Mailers promised ‘guaranteed income’ through cash and gold
DES MOINES — A Florida man accused of operating a “pure pyramid scheme” and taking more than $51,000 from older Iowans must make refunds to the victims and stop his solicitations under a settlement with the Iowa Attorney General’s Office.
Attorney General Tom Miller accused Jhon Palacio, a.k.a. Richard Diamond Sr., of Lake Worth, Fla., and his company, Reliable Data Solutions, Inc. (DBA “RDS Success Team”) of violating the Iowa Consumer Fraud Act and Older Iowans Act.
Palacio sent Iowans verbose mailers that were headlined “$5,000 a week cash and gold generator!” For an investment of at least $750, the mailer recipient could become an “independent dealer,” and the company promised to send out more mailers for him or her. Every time someone joined the offer, the recipient was promised to receive $250 and a gram of gold “to infinity.”
“Welcome to the easiest money-maker on the entire face of the planet,” the mailer read.
Consumers paid thousands of dollars to Palacio and received no returns, according to interviews of some of the participants conducted by the Attorney General’s Office. Palacio lied to consumers by claiming that participation in the scheme would result in “guaranteed income,” and his actions financially harmed older Iowans in particular, the AG alleged.
Palacio denied the allegations but agreed to a consent judgment. He sent out 6,000 pieces of mail to at least 300 Iowans, documents show. At least 17 Iowans gave him more than $51,000, and most were age 60 or older.
As a result of the consent judgment, Palacio is prohibited from participating in any business operation involving mail or phone solicitations in Iowa. He agreed to refund $43,017.50 to consumers. (The balance had been previously refunded to a consumer in response to the Attorney General’s investigation of Palacio.) He also agreed to pay $5,000 to the state’s Consumer Education and Litigation Fund.
Seniors are frequent targets of scammers, according to a U.S. Senate report released in January. The Special Committee on Aging found that older adults lose an estimated $2.9 billion each year to financial scams.
Businesses that commit fraud against the elderly can face additional civil penalties under the Older Iowans Act.
If you receive questionable mailings or calls, contact the Iowa Attorney General’s Office:
Phone: 515-281-5926 (outside the Des Moines area, call toll-free: 888-777-4590)