Judge pares back ‘lavish lifestyle’ of men sued in sweepstakes scheme to $18K a month

Tricks of the trade, or tools of business?

No one has ever won the million-dollar grand prize, and now sweepstakes and mail-in contest companies tangle with the Federal Trade Commission. These are the techniques that the government says help deceive consumers.
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No one has ever won the million-dollar grand prize, and now sweepstakes and mail-in contest companies tangle with the Federal Trade Commission. These are the techniques that the government says help deceive consumers.

Sued over a $110 million sweepstakes-and-contest scheme and their assets frozen, two men asked a federal judge in Kansas City for “living expenses.”

Kevin Brandes claimed he needed $28,740 a month, and his business partner William Graham claimed he needed $14,058.39.

Among the reasons: Brandes owes payments on three properties and child support; Graham’s supporting a family of five, and that includes $297.50 a month for haircuts.

The judge was not swayed.

“Defendant Brandes seeks funds so that he can maintain three separate properties,” Chief Judge Greg Kays wrote. “Defendant Graham seeks $1,247 per month for clothing and shoes, $537 a month for exterior home maintenance, $297 per month for haircuts and $316 per month for pet costs.”

Moreover, the judge noted, these amounts would be coming out of money that could end up paying restitution to consumers whom federal officials claim were deceived by the men’s businesses.

That potential, his order said, “weighs heavily against Defendants’ desire to use frozen funds to maintain the lavish lifestyle to which they have become accustomed.”

Under the court orders, the men and their families have been pared back to $18,000 a month — $10,000 for Brandes and $8,000 for Graham. Nor will Brandes be able to sell his $3 million house at the Lake of the Ozarks that’s costing him $8,000 a month.

Attorneys for the men declined to comment.

Brandes and Graham were sued in February by the Federal Trade Commission and Missouri Attorney General Josh Hawley. The complaint in U.S. District Court said their businesses had pitched million-dollar sweepstakes prizes that no one ever won and ran mail-in contests with virtually unsolvable top-prize puzzles. Through deceptive practices, the suit said, their operations had taken in $110 million from consumers.

The companies, which operate mostly in North Kansas City and Lee’s Summit, include Opportunities Unlimited Publications Inc., Contest America Publishers Inc., Next-Gen Inc. and Westport Enterprises Inc.

In mid-July, Chief Judge Kays put a receiver in charge of the companies and froze all bank accounts and other assets controlled by Brandes, Graham and their businesses. The freeze hit even businesses not being sued by the FTC.

Left with no money and facing rapidly mounting legal bills, each man sought limited access to the frozen accounts for living expenses.

Brandes asked the judge for $28,740 a month but noted that much of that would be soaked up by those three properties he maintains.

Expenses on his two houses — one in Florida and the lake house in Missouri — cost Brandes $11,750 a month, according to his filing in federal court. Then there’s an additional $5,500 monthly expense for leased property in Independence.

Add in groceries, cellphones, travel (he lives in Florida but ran businesses here), toiletries, clothing, restaurants, fuel, pet expenses and health insurance if his asset-frozen businesses aren’t allowed to continue covering the Brandes clan.

Two children live in Brandes’ home, his request to the court said, and his wife doesn’t work outside the home. One child has special needs.

There’s a third child, also with special needs, and Brandes has been paying $3,500 a month in child support since June 2017. It had been lower previously. The mother had sued for an increase in support given that the child’s expenses had increased with age and Brandes was earning $2 million a year, records in the Johnson County District Court case show.

Brandes also petitioned the court to let him sell that lake house, which he had been offering for $3 million.

According to a posting on Trulia, the lake house was built in 2009 and has seven “en suite” bedrooms, nine bathrooms, a theater room, a pool and a “large cruiser docking system with double breakwaters” that features three slips.

Brandes argued that selling the lake house would preserve the value it represents. The judge already had limited him to $10,000 a month, and Brandes’ request argued that would not be enough “to maintain all of his properties — including his lake house.”

The judge denied the request.

Graham, who lives in Lee’s Summit, gave the judge an itemized list of living expenses totaling $14,058.39 a month.

It included only one mortgage payment, $3,031.82 a month. But clothing and shoe bills tally $1,247.16 a month, and hair cuts — with five in the family — total $297.50 a month. KCP&L gets $598.82 a month from Graham, his filing said.

The government agents opposed the requests. According to the Internal Revenue Service, they argued, standard necessary monthly living expenses in 2018 amount to $2,057 for a family of five.

A month after the judge rejected Brandes’ request for $28,740, Brandes went back to Johnson County District Court asking for a cut in his monthly child support payment.

Brandes’ motion said, though without getting into details, that his “income has dramatically decreased” from levels when the $3,500 payment had been set.

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