Three Defendants Plead Guilty In $300 Million Nationwide Telemarketing Fraud Scheme

United States Attorney Erica H. MacDonald today announced the guilty pleas of TERRY LYNN CHRISTENSEN, 73, TODD ALLEN HUGHES, 47, and JESSICA MARIE PRINCE, 40, for their roles in a $300 million telemarketing fraud scheme. The defendants were indicted on October 27, 2020, and entered their guilty pleas before Chief Judge John R. Tunheim in U.S. District Court in Minneapolis, Minnesota. 

According to his guilty plea and documents filed with the court, CHRISTENSEN worked as a call center manager for several fraudulent magazine companies including MO Management LLC, Preferred Media Source Inc., Preferred Media Solutions, American Readers Service, Atlantic Media Source, North American Direct Service, Inc., and North America’s Readers Choice. These companies had telemarketing call centers in Fort Lauderdale and Cape Coral, Florida. These companies were owned by MICHAEL OELRICH, who pleaded guilty to mail fraud on July 2, 2020, and were operated on behalf of co-defendant RUSSELL RAHM. In his role, CHRISTENSEN trained telemarketers to use deceptive sales scripts designed to defraud victim-consumers—many of whom were elderly or otherwise vulnerable—by tricking them into signing up for expensive magazine subscription packages. Between June 2009 and 2020, the fraudulent magazine companies defrauded victims out of approximately $98,788,421. As part of his guilty plea, CHRISTENSEN agreed to pay $100,000 in restitution to victims of his fraud conspiracy.

According to his guilty plea and documents filed with the court, HUGHES worked from his home in Holstein, Iowa, as a telemarketer for a company called The Magazine Deal. At the direction of the company and its owners, HUGHES used fraudulent sales scripts to defraud elderly victim-consumers out of hundreds or even thousands of dollars. Among other misrepresentations he made, HUGHES would falsely claim that a victim-consumer owed a large debt for an existing magazine subscription and fraudulently offered to pay off the balance in exchange for a single lump sum payment. In reality, HUGHES was simply defrauding victims out of thousands of dollars. As part of his guilty plea, HUGHES agreed to pay $50,000 in restitution to all identified victims in this and related cases.

According to her guilty plea and documents filed with the court, PRINCE worked as a call center manager for Readers Club of America (“RCA”), a Missouri-based company involved in fraudulent magazine sales. RCA employed a similar fraud scheme that also targeted victim-consumers who were elderly or otherwise vulnerable. RCA telemarketers used deceptive sales scripts and, through a series of knowing and deliberate lies and misrepresentations, signed up elderly and vulnerable individuals for expensive magazine subscriptions. Between 2014 and 2020, RCA collected $4,070,549.01 from victims as a result of this fraudulent scheme. As part of her guilty plea, PRINCE agreed to pay $4,070,549.01 in restitution to all identified victims in this and related cases.

This case is the result of an investigation conducted by the United States Postal Inspection Service and the Federal Bureau of Investigation. Additional assistance was provided by the Treasury Inspector General for Tax Administration (TIGTA) and the Minnesota Attorney General’s Office.

Assistant U.S. Attorneys Joseph H. Thompson, Harry M. Jacobs, and Melinda A. Williams are prosecuting the case.

Defendant Information:

TERRY LYNN CHRISTENSEN, 73

Fort Myers, Fla.

Convicted:

• Conspiracy to commit mail fraud, 1 count

TODD ALLEN HUGHES, 47

Holstein, Iowa

Convicted:

• Conspiracy to commit wire fraud, 1 count

JESSICA MARIE PRINCE, 40

Thayer, Mo.

Convicted:

• Conspiracy to commit mail fraud, 1 count

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United States Attorney’s Office, District of Minnesota: (612) 664-5600