ANATOMY OF A PENIS PILL SWINDLE - MSNBC Reports on LONGITUDE FRAUD
Here a June 5, 2003 report from MSNBC on the whole Longitude Pills Ripoff. There are also some interesting quotes from "Big Al Alfaro" and Brandon Reece. Here’s the link to the "Anatomy of the Penis Swindle":
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Here are some sample excerpts of the report.
Anatomy of a penis pill swindle
$74 million later, law catches up with Arizona con artists
By Mike Brunker
MSNBC
June 5 — Giving Americans a first glimpse of an industry flourishing at the intersection of larceny and libido, authorities in Arizona are seizing the assets of a Scottsdale company that sold more than $74 million worth of pills that it claimed would enlarge penises or breasts, make the consumer taller or hairier — even sharpen his or her golf game. But despite such audacious claims, the company — C.P. Direct — would likely still be gouging the gullible if its founders hadn’t decided to also illegally charge consumers’ credit cards, industry insiders say.
THE C.P. DIRECT case, apparently one of the first criminal prosecutions of a seller of “body enhancement” supplements, will do nothing to halt the avalanche of e-mail touting products that claim the ability to turn your Volkswagen into a Chevy Suburban, anatomically speaking. But it has triggered concern among other purveyors of pills, creams and nutritional products promising too-good-to-be-true results.
“Other sellers have toned down their ad copy a bit because of what happened to the C.P. Direct guys,” said A.J. “Big Al” Alfaro, whose forsize.com Web site touts a strenuous regimen of stretching and exercise as the true path to penis expansion. “You’ve got to be careful what you say. Even with the exercises, I can’t promise anything.”
The case also has opened a window on just how lucrative the painless body enhancement business can be, especially if you’re willing to ignore regulatory niceties and consumer-protection statutes.
Under a settlement of a civil complaint announced last month by the Arizona attorney general’s office, the state is seizing 13 luxury homes and property valued at more than $20 million, a fleet of expensive automobiles and tens of millions of dollars of cash from C.P. Direct and its main officers, Michael Consoli, Geraldine Consoli and Vincent Passafiume, all of Scottsdale.
‘GROSS … ALTERATIONS’ GUARANTEED
Prosecutors described the assets as the proceeds of the fraudulent sale of “herbal-based nutritional supplements … guaranteed to induce gross physical alterations of the human body.”
In a parallel criminal case, Michael Consoli, 45, and Passafiume, 29, Consoli’s nephew, also are expected to be handed a year in jail when they are sentenced on state fraud and money laundering charges on July 21. A third defendant, Suzanne Rye, 32, Passafiume’s girlfriend and a business associate, also pleaded guilty as part of a deal with prosecutors but is not expected to serve any jail time under the prosecution’s sentencing recommendation.
Court documents filed in the case show that the company’s big money-earner was the Longitude penis-enlargement pill, which it described in advertisements as “a breakthrough product that will make your penis grow until you are satisfied with your new size.” The ad recommended that users should discontinue the pills after reaching nine inches in length to avoid discomforting sexual partners.
The pills were advertised on Howard Stern’s nationally syndicated radio show, in men’s magazines, including Playboy, Penthouse and Maxxim, and over the Internet, though it is unclear whether the company or its network of “affiliates” was responsible for waves of spam touting Longitude.
The company also offered a breast-enlargement pill — Full and Firm, advertised as an “implant in a bottle” that would increase the bust size of the consumer by “two or three cup sizes” in a matter of weeks — as well as other capsules said to perform their own medical miracles: Follicure (grow hair), Stature (increase height by up to four inches) and Long Jack (improve golf game).
Larry Warfield, the court-appointed receiver in the case, said the company sold $74 million worth of Longitude, Full And Firm and Stature in the two years before agents from the U.S. Customs Service and the Arizona Department of Public Safety shut the business down last year. A company employee who cooperated with the investigation estimated that Longitude accounted for 90 percent of the company’s sales.
But Desi Rubalcaba, the prosecuting attorney handling the case for the attorney general’s office, said the Consolis and Passafiume may have earned more than that. “That’s been a bone of contention because they operated another business (that allegedly engaged in fraudulent practices) prior to that,” he said.
NO TESTS, NO EXPERTS
According to court documents, when agents served a search warrant on C.P. Direct’s offices on May 23, 2002, Rye said that she and Passafiume studied ingredients listed on Web sites advertising similar products before concocting the formula for Longitude. She acknowledged that they had never consulted any medical experts or done any scientific testing of the product, contrary to claims on the C.P. Direct Web site, the documents said.
A law enforcement source, who spoke with MSNBC.com on condition of anonymity, put it more succinctly: “The only thing that was increasing was the size of the perpetrators’ bank accounts.”
That rapid rise was fueled in part by the company’s refusal to provide promised refunds to unhappy customers and fraudulent credit card billing practices, according to the court papers. Most customers who called the company’s toll-free line seeking to stop automatic monthly delivery of the product or to demand their money back were unable to get through, and those who did were promised refunds that never were sent, the papers said.
Warfield, who believes that between 350,000 and 500,000 people fell for the scam, is responsible for selling the seized assets and reimbursing the victims. He said he expects to disburse about $35 million — less than half of what the company took in through its fraudulent sales — to those purchasers he can locate. Most of the missing money went to pay the company’s advertising costs, which Warfield said were around $1 million a month.
“I have no comfort whatsoever as to the validity of the company’s records,” he said, urging those who purchased the product to contact his office through the Web site he has established to keep victims abreast of developments.
A NICHE DIVIDED
Also uncomfortable with the recent developments are “Big Al” Alfaro and colleagues who say they are traveling the high road to penis enlargement by offering instruction on how to stretch and strengthen the organ through exercise.
“What we do works,” said Brandon Reece, president of Reece Marketing of St. Joseph, Mo., who has operated penilefitness.com since 1999. “You get tiny little fiber tears in the cells, similar to what happens with a muscle. It heals and becomes a little stronger, a little larger.”
Reece said the idea that a pill could enlarge the male sex organs makes nowhere near as much sense.
“When you take a pill, it goes through your whole body,” he said. “If a pill could make your penis grow by somehow affecting the soft tissue, it would swell your nipples and lips and nostrils as well.”
But both Alfaro, who works as a consultant to several penis enlargement pill sellers, and Reece said that C.P. Direct would likely still be selling its pills today if it hadn’t illegally charged customers’ credit cards without reauthorization.
“They had a big problem with consumer complaints,” Alfaro said. “A lot of them were placed on autoship and they couldn’t stop. When you do things like that, you’re going to get cracked down on.”
At the federal level, the Federal Trade Commission hasn’t filed any complaints against any companies offering penis-enlargement products, despite the dubious nature of their claims.
But Janet Evans, a staff attorney, said the agency has “done a whole lot” in the area of fraudulent claims by makers of supplements and body-enhancement products, including halting the sale of the Isis System, a dietary supplement and topical cream purported to enlarge breasts, and a suite of bogus Viagra-like impotence-treatment products. The agency also refers cases to states, which can levy tougher penalties against fraudulent sellers, she noted.
CAREFUL SELECTION OF TARGETS
But Evans acknowledged that, out of necessity, the agency has to carefully choose its targets.
“We look at the complaints, look at the cost of the product, is there a safety issue?” she said. “… We could bring 100 cases a day. You try to pick cases that will get the message out.”
Have a good read!
Peforeal
