Sean Rosales of Miami, Florida was arrested Tuesday after he was accused of lying about the origin of the greeting cards and beverages he was selling, a press release from the U.S. Attorney's Office indicates. Rosales was arrested and booked into police custody on 13 counts of wire fraud, 7 counts of mail fraud, and a single count each of conspiracy to commit mail and wire fraud and committing fraud via telemarketing, It is unclear whether he qualified for bail bond. It is also not yet known whether he has hired an attorney.
Reports say Rosales operated the alleged fraud in 2005 out of a number of businesses: USA Beverages Inc., Twin Peaks Gourmet Coffee Inc., Cards-R-Us Inc., Premier Cards Inc., The Coffee Man Inc. and Powerbrands Distributing Company. Rosales and his conspirators reportedly sold businesses opportunities with these companies for thousands of dollars, with a minimum investment amount of $10,000. After the opportunities were sold, Rosales and his co-conspirators allegedly closed down the business and opened another. The average operating period of each business was a few months, though each business rented out office space to make the operations appear more legitimate, sources indicate.
According to reports, Rosales and the other parties involved in the alleged scheme attempted to give their businesses the appearance that they were operating out of the U.S. when they were actually run out of Costa Rica. An indictment also claims the defendant made false representations about the business opportunities to investors, who ended up losing tens of thousands of dollars. These false representations allegedly included telling investors that they had a good chance of earning substantial dividends, that investors would sell a minimum amount of goods (which included beverages and greeting cards), and that the businesses would employ people with comprehensive knowledge of the locations where the goods would be marketed.
Reports say the business employed three types of representatives. They were referred to as fronters, closers, and references. According to reports, fronters would speak to potential purchasers to try and make a deal. Closers would then attempt to close those deals with the potential buyers. A reference would then pretend to be a happy customer and tell the victim how successful the investment was.