Under Investigation: The inside story of the Florida Attorney General’s investigation of Wilhelmina Scouting Network, the largest model and talent scam in America.

ISBN-0968713335 Paperback 512 pages $29.95

Easy Background Check

News reports: Ayman El-Difrawi aka Alec Defrawy

A third consultant, Alec Defrawy, is actually the man we saw coordinating that fake "documentary crew" during our interview with an Options executive. Mr. Defrawy pled guilty in 1995 to conspiracy to commit bank fraud and wire fraud.

According to the SEC filings, all three continue to work as paid consultants with Trans Continental Talent, one of them collecting a six-figure salary.

Source: "Trans Continental Talent: An I-Team Investigation," Fox 5 Atlanta, Nov. 14, 2002.

Scouting network's history troubles Pearlman

Documents also point to the three men as being "the principals of eModel," one of the company's many previous names. They identify Randell as the former chairman and chief executive officer of eModel. No titles are given for Bell or El-Difrawi. But critics and former employees say El-Difrawi (Alec Defrawy) was the heart of the scouting company, going back to its beginning.

"It's Alec. He runs the whole thing," said Stephen Layne, a former director of the firm's Atlanta office.

Layne said he left the company in late 2002 to escape the negative publicity and the strain of having to constantly replace his stable of talent scouts.

Both Pearlman and El-Difrawi, however, downplay El-Difrawi's role, with Pearlman referring to him as a "computer guy" who worked on the company's Web site.

"My role was to build, maintain and develop the website," El-Difrawi said in a written statement.

Source: Tim Barker, "Scouting network's history troubles Pearlman," Orlando Sentinel, Oct. 5, 2003.

MAN GETS FOUR YEARS IN FRAUD CASE

The Washington Post
From news services and staff reports
Column: CRIME AND JUSTICE
March 12, 1996; Page B8

An Arlington man was sentenced yesterday to nearly four years in prison for defrauding more than 13,000 customers of more than $2 million in a national telemarketing scam.

U.S. District Judge Thomas F. Hogan ordered Ayman A. El-Difrawi, 32, to pay more than $2.3 million in restitution to victims of the scam he created through companies known as the Small Business Loan Association and Shearson Management Group.

El-Difrawi also was ordered to repay the costs of his court-appointed lawyers after the probation office and the FBI discovered that he and another of his companies, Cosmoco Inc., received more than $170,000 for consulting work during the time he claimed he could not afford an attorney.

According to prosecutors Roger W. Burke Jr. and Peggy Ellen, El-Difrawi and the Small Business Loan company offered to help small businesses acquire loans. He and others collected fees but never followed through with the promised help. Through the Shearson company, they offered to help people find jobs, again for a fee, but never delivered.

The scheme was launched in 1990 and stretched from Orlando to Los Angeles to Washington.

4 BUSINESS OFFICERS TAPED CALLS ILLEGALLY, POLICE SAY

Orlando Sentinel (Florida)

November 22, 1990 Thursday, 3 STAR

SECTION: LOCAL & STATE; Pg. B4

LENGTH: 99 words

BODY:
Four officers in a Maitland business that helps other companies get loans
were charged Wednesday with illegally taping telephone calls.

Patrick Read, 29, of Apopka, president of the Small Business Loan
Association; G. Thomas Bradshaw, 24, of Altamonte Springs, vice president;
Michael Difrawi, 26, of Altamonte Springs, vice president; and David
Elliott, 27, of Orlando, national sales manager, were all released from jail
on $1,000 bail after being charged with unlawful interception of an oral
communication, a felony that carries a maximum sentence of 5 years in prison
and $5,000 fine.

Be wary of up-front money for services, local BBB warns

The Washington Times

January 11, 1991, Friday, Final Edition

SECTION: Part C; MONEY; Pg. C3

LENGTH: 640 words

BYLINE: Stephen Goldstein; THE WASHINGTON TIMES

BODY:

The Better Business Bureau of Metropolitan Washington is warning job-seekers
and people seeking loans to be wary of companies that demand an up-front fee
"for questionable services."

The BBB said this week it has received several complaints about Shearson
Management Group and its sister company, the Small Business Loan
Association, which offer employment and loan referral services for $195.

Shearson recently changed its named to Strategic, a company employee said,
because of objectiions from the well-known Shearson Lehman Hutton Inc.,
which has no connection with the job referral firm.

The company applied for BBB membership in November but was rejected in
December because the company couldn't substantiate its advertised job
listings, said Brenda Jimenez, a spokeswoman for the bureau.

"We've gotten calls from all over the country about them. Until today, we
couldn't substantiate that Shearson and Strategic were the same company,"
said Ms. Jiminez, who first visited the company at 2000 M St. NW in October.

Marwan Dien, who manages the Washington office, said he responded to
inquiries from the BBB, but "they requested too much information. I decided
not to spend three or four hours a week complying with the requests. I felt
my time was better spent running the business."

Strategic opened just seven months ago in Washington and now has 180
employees who answer calls made in response to its nationwide newspaper
advertising. The Washington BBB has received complaints of misrepresentation
and failure to provide promised refunds.

Applicants pay the employment service $195 by credit card on the phone and
are mailed an aptitude test to fill out and return. The company says it
makes the results available to potential employers. A counselor at Strategic
said the test results were given mostly to large companies.

Applicants are promised they'll get 10 job referrals within 90 days.

The testing firm is Brenner Business Corp., owned by the principals of
Strategic, according to the bureau and a company spokesman.

Applicants who are not satisfied with the service can request a refund in
writing, a Strategic spokesman said. About 7 percent of the applicants get
refunds, he said. Strategic is getting between 85 and 130 applicants a week
in Washington, he said.

The Better Business Bureau recommends that people not give money up front
for "questionable services," Ms. Jiminez said.

The Strategic spokesman said his firm might have been discriminated against
by the BBB and the media because "our employees are 90 percent minority." He
said the company was planning to file a complaint with the National
Association for the Advancement of Colored People.

The company's owners, according to the spokesman, are Patrick Read, its
president in Maitland, Fla., and Mr. Dien in the District.

Ms. Jiminez said corporate Vice President Michael DiFrawi and Tom Eliotson
were also principals of Strategic and the loan firm.

Florida's Metro Bureau of Investigation in Orlando has received hundreds of
compliants against the two firms and is continuing to investigate, she said.
The BBB of Orlando, Fla., where Strategic is based, has given the firm an
unsatisfactory report because it failed to respond to consumer complaints.

The Small Business Loan Association says it will provide the names of five
sources of loans and charges a $195 fee up front. The Florida company
recently filed for Chapter 11 bankruptcy reorganization. The loan company
opened its Washington office nine months ago.

The Strategic spokesman said the Loan Association has stopped advertising
months ago and now gets business by word-of-mouth. It shares offices with
Strategic.

The company has no connection with the federal Small Business
Administration.

Sears Terminates Job-Listing Firm's License

Business Dateline;
Orlando Business Journal

March 27, 1992

SECTION: Vol 8; No 42; Sec 1; pg 1

LENGTH: 1358 words

BYLINE: Beth Zacharias

DATELINE: Orlando; FL; US

BODY:
Two Central Florida men who were arrested in February 1991 on charges
stemming from their involvement with a career placement agency have opened
for business again, but Sears says it has terminated their licensing
agreement.

Dave B. Elliott, former national sales manager of Shearson Management Group,
and Michael Difrawi, former vice president of Shearson, opened Sears Career
Services --a resume preparation and job-listing service--in January.

Shearson Management Group and Small Business Loan Association--an affiliated
company--were the targets of a Metropolitan Bureau of Investigation probe in
late 1990 and early 1991. The company eventually shut its doors, after four
company officials--including Elliott and Difrawi--were arrested on various
charges. The state of Florida administratively dissolved Shearson Management
Group and SBLA in October 1991. In January, TCI Inc.--a new company owned by
Elliott--obtained a licensing agreement with Sears Roebuck & Co. to use the
Sears name and to lease space within Sears stores for the career services
operation. TCI has not set up operations in any Central Florida Sears
stores, but it has opened two in Illinois and a third was scheduled to open
in that state the week of March 16 until Sears "contacted us and said they
had additional concerns," Difrawi says.

There are two Sears Resume Services in two metro Orlando Sears stores, but
they are not affiliated with TCI or Sears Career Services.

Difrawi says he is a consultant to TCI. He carries Sears Career Services
business cards that have the same address--151 Wymore Road, Suite 520,
Altamonte Springs--as that listed on Elliott's TCI card. Difrawi's
consulting business, International Management Team, has the same phone
number as TCI and Sears Career Services.

Sears terminated its licensing agreement with TCI Inc. March 23, shortly
after receiving information about Elliott's and Difrawi's involvement with
Shearson Management Group, according to a Sears spokesman. The agreement was
terminated without cause, he says.

"We were unaware of the previous activities of TCI Inc. in the state of
Florida," says Sears spokesman Greg Rossiter. "We made the decision to
terminate our agreement with TCI Inc. because our contract gives both
parties the right to exercise termination of the agreement at any time
without cause. We exercised our right to do so."

Difrawi says he has not been notified of Sears' termination of the
agreement.

"We're talking with them about restructuring," he says. "We know there are
some concerns that have been there since the beginning, but we're working on
that."

For a $ 350 fee, Sears Career Services provides clients with 25 resumes, 25
pieces of personalized stationery and envelopes, five salary history sheets,
50 employer target letters and envelopes, five reference lists and a career
search guide, according to the company's brochure.

In addition, Difrawi says the company provides clients with a Dun &
Bradstreet listing of 50 potential employers. He says unsatisfied clients
receive "a full refund, no questions asked."

In February 1991, Difrawi was arrested on charges of fraud involving
Shearson Management Group and Small Business Loan Administration. Shearson,
which was not affiliated with Shearson Lehman Bros., was advertised as a
career placement service that matched qualified applicants with available
career opportunities for a $ 95 fee. The company brochure guaranteed a full
refund if the applicant was not offered a position in his field within 90
days.

In an affidavit filed in the case, an MBI investigator said he was
"contacted by, and has statements from numerous victims who paid Shearson
Management for a service they never received."

The fraud charges against Difrawi are still pending, according to Mike
O'Brien in the Orange-Osceola state attorney's office. Elliott was not
arrested in the fraud investigation.

Difrawi says he has not been contacted by law enforcement officials
regarding the fraud charges "in the last year-plus."

"Shearson had some internal problems which caused an investigation," he
says. These problems "were business problems elevated by the media. It's
been a year since this happened, and I haven't heard a word about it," he
says.

"Our contention is that no one has told us what we've done wrong," Difrawi
says.

In November 1990, Difrawi, Elliott and two other employees of Shearson
Management and Small Business Loan Association were arrested on charges of
interception of oral communications and possession of oral communication
intercepting devices. MBI investigators said the men had knowingly directed
employees to record incoming phone calls without getting the callers'
consent.

The state attorney's office has decided not to prosecute Elliott or Difrawi
on the oral interception charges at this time.

"We feel further investigation is warranted because of the complexity of
this case," says Randy Means, spokesman for the state attorney's office.

In early March of this year, Elliott and Difrawi began looking for an
advertising agency to place classified ads for TCI Inc., doing business as
Sears Career Services. Three ad agencies--Greenstone Roberts McKenzie of
Orlando, Donahue Thompson Advertising of Orlando, and Barkley & Evergreen of
Kansas City, Kan.-- were asked by TCI for proposals to handle the company's
classified advertising placements.

Representatives of all three agencies say they were offered but declined the
account because TCI was too new to have an established credit history.

In October 1990, one Orlando advertising agency sued Small Business Loan
Association and its officers--including Difrawi --for about $ 357,000 in
allegedly unpaid media bills.

According to the suit, ad agency Anson Stoner Gilpin--which has changed its
name to Anson-Stoner Inc.--placed 890 advertising orders on behalf of SBLA
within a two-month period during 1990. Anson Stoner Gilpin used its own
credit to place the print ads under an agreement that the agency would pay
for the ads in advance. In return, according to the suit, SBLA would
reimburse the agency for its costs, 15 percent agency commissions and
shipping charges.

The suit alleged that Anson Stoner Gilpin had not been paid for any of the
ad placements.

At the time, Difrawi said he thought Anson Stoner Gilpin was "inflating
advertising prices," and that SBLA had made several unsuccessful attempts to
settle the dispute.

Joe Anson, president of Anson Stoner Gilpin and Anson-Stoner Inc., issued a
statement saying "there was gross misrepresentation on the part of SBLA."

The suit was put in legal limbo when SBLA filed for Chapter 11 protection
from creditors in December 1990. The case has been converted to a Chapter 7
bankruptcy filing and is ongoing.

Difrawi told Greenstone Roberts McKenzie that TCI Inc., doing business as
Sears Career Services, had offices in Chicago, Indiana, and St. Louis, Mo.,
according to Sam Pellegrino, an account executive with the ad agency. Sears
is only aware of TCI's three Illinois locations, says company spokesman
Rossiter.

Difrawi now says TCI planned to open Sears Career Services offices in
Indiana and St. Louis, but that Sears' "questions about the licensing
agreement" held up the openings.

Pelligrino says Greenstone Roberts McKenzie also was told that TCI would be
expanding into Florida, New York, Los Angeles, Washington, Detroit,
Philadelphia and San Francisco.

Sears Career Services is an in-house resume preparation and job-listing
concession offered to outside licensees. Sears in-house photo studio
services are similarly structured.

"In general, a licensing agreement allows a company to use the Sears name in
exchange for a percentage of their gross," Rossiter says. "They provide the
employee training and start-up capital; we only allow them to use the name.

"Licensing is usually done in a situation where it would be prohibitively
expensive for us to provide the employee training and such, but where there
is a service that would be beneficial to our customers," Rossiter says.

Rossiter says Sears conducts a thorough background check on all potential
licensees.