NEW YORK — Two leaders of a Israeli lottery fraud were sentenced to prison for targeting elderly victims in a lottery scheme, federal officials said Tuesday.
Avi Ayache and Yaron Bar were sentenced to 13 and 12 years, respectively, on mail and wire fraud charges, authorities said.
Officials said all 12 members of the ring who were charged in this case have plead guilty. The ring was responsible for bilking victims of more than $8 million, officials said.
With this sentence, nine of the twelve defendants have been sentenced from three years and 10 months to 13 years behind bars, officials stated.
Three remaining defendants will be sentenced July and August.
“Avi Ayache and Yaron Bar were leaders of a predatory group that targeted elderly people in the U.S., conning them into believing they were lottery winners,” Manhattan U.S. Attorney Preet Bharara said. “Preying on their victims’ dreams of financial comfort, Ayache and Bar bilked them out of substantial portions of their life savings. Now Ayache and Bar will spend a substantial portion of their lives in prison.”
According to the indictment, from about 2005 through 2009, the defendants participated in a phony “lottery prize” scheme that targeted victims, mostly elderly, in the United States.
The defendants identified victims, or “leads,” by purchasing from brokers the names and contact information of U.S. residents who subscribed to sweepstakes lotteries.
Then, operating out of telemarketing boiler rooms run by “Managers,” “Qualifiers” called the victims and, using a script, falsely told the victims they had won a substantial cash prize, and asked them about their assets.
If the victim had sufficient assets, the victim was transferred to a “Shooter,” who purported to be an attorney in the U.S., and who told the victims that to obtain the prize, they had to pay several thousands of dollars in fees and taxes.
Victims who complied were typically contacted again by Shooters and induced to send additional funds, amounting to tens and sometimes hundreds of thousands of dollars. In reality, there was no lottery prize .
The defendants operated multiple boiler rooms that used the names of various sham law firms purportedly located in New York, including law firms named “Abrahams Kline,” “Bernstein Schwartz,” “Steiner, Van Allen, and Colt,” “Bloomberg and Associates,” and “Meyer Stevens.”
The defendants further used various aliases and call forwarding telephone numbers to mask the fact that the defendants were located in Israel.
The defendants also possessed bank accounts in Israel, Cyprus, and Uganda, to which illegal proceeds were wired. In furtherance of the fraudulent scheme, the defendants even sent shipments of flowers and gift baskets to various victims in the United States in order to “congratulate” them on their purported lottery winnings.
In addition to the prison terms, Judge Loretta Preska also ordered Ayache and Bar to forfeit $8.2 million and pay restitution of $8.2 million.
Eleven of the twelve defendants were arrested in Israel in July 2009. All 11 were extradited to the United States. A twelfth defendant, Matthew Getto, was arrested in July 2009 at Newark International Airport as he attempted to board a flight for Israel, according to authorities.