Former Epsilon Executives Charged with Fraud for Selling Potential Victims' Data to Fraudsters

A former executive and a former sales manager of data management company Epsilon Data Management LLC (Epsilon) have been charged by the U.S. Department of Justice with multiple counts of fraud for selling data to mass-mailing scammers.

According to the DOJ, Robert Reger, 57, and David Lytle, 64, were former employees of Epsilon. When they were working for the company, they conspired to sell datas to mass-mailing fraud schemes.

Epsilon used transactional data collected from marketing customers to predict new "responsive buyers" by using computer algorithms and a database of 100 million U.S. households. So-called "responsive buyers" are consumers that the algorithms believe are most likely to respond to fraudulent messages.

The DOJ believed that Reger and Lytle knew that Epsilon was planning to provide data to fraudsters and was aware that the fraudsters were targeting elderly and vulnerable consumers. However, they still used business units that managed to facilitate the mass-mailing fraud schemes.

Evidence showed that the defendants sold nearly one hundred lists to one of the fraudsters.

In 2021, Epsilon paid $150 million in fines and compensation to the U.S. DOJ for selling data to fraudsters, with $122 million returned to more than 200,000 victims who suffered losses as a result of Epsilon's sale of data.

In 2018, Steven Fritz Kessler, former Vice Chairman of Epsilon, pleaded guilty to conspiracy to commit mail fraud.