NEWARK, N.J. (AP) -- For four years, a New Jersey man fooled the computers at two music-by-mail clubs, using 1,630 aliases to buy compact discs at rates offered only to first-time buyers.
Investigators said it took an employee to notice that a suspicious amount of CDs were going to post office or commercial mailboxes in seven towns.On Thursday, David Russo admitted he received 22,260 CDs by making each address just different enough to avoid detection, adding fictitious apartment numbers, unneeded direction abbreviations and extra punctuation marks.
Russo paid a total of about $56,000 for CDs, or about $2.50 each. Operating as "CDs for Less," he then sold the CDs at flea markets for about $10 each, said his lawyer, Paul Brickfield.
"It essentially started as a hobby," Brickfield said after a court hearing. "He joined a few times, made some money on it, and made the mistake of turning it into a business."
"It got to the point where people were ordering through him," he said.
The scam is believed to be the largest of its kind in the nation, said Assistant U.S. Attorney Scott S. Christie, who prosecuted the case.
Russo, 33, pleaded guilty to a count of mail fraud, and could receive up to 18 months in prison and a fine of up to $250,000. He is free on a $50,000 bond until his Feb. 14 sentencing.
Russo admitted acquiring 12 mailboxes from 1994 to 1998.
The music clubs, BMG Music Service and Columbia House Music Club, eventually "felt that they were seeing a lot of orders" in the seven towns, said Special Agent Joseph Corrado of the U.S. Postal Inspection Service.
A "hand-by-hand" analysis revealed that the orders eventually attributed to Russo had the same handwriting, Corrado said. The clubs' introductory offers typically provide nine free CDs with the purchase of one CD at the regular price, plus shipping and handling. The customer then purchases a set number of other CDs at later dates to fulfill club requirements.