Orono man is third to face charges in Minnesota in multimillion-dollar magazine scam probe

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Via www.startribune.com

Federal authorities in Minnesota charged a third man with helping to run a multimillion-dollar nationwide magazine sales scam, arresting him as he tried to leave the country over the weekend.

According to charges unsealed on Monday, Brian James Williams, 51, of Orono, used companies in South St. Paul and San Diego to allegedly bilk thousands of “elderly or otherwise vulnerable” consumers out of $2.4 million over five years.

Williams was arrested Saturday before he could board a Los Angeles flight to Canada, making him the third defendant in an ongoing federal fraud probe that has so far publicly outlined more than $100 million in losses to victims around the country.

According to a sworn statement by U.S. Postal Service Inspector John Western, Williams owned Readers Club Home Office in South St. Paul and Pacific Beach Readers Club in San Diego, later telling investigators that he had been in the magazine sales industry for more than 30 years.

Federal authorities executed search warrants at Williams’ businesses in February, around the same time that agents raided multiple magazine sales businesses in southern Missouri and in Florida, seizing documents and computers associated with the companies’ call centers. In a subsequent interview with law enforcement in April, Williams allegedly admitted to committing fraud.

“Williams admitted that his company lied to consumers to take their money and that doing so was fraud,” Western said.

Williams is accused of directing employees at his telemarketing call centers to read from sales scripts in which they falsely claimed to be calling about existing magazine subscriptions. Instead, consumers were signed up for additional and expensive services.

A 70-year-old retiree from New Jersey shared copies of his credit card statements with the FBI, detailing multiple magazine billings — including three by Williams’ business in one month. A 65-year-old Maryland woman told investigators that she got about 20 magazines a month at a cost of $400 to $1,000 each month. She was charged $1,500 by 17 different companies across eight states in a four-week period, from December 2017 to January 2018.

Agents stopped Williams from leaving the country after getting a tip that he booked an airline ticket to Canada days earlier. He is expected to be extradited to Minnesota to face charges in the case in the district’s federal court. Williams is unemployed, a U.S. citizen and his ex-wife and son both live in Minnesota.

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