Longtime Diet Pill Scammer Gets 20-Year Prison Sentence

Stephen Barrett, M.D.

Frank Sarcona (a/k/a Frank Sarcone), whose career as a mail-order scammer spanned more than 30 years despite more than a dozen government enforcement actions, appears to have finally been stopped. In February 2010, he was sentenced to 20 years in prison for a long list of crimes related to selling worthless diet pills.

My first observation of Sarcone's work occurred in the late 1970s when "Nancy Pryor" flooded the country with ads for a book called The Amazing Secret of a Desperate Housewife. Government reports indicate that between 1978 and 1981, Sarcone and three of his companies (Millburn Book Corporation, Nancy Pryor, and Millburn Products) grossed over $15 million by advertising in more than 600 newspapers and magazines throughout the continental United States, Puerto Rico, and Canada. The products also included four other books: The Boston Police Diet, The Hollywood Emergency Diet, The Crash Loss Diet, and Dr. Romano's Mega II Rapid Weight Reduction Program. Sarcone also marketed Diet Bullets, a protein powder mix claimed to be a "crash-burn" system that "turns up your body's 'inner furnace' and breaks down your excess body fat and automatically flushes it out of your body forever." In 1979, U.S. postal inspectors began filing false representation complaints that led to mail-stop orders and consent agreements, but these were temporarily circumvented by changing postal box locations and establishing toll-free response numbers. Millburn Books was also criminally prosecuted, pled guilty to one count of conspiracy and 40 counts of mail fraud, and was ordered to pay a fine $50,000 fine [1,2].  

Most books for the general public have 250-350 words per page and a word count between 35,000 and 60,000. The "diet secret" book included only 57 pages of large-type text with an average of about 175 words per page and a total word count under 10,000. Standard typesetting would have produced 30-40 pages, enough for a booklet, but hardly a hardcover book. To double the book's thickness, it contained 57 additional pages on which the user could record anything eaten each day that was not "on the diet." The "secret" itself was not exactly amazing. It consisted of five strategies: (1) substitute fructose for table sugar, (2) "diet" every other day, instead of every day, limiting intake to 900 calories, (3) use lethicin, dolomite, brewer's yeast, wheat germ, and yogurt, which "Nancy" claimed were "natural food tranquilizers," (4) consume kelp, and (5) have a tablespoon of fructose 20 minutes before each meal.

In 1982, three civil consent injunctions were entered in U.S. District Court in Newark that barred further fraudulent advertising and a fund was set up to refund $150,000 to consumers. But Sarcone was not deterred. From at least 1983 to 1991, he ran at least three more deceptive companies: Forever Thin Weight-loss Clinic Inc., Amerdream, Inc., and Advanced Automotive Technology (AAT). Forever Thin and Amerdream involved diet schemes. In addition to weight loss, prospective buyers of Amerdream's Ultimate Solution Diet Program were offered a money-back "guarantee" and were falsely told they would receive a $1,000 US Treasury bond or buying and testing the product for two months. AAT was a telemarketing scheme to sell a bogus gas-saving device called PetroMizer [3].

In 1984, after the U.S. Postal Service filed an administrative complaint, Sarcone agreed to a cease-and-desist order that prohibited false representations about Forever Thin. In 1985, he signed an assurance of voluntary compliance in a proceeding that the State of Utah brought against Forever Thin. Six states—Arizona, Louisiana, Minnesota, Ohio, Oklahoma, and Texas—obtained injunctions and or monetary judgments based on complaints that AAT had represented PetroMizer benefits. In 1991, in response to FTC charges, a federal court in Arizona permanently banned the false and misleading claims made by Amerdream for its Ultimate Solution program and by AAT for the "PetroMizer" The court also ordered Sarcone and the companies to pay nearly $675,000 for consumer redress [4].

In 1997, in response to more FTC charges, a federal judge ruled that Sarcone and an associate, doing business as SlimAmerica, Inc., had violated federal consumer protection laws by falsely advertising that "Super Formula" would "blast" up to 49 pounds off in only 29 days, "obliterate" five inches from waistlines, and "zap" three inches from thighs —all without the need to diet or exercise. The ads also falsely asserted that all of these claims had been validated by scientific studies, and that Super-Formula was endorsed by a medical doctor with credentials from a well-known nutrition organization. "Super-Formula" consisted of three different pills: Slim Again, which contained chromium picolinate and hydroxycitrate; Absorbit-ALL, which contained chitin; and Absorbit-ALL PLUS, which contained glucomannan. In 1999, the court ordered the defendants to refrain from false advertising and to post a $5 million performance bond before marketing any other product or service. He also ordered payment of $8,374,586 in consumer redress, which represented the estimated amount of the defendants' sales of Super-Formula less previously-issued refunds [5]. However, it appeared that Sarcone had dissipated most of the money.

In the SlimAmerica case, the judge noted that Sarcone had a long record of fraudulent schemes that bilked thousands of victims out of millions of dollars in more than a dozen states and had persisted despite more than a dozen administrative or court orders to stop [2]. The judge warned that any conduct undertaken to frustrate the provisions of the SlimAmerica injunction would be treated as acts of contempt. Nevertheless, almost immediately after the injunction was issued, Sarcone began marketing and selling LipoBan and used the name "Dave Johnson" to hide his identity. Despite the judge's warning, he did not post the required bond and thus subjected himself to prosecution for criminal contempt of court.

LipoBan, which contained chitin, was marketed through newspapers, national magazines, the Internet, and direct mail solicitations. The scheme included mailing millions of letters inviting customers to participate in what he termed “a restricted nationwide test” of a new product that would promote large weight loss without diet and exercise. The advertisements created the false impression that a study was being conducted in conjunction with the LipoBan Clinic and that purchasers of the product would participate in that study. However, virtually all customers were told that they were test participant #731. Included in the mailings was a letter from Dr. Joseph Maya, the clinic's purported medical director. The printed material falsely stated that the “clinic” had a team of weight loss and nutrition professionals and that a New York cardiologist had endorsed LipoBan. In reality, however, the “clinic” was located at the residence of co-defendant George Forgione and later at an office in an industrial park, neither of which was set up to provide any medical services or perform any research. "Dr. Joseph Maya," whose real name was Jose Maya Behar, was licensed in Mexico but not in the United States and never visited or performed any services for the "clinic." Prospective LipoBan buyers were promised $50 for participating in the "study" but found it difficult or impossible to collect this money or obtain a refund for the product [6].  

Sarcona funneled monies he received from the scam into the bank account of a defunct corporation he maintained solely for personal use. Thereafter, large sums of money were withdrawn as cash or transferred into other accounts in the name of a nominee. Sarcona was given a signature stamp so that he could write checks on those accounts, and used some checks to purchase a luxury home in the U.S. Virgin Islands. In 2008, the U.S. Government obtained a Decree of Forfeiture under which it seized this property.

In 2009, Sarcona was convicted of 29 criminal charges that included conspiracy to commit mail and wire fraud; conspiracy to commit money laundering; and multiple counts of mail fraud, wire fraud, money laundering, misbranding of a food, and criminal contempt of court. Court documents indicate that he defrauded more than 130,000 customers out of more than $7 million by making false claims about LipoBan [7].

For Lauderdale's Sun Sentinel newspaper has published an interesting account of the sentencing hearing:

Before learning his fate Friday afternoon, Sarcona made one last pitch—a 15-minute plea for leniency to U.S. District Judge Kenneth Marra. He portrayed himself as a crusader for dietary supplements in the face of a federal government that, he said, wants to suppress them.

He acknowledged that he made mistakes in his LipoBan advertisements, but said he could have fixed them if the government had alerted him to the problems. "I don't stay up at night thinking of ways of bilking little old ladies out of $50," Sarcona said.

Assistant U.S. Attorney Kerry Baron told Marra that Sarcona had spent a lifetime deceiving people, preying on those desperate to lose weight. "If Mr. Sarcona is not given the stiff sentence he deserves, he will repeat this," Baron said. Sarcona had faced between 27 and 33 years behind bars under federal sentencing guidelines. Marra opted for a shorter sentence, saying that while the guidelines might be appropriate for someone running a Ponzi scheme, they weren't in a case where victims lost only what they paid for the pills, typically $60 per bottle. But Marra said Sarcona still needed a lengthy prison sentence to reflect on his history of suspect business practices [8].

Another report on the hearing noted that after the "LipoBan Clinic" was shut down, Sarcona started maketing "Nature's Fat-Fighting Secret," a pill he claimed "stops hunger, increases energy & prevents fat calories from being absorbed into your body!" [9]

Diet-pill scammers are rarely subjected to criminal prosecution. The 20-year sentence is by far the longest I have seen for a diet pill scheme and one of the longest ever given for any type of quackery-related activity.

References

  1. Mail order company fined. Law Enforcement Report, Fall 1982, p 11.
  2. Postal Service decision for breach of consent agreement. In the matter of the complaint against Nancy Pryor, Millburn Products, and the Millburn Book Corp. P.S. Docket No. 7/81, June 16, 1980.
  3. Final judgment for permanent injunction and damages. FTC vs. SlimAmerica, Inc., Frank J. Sarcone, and Robert Wyman. U.S. District Court, Southern District of Florida Case No. 0:97-cv-06072-DLG, filed July 2, 1999.
  4. Federal court bans false and misleading claims for diet program and purported gas-saving device following Federal Trade Commission charges. FTC news release, Jan 16, 1992.
  5. FTC wins case against defendants engaged in deceptive advertising of "Super-Formula" diet product: SlimAmerica ordered to pay more than $8.3 million in consumer redress, post bonds before engaging in future weight-loss or other marketing activities. FTC news release, July 19, 1999.
  6. Superseding indictment. U.S.A. vs. George Forgione and Frank Sarcona. U.S. District Court, Southern District of Florida, Case No. 07-cr-80138, filed Sept 14, 2007.
  7. Boca Raton man sentenced for nutritional supplement scam. USDOJ news release, March 1, 2010.
  8. Burnstein J. Diet pill creator sentenced to 20 years for LipoBan’s fraudulent claims. Sun Sentinel, Feb 26, 2010.
  9. Musgrave J. Man promising effortless weight loss sentenced to 20 years in prison. Palm Beach Post, Feb 26, 2010.

This article was revised on March 16, 2010.

Links to Recommended Companies