Press Release: U.S. Attorney
October 23, 2001
BOSTON, MA -- One of eleven individuals indicted earlier this year in a widespread appraisal fraud telemarketing
scam that is alleged to have defrauded well over 20,000 victims of more than $12 million has pleaded guilty.
United States Attorney Michael J. Sullivan and Kenneth R. Jones, Inspector in Charge of the U.S. Postal Inspection
Service in New England, announced that PETER TRAIN, age 58, of Deerfield Beach, Florida, pleaded guilty to one
count of conspiracy and 22 counts of mail fraud at a hearing yesterday before Chief U.S. District Judge William
G. Young. TRAIN was indicted, along with nine others, in February 2001, and an eleventh defendant was added in
July 2001.
According to the federal prosecutor who outlined the evidence against TRAIN in yesterday's plea hearing, TRAIN
was involved in a complex network of more than a dozen companies designed to convince as many timeshare owners
who were interested in selling their timeshares as soon as possible to purchase a $400 ``appraisal'' of their timeshare.
The scheme is alleged to have operated through a series of steps, the first of which involved timeshare owners
being contacted by buying companies that made a host of misrepresentations, including that they would buy their
timeshare if the owner obtained an appraisal and that they would reimburse the owner for the appraisal fee at the
time of closing. However, once timeshare owners paid for an appraisal they were rarely able to follow through on
the proposed sale. In fact, it is alleged that only twelve of the more than 20,000 people who purchased appraisals
from the defendants actually closed on the sale of their timeshare.
One of the primary buying companies, Resort Investment Trust, which would initially contact timeshare owners, was
run by TRAIN, who had a staff of up to 20 telemarketers working for him.
Chief Judge Young set a sentencing date of June 6, 2002. Each of the charges to which TRAIN pleaded guilty carries
a maximum penalty of five years' imprisonment and a $250,000 fine, as well as restitution.
The case was investigated by the U.S. Postal Inspection Service and the Florida Department of Law Enforcement and
is being prosecuted by Assistant U.S. Attorneys Joshua S. Levy and Carmen M. Ortiz of Sullivan's Economic Crimes
Unit.
SOURCE: U.S. Attorney