Man Accused of ‘Boiler-Room’ Scam

A Santa Monica man has been charged in Utah with running a telephone “boiler room” that used promises of discount vacations to defraud credit-card holders.

The two-count complaint alleges that Edward Kane was among several people who from June through August of 1984 helped manage Sunsets Unlimited, a Utah-based travel club in reorganization bankruptcy.

To sell club memberships, Salt Lake City Prosecutor William Ryan said, Kane helped set up a boiler room office “equipped with multiple telephone hookups and a sales staff of telephone solicitors.” According to the complaint, Kane instructed the phone solicitors to seek out major credit-card holders as customers and obtain their card numbers “by means of various misrepresentations.”

The victims were allegedly told that they would receive a package of materials including a “valuable discount coupon book for reduced rates at major hotels, restaurants, car rentals agencies and tourist attractions.” But Kane knew, the complaint said, that Sunsets Unlimited was systematically charging $149 to the credit-card accounts as soon as the number was obtained, “irrespective of whether the customer had agreed to become a member.”