Mitch Gold Charity Telemarketing Scams Keep Rolling
Mitch Gold is in prison, but his network of charity telemarketing scams is stronger than ever. Meanwhile, the law enforcement team that put him behind bars (after he had been in business nearly 15 years) has been disbanded and is unlikely to reassemble due to changed priorities after 9/11.
Reporter Ronald Campbell in the OC Register has put together an extensive investigative report that boasts its own web portal worth exploring for its graphics and documents. But the main article on Mitchell Gold is here and the one on protégé Joe Shambaugh is here. On the other side, there a profile of prosecutor Ellyn Lindsay and even U.S. district court judge David Carter.
The sheer volume of assembled data and stories is a bit overwhelming. To me, the only serious omission is the absence of a link to the Department of Justice Inspector General Report that details the investigative gap after 9/11. The web portal puts more emphasis on the old prosecutor's argument that Supreme Court cases tie their hands, when it does appear that it is more a matter of putting the right resources on the job.
WMN has noted before that it typically takes a decade to bring these cases to justice, whether it is Richard Blaich hijacking a foundation or another telemarketing scam like Global Mindlink.
The data really speaks for itself, so WMN also finds disappointing that the article also offers some general quotes disdaining telemarketing firms from the self-appointed charity watchdog Daniel Borochoff and from Nonprofit FAQ editor Putnam Barber. This reporter has offered us much more in the way of understanding the details of these operations, and the issue to me is not so much how bad the bad guys are, but why it takes the good guys so long to stop them.
Gold had a network of charity boiler rooms that generated millions via $6 per hour telemarketing reps collecting for charities with names like American Veterans Network, the Association for Disabled Firefighters, Emmanuel Outreach Ministries, Hospitalized Children Fund, Help for the Homeless Program and Hear the Cry of the Children International. Some were charities set up by Gold, but there were also many small charities willing to participate in return for tiny percentages of the proceeds.
Of course, Gold's firm controls the donor lists, so that the charities never could develop their own fund raising base.
Gold started in 1987, but It took law enforcement officials over a decade to catch up with him. He was indicted on September 5, 2001, then in July, 2002 he was sent to prison for eight years for fraud. The key to the successful pursuit was a federal prosecutor named Ellyn Marcus Lindsay who directed a group called the County of Orange Boiler Room Apprehension task force (COBRA), a group of local and federal cops based in Santa Ana.
However, after 9/11, the FBI saw its priorities change. A 2005 report from the Department of Justice Inspector General described how the FBI commitment of agents for telemarketing fraud went from 60 in 2000 to 16 in 2004. In 2000, there were 215 new cases but only 56 in 2004. In the PDF report, the material on telemarketing fraud starts on the page numbered 45, which is page 65 of the PDF file. The report found that these cases transcend state boundaries and local officials are not in the best position to investigate them. It concluded that the FBI's limited involvement creates what it called an investigative gap that hinders successful prosecution of these cases.
Gold's successors include Joe Shambaugh, who has refined the technique by using management contracts that further obscure his involvement in the telemarketing schemes.
Please change the posting on your site when referring to MItch Gold. Please show Mitch D Gold rather than just Mitch Gold as I am MItch L Gold and my reputation is being smeared by your use of my name, incorrectly.
This is my second note to your organization.
Thnaking you in advance.
Peace
Mitch L. Gold
Posted by: Mitch L Gold | July 05, 2006 at 06:07 PM