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2 plead guilty in $14 million telemarketing fraud scheme

Posted at 5:01 PM, May 01, 2018
and last updated 2018-05-01 20:01:07-04

Two Las Vegas men involved in a $14 million telemarketing fraud scheme targeting small business owners pleaded guilty in federal court Tuesday, according to the U.S. Attorney's Office.

Mark L. Bausch, aka Mark Eting, 43, and Alan W. Rodrigues, 59, both of Las Vegas, each pleaded guilty to one count of conspiracy to commit wire fraud, one count of wire fraud, and one count of money laundering. Sentencing is set for Aug. 14.

According to their individual plea agreements, from March 2009 to about October 2010, Bausch, Rodrigues, and their co-conspirators organized and operated four telemarketing companies: Small Business Funding Co., Inc., Company Funds, Inc., Foundation Research, Inc., and Silver State Holding Company. They charged a fee for their services and offered to help small business owners obtain grants from public and private entities.

Court documents state they made false statements to victims to make it appear that they were likely to or guaranteed to receive a grant. They hired salespersons to market the services and to provide false information to the customers. In order to convince the customers that their service was legitimate, the defendants instructed their employees to conduct research about funding entities and send letters to customers and funders, knowing that many of the customers would not qualify for the grants. 

The defendants also solicited customers by conducting seminars throughout the United States. Throughout the entire scheme, the telemarketing companies received numerous complaints, and the defendants made false statements to them to prevent or delay them from contacting law enforcement. 

Bausch and Rodrigues used the proceeds from the scheme to pay themselves and others and to pay the expenses necessary to continue operating the scheme.

The maximum statutory penalty is 20 years in prison and a $250,000 fine for each count of conspiracy to commit wire fraud and wire fraud, and the maximum penalty is 20 years in prison and a $500,000 fine for money laundering. As part of the plea agreement, each defendant has agreed to pay $13,966,329.30 in restitution to victims and to pay between $631,142 and $1,050,955 in a criminal forfeiture money judgment.

In December 2014, Bausch, Rodrigues, and co-defendants were indicted for their roles in the telemarketing fraud scheme. Several co-defendants have already pleaded guilty and have been sentenced for their role in the scheme, including Craig Rudolph was sentenced to 77 months in prison; Jonas Bowen was sentenced to 63 months in prison; Lee Panelli was sentenced to 41 months in prison; and David Bergstrom was sentenced to 51 months in prison.

The case was investigated by the FBI and IRS Criminal Investigation.