Your weekly ScamWatch: Jobs, taxes and real estate
Internet jobs scam — Two Michigan residents who ran a company that claimed to hire people to inspect bank-foreclosed homes have been indicted on federal charges that they scammed 20,000 job-seekers out of $2 million. Former NBA player Jay Vincent and a business partner were accused Wednesday of charging job seekers fees that allegedly would be used for liability insurance and background checks. Instead, prosecutors said, the men pocketed the money. None of the applicants were given jobs, federal prosecutors alleged. Vincent’s company, Foreclosure Bank Inspection Company, advertised in newspapers and on the Internet. Vincent, of Lansing, Mich., is charged with mail fraud and income tax violation. Vincent’s attorney, Charles Ford, told the Associated Press that Vincent is “a legitimate businessman,” and cautioned, “A person is innocent until proven guilty.” Federal authorities have urged consumers to be wary of companies that offer prizes or services but demand payment in advance.
Scamming Uncle Sam — The U.S. attorney’s office has sued a Chicago tax return preparer, accusing him of filing fraudulent returns for potentially thousands of taxpayers. The lawsuit seeks a court order prohibiting Charlie Wilson and his company, CBD Tax Service, from preparing tax returns in the future; it also requests a list of all clients for whom his company prepared returns between 2006 and 2009. The IRS reviewed 114 returns prepared by Wilson’s company and contends that 112 of them were fraudulent, with a loss of more than $500,000 to the federal Treasury, the lawsuit alleged. The returns contained fraudulent deductions for charitable contributions and business expenses, the lawsuit said. Wilson could not be reached for comment.
Massive real estate fraud arrest -- A New Jersey man has been arrested on federal charges that he ran a real estate investment fraud that caused victims to lose $200 million. Eliyahu “Eli” Weinstein, 35, is accused of targeting fellow members of the Orthodox Jewish community in New Jersey, New York, Florida, California and overseas. According to the indictment, Weinstein did not own many of the properties he claimed to own and drafted phony leases to make it seem that properties had substantial rental income, when in fact there were no tenants and no income. Authorities contend that Weinstein, who was arrested Aug. 12, operated a Ponzi scheme, using new investor money to pay returns to earlier investors. He allegedly used investor money to buy millions of dollars worth of jewelry, watches, art and Judaica. Weinstein's attorney has said his client is innocent and that the charges are from disgruntled former partners who are already suing him over investment losses. Michael B. Ward, special agent in charge of the FBI’s Newark office, said, “This investigation highlights the need for consumers to do their own homework before entering into any business arrangements and not simply take the word of the other partners. If something seems too good to be true, it almost always is.”
-- Stuart Pfeifer