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Four Charged With Phone Fraud

July 18, 2001

INDIANAPOLIS (AP) _ Four Texas businessmen have been charged with setting up a false telemarketing company to defraud Ameritech and AT&T of more than $5 million in long-distance fees.

A federal indictment released Tuesday asserts that the four engaged in a scheme in which they obtained more than 600 phone lines in Indianapolis under the guise of a catalog and telemarketing company.

Instead, prosecutors said the company provided the lines to long-distance providers, allowing them to avoid paying usage fees to Ameritech and AT&T.

Those charged include: Lacy Ward, 50, Danny Hodges, 40, and Shane Gregg, 32, all of Kilgore, Texas, and Robert Seale, 50, of Victoria, Texas.

Prosecutors said the four also operated similar schemes in other cities across the country, including Tampa, Fla., and Charlotte, N.C., since 1997.

Assistant U.S. Attorney Donna Eide said investigators had not calculated the loss to the telephone companies in those cities and others. She said it would likely involve tens of millions of dollars.

Gregg denied the charges in the indictment.

``This isn’t what we did,″ Gregg said. ``We didn’t go out to try to do this.″

Attempts by The Associated Press to reach the others charged weren’t successful.

The indictment charges that one of the fraudulent companies contracted for phone lines from Ameritech from 1997 until March 2000, when Ameritech learned of the situation and canceled the 672 lines.

The next day, the indictment said, the defendants contracted with AT&T for the same number of lines to continue the scheme.

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