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December 13, 2016

“Predatory” Mass Mail Operation Permanently Barred from Targeting Iowans

Miller alleges Waverly Direct Inc. and owner Gordon Shearer, of East Rockaway, NY, sent deceptive prize mailings to older Iowans, and marketed victim lists to con artists. Waverly Direct & Shearer to pay $20,000.

DES MOINES – A New York company will cease mail marketing to Iowans to resolve a consumer fraud lawsuit filed by Attorney General Tom Miller.

Polk County District Court Judge Brad McCall Monday approved a consent judgment that resolves Miller’s lawsuit, filed in September, against Waverly Direct Inc., and owner Gordon F. Shearer, of East Rockaway, New York.

The suit alleged the company solicited older Iowans with bogus notices of financial winnings and then sold customer lists to con artists.

In addition to halting the mailings to Iowans, the consent judgment orders Waverly Direct and Shearer to pay $20,000 to the Consumer Protection Division for consumer fraud enforcement efforts, including $8,750 in refunds to Iowa victims.

According to the lawsuit, since 2005 Shearer and his company sent Iowans letters from the fictitious director of the bogus “Numerological Resource Center,” congratulating each Iowan for being personally “selected” to receive a large sum of money and other life-changing benefits.  The letter asks the recipient to provide key personal information — including age and phone number – and to send it back with a $25 fee.

“Deceiving older Iowans into making payments – sometimes repeated payments – of $20 or $25 was reason enough to sue these operators,” Miller said.  “But even more damaging was their practice of renting lists of victims’ names to other scammers. That multiplied peoples’ losses – especially those who are more vulnerable.”

According to the lawsuit, the case involved a series of deceptive and unfair practices. The practices illustrate common abuses by certain mass mailers:

  • A “confidential” personalized letter congratulates the “winner,” falsely stating that he or she has been specially selected to receive dramatic wealth and other benefits.
  • The letter highlights an attention-getting sum of money – $2,150,000 – insinuating that’s what the recipient can expect to receive.
  • The consumer is told to respond quickly, because the matter is “extremely urgent.”
  • The mailing to the consumer includes a “Publicity Information Release” form, intended to heighten the false impression that the consumer has won a news-worthy prize.
  • What the consumer actually receives for his or her payment is a short “report” with general advice from a supposed psychic – a report Miller’s lawsuit called “worthless drivel.”
  • The consumer is asked to provide important personal information, including age, phone number, and credit card use – information that would prove valuable to other fraudsters looking for suitable victims.
  • The name of each Iowan who responds gets added to a list, which is then rented out to other perpetrators who seek vulnerable victims for their own predatory schemes.

Miller said that company records identified about 70 recent Iowa victims who will receive refund checks, but that other Iowans who lost money to this scheme should contact the Consumer Protection Division for a refund as well.

“We stopped this deceptive operation from continuing to target Iowans, but sadly there are many others with very similar schemes,” Miller said.  “Be skeptical whenever you read or hear a claim that you’re a big winner, whether it comes through the mail, online, by phone, or in-person.”

TIPS FOR CONSUMERS:

  • Claims that you’ve won a big prize should make you get a tight hold on your wallet, because it’s almost always part of a scam.  Don’t be fooled!
  • Personalized letters from strangers may convey a personal interest in your life and well-being, but they are typically mass-mailed to tens of thousands, to see who will “bite” by sending a check. Don’t waste your money!
  • Once victimized, an Iowan who sends money to scammers may be added to a target list used by other scammers, who will then create other lists to rent, and so on. This can result in a “feeding frenzy,” as one fraud after another goes after each vulnerable victim.
  • Iowans should be especially aware that this can happen to older relatives, neighbors, or friends, and should report such incidents to the Consumer Protection Division.

For more information or to file a complaint, contact the Consumer Protection Division through the Attorney General’s website at www.IowaAttorneyGeneral.gov or email directly to consumer@ag.iowa.gov.  Consumers can also call the Consumer Protection Division at 515-281-5926, or outside the Des Moines area, toll free, at 1-888-777-4590.

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