WRAL Investigates Satellite Company With Questionable Track Record
Posted March 31, 2004
RALEIGH, N.C. — The same owners of Prime TV said they plan to create 1,000 new jobs with a company called DishTVNow.com. After a closer look at one of the owners, WRAL found a history of successful businesses, along with a history of complaints, fraud and prison time.
When DirecTV severed ties with Moore County's Prime TV,
lost their jobs. The local dealer blamed the satellite dish company for pulling the plug, but a DirecTV spokesman told WRAL: "We want to work with those who conduct business ethically and honestly. Prime TV breached the contract."
In recent years, thousands of customers nationwide complained that Prime TV failed to pay promised rebates of $50 to $150. The Better Business Bureau fielded more than 2,200 complaints. The attorney general's office said it has heard more than 600 complaints.
"I think it is significant, and, for that reason, we've closely investigated it and followed it," said Assistant State Attorney General Len Green.
Green said the attorney general's office has helped many of those consumers get their money.
WRAL took a closer look at the ownership team connected to Prime TV and found businessman David Hagen. Checking his background is not easy because he has used different names over the years, including David Allen and David Defusco.
WRAL found Hagen served time in federal prison for a fraud conviction in Virginia related to direct mail fraud. His wife, Annette, was also convicted.
According to Washington Post articles from 1990, prior to their arrests, the couple lived the good life with Rolls Royces, furs and $1,500 ties, while racking up $2.5 million in debt.
"His individual background has not been a factor in our investigation," Green said.
Green said there is not enough evidence to show Prime TV's rebate problems amounted to fraud.
Now, another of Hagen's companies plans to move into a building in Cary's Macgregor Park.
DishTVNow.com employees will work the phones and computers selling equipment for DirecTV's competitor. Prime attorney Richard Yelverton told WRAL: "Prime TV and DishTVNow.com are unrelated.
"As far as I know," Yelvertson said, "both businesses operated in a very appropriate manner."
Said Green: "I think we have our antenna up to see if we do have complaints. We'll be looking very, very closely at those."
Hagen released a statement to WRAL.
"As a young man, I made the mistake of becoming involved in a business relationship with people whose marketing practices were challenged by various government agencies," the statement said. "Although I never intended to break the law, I entered into a plea agreement to charges related to alleged mail fraud and a bankruptcy filing and served a prison term."
Hagen said he paid his debt to society and has tried to run an honest business. He plans to sue DirecTV for breaking off the contract.
Prime TV has a long record with the Better Business Bureau with more than 2,200 complaints in the last three years, which is about 62 per month or two per day.
Because of that record, the Bureau gave the company an unsatisfactory rating. Most of the complaints involved rebates that were not paid. All but eight cases were resolved, only after the Better Business Bureau got involved.