Oregon Attorney General Ellen Rosenblum filed a racketeering and unlawful trade practices lawsuit against 19 companies and 9 individuals who allegedly operate a nationwide newspaper and magazine subscription scam based out of White City, Oregon. According to the complaint, the companies and individuals inflated subscription prices by 40-100 percent, and illegally collected as much as $40 million from consumers nationwide since 2010.
“This sophisticated mail scam ripped off thousands of Oregonians and others across the country. Consumers thought they were dealing with legitimate companies, and that they were paying the lowest available price. Instead, they sent payments to a dishonest third-party, who pocketed the money,” said Attorney General Rosenblum. “As Attorney General, I will not tolerate dishonest or fraudulent business practices in Oregon.”
Oregon’s lawsuit, filed in Marion County Circuit Court, alleges that the companies and individuals sent millions of misleading mail solicitations that were designed to trick consumers into paying an inflated subscription price. The lawsuit also alleges that the company would send mail solicitations to consumers that falsely suggested subscriptions were about to expire. The money collected in this scam, which is laid out in a 46-page complaint, was then laundered through a complex network of companies and financial institutions.
In additional to filing a lawsuit, the Oregon Department of Justice also obtained a temporary restraining order to freeze bank accounts and stop the defendants from doing business in the state. Attorney General Rosenblum filed the Oregon lawsuit in coordination with similar actions filed today in New York, Minnesota, Missouri and Texas.
New York Attorney General, Eric Schneiderman, who helped lead the multi-state investigation said, “It is illegal under New York law to trade on the name of reputable publications and use deceptive advertising to trick consumers into overpaying for goods and services. New York is home to the largest media market in the country and serves as headquarters to many of our nation’s most important newspapers and magazines. My office will work hard to protect New Yorkers from swindlers and to protect the business of reputable companies who play by the rules.”
Among the named defendants in the Oregon lawsuit are Liberty Publishers Service, Inc. Express Publishers Services, Inc. Associated Publishers Network, Inc., Publishers Payment Processing, Inc., Jeffrey Hoyal, Lydia Pugsley and Noel Parducci.
Newspaper and magazine subscription scams topped Oregon’s 2014 list of consumer complaints.
A full copy of the complaint can be found here.
Kristina Edmunson, Department of Justice, Kristina.Edmunson@doj.state.or.us, 503-378-6002