2 Men Convicted in Gumball Telemarketing FraudA federal jury in Boston returned a guilty verdict against two men Friday on charges that they ran a $400,000 telemarketing scam in which they sold gumball machines but never delivered to customers.
William M. Ranney Sr., 56, of Saugus, MA, and Dennis Cioffi, 26, of Medford, MA, were convicted in U.S. District Court on multiple charges of mail and wire fraud. In the scam, telephone solicitors from the men's company, Big Top Gumball, sold 6-foot-tall gumball machines for $5,000, the U.S. Attorney's office said.
Consumers were guaranteed at least $1,000 in revenue from the machines each month, the attorney's office said. They were also promised delivery of the machines six to eight weeks after ordering.
However, during an order backlog after February 1997, Big Top Gumball continued to market the machines for 18 months despite being unable to deliver the product, the attorney's office said. Of the dozens of customers who ordered during that period, only five received their full orders and more than 50 received no machines.
The men are scheduled for sentencing by U.S. District Judge Edward F. Harrington on June 18. They face up to five years in prison and up to $250,000 in fines for each charge, plus restitution.