W A S H I N G T O N, Aug. 21, 2001 -- Eight people have been arrested and charged with allegedly rigging popular McDonald's games to fraudulently collect more than $13 million worth of prizes.
No employees of McDonald's were involved in the scam. Attorney General John Ashcroft today said that employees of Simon Marketing Inc., the Los Angeles-based company hired to run the games for McDonald's, allegedly figured out how to direct accomplices to pick up big prize tickets and then split the winnings with them.
The arrests in operation "Final Answer" were announced by Ashcroft and Thomas Pickard, acting director of the FBI.
McDonald's Corporation Chairman and CEO Jack M. Greenberg said in a statement that they were "shocked and stunned" to learn of the alleged scam and agreed to immediately cooperate with the FBI. He insists "millions of McDonald's customers legitimately won prizes over the years, from free food and drinks to cash and merchandise."
In addition, to "right this wrong," the company announced they will offer a new game where customers will be eligible to win prizes valued at $10 million from Aug. 30 through Sept. 3 in an "Instant Give-Way."
All eight individuals were charged with conspiracy to commit mail fraud, and felony complaints were filed against them in federal court in Florida. They are all in custody.
Law enforcement authorities said the defendants were charged with fixing the outcome of McDonald's Monopoly, Who Wants to Be a Millionaire and other McDonald's promotional games by controlling the distribution of the high-value prize pieces, such as the $1 million grand prize.
FBI: the Scheme Began as Early as 1995
The FBI said the scheme began as early as 1995 and involved McDonald's Monopoly game promotion.
The company has offered the Monopoly promotion for 10 years. It offers big prizes, including $1 million in cash, diamonds or gold, cars and vacations. Customers "collect to win" by gathering game pieces attached to drink cups or food packaging and working towards the prize of choice in each section on a game board available at McDonald's or at the company's Web site.
The pieces are also redeemable for "instant win" prizes.
This year McDonald's introduced a new Pick Your Prize, which gives winning customers the chance to select from one of three prize options in eight different categories.
Those arrested are: Linda L. Baker, 49, of Westminster, S.C.; Noah D. "Dwight" Baker, 49, of Westminster, S.C.; John F. Davis, 44, of Granbury, Texas; Andrew M. Glomb, 58, of Fort Lauderdale, Fla.; Michael L. Hoover, 56, of Westerly, R.I.; Ronald E. Hughey, 56, of Anderson, S.C.; Jerome P. Jacobson, 58, of Lawrenceville, Ga., and Brenda S. Phenis, 50, of Fair Play, S.C.
—ABCNEWS' Pierre Thomas contributed to this report.