WASHINGTON -- Twenty-four manufacturers who were victimized in a coupon fraud scheme in the early 1990s have been awarded nearly $1.3 million by the Department of Justice.
ich was not involved in the coupon scheme.
The fraud was committed by Jules Rose, chairman and chief executive officer of the predecessor Sloan's, and two other chain executives -- Gary Meyer, the company's secretary-treasurer, and Stephen E. Karsch, vice president of administation. All three executives admitted they cheated consumer goods manufacturers out of $3.5 million in a scheme in which they purchased manufacturer coupons in bulk and submitted them to clearinghouses or to manufacturers for redemptions at face value.
Thomas Queen, a partner in the law firm of Wiley, Rein & Fielding here, told SN last week the 24 manufacturers are members of the Coupon Information Corp., Alexandria, Va., which assisted law enforcement officials in investigating and prosecuting the original case.
According to Queen, "We went to the Department of Justice and said the money they had seized was the manufacturers' money that had been stolen pursuant to Sloan's fraudulent scheme and we wanted it back."
"Then we went through a process where we documented payments to Sloan's for the particular years of the fraud, and Justice made a determination of what percentage of money each had paid Sloan's in those years attributable to the fraud and then agreed to refund that money."
The refund totalled $1,253,679.56, Queen said.
The balance of the $5 million will ultimately go to the U.S. Treasury if there are no further claims, Queen pointed out.
