Operation Plastic Empire was the Metropolitan Bureau of Investigation (MBI) strategy to file state charges at the heels of the IRS Operation Out Call. The operational strategy was a failure, at least at the state level and in respect to the credit card processing. It wasn't a failure in relation to its accompanying toolbox – obtaining the client names from the credit card transactions and intimidating and coercing every defendant to the point that each accepted a plea deal. And then it certainly succeeded in scaring every escort service owner in Orlando that wasn't involved, with the exception of yours truly and two other operators. By the middle of 1996, this place was almost abandoned, in part due to the Amnesty Program, and by January 1997, no escort services remained in the area yellow page books, due to the Yellow Pages Fiasco, as I refer to the MBI setup of advertising representatives.
The many cases involved in this operation were separated for reasons unknown to me. One case had five defendants, several cases had one lone defendant, and another case had nine defendants. There may be additional cases that I'm not aware of with any number of defendants. As my example here I'll use Case Number 96-CF-0011913-0. This is the case with nine defendants, A through I, and it's an Orange County, Florida case that can be found at the Orange County Clerk's Office or the basic filings can be viewed online. The last time that I viewed these files in person there were six volumes, each close to 12 inches thick, and that was without all of the depositions.
The defendants in the case:
Maritza Cascante Bobber – 26 counts
Trevor Banks Campbell – 12 counts
Rhonda Liphart – 6 counts (Rhoda in my book)
Debra Watson – 2 counts (Diana in my book)
Elizabeth Helen Clifton – 12 counts
Christopher Batura – 12 counts
Robin Janeen Dickinson – 20 counts
Joseph Formosa – 14 counts
Steven Voss – 8 counts
Each defendant was charged with Racketeering, a 1st degree felony, and Conspiracy to Commit Racketeering (RICO), also a 1st degree felony. Each first degree felony is punishable by up to 30 years in a Florida prison – that's what these statutes accomplish. The MBI uses them in most prosecutions. Beyond this, every defendant except Debra Watson had at least one count, and most had many counts, of the following:
Unlawful Transport of Currency
Illegal Factoring of Credit Card Transaction
Money Laundering
Each charge, and every count, that these defendants faced, is a felony. There were no misdemeanors charged in this case. Maritza Cascante and Joseph Formosa still have a capias (warrant) for their arrests – neither showed for sentencing and both jumped bond. Debra Watson left town the minute that she heard the MBI was looking for her, and was therefore never arrested. Her charges were finally dropped in 2003. The defendants that remained made deals that included probation, jail time, years in prison – it varied, except in each case there was eventually probation. The Violation of Probation (VOP) charges began in 04/1998 and the last VOP was filed in 02/2002. I did know several of these defendants, but one that I did not know contacted me from jail while awaiting trial: Trevor Campbell related much of the information I know about the case that is not findable in the files. He was looking for help to fight the charges and had no intention of pleading guilty to anything. I felt sorry for him, and I did speak to his court-appointed public defender, but the attorney had no real clue how to fight the case and didn't sound like he intended to. At the time I was law-ignorant and there was nothing that I could do to help Trevor.
In the end, statements from the clients of the credit card transactions, including many from out-of-state that I read in the file, convinced these defendants to take the plea deal. As the appeals continued through the Florida court system, pleas to anything relating to signing-up for a merchant services account were tossed out. These files are mixed-up because of this – a judge stated that a defendant could not know that the merchant services operation handled offshore was not legal. This is a fact – I remember Debra Watson's story well. She signed-up and received a package that looked absolutely legal. I saw it. Several defendants had extremely high bonds because of the number of felonies charged and they couldn't get out of jail. Beyond this, it was the intimidation, threats of decades in prison, and court-appointed public defenders that had no clue. This was one of the biggest operations in escort service history, considering the many defendants in the list of cases and the extensive list of felonies charged to each, yet few people have any idea that it existed.
Next: The Amnesty Program
Thursday, May 28, 2009
Wednesday, May 27, 2009
Operation Out Call (IRS)
What began as an IRS sting, Operation Out Call in the Dallas, Texas IRS office, soon evolved into Operation Plastic Empire, in Orlando, Florida, a Metropolitan Bureau of Investigation (MBI) brainstorm, which soon led to the Amnesty Program, also described in my book.
Operation Out Call was a sting the IRS dreamed-up to target escort services that accepted credit cards back in 1995. The IRS busted and then took-over Electronic Merchant Services (EMS), a company that processed credit cards for adult businesses. When it was still EMS I almost signed-up with it, with almost being the operative word. I met the EMS area representative at my office, but the paperwork required that I write-in the "type of business" and I wrote "escort service" which resulted in the rep ripping-up the contract and stating that I needed to write "tour company" or something else. I informed him that all of my business licenses, city and county, stated "escort service" so I couldn't do that. I told the guy:
"I think that's credit card factoring, or something like that, when you process credit cards by claiming to be something else. Who knows? I'm not an attorney, but what's wrong with writing the correct type of business?"
Soon he was packing his processing machine back in the box, picking-up his papers, and exiting. Quite a few people – escorts and a booker – were ticked off at me that day. We were doing little business because just about every other agency accepted credit cards.
This transpired prior to the IRS taking over EMS and signing-up escort services all over the country. I was later contacted, on several occasions, by the IRS to sign-up to accept credit cards. They had some man that sounded like a New Jersey thug calling me in an attempt to entice me, and then drilling me as to why I refused the offer. This strategy in itself gave me a clue that something was amiss. He didn't leave me alone until I told him why I'd never accept credit cards: At my agency the clients will get their privacy whether they want it or not – if I wanted the bank and the government to have client lists, I'd just fax them over a copy. The agent said that he understood my point and never called me again.
At the same time I had potential clients (really the MBI) calling me in force wanting to use credit cards, and then stating some form of "oh I understand – you are avoiding paying taxes." This continued to the point that it was absurd. Soon I was just hanging-up the phone as soon as I heard "credit card" – my ads were close to the only ads without credit card emblems. They did manage to sign-up around 15 agencies that had at least a hundred ads in area yellow pages though. I was one of very few that passed and several other agencies already accepted credit cards via other processing companies. Incidentally, EMS (and the IRS) charged 18% to process the transactions.
The MBI began working with the IRS on this operation and the agency was now privy to information concerning the credit card holder's name, address, bank etc…. For the MBI, each credit card user was now a potential state witness.
The story about IRS Operation Out Call is still available in the July 22, 1996 issue of New York Magazine that is published in Google Books. I had it embedded in the footer of this blog, but Blogger no longer allows frames, so go to the link and the story, titled "The Love Float," starts on page 30, which actually states, "The Screwball Scheme" as title: The Love Float by Daniel Green
Operation Out Call was a sting the IRS dreamed-up to target escort services that accepted credit cards back in 1995. The IRS busted and then took-over Electronic Merchant Services (EMS), a company that processed credit cards for adult businesses. When it was still EMS I almost signed-up with it, with almost being the operative word. I met the EMS area representative at my office, but the paperwork required that I write-in the "type of business" and I wrote "escort service" which resulted in the rep ripping-up the contract and stating that I needed to write "tour company" or something else. I informed him that all of my business licenses, city and county, stated "escort service" so I couldn't do that. I told the guy:
"I think that's credit card factoring, or something like that, when you process credit cards by claiming to be something else. Who knows? I'm not an attorney, but what's wrong with writing the correct type of business?"
Soon he was packing his processing machine back in the box, picking-up his papers, and exiting. Quite a few people – escorts and a booker – were ticked off at me that day. We were doing little business because just about every other agency accepted credit cards.
This transpired prior to the IRS taking over EMS and signing-up escort services all over the country. I was later contacted, on several occasions, by the IRS to sign-up to accept credit cards. They had some man that sounded like a New Jersey thug calling me in an attempt to entice me, and then drilling me as to why I refused the offer. This strategy in itself gave me a clue that something was amiss. He didn't leave me alone until I told him why I'd never accept credit cards: At my agency the clients will get their privacy whether they want it or not – if I wanted the bank and the government to have client lists, I'd just fax them over a copy. The agent said that he understood my point and never called me again.
At the same time I had potential clients (really the MBI) calling me in force wanting to use credit cards, and then stating some form of "oh I understand – you are avoiding paying taxes." This continued to the point that it was absurd. Soon I was just hanging-up the phone as soon as I heard "credit card" – my ads were close to the only ads without credit card emblems. They did manage to sign-up around 15 agencies that had at least a hundred ads in area yellow pages though. I was one of very few that passed and several other agencies already accepted credit cards via other processing companies. Incidentally, EMS (and the IRS) charged 18% to process the transactions.
The MBI began working with the IRS on this operation and the agency was now privy to information concerning the credit card holder's name, address, bank etc…. For the MBI, each credit card user was now a potential state witness.
The story about IRS Operation Out Call is still available in the July 22, 1996 issue of New York Magazine that is published in Google Books. I had it embedded in the footer of this blog, but Blogger no longer allows frames, so go to the link and the story, titled "The Love Float," starts on page 30, which actually states, "The Screwball Scheme" as title: The Love Float by Daniel Green
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