Judge Agrees to Coupon Fraud Trial Delay

To a couponer, a warehouse full of coupons sounds like a dream. To a former coupon executive headed to trial for fraud, it’s a nightmare.

So a federal judge has agreed to ease that nightmare just a bit, and delay the trial date for three defendants charged in a quarter-billion dollar coupon fraud case.

Chris Balsiger, the former CEO of coupon processing company International Outsourcing Services, was set to stand trial on October 26, along with former IOS sales manager Howard McKay and information technology chief James Currey. But even though it’s been nearly eight years since the three were indicted (along with eight others who have since reached plea deals), Balsiger argued that he needs more time to prepare for trial.

“The amount of discovery material is immense,” he wrote in a recent letter to the judge, citing “hundreds of thousands of pages of written material (and) a warehouse full of coupons and documents.”

All of that material, prosecutors allege, shows that the defendants schemed to defraud manufacturers out of some $250 million, by submitting coupons for reimbursement that were never redeemed by consumers. As the nation’s largest coupon processor at the time, IOS collected coupons from retailers and submitted them to manufacturers for reimbursement. But a 2007 indictment accused 11 people who worked for, and with, IOS of arranging to cut out their own coupons, mix them in with coupons that customers actually redeemed, and pocket the extra money for themselves.

While, one by one, other defendants made deals with prosecutors, Balsiger, Currey and McKay have been preparing for trial. Balsiger and Currey recently tried and failed to have the case dismissed – an effort that Balsiger now says set back his trial preparation.

“The first 2 weeks of August were spent exploring options with the prosecutors that could possibly avoid trial,” he wrote to the judge. “Those discussions were not successful. The remaining time to spend preparing for trial was minimal.”

Balsiger is a pro se defendant, which means he’s representing himself, since his original attorney passed away a year before his scheduled trial date. So he said he needs time to go through various documents, records and coupons himself. Without a delay until at least next April, he argued, his defense is doomed.

“The government has made it very clear that they intend to manipulate my unrepresented and pro se status to their advantage and defeat me through procedural issues that will block the evidence that I can admit at trial,” his letter read.

In his response to Balsiger’s request, Judge Charles Clevert acknowledged that preparing for this particular trial is a difficult task. “Although this trial date was set back in December 2014, this case is complex and includes voluminous records, with over 700 docket entries, a warehouse or more of discovery, and years of history,” he wrote. “Therefore, the court will grant the motion to adjourn. However, the trial will be scheduled earlier than Balsiger requests.”

So the three remaining defendants will have their day in court sometime before next April, as the judge plans to decide in the next few weeks on a new trial date.

In the meantime, Balsiger will have his hands full, going through that warehouse full of documents and coupons, looking for evidence that he hopes can help secure his acquittal. With the judge declaring that he’ll agree to a delay just this once, and no more – the clock is ticking.