Telemarketing firm charged in fraud case

Cy Ryan and Karen Zekan

Friday, April 9, 1999 | 10:36 a.m.

A Las Vegas-based company that may have bilked consumers out of $1.2 million in a pyramid scheme has been closed, and its three owners charged with four felonies each.

Deputy Attorney General Brian Kunzi said state and federal agents searched The Winning Edge and seized records Thursday. One of its owners, Douglas Savage, was arrested, along with four workers.

The other two owners, Brian Michaels and David Sergi, are believed to be out of state, Kunzi said.

The three are charged with securities fraud, selling unregistered securities, not being licensed as a salesman of securities and failing to register as a telephone solicitor.

No one from the firm could be located for comment.

Kunzi said the firm, located at 6655 West Sahara Ave., suites 208 and 210, conducted "an aggressive national advertising campaign," calling itself a multilevel marketing company. But it was a "classic pyramid," he said.

The company solicited memberships in which people were asked to invest $500 for each membership share they desired to purchase in the investment plan, which involved selling phone cards. The investors were in turn promised a $2,000 profit in less than five months, Kunzi said.

The victims, according to the attorney general's office, had to provide the names of three individuals. And The Winning Edge would then contact those persons and attempt to sell them on the program.

Kunzi said there were reports that $1.2 million may have been owed to people who joined. One individual lost $60,000 in the venture, he said.

Jane Femiano of the attorney general's office identified the four workers arrested out of the West Sahara office as Louis Dalessandris, Allen Sarac, Victor Lopez and Karl Payne.

Femiano said The Winning Edge is believed to have been running a similar outfit in Hawaii, but that it shut down a few weeks ago as the attorney general's monthlong investigation was getting under way.

"Pyramid schemes are inherently fraudulent because of the number of new victims that must be added in order to make the promised payoffs to the people at the top of the pyramid," Attorney General Frankie Sue Del Papa said.

"Consumers have to remember that every pyramid scheme must and will fail. Consumers should be wary of promotional schemes that promise payouts based on different levels of participation and offer no-risk investments. This type of solicitation is illegal in Nevada."

She said people victimized by The Winning Edge should contact her office's hot line in Las Vegas at 486-3777 or call the statewide toll-free number (800) 992-0900.