Hernando County authorities have arrested a Spring Hill man who they say ran a telemarketing operation that bilked donors out of more than $200,000.
Darryl R. Bruggemann, 33, was charged with organized fraud for allegedly conning out-of-state residents into making charitable donations that never went to charity.
"It's all fraud," said Maj. G. Z. Smith of the Hernando County Sheriff's Office. "We've identified some bank accounts, but we don't know where all of (the donations) went."
Bruggemann's case is an example of rampant nationwide telemarketing fraud, according to prosecutors and consumer advocates. Americans lose between $40-billion and $60-billion annually in phone scams, according to consumer groups.
Sheriff's investigators said Bruggemann's telemarketers solicited between February and June, but they are unsure how many people donated or exactly how much money was involved. Authorities believe Bruggemann targeted Maryland residents, but they do not why he picked that state.
Bruggemann's company _ known as Eagle Marketing, King Marketing and Tri-Star Marketing _ was not licensed for telemarketing in Florida or Maryland, regulators in both states said.
Bruggemann's company claimed it was collecting donations on behalf of groups including Maryland Vietnam Veterans of America and Alexandria, Va.-based International Union of Police Associations, authorities said. Several organizations for whom Bruggemann purported to solicit said they had not contracted with Bruggemann and had never heard of his firm.
"It's unfortunate, very unfortunate," said John Bartkowiak of the veterans group. "If he is simply some type of con artist it's just despicable, revolting."
Hernando investigators spent much of Friday sifting through boxes of documents seized from Bruggemann's home and storefront business at 11159 Spring Hill Drive. Authorities declined to describe the documents because the investigation was continuing.
Bruggemann was arrested Thursday and released from Hernando County Jail on Friday on $20,000 bail. If convicted, he could face a penalty ranging from probation to 15 years in prison, said Assistant State Attorney Donald E. Scaglione.
Bruggemann declined to comment to a reporter, and authorities said he refused to answer their questions about his operation. Sheriff's officials were told of Bruggemann's business by someone who had been arrested on an unrelated charge.
Bruggemann appears to have no criminal record in Florida. However, Smith said Bruggemann may have conned Connecticut residents in a similar telemarketing scheme.
Here's how authorities said the Hernando scam worked:
Bruggemann's telemarketers made calls from a white stucco office with rows of telephones set up on folding tables. Solicitors would name the charity for which they were collecting and ask for donations.
A script obtained by the Sheriff's Office tells solicitors calling on behalf of the veterans group to advise that it is holding a fund-raiser for hospitalized and homeless veterans.
"We're calling in hopes that we can count on your support," the script says. Telemarketers are instructed to offer several "support packages" that ask for donations ranging from $15 to $50.
The script also calls for telemarketers to identify themselves as representing a Milwaukee telemarketing company called American Trade & Convention Publications Inc. An American Trade company administrator who declined to give her name said Friday that the organization does not contract with Bruggemann's firm.
After getting the donor's name and address, telemarketers mailed official-looking white envelopes emblazoned with a charity's logo and a Baltimore mailing address. Donors sent checks to a private post office box, and that mail was forwarded to Bruggemann's Spring Hill business.
Because the money was sent by mail and the telemarketing operation involved multiple states, Smith said the FBI has said it may investigate. A spokesman for the FBI's Tampa office did not return a reporter's call Friday.
Once Bruggemann received the money, authorities believe he put it in bank accounts and gave none of the funds to the organizations that telemarketers said would receive it.
When sheriff's officials searched Bruggemann's office, they said they found eight telemarketers working. There is no indication the employees knew of the alleged fraud, Smith said.
Telemarketing fraud is increasingly common, according to regulators and consumer advocates. The Washington-based National Consumers League, which operates a hotline for people to report telemarketing fraud, receives about 400 calls a day.
"Charity fraud is a big fraud," said Linda Golodner, president of the league. "A con artist might do charities one week and then they're selling precious metals the next. Whatever is hot, they'll go after it. If we get some hurricanes, I'm sure they'll be saying they're collecting for hurricane victims."
Consumer advocates advise never to donate money over the phone. They suggest asking for literature about the organization and researching its background before agreeing to contribute.
Consumers who send money to fraudulent firms may never know their dollars are stolen.
"The terrible thing about these kinds of scams is that the individual donor is not going to know," said Lucy Weisz of the Maryland Attorney General's Office.
"They're going to assume the funds are being used by the appropriate organizations. So one of the insidious outcomes is they don't know to complain. Only when a fellow is picked up does it alert those victims. But at that point in time it's often too late."
Here is the text of a prepared solicitation read by the Spring Hill telemarketing operation on behalf of Maryland Vietnam Veterans of America:
Hello Mr./Mrs. (name on phone sheet). This is (telemarketer's full name), a paid solicitor for American Trade, calling for the Maryland Vietnam Veterans of America. How are you this evening? Good to hear.
The reason for the call, the Vietnam Veterans of America are holding their annual fund-raiser to help hospitalized and homeless veterans. We're calling in hopes that we can count on your support. We have a few support packages to choose from, we start with our Gold Medal donation for $50.00, our Silver Medal donation for $40.00 and our Bronze Medal donation for $30.00. Can I put you down for one of these?
I have a $20.00 booster package here, would that be a little better for you?
Our least expensive package would be our patrons support pledge for $15.00, this would really go a long way in helping out. Can I put you down for that?
That's great!!! We appreciate your support. A financial statement may be obtained at the secretary of state's office. Now what we'll do is mail you an official receipt along with a return addressed envelope for you to return your check to us. May I please verify your name and address? (verify fully) Thanks again for your kind support and have a good evening!