Industry Canada

Industry Canada
Competition Bureau Canada

Competition Bureau Canada

April 29, 2008 11:03 ET

Competition Bureau Canada: Jail Sentence for Deceptive Telemarketer

TORONTO, ONTARIO--(Marketwire - April 29, 2008) - The Competition Bureau announced today that an Ajax, Ontario man has received a two-year conditional jail sentence for his involvement in a business directories telemarketing scam that defrauded businesses of an estimated $150 million over a 10-year period.

Paul Barnard, 56, a senior manager of DataCom Marketing Inc., pleaded guilty to six criminal charges under the deceptive telemarketing provisions of the Competition Act.

"The Competition Bureau is committed to taking action and seeking significant sentences against scammers who harm businesses and consumers through deceptive telemarketing schemes," said Andrea Rosen, Acting Deputy Commissioner of Competition.

Barnard pleaded guilty for his part in a scheme in which it is alleged that Datacom telemarketers contacted small and medium-sized businesses in Canada and the United States, claiming that they were updating information in their business directory listings. The telemarketers implied that the businesses had ordered a listing in the past and that someone in the company had already authorized an order. It is alleged that by using this "assumed sale" technique, which led customers to believe that they had already ordered a listing when in fact they had not, the company successfully deceived more than 50,000 businesses costing each between $200 and $500.

It is further alleged that the telemarketers failed to disclose which company they represented, the price of the product, the terms and conditions to return it, the purpose of the call and the nature of the product, as required by the telemarketing provisions of the Competition Act. Customers subsequently received a business directory, which they ordered as a result of the false or misleading representations.

In addition to the conditional jail sentence, Madam Justice Marion E. Lane of the Ontario Court of Justice ordered Mr. Barnard to complete community service. Mr. Barnard is also prohibited from engaging in any form of telemarketing for life.

In passing sentence, Justice Lane observed that, but for the mitigating factors in Mr. Barnard's case, including his co-operation with authorities in Canada and the United States, a penitentiary sentence would have been warranted.

Proceedings are pending against others charged in connection with this scheme, who have not co-operated with authorities, including: Bernard Fromstein, 56, and Judy Neinstein, 64, both of Toronto, Ontario, and James Sharo, 58 and George Pavlopoulos, 37 both of St-Hubert, Quebec, as well as two companies: DataCom Marketing Inc. and DataCom Direct Inc.

This investigation was conducted with the assistance of the U.S. Federal Trade Commission, the Toronto Strategic Partnership and the Service de Police de la Ville de Montreal. Members of the Toronto Strategic Partnership include the Competition Bureau, the Toronto Police Service, the Ontario Provincial Police, the RCMP, Ontario's Ministry of Government and Consumer Services, the U.S. Federal Trade Commission, the U.S. Postal Inspection Service, and the U.K.Office of Fair Trading.

The Competition Bureau is an independent law enforcement agency. We contribute to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice.

Contact Information

  • Media enquiries:
    Pamela Wong
    Communications Advisor
    External Relations and Public Affairs Branch
    819-953-7734
    or
    General enquiries:
    Competition Bureau
    Information Centre
    819-997-4282
    1-800-348-5358