Crime & Safety

UPDATE: 5th Man Sentenced in Lottery Scam

Chatsworth man previously pleaded guilty to mail fraud charges.

Update: A 10-year federal prison term was handed down Monday
for James Ray Houston, the last of five defendants to be sentenced for orchestrating an international fraud scheme that bilked thousands of people out of at least $26.5 million by promising increased chances of "winning'' foreign and domestic lotteries.   

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The fifth defendant linked to an international fraud scheme that bilked thousands of people out of nearly $25 million by promising increased chances of winning foreign and domestic lotteries is scheduled to be sentenced today.

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Previously, Dennis W. Emmett, 63, of Chatsworth, pleaded guilty to mail fraud charges in connection with the scheme. He was extradited from Costa Rica in July 2008 and was sentenced to 51 months behind bars.

James Ray Houston, 65, also known as ``Rex Rogers,'' faces sentencing today. He pleaded guilty in March in Los Angeles federal court to felony mail fraud. He surrendered at the U.S. Embassy in Costa Rica in January, officials said.

Find out what's happening in Northridge-Chatsworthwith free, real-time updates from Patch.

Houston, who previously lived in Missouri and Nevada, faces a maximum of 10 years in federal prison, prosecutors said.

The long-running scheme involved victims being offered ``positions'' in lotteries that would be grouped together or ``pooled'' to buy larger blocks of tickets, thereby increasing the chance of winning, according to the U.S. Attorney's Office.

Funds taken from victims were not, however, used to purchase tickets, but to pay ``winnings'' to other victims, to fund the scheme and to benefit the defendants, court papers show.

Victims were sent checks falsely represented as lottery ``winnings,'' but the amount was far less than what the victim had sent in, authorities said.

The indictment alleged that more than 1 million solicitations were sent throughout the United States, offering chances of winning foreign and domestic lotteries such as ``The Australian Lottery,'' ``The International Irish Sweepstakes,'' ``The El Gordo,'' and others.

The solicitation packet contained envelopes pre-addressed to mail drops in the Netherlands, Ireland and other international locations under the control of the defendants, officials said. The bank accounts were listed under names that sounded similar to official lotteries, including the Shamrock Agency, World Expert, Old Amsterdam, and German Swiss, prosecutors said.

Previously, four others pleaded guilty to mail fraud charges in connection with the scheme. They are:

   -- Dennis W. Emmett, 63, of Chatsworth;
   -- Henry Walther, 66, of Pacific Palisades. A former attorney in Santa
Monica, he was sentenced to two years in prison, one year of home confinement, followed by three years of supervised release, and fined $10,000;
   -- Sonny Chris Vleisides, 39, previously of Kansas City. He was arrested in 2007 and held for two years in Italy before he was extradited to the United States. Vleisides was sentenced to 14 months in federal prison followed by three years of supervised release; and
   -- William Cloud, 61, who was extradited from Amsterdam in 2007. He was sentenced to one year in prison followed by two years of supervised release.

-- City News Service


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