February 8, 12

NEWS / Florida Resident Sentenced to Year in Prison in Connection with Selling Fraudulent Business Opportun

James Cummings, a resident of Boca Raton, Fla., has been sentenced for committing fraud in connection with a coffee machine business opportunity scheme, the Justice Department and U.S. Postal Inspection Service announced today.



The government alleged that the defendant sold a business package that included coffee machines, locations in which to place those machines and on-going support and assistance in the operation of the machines. Cummings sold the business opportunities for a minimum price of approximately $10,000 each.



In pleading guilty, Cummings admitted that, in making sales to consumers, he made a number of false claims about the profits generated by the machines. In addition, he admitted that he led potential buyers to believe that they would recoup their investment in 12 to 18 months. Cummings admitted that he misrepresented to his customers that “locating companies” would find high traffic, high profit locations in which to place the vending machines. In reality, as the government alleged, buyers suffered a total loss on their investments and some buyers did not receive their purchased machines.



Cummings was sentenced by U.S. District Judge William P. Dimitrouleas in Ft. Lauderdale, Fla., to a year and a day in prison and three years supervised release, and ordered to pay over $137,000 in restitution. Cummings had pleaded guilty on Nov. 29, 2011, to conspiracy to commit mail fraud for his participation at three Florida companies: M & D Gourmet Coffee Inc. of Boca Raton, Fla.; Coffee Heaven LLC of Deerfield Beach, Fla.; and Divino Trio Coffee & Vending Company of Ft. Lauderdale. The criminal information charging Cummings alleged that he served as a salesman at these companies from December 2003 to February 2008.



“This defendant took advantage of investors who wanted to make a better living for themselves, causing them to pay thousands of dollars for worthless business opportunities,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “This prosecution and the court’s sentence should send a signal to others that we will pursue those who perpetrate fraud regardless of their position in the scheme.”



Cummings’ co-conspirator, Manuel Rodriguez, the leader of the scheme, was convicted by a jury of one count of conspiracy and seven counts of wire fraud in September 2011. In December 2011, Rodriguez was sentenced to 120 months in federal prison.



“Business opportunity fraud often involves a number of perpetrators – owners, salespeople, locators, references, and others,” said U.S. Postal Inspector in Charge, Henry Gutierrez, based in Miami. “As this case and many others show, the Postal Inspection Service will vigorously pursue anyone who plays a part in bilking consumers of their hard earned money through the U.S. mails.”



Assistant Attorney General West commended the investigative efforts of the U.S. Postal Inspection Service. The case was prosecuted by Matthew Ebert of the Justice Department’s Consumer Protection Branch.

http://www.justice.gov/opa/pr/2012/February/12-civ-178.html