Show POSTAL NOTES TES By Clifford H H. H Sondrup Ephraim Utah WARNING YARNING GIVEN N AGAINST FOND AND OTHER SCHEMES IN N OR OUT oUr OF 1 MAILS S Noting that new reports from Chief Postal Inspector David H. H Stephens Indicate a renewal of chain letter schemes Postmaster ter er General Arthur E. E Summerfield Summerfield Summer Summer- field warned today that those who participate in such activities activities activities may be subject to criminal prosecutions prosecution r rHe He emphasized also that those putting their money into these schemes s seldom get ct anything and usually lose out altogether Mr Summerfield explained that the United States Courts have ruled that chain letters are arc both frauds and lotteries It makes makes no differ difference whether whether whether ther the solicitation is for mone money money mon mon- e ey or bonds or anything else of oC value Whether he chain is broken is a matter of chance which makes it a lottery And too whether the participant will get nothing or a small amount or er be lucky and receive a substantial substantial sub sub- amount depends upon chance The scheme is a fraud because the same representations arc are made to all the participants that they will eventually receive substantial substantial substantial sub sub- rewards However the chain of interested persons soon vanishes and there is no way by which the new participant can determine whether he is on th the first round or the last round round round-of bf the thc chain letter One prominent version of the chain letter idea beIng be- be ing revived Mr Summerfield noted is a scheme in which US U.S. Savings Bonds are used and in which the list is not sent by mail mall but is exchanged by hand This This This' particular version of the chain letter scheme was employed employed employed em em- several years ago and was at that time the object objector of or ora a warning by postal author author- Neither the fact that savings bonds are arc used to give an aura of respectability to the schemes nor the fact that the lists of the participants are not cIrculated circulated circulated in the mails malls alters the i Illegality of th these se operations I Mr Summerfield l warned All Alf reports of such schemes which come corne to the attention of II the Postal Service will be in investigated investigated in- in I fully and submitted to the Department of Justice for possible prosecution whenever there appears' appears to have been a violation of fraud and lottery stat statutes tes applying to chain letter letter let let- ter operation The investment required of ot an individual in the Savings Bond version of the chain letter Is two savings bonds The new member of these groups sometimes calling themselves Savings Bonds Clubs buys two bonds He gives one to the person per per- person person per per- son who has enrolled him inthe Inthe in inthe the club and sends the other bond- bond to the name at the top of a list furnished by the enrolling enrolling enroll enroll- ing member The new enrollee then makes tw two copies of ot the list list he has received from the person en enrolling enrolling enrolling en- en rolling him In the club I These new copies of the list vary from the original in that I on on- on the new lists the name I of the person to whom the new member has just mailed a 8 abond abond bond is now placed at the bottom bottom bot bot- tom torn while the name oC of the new new enrollee is now pla placed ed on both new copies next to the bottom The new member attempts to sell both of of his copies of th tHe thc e list to oth other r persons Each time he makes a sale he receives re receives receives re- re a bond from the buyer and his name is advanced one notch on each of the two new lists prepared by each new buyer In this way the new enrollee is supposed to get his own in investment investment investment in- in vestment back quickly and to find his name nam moving ever upward upward up up- ward in a growing number of oC lists that will get him a harvest of bonds However Mr Summerfield explained while we in the Postal Postal Postal Pos Pos- tal service are are directly concerned concerned concern concern- concern concern- ed with the illegal aspe aspects ts of such schemes we also are arc anxious anxious anxious ious to caution people that they may lose their money If they are lured into such schemes Chain letter schemes always turn out so that the few who wh start them may get back a little littlemore littlemore more than their investment at the risk of criminal prosecution prosecution prosecution prose prose- cution while practically all the others others' lose their money Such an outcome is inevitable inasmuch as the supply of Interested in interested interested In- In persons persons' is soon ex exhausted ex- ex h hausted P I |