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Government Action: BBB reports on known government actions involving business’ marketplace conduct:

U.S. Court in the District of Minnesota vs Russell Jason Rahm

The following describes a pending government action that has been formally brought by a government agency but has not yet been resolved. We are providing a summary of the government’s allegations, which have not yet been proven.

On December 8, 2022, Russell Jason Rahm pleaded guilty in U.S. Court in the District of Minnesota to conspiracy to commit mail and wire fraud in connection to a $300 million nationwide telemarketing fraud scheme that targeted elderly and vulnerable victims. According to court documents, from 2000 through February 2020, Rahm participated in a telemarketing fraud scheme involving fraudulent magazine subscription sales. Rahm was the owner and Chief Executive Officer of several Kansas-based companies involved in the fraudulent scheme, including Subscription Ink Co. and Millennium Marketing. As part of the scheme, Rahm’s companies, along with other companies, used fraudulent sales scripts to defraud victim-consumers, many of whom were elderly or otherwise vulnerable, out of hundreds or even thousands of dollars. The fraudulent sales scripts were designed to induce consumers, through a series of lies and misrepresentations, into making large or repeat payments. Rahm’s companies also handled collections for those victim-consumers who did not pay or who challenged the resulting charges as fraudulent. Rahm’s companies received, reviewed, and responded to complaints from victim-consumers to state Attorney General’s offices and the Better Business Bureau. According to court documents, Rahm and his companies also provided sales leads and handled order management, billing, and collections for other companies involved in fraudulent magazine sales in exchange for a percentage of the revenue received from victim-consumers. The matter is pending a sentencing hearing.