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Tustin Men Arrested in Fraud Case

April 23, 1998|John O'Dell

Three Tustin men suspected of defrauding businesses across the country of as much as $600,000 in a phony billing scam were arrested Wednesday on suspicion of federal fraud.

Michael Mueller, 35, Vern E. Willhite, 36, and Lane Devin Fife, 37, were charged with wire fraud, mail fraud and aiding and abetting the commission of a crime.

In a criminal complaint, authorities allege that the men victimized companies by billing them for copier machine chemicals that were never sent.

The bills ranged from $100 to $600--small enough that many companies never questioned them. Total losses to the victims are estimated at $500,000 to $600,000, according to Timothy P. McNally, assistant director of the FBI office in Los Angeles.

The arrests were made by the County of Orange Boiler Room Apprehension (COBRA) task force, which consists of city, county, state and federal law enforcement and regulatory agents.

McNally said the task force conducted searches of the suspects' Tustin residences and of their business at 4500 Campus Drive, Suite 365, Newport Beach.

The men were in business for about four years, according to the complaint, and used at least five different business names: Nationwide Shipping; Automated Shipping; Express Processing Service; Elite Packaging, and American Shipping.

The task force was started in January 1997 to combat "pervasive telemarketing fraud" in Orange County, McNally said. To date, 17 illegal telemarketing operations have been closed because of COBRA investigations, he said.

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