Lottery Scam Money Recovered

Attorney General Tom Corbett today announced that more than $175,000 has been recovered and will be released to consumers in Pennsylvania and throughout the country, who were defrauded in a 1998 Canadian-based telemarketing scam that promised an opportunity to win a share of the Australian Lottery. The funds were recently released following a protracted bankruptcy proceeding in British Columbia where the scam originated.

The Attorney General's Bureau of Consumer Protection will disperse the funds to victims throughout the United States who lost money in the scheme. Those eligible for refunds must come forward and submit a claims form and signed affidavit before a May 2, 2006 deadline.

Corbett said U.S. District Court Chief Judge Sylvia H. Rambo awarded final judgment in the Attorney General's 1998 lawsuit against Sushila Devi Kumar, also known as Sheila Kumar, and Sandhya Murthi, also known as Kelly Williams. Kumar and her British Columbia-based company did business under the names Systems 3 Marketing Inc., SMI or Systems Marketing.

According to the lawsuit, the defendants' were accused of engaging in the illegal sale of foreign lottery tickets via telephone in the U.S. The telemarketers allegedly contacted mostly elderly consumers to encourage them to participate in a lottery "pool" that would enhance their chances of winning large prizes from the Australian Lottery.

Consumers said they were asked to pay various amounts to purchase a share in a lottery ticket or series of tickets. Some unsuspecting consumers were told that they had already won and were encouraged to roll over their winnings in the lottery "pool." The suit also claimed that consumers were never informed that participating in foreign lotteries is illegal under federal law.

"Unfortunately, some consumers were conned out of significant amounts of money in this scheme," Corbett said. "The funds awarded in this case belong to these victims and our immediate goal is to encourage those entitled to the money to come forward and obtain their share."

Corbett said any consumers who paid money to Systems 3 Marketing Inc., Systems Marketing or SMI for chances to participate in the Australian Lottery are eligible for a refund.

Any U.S. resident who suspects that he or she is eligible for a refund must submit a SMI claim form and signed affidavit before May 2, 2006. No other documentation is necessary. The form and affidavit can be downloaded by visiting the Pennsylvania Attorney General's website at http://www.attorneygeneral.gov. Those without access to the Internet may call (814) 471-1831 to receive the forms in the mail.

Once completed, the SMI claim form and signed affidavit must be mailed to the following address before the May 2 deadline:

Pennsylvania Office of Attorney General

171 Lovell Ave., Suite 202

Ebensburg, PA 15931

Corbett said the amount of money consumers will receive will depend upon the total dollar amount of all claims submitted. If the total amount of all claims received exceeds the amount available for distribution, pro rata refunds will be issued. The funds are expected to be distributed to consumers nationally before July 2006.

The cross-border prosecution was led by Senior Deputy Attorney General E. Barry Creany of the Attorney General's Bureau of Consumer Protection and the British Columbia Director of Trade Practices. Corbett also thanked the U.S. Department of Justice Office of Foreign Litigation for its assistance in the case.