MANHATTAN (CN) – A man on supervised release for investment fraud did it again, conning people out of $500,000 by selling sham “Return-A-Pet” franchises, federal prosecutors said.
Eric Stein, 53, of New York City, who used the alias Robert Philips, was arrested and jailed Tuesday on charges of running an investment scam through his Manhattan business, Return-A-Pet LLC, which he claimed helped return lost pets to their owners.
“As part of the scheme in which he netted at least $500,000, Stein allegedly deceived dozens of consumers into purchasing sham Return-A-Pet distributorships using false and misleading advertisements,” the U.S. Attorney’s Office said in a statement announcing Stein’s arrest.
It added: “Stein ran the company while out on supervised release for an investment fraud scheme in which he had been previously convicted of committing in Nevada.”
According to the indictment, Stein told his victims: “‘The concept is simple. For a one-time fee of $20, a pet’s owner gets a lifetime membership to the service, and when someone finds the lost pet, he or she calls the toll-free number on the tag. Telephone operators are on call around the clock, seven days a week, to contact the pet’s owner and return the animal.'”
Stein sold his “distributorships” for upfront fees of $5,000 to $50,000, and sold them to victims as far away as Texas, Georgia, Kentucky, North Carolina, and South Africa, “often falsely identifying himself as Robert Philips,” prosecutors said.
In its statement, the U.S. Attorney’s Office added: “Stein was publicly interviewed by a Wall Street Journal reporter in 2004, and on the television program ‘American Greed’ in 2008, concerning an investment fraud scheme he operated in Nevada for which he was previously convicted. In the interviews, Stein described how he had lured investors into believing that his business was legitimate by, among other things, paying people to give phony, ‘wonderful’ references – similar to his alleged operation of Return-A-Pet. In the Wall Street Journal interview, he stated it’s all about the packaging and the picture that you paint for them – the image, all about the dream you’re making for them.'”