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Wednesday, July 21, 1999
Copyright © Las Vegas Review-Journal
Senate probes contests
Government investigators say a Las Vegas-based company is running misleading sweepstakes.
By Steve Tetreault
Donrey Washington Bureau
WASHINGTON -- A U.S. Senate probe into sweepstakes fraud focused Tuesday on the practices of a Las Vegas consulting firm that investigators said is behind millions of pieces of deceptive mail and has gone to great lengths to disguise itself from authorities.
Companies controlled by Anthony Kasday lead people to believe they have won prizes like a Ford Escort or $10,000 cash, to be delivered upon receipt of a $10 claim fee, according to evidence presented to the Senate Permanent Subcommittee on Investigations.
What respondents receive for their $10 is a thin booklet of discount coupons for, among other things, doughnuts, pretzels, a lube job and a rental car upgrade.
Furthermore, investigators said, Kasday has cloaked his direct involvement. They said he set up two prestigious-sounding companies in the name of a niece, and collects most of the profits through a Las Vegas firm he owns, Neopolitan Consultants.
In the past year and a half, Neopolitan has collected close to $1 million from the two firms, and three others connected to Kasday, investigators said.
Appearing under subpoena and seated beside his lawyer Tuesday, Kasday answered general questions but twice invoked his constitutional privilege not to answer questions he said might incriminate him.
He declined to talk to reporters afterward except to say he no longer lives in Las Vegas. A subcommittee staffer said he lives in Brookings, Ore.
Sen. Susan Collins, R-Maine, the panel's chairwoman, dissected a Kasday mailing that invited recipients to send their money to an official-sounding "trustee" at an address in Lake Forest, Ill. Kasday conceded the address was a post box at a Mail Boxes Etc outlet.
"Are you not troubled that this is misleading?" Collins asked.
"I don't consider it misleading," Kasday said.
On another piece, Kasday acknowledged the official-looking seal was an artist's creation, and the "prize registrar" named "J. Remington Astor" was a fiction.
Collins said Kasday appears to be typical among smaller sweepstakes operators who often fly under the radar of authorities.
She said such operators are much less visible than national sweepstakes firms that were the subject of Senate hearings in March, but nonetheless were responsible for hundreds of millions of mailings last year.
"We've learned these smaller operators engage in marketing tactics that are much more deceptive and sometimes border on outright fraud," she said. "They very craftily obscure their true identity so that neither the public nor the regulators can easily identify or pursue them."
Most of what Collins called "stealth sweepstakes companies" operate under multiple corporate names and through mailbox drops in various states.
In Kasday's case, he formed two companies in the name of a niece, a college student who has no involvement in either one, according to Glynna Christian Parde, the subcommittee chief investigator.
Revenues generated by the companies -- Enwood & Pressman & Ingram Inc., and Mellon, Astor & Fairweather Inc. -- were directed to Kasday's consulting firm, Neapolitan, Parde said.
Questioned by Collins, Kasday said the company names were made up, but denied Collins' assertion that they were made up to sound like prestigious accounting firms.
Also questioned was a New York sweepstakes operator, David Dobin. Dobin is awaiting sentencing after pleading guilty to a mail fraud charge in connection with an earlier contest enterprise. In the meantime, he heads a sweepstakes firm that he said he is running as a legitimate business.
But Sen. Carl Levin, D-Mich., accused Dobin of continuing to deceive customers by sending them multiple contest entry forms, under different names and of differing designs, without telling them clearly it's all the same sweepstakes.
"This is fundamentally a tissue of lies, a fabric of lies," Levin said. "It is fundamentally deceptive, what you are doing. I'll look you in the eye and tell you that."
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