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06-16-2011, 08:06 PM
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A federal grand jury has indicted infomercial pitchman Don Lapre on fraud-related charges for promoting a vitamin-selling business that attracted more than 220,000 people who invested more than $50 million for a chance to establish an Internet-based business.

Lapre was indicted on 41 counts of conspiracy, mail fraud, wire fraud, promotional money laundering and transactional money laundering. He is scheduled to be arraigned next Wednesday in U.S. District Court in Phoenix.

Federal prosecutors say Lapre, 47, swindled investors through an Internet-based business called the Greatest Vitamin in the World, which lured investors with the promise of easy money in exchange for a small, up-front investment.

Lapre's attorney, Tyrone Mitchell, would not comment on the case.

"We are still trying to gather all the information together," Mitchell said. "At this point, I have no comment."

The Greatest Vitamin in the World shut down its office at Park Central Mall on Central Avenue in 2007 after U.S. Postal Inspection Service served a warrant on the business. Federal investigators also served a warrant at Lapre's Phoenix home.

The indictment alleges that the Greatest Vitamin attracted 226,794 people who invested in largely "worthless" business opportunities from 2003 through 2007.

Lapre and his company solicited new customers through infomercials, phone calls and a website. In exchange for a small, up-front fee, customers were given the chance to become "independent advertisers" who could earn checks of $1,000 or more for getting new customers to purchase vitamins through customized websites.

The investors were then sold Internet advertising packages that cost up to $3,495 that promised to drive traffic to their individual websites. In reality, customers received "inexpensive bulk traffic" for their advertising dollars through pop-up and banner ads, the indictment said.

In all, investors spent more than $51.8 million and received just $6.3 million in total commissions. Lapre personally was paid at least $2.2 million from the business from 2004 to 2007.

The federal charges carry a maximum penalty ranging from five years for conspiracy to 25 years for wire fraud.

Stephen Barrett, a retired psychiatrist who has written about Lapre's infomercial dealings on his website Quackwatch .org, said the federal government has become more aggressive over the past two years in prosecuting health-related scams.

"Very often you get people like this who will just continue if there is no criminal prosecution," Barrett said.

Lapre, a former house painter, has promoted numerous businesses over the past two decades, and his late-night television pitches were once parodied on NBC's "Saturday Night Live."

Lapre told The Arizona Republic in the mid-1990s that he grossed more than $40 million one year and sold more than 500,000 "Money Making" kits during a five-year period.

Customers of Greatest Vitamin in the World filed hundreds of complaints with the Phoenix Better Business Bureau, Arizona Attorney General's Office, Federal Trade Commission, the Internet Crime Complaint Center and postal inspectors.

-http://www.azcentral.com/business/articles/2011/06/15/20110615biz-TV-pitchman-infomercial-accused-scam.html