DVD Vending Machine Scam Convictions
In the American Entertainment Distributors business opportunity fraud, the U.S. Attorney announced that "a jury convicted Edmond Grigorian and Cesar Menendez after a two-week trial before United States District Court Judge Jose E. Martinez, in Miami, Florida. The defendants were convicted of fraud charges in connection with a scheme to sell a business opportunity involving DVD vending machines."
The two were jailed immediately and held over for sentencing, scheduled for January 4th, 2007. There is a mandatory restitution order, and it will be interesting to see what monies, if any were recovered for the investors.
American Entertainment Distributors was the classic business opportunity scam. "Evidence introduced during the trial showed that AED sold the DVD vending machine business opportunity by using baseless and wildly exaggerated profit projections. In addition, AED falsely promised to secure good locations for the machines, falsely claimed that the machines were reliable and easy to operate, falsely promised to provide long-term customer service, and referred prospective buyers to phony references. Undercover tapes introduced during the trial showed that both defendants knew that they were using false information to lure people into the deal. Most of the consumers paid $36,500 to AED for the machine and the promised services."
It would be interesting to listen to the tapes, but they are unavailable on the Pacer system.
I suspect the DVD Kiosks will become the weapon of choice for business opportunities frauds as the use of DVD Kiosks become more common in the marketplace.
For very interesting reading, on the other hand, regarding the legitimate Kiosk marketplace, I highly recommend Davis Freeberg's blog.
Technorati Tags: vending machine business, business opportunity fraud, business opportunity scam, vending machines, american entertainment, mandatory restitution, aed, fraud charges, jose e martinez, profit projections, classic business, sell a business, menendez, united states district court, edmond
