Coffee Machine Business Opportunity Fraud Leads To Prison
If everyone drinks coffee, then vending machines that sell coffee should be a good business. That must be what James Cummings figured. The only problem: he was selling the idea for a coffee machine business, but he wasn’t completely honest.
According to prosecutors, Cummings sold a business package that included coffee machines, locations in which to place those machines and on-going support and assistance in the operation of the machines. Cummings sold the business opportunities for a minimum price of approximately $10,000 each.
Cummings now has admitted, however, that, in making sales to consumers, he made a number of false claims about the profits generated by the machines. In addition, he admitted that he led potential buyers to believe that they would recoup their investment in 12 to 18 months. Cummings admitted that he misrepresented to his customers that “locating companies” would find high traffic, high profit locations in which to place the vending machines. In reality, as the government alleged, buyers suffered a total loss on their investments and some buyers did not receive their purchased machines.
Cummings was sentenced by U.S. District Judge William P. Dimitrouleas in Ft. Lauderdale, Fla., to a year and a day in prison and three years supervised release, and ordered to pay over $137,000 in restitution. Cummings had pleaded guilty to conspiracy to commit mail fraud for his participation at three Florida companies: M & D Gourmet Coffee Inc. of Boca Raton, Fla.; Coffee Heaven LLC of Deerfield Beach, Fla.; and Divino Trio Coffee & Vending Company of Ft. Lauderdale.
Cummings’ co-conspirator, Manuel Rodriguez, the leader of the scheme, was convicted by a jury of one count of conspiracy and seven counts of wire fraud and recently was sentenced to 120 months in federal prison.