The Payment Guy: How Fake Merchant Accounts Kept a Multi-State Telemarketing Scam Running

The victims want refunds. The credit-card companies start noticing the chargebacks. The merchant accounts get shut down. Game over.

Unless somebody's job is to keep the payments flowing. In this Utah case, prosecutors say that was Charles Robert Brewer.

So what happened?

In August 2023, Charles Robert Brewer, also known as "Robert Brewer" or "Scott Brewer," 59, of Manhattan Beach, California, was sentenced to 12 months and one day in prison, 24 months of supervised release and $48,639.86 in restitution. Brewer admitted to conspiracy to commit wire fraud. The U.S. Attorney's Office for the District of Utah, part of the Department of Justice (DOJ), announced the sentence on August 3, 2023.

According to the court documents, the conspiracy was multi-state and had caused millions of dollars in losses between June 2016 and February 2017. The telemarketing rooms were selling fraudulent products, including "Amazon rooms and accompanying advertising," "government grants" and "business opportunities."

Here's what Brewer did, according to the DOJ:

• Processed payments fast, so victims' card charges could be run and the money moved to safe accounts before victims demanded refunds or card companies shut the accounts down.
• Recruited "nominees," people whose names were used to set up merchant accounts without their knowing about the fraud.
• Helped fabricate financial documents and bank statements to get merchant accounts approved.
• Helped co-conspirators impersonate satisfied customers to fool auditors.
• Emailed a payment processor pretending to be a merchant account owner, making excuses for high chargebacks to keep accounts open.

IRS Criminal Investigation was among the investigators.

Here's the thing ...

Read that list again. Every single item is about fooling the payment system.

That's the hidden engine of a lot of telemarketing fraud. The sales floor lies to the customer. The payment guy lies to the bank.

And look at the products. "Amazon rooms." "Government grants." "Business opportunities." Same scam, just different week. Am I right?

Why should you care?

If you run a legit call center, your merchant account is your lifeline. Payment processors are watching chargeback ratios closely because of cases like this.

So high chargebacks aren't just a cost. They're a warning sign, to your processor and to you.

What to do this week

• Watch your chargeback rate like a hawk. Find the cause, not an excuse.
• Never put merchant accounts in someone else's name.
• Never fake customer testimonials or reviews for auditors. Or anyone.
• Tell your processor the truth. Always.

It's not rocket science. If you have to lie to your bank to keep selling, stop selling. That's it.