Gosh, There Sure are a Lotta Bricks in That Pyramid Scheme

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Though he was cued up for sentencing March 12, convicted Colleyville network marketing and anti-government guru (and Alabama gubernatorial candidate) James Phipps had his sentencing hearing vacated. At the moment, Phipps languishes in Seagoville federal prison with a potential 20- to 27-year sentence hanging over his head. But it seems the government is tied up in knots over the prospect of contacting each of the estimated 30,689 members of Phipps’ Life Without Debt network marketing program. Sure, it wants to inform them of their “potential rights to restitution.” But, dang, that's a lot of folks to track down.

In court filings the government says it has determined net dollar amounts associated with each of the 30,689 member ID numbers and has identified which of those participant ID numbers incurred losses. But of the 26,309 letters sent out to ID numbers cross-referenced with addresses, 9,257 were returned as undeliverable. So prosecutors are proposing the posting of a general letter to all the victims of Phipps LWD program on the Victim Notification System, where it would inform them of such rights; there'd also be a letter made available to each victim describing more specific loss information. Wouldn’t a simple caveat emptor suffice? --Mark Stuertz


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