A Florida federal court has issued a temporary restraining order against a global sweepstakes operation based in Fort Lauderdale, Florida that pilfered approximately $28 million from consumers in the U.S. and other countries, including Australia, Canada, France, Germany, Japan, and the UK, the FTC has announced. The FTC’s efforts have been joined by the U.S. Attorneys Office for the Southern District of Florida that arrested Matthew Pisoni, Marcus Pradel, John Leon, and Victor Ramirez in connection with the sweepstakes operation. Ultimately, the FTC seeks to permanently end the sweepstakes’ illegal practices and refund money to victims of the scam.
In its complaint, the FTC alleges that the sweepstakes, headed by Mail Tree, Inc., mailed personalized letter falsely telling consumers that they had won large cash prizes, typically more than $2 million. The falsified letters said that the prize money was “guaranteed,” but, that in order to collect the money, consumers had to mail the defendants a $20-$30 fee by cash, check, or money order. To hasten the consumer’s payment, the sweepstakes set a bogus deadline, generally within ten days of receipt of the letter, warning the consumer that he or she would forfeit their winnings if they didn’t pay by the deadline. However, in reality, the FTC says that consumers had won nothing.
The FTC alleges that Mail Tree and the other defendants never had any connection to a sweepstakes and never could pay consumers the prize money they promised. “Only in dense, confusing language, at the bottom or on the back of the letters,” the FTC explains, do they admit that the only service they provide is compiling “reports” about sweepstakes and contests offered by other parties that are open to the public. By design, the defendants’ disclaimers are unclear and inconspicuous, and fail to alert consumers to the truth, and most consumers don’t even receive the “reports” and would never have agreed to pay $20-$30 for them.
“This outfit promised people huge prizes and collected millions in fees but never paid out a dime,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “If someone says you have to pay to claim a sweepstakes prize, assume it’s a scam.” Furthermore, according to the U.S. Attorney Wifredo A. Ferrer, “No one is permitted to steal hard-earned money from members of our community. This office will work with international, national and local law enforcement agencies to prevent these types of sweepstake fraud schemes, and we will bring those who commit these crimes to justice.