Three Long Island residents were charged Thursday with defrauding at least 14 people around the United States of more than $1 million in a scheme that involved selling coins of negligible value at huge markups, federal officials said.
The scheme was particularly heinous because it preyed mostly on senior citizens, in several cases costing the victims their life savings, a U. S. attorney said.
At the arraignment of two of those charged with fraud Thursday in federal court in Central Islip, N.Y., another assistant U.S. attorney said records appeared to show that there may have been hundreds of victims.
The scheme involved calling elderly people around the country and offering to sell them rare coins that would be repurchased at a 20 percent premium in a year if the buyers were not satisfied, according to court papers.
Later, the victims were told buyers in Europe would purchase the coins for even more if they were part of a set, court papers said. The victims were then sold the remainder of the coins in the set, also at vastly inflated prices, the papers said.
A victim who lost $150,000 was told that the 18 coins that were purchased could be sold in Europe for $480,000. In fact, they were worth only $1,800.
Another victim paid $85,000 for eight coins that were actually worth $800, the papers said.