Two men were sentenced on Sept. 30 to federal prison for their roles in selling data that was used in mass-mailing fraud schemes targeting vulnerable populations, particularly the elderly.
Robert Reger, 57, of Boulder, Colorado, was sentenced to 10 years in prison, while David Lytle, 64, of Leawood, Kansas, received a four-year sentence.
Both men were convicted in the U.S. District Court for the District of Colorado of conspiracy to commit mail and wire fraud, along with multiple counts of mail fraud and wire fraud, following a two-week trial.
The scheme spanned over a decade, during which Reger and Lytle, both former employees of Epsilon Data Management LLC, were found to have sold lists of U.S. consumers’ information to fraudsters.
The lists, generated through Epsilon’s data algorithms using a database of 100 million U.S. households, were designed to predict which consumers were most likely to respond to fraudulent mailings.
Evidence presented at trial demonstrated that one client of the defendants defrauded more than 218,000 victims, resulting in more than $23.7 million in losses, the DOJ said in the statement.
The harm caused by this data misuse was substantial, prosecutors argued. Victims testified in court about the numerous scam letters they received, with some targeted more than 20 times.
“Today’s sentences should make clear that those who illegally use Americans’ personal information to facilitate fraud will face serious consequences,” said DOJ Principal Deputy Assistant Attorney General in the Civil Division Brian M. Boynton.
“The Justice Department will investigate and prosecute individuals who use their access to our personal data to target vulnerable Americans for their own gain.”
“Far too often, we prosecute cases where criminals prey on the elderly and vulnerable,” said Acting U.S. Attorney for the District of Colorado Matt Kirsch. “This sentence demonstrates that those who exploit the most vulnerable in our society for financial gain will be prosecuted and held accountable for their despicable actions.”
The investigation into Reger’s and Lytle’s actions was led by the U.S. Postal Inspection Service as part of its broader efforts to protect vulnerable populations from fraud.
The DOJ said the case is part of a wider initiative to crack down on companies and individuals that facilitate elder fraud schemes.
KBM Group LLC, another marketing company involved in selling consumer data to fraudsters, agreed to a $42 million DPA that same year, with $33.5 million allocated for victim compensation.
Both Epsilon and KBM Group acknowledged their roles in selling consumer lists used in fraudulent schemes, such as deceptive “sweepstakes” and “astrology” solicitations, which disproportionately harmed the elderly.
