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ASHEVILLE CITIZEN-TIMES, June 18, 2005
Asheville man sentenced in computer
fraud case
By Julie Ball
STAFF WRITER
June 18, 2005 6:00 am
ASHEVILLE — An Asheville man who authorities say sold computers over
the Internet but failed to deliver them was sentenced Friday to 10 years in
prison and ordered to pay $1.8 million in restitution.
Todd Wilson Short, 44, pleaded guilty last year to two federal fraud charges.
Short had been jailed since 2003, when federal agents charged him with using
the Internet to obtain money fraudulently.
U.S. District Court Judge Lacy Thornburg sentenced Short. In addition to the
prison sentence, Thornburg ordered five years of probation.
During the sentencing, Thornburg said he considered the number of victims in
the case as well as the substantial amount of restitution owed by Short.
At the time of Short’s arrest, federal authorities said they had
received nearly 200 complaints about him from across the United
States and outside the
country. They ended up with more than 250 victims.
Authorities say Short operated several businesses that offered laptop
computers for sale through Internet auctions. Customers paid for computers,
but most never received them, officials have said.
Nearly 50 victims wrote to the court regarding Short’s sentence,
prosecutor Corey Ellis said. Ellis handed the judge one of those letters
before sentencing.
“It’s been a tremendously unsettling and financially burdensome
loss for these individuals,” Ellis told the judge.
But Short’s attorney Andrew Banzhoff asked
the judge to consider Short’s history of mental illness.
“I don’t believe he really set out within his heart believing
that he was going to defraud people,” Banzhoff
said.
Instead, Short believed he was working for the CIA, and selling computers
that had been fitted with a special chip so the government could monitor
their users, Banzhoff said after the sentencing.
Banzhoff said he is not sure whether Short will
appeal the sentence.
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This page is about Todd W. Short and his
cohort. They ran an online sales
business called J.C. Morris & Co. which advertised spectacular savings on
computer equipment, mainly laptops. To obtain these great savings, customers
were required to pay in advance and wait several weeks for delivery. Hundreds
of customers paid their money but never received merchandise.
That's the basic outline. Added details include:
- This was at least the third business with the
same M.O. Todd’s previous companies include MedNetPlus
and the impressively-named Benton Medical Group International.
- During special sales events he promised to make
contributions to charities including Make-a-Wish and the September 11
Fund. FatWallet forum participants who have
contacted the charities report they have no record of such donations.
- He used a marketing pitch that described his
company as providing advertising and marketing services. He said the
company added sales to promote the marketing activity. It’s hard
to imagine now, but lots of customers accepted this as a plausible
explanation for J.C. Morris’s low, low prices.
- He and his cohorts used a long list of aliases
to mask their identity.
- Todd Short has previous criminal convictions
for felonies in Texas and entered "not guilty by reason of
insanity" pleas to federal felony charges in Utah.
- Todd Short attempted to intimidate customers
who sought to take action against him. He called them "adversarial
customers." He published the names of many (including me) on his
website, imagining that this would be a kind of punishment.
- He filed a lawsuit against one customer and
threatened others.
- He filed a $27,000,000 lawsuit against FatWallet for hosting a forum
discussion about J.C. Morris.
- He tried to take J.C. Morris into bankruptcy
himself, ignoring the federal rule that corporations must be represented
by an attorney. The case was thrown out of court.
- He then filed personal bankruptcy, but tried to
include his companies in that case. The court ruled that he could not
sneak corporate bankruptcies in under the umbrella of his personal
bankruptcy.
- PayPal, who claim to be owed about $700K by Todd
Short, got a court order requiring Todd to turn over his financial
records and submit to questioning under oath.
This is where things stood
until December 19, 2002, when Todd was declared incompetent by a state
court in his home town of Asheville,
N.C, in an action requested by his friend, Phillip Hannah. The director of
the local tax-supported mental health facility was subsequently appointed as
Todd’s guardian
On February 18,
2003, the Bankruptcy Court
granted the motion of the Bankruptcy Administrator to convert Todd's
bankruptcy to Chapter 7. The
Court appointed an interim Trustee to liquidate assets and close out
Todd’s legal cases. The
bankruptcy case is closed and no victims recovered any money.
On May 13, 2003, Todd Short was arrested by the FBI and on April 21, 2004, he entered a Plea Agreement with the federal prosecutors,
pleading guilty to two counts of fraud.
As part of the agreement, Todd promised to cooperate fully and
truthfully in investigation of the case.
On June 17, 2005, Todd was sentenced to ten years in prison.
The arrest and prosecution of Todd Wilson Short were
successful in large part because many victims banded together over the
internet and provided the FBI and federal prosecutors with factual evidence. The case of Todd Short should be a
lesson and a warning to others who think they can get rich quick by cheating
people through fraudulent internet sales.
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