and you need to determine how much risk you can tolerate.
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