Local News in Brief : 2 Men Sentenced to Prison in $257,000 Fraud Scheme

Two men were sentenced to five years in prison Monday for coaxing $257,000 worth of electronic equipment and other goods out of 54 companies by giving them phony credit references over the telephone.

Haim Pinhas, 44, of North Hollywood and Jack Price, 45, of Minneapolis were each sentenced to five years in prison and five years probation by U.S. District Judge Edward Rafeedie.

Operating through a Van Nuys business called General Merchandise Club, Pinhas and Price defrauded such firms as Kodak, Atari and Sony out of about $257,000 in televisions, leather goods, hot tubs, cameras and stereos by purchasing the goods on bogus credit.

The men paid nothing for the goods, then sold them quickly and cheaply to discount outlets and closed up their business before the victims realized the credit references were no good, said prosecutor Gary S. Lincenberg. The scheme operated from December, 1986, through May, 1987, he said.

The two men were convicted in a federal court trial on 18 counts of conspiracy, mail fraud and interstate transportation of stolen property.

Another man, Anthony Anish, 39, of Laguna Niguel, who helped supply the credit references, pleaded guilty to aiding and abetting mail fraud and was put on three years probation, Lincenberg said. A fourth defendant, Byron Foster, 28, of Los Angeles, was acquitted.

Lincenberg said Pinhas and Price had potential customers telephone their associates, who posed as longtime customers and praised their reliability in paying bills on time.

Clients were sometimes directed to call an answering service Pinhas had set up, Lincenberg said. The client would leave a message requesting a credit reference and Pinhas or one of his employees would call back and provide a strong credit report, Lincenberg said.

Pinhas told the judge that General Merchandise fell apart because of his poor business practices, but said he had “no intent to steal.”

“I’m just a nobody,” he said. “I’m just an ordinary man trying to make a living. . . . I didn’t want to beg for my family. . . . I just had some financial problems.”

Price admitted he is “the guilty party here” and that he helped Pinhas obtain favorable credit references. His lawyer, Lindsay A. Weston, portrayed Price as Pinhas’ puppet, pointing out that Pinhas, not Price, owned General Merchandise. But Rafeedie said they were equally culpable.

“It was clear throughout the trial that the influence of Mr. Price on the transactions was not minimal,” Rafeedie said. “The court has the sense that in some ways, Mr. Price was the mentor to Mr. Pinhas.”