Scam artists who focused their efforts on senior citizens were aided by at least one bank, Wachovia, and by list compiler infoUSA, according to a front-page article in Sunday’s New York Times.
According to the Times, a variety of fraudsters tricked elderly Americans into revealing personal information. The thieves then used that data to make unauthorized withdrawals via fraudulent checks from their bank accounts.
The Times article described infoUSA as “helping [to] sell lists to companies that were under investigation or had been prosecuted for fraud.”
While the Times implied that several banks had been negligent in not taking appropriate safeguards against fraud, the only financial institution it named was Wachovia.
Wachovia cashed unsigned checks that drew funds from victims’ accounts, according to Times. When a number of these checks were returned, Wachovia made on them good on an individual basis, but it did not a general alert out on them, the paper continued.
The checks were written by a company called Payment Processing Center, the Times reported. Wachovia has a civil suit pending against it stemming from these actions, the Times reported.
“Although some companies, including Wachovia, have made refunds to victims who have complained, neither that bank nor infoUSA stopped working with criminals even after executives were warned that they were aiding continuing crimes, according to government investigators,” the Times said.
According to the newspaper, the Iowa attorney general has records documenting these allegations. The article did not give any indication that infoUSA was under any investigation.
And while Wachovia is the subject of a civil suit, no complaint has apparently been filed against infoUSA.
InfoUSA CEO Vinod Gupta confirmed that. “At times, authorities have come to us and asked for records regarding who has bought our lists,” he said in an interview with Direct Newsline Sunday evening. “We always comply with them.”
Gupta added: “We have four million customers, and we have no way of knowing how they use our lists. We require that they abide by our policy that they use it for lawful purposes. When somebody buys a gun legally and goes and kills a bunch of people, you don’t blame the gun dealer.”
He continued that some of infoUSA’s customers obtain names through the company’s Web site.
Asked about the Times’ claim that infoUSA employees had exchanged e-mails expressing their concern over Richard Panas, of the alleged scam artists, Gupta observed that his company had 5,000 employees and that he had no idea what was in their e-mails.
He continued that the company is conducting an internal investigation. “I have asked our general counsel to investigate this,” Gupta said. “If we have made a mistake, we will make corrective efforts.”
As for the Times article itself, “They have used sensationalism to blow this thing up,” Gupta said. “We have a lot of customers. The New York Times buys our list. If the New York Times uses our list to send an offer that is wrong, they cannot blame us.”
Gupta also vehemently denied an advertising copy line the Times attributed to one of his lists. According to the newspaper, the list bore the line “These people are gullible. They want to believe that their luck can change.”
“I have never seen copy like that,” Gupta said.
The article also made passing reference to Walter Karl, a list management/brokerage firm owned by infoUSA. Walter Karl is the list manager for Penton Media, Direct Newsline’s parent company.
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