A federal judge in Boston has sentenced a man to five months in prison for his conviction in a $400,000 scam to sell gumball machines by telephone without intending to deliver, the U.S. attorney's office said yesterday.
Roy Nelson of Quimby, MA, faces two years of supervised release after his prison sentence for his involvement in the scheme. Nelson also must pay $97,252 to compensate the victims of the scam.
He pleaded guilty to conspiracy and eight counts of fraud in March. He and three other men, who were convicted after a three-week trial in March, sold hundreds of gumball machines and collected a 50 percent deposit on the $5,000 purchases. The six-foot-tall novelty machines dispensed gumballs for 25 cents. When operated, the machines set in motion a series of gumballs on interconnecting tracks with accompanying circus theme music.
The men, operating as Big Top Gumball, promised delivery in six to eight weeks, but delivered only to a few people, according to the U.S. attorney's office. In February 1997, the supplier of the gumball machines cut off Big Top for failure to make payments, leaving at least 100 customers stranded without machines.
Big Top never replaced its manufacturer but continued marketing anyway, the U.S. attorney's office said. Nelson joined the company in October 1997 and participated in at least a dozen fraudulent sales in 1998.
Big Top also told customers at the end of the six- to eight-week delivery period that their machines would ship when they forwarded the remaining 50 percent due on their order, the U.S. attorney's office said.
The ringleader, William Ranney Sr., received a prison sentence of four years and nine months. His partner, Dennis Cioffi, received a two-year sentence, while Ranney's son, William Ranney Jr., received a one-year sentence for his role.