Long Island jury convicts Florida man of mass-mailing fake prize scheme through local operation

A Florida man was convicted in federal court in Central Islip of tricking thousands of people, many of them elderly, into sending money for prizes they never received, according to the U.S. Department of Justice.

Philip Priolo, 61, ran "a mass mailing fraud scheme," through a direct-mail operation on Long Island, that sent victims fake prize notices from March 2015 to December 2016 via U.S. mail, according to the indictment and a news release. The fake notices claimed recipients would win a big cash prize, typically over $1 million dollars, after paying a fee that ranged from $20 to $40, according to court documents. But recipients were never awarded winnings. 

Priolo was convicted on Wednesday by a federal jury of conspiracy to commit mail fraud and four counts of mail fraud, according to a release. He faces a maximum 20 years in prison for each count and will be sentenced later this year before U.S. District Judge Nusrat Jahan Choudhury of the Eastern District of New York.

"Here, the defendant targeted and defrauded older individuals, the most vulnerable of populations, through a mass-mailing scheme," Eric Shen, inspector in charge of the U.S. Postal Inspection Service’s Criminal Investigations Group, said in a statement.

The Postal Inspection Service launched a multiyear investigation into the case along with the Department of Justice.

The direct-mail operation on Long Island helped execute the scheme, including by printing and mailing the prize notices and updating the mailing lists, according to the indictment. 

The fake prize notices looked personalized but were boilerplate documents mailed out in bulk, according to court documents. Recipients were ordered to pay the fee by cash, check or money order to be sent back in a preaddressed return envelope, which was included in the notice. The notices appeared to be from "official-sounding entities," but they only "existed on paper," according to the indictment. 

 Priolo transmitted payments from the victims into a payment processing company that was then directed to disburse the funds through wire transfers into bank accounts controlled by Priolo and another co-defendant, court documents state.

In October 2014, a judicial officer with the U.S. Postal Service issued a cease-and-desist order banning a company Priolo used to operate the fake operation but he continued the ruse, according to the indictment. 

"The Department of Justice’s Consumer Protection Branch is committed to pursuing criminals who prey upon our elder citizens through fraudulent schemes like fake prize scams," acting Assistant Attorney General Yaakov Roth, of the Justice Department’s Civil Division, said in a statement.