That's the question posed by Vanessa Blum in this Sun-Sentinel article:
"A once in a lifetime opportunity." "A part time business that earns a full time income." "Call now!" "Don't miss out!"The late night television ads for the Box Office Express DVD rental machine peddled a dream. But it didn't take long for customers of the Hollywood firm to realize they'd been sold an empty promise.In some cases the machines never came. Sometimes they arrived but didn't work properly. Those that functioned would never yield impressive profits.Today federal prosecutors are asking a Miami federal judge to sentence the founder of American Entertainment Distributors Inc. to 23 years in prison for conspiracy, fraud and violating a court order banning him from selling business opportunities. Russell MacArthur, 43, pleaded guilty to those charges in February.
Prosecutors contended the false statements and inflated profit forecasts MacArthur, used to sell the DVD vending machines at American Entertainment amounted to a massive fraud that cost 400 investors a total of nearly $20 million. His plan all along, according to prosecutors, was to make as much money as possible and then declare bankruptcy and fold.It's an area where federal authorities in South Florida have been cracking down. A string of recent cases targeting so-called "business opportunity fraud" have involved the sale of debit card dispensers, Internet kiosks, payphones and anti-aging devices.So far, 14 individuals affiliated with American Entertainment have been convicted, not including MacArthur's partner, Anthony "Rocco" Andreoni, who died in March just hours before he was set to plead guilty.The defendants had worked for at least 16 other business ventures in which most customers lost almost all their investment, prosecutors alleged.In a recent court filing, MacArthur's attorney, Frank Rubino, asserted that prosecutors have exaggerated financial losses tied to American Entertainment. Most customers received the DVD rental machines they paid for, if not the profits they expected, Rubino said.But prosecutor Patrick Jasperse of the Justice Department's consumer fraud section responded that the machines, which sold for $28,000 to $40,000, had no value because American Entertainment failed to provide locations for them and other services that were promised.
This afternoon, Judge Martinez sentenced MacArthur to 23 and 1/2 years.
UPDATED -- Here's the story of the sentencing by Blum. A couple of reasons for the lengthy sentence:
[Judge] Martinez said MacArthur deserved extra punishment for violating a court order banning him from selling business opportunities and for fleeing to Costa Rica after his indictment in 2005. He pleaded guilty in February.The judge called the DVD rental machine, which sold for $28,000 to $40,000, "a worthless piece of junk."
The defense lawyer responds:
Defense attorney Frank Rubino called the 23-year prison term "excessive" and a sentence more suitable for a drug lord or a terrorist."I'm not making light of this crime, but my god, 10, 12, 13 years is a long time," Rubino said.
The prosecutor:
But prosecutor Patrick Jasperse asked for harsh punishment, saying MacArthur was responsible for stealing the life savings and college funds of retirees and hardworking individuals."Russell MacArthur is a danger to the public," Jasperse said.
The SDFLA Blog is dedicated to providing news and notes regarding federal practice in the Southern District of Florida. The New Times calls the blog "the definitive source on South Florida's federal court system." All tips on court happenings are welcome and will remain anonymous. Please email David Markus at dmarkus@markuslaw.com
19 comments:
Well, let's see, Judge Cooke would have given him time served......
638 you are a retard. judge cooke is very rough on fraud defendants.
I grew up with him and his brother in Roch NY- he was my best childhood friend. How terribly sad for everyone
23 years should be reserved for violent crimes. I understand people lost money, but he is not a violent offender hence not a threat to society. People who invested in this hold some responsibility. No-one should take life saving or money they need for important purposes and take any risk. There is no sure thing.
I agree that there is a difference between violent crimes and fraud. However, there should be harsh penalties for fraud. Especially since he did this before in the past. Maybe if the past judge was more harsh on him, he would not have gone back and frauded people again. Is this any different then Maddoff, except the people affected by this aren't multi millionairs which most of the Madoff victoms are, these people are just plain old simple middle class folk.
I believe this is a extremely harsh punishment. He does not deserve to lose his whole life over this.Twenty thee years should be reserved for much harsher crimes I dated him a long time ago and he was not a bad guy. I guess he just got greedy and let that get to his head. Its very sad. I am sure he learned his lesson. That punishemnt is excessive
If he would have paid me back my $38,000 for his scam. I think the judge should be more lenient. But if he can’t pay it back it’s on him. I will never recover from this without repayment, why should he.
I grew up with him too..This is all very shocking and sad.
To the person who wrote about repayment, he can never repay it now. Maybe the punishment should be repayment options and not 23 years in jail where he will never be able to repay anyone...
Those of you posting that the sentence is harsh seem to have overlooked his past. This was not his first crime just his last in a long history of defrauding people. I remember 20 years ago he would write bad checks and buy video game systems from Toys R Us and sell them for cash to local video game stores in Rochester NY. He even had the audacity to remove the systems from the packaging and replace them with phone books. This was a long time coming.
I know people that have committed armed robbery and only get sentenced 2 or 3 years. For robbing somebody at gunpoint. Yes, it was a scam, but he didn't force you to give him all your money. You handed over the money willingly because you thought it was a golden opportunity. You are greedy just like him. You know what they say, "If it sounds too good to be true, then it probably is."
he was a fraud who would con his own mother he has all assets in family name
He did deserve to be punished but this amount of time is literally DRACONIAN. Judge Martinez was swayed by the testimony of the defendants at the trial which Russell was not present at. All the attorneys advised their clients (all of which had previous criminal convictions including child support dereliction, spousal abuse, and drug charges) to put blame on Russell for everything. Not being there to defend himself caused Judge Martinez to have extreme bias when Russell was finally brought before him for sentencing. Prosecutor Patrick Jaspers had an agenda to advance his career and his recommendation was ridiculous and personally fueled. The machines that Judge Martinez called 'worthless' are now called Red Box and the company is now worth billions. 23 years? Really? Murderers, rapists, and child abusers routinely receive less time........come on!
Ever ask yourself why the US has 5% of the worlds population but 25% of the worlds prisoners? We have turned Prison and Incarceration into a money making industry that supports 100's of thousands of families. Why do we routinely put Doctors, Lawyers, and Dentists behind bars for years when they could be doing community service in our over stressed health care system like everywhere else in the world?
I grew up with him as well. Jimmy was a pothead, the other one gay, and Rusty was a small time pot dealer, part time tbief. I guess he never got his act straight.
He was a worthless POS. His father taught him how to be a scamming thief. His father had a rental property on Yarker Ave, in Rochester,NY. Every tenant who has ever rented from him has either lost their security deposit or has had to take him to court to have their deposit returned. Absolute pieces of !@#$.
Rusty always was a thieving POS! Good riddance! He should get more than 23 years. Total scumbag!
The sentence is way too harsh. Did he deserve time? Yes...but maybe 3-5 years would have been sufficient. These kinds of sentences are killing America...a land of grace, freedom and second chances. Very sad.
I ewent to school with him to but barely knew him
I went to school with him too at Brookside I think then Athena for Jr. high. Barely knew him but geez
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