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Owner of 'Magic Factory' in Medford Charged with Stealing 500k from Customer

Harry P. Levy is charged with credit card fraud and issuing false statements.

Most recent: Hearing Scheduled in 'Magic Factory' Fraud Case

The owner of a magic store in Medford is charged with credit card fraud and making false statements to authorties after he tried to pull off a $500,000 trick on one of his customers, according to court filings.

Harry P. Levy, the owner of Hank Lee's Magic Factory, admitted he made 134 false transactions between 2009 to 2011 on a customer's American Express card totaling $561,927, according to a stipulation of facts signed by Levy and prosecutors. The document was filed in Federal Court in Boston Friday.

The store's website was still operational as of Friday evening.

Levy, a Lexington resident, regularly lied to investigators as they looked into the credit card charges last year, the filing said. He also claimed other people were defrauding the victim, the filing said.

The victim was a Texas man who ordered regularly online from the Magic Factory, typically using his PayPal account, according to a U.S. Attorney press release. But in 2009, he made a transaction with his American Express card by entering his account information in the store's website, according to prosecutors.

One of the victim's assistants spotted the unauthorized charges while reviewing his finances in May 2011, according to court documents. The victim checked his account with the Magic Factory, but only his legitimate purchases appeared, court documents said.

Levy told the victim the unauthorized charges paid for foreign orders and showed him invoices with Vietnam shipping addresses, according to the filing. But those invoices were false.

"In fact, the charges had been made by (Levy) personally," the filing said. "They had not been made in response to foreign orders."

Even the items the victim legitimately ordered with his credit card were never received, according to the filing.

When federal investigators sat down with Levy in September 2011, he blamed the fraud on other people defrauding the victim, and the victim himself, according to the filing.

"(He) didn't look at his American Express bill for more than two years," Levy told investigators. "People were using his cards."

He also claimed he shipped orders submitted by the victim all over the world, prosecutors said. Levy told investigators he continued to take the orders, but eventually stopped shipping them because he "thought something was up," according to the court filing.

Levy was ordered to provide investigators with files related to the charges, but he gave them logs that were "not comprehendable by a human," the filing said, and did not provide any specific information.

Levy also told falsely told investigators he wrote to the victim to tell him someone was using his credit card, prosecutors allege.

After several more interviews and a visit to his store, investigators obtained a search warrant for the Magic Factory and found files that showed Levy falsified invoices, the filing said.

Levy has agreed to plead guilty to credit card fraud and making false statements, and in exchange prosecutors won't charge him with wire fraud or aggravated identity theft, according to a plea agreement. Levy faces a total of up to 20 years in prison on the charges.

Prosecutors will seek a sentence at the "low end of sentencing guidelines," and to have Levy ordered to pay resititution to the victim, according to the plea agreement.

No further court dates for Levy have been set, according to a federal court online docket.

UPDATE: Read the court filings in this case for yourself,

Alan Tauber June 15, 2012 at 06:30 PM
You're putting words in many mouths. Personally, I said that my thought was it was not like Hank to do this. Then, I said that the whole truth had not come out and it hasn't. He has admitted to breaking the law, yes. My experience of Hank Lee was that he was an honest, hard working, straight to your face guy. And I know he was because I was pretty close to him. He could be a jerk and push too much, yes. A lot of people do. But he was also kind and caring. He loved magic and developed a good business, I felt. He went the extra mile to bring more good magic to Boston when others were not. There were the lectures of some of the best names in the business. Always trying to get the best magic in the store. He said once that a LOT of bad magic props would come in the store and that there was no reason to sell bad magic. There was plenty of good magic available. He broke the law and will pay for that. What more can we do? I personally feel that he should not be involved in the business in any way at this point since he is continuing his business. Sell it or give it to the son or family person and stop writing the Extra copy. To continue that does't give you business. No one wants to buy from a thief.
Bill Meeker September 07, 2012 at 05:58 PM
Up to 20the yrs ago I often bought from Hank Lees in person and by mail. After moving to Phoenix bought occasionally by mail intil a few years ago. Stopped after I bought an item that was not as advertised. A McCombical deck item supposed to include the original routine, patter, script, etc...but no such thing. Just a deck and small insert of generic instructions! I did enjoy the Cape Cod Conclave in the early 90's, but noticed Hank's personality seemed to become grumpier and more and more "cranky" over the last few years of contact at various conventions, etc.
Ray December 03, 2012 at 08:14 PM
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Lee Earle January 25, 2013 at 04:35 PM
As a supplier of items for the trade, I discovered 'Hank Lee' NEVER paid an invoice on time, often 60 days late. Plus his 'elves' often, um, miscounted arriving merchandise and quite often the cost of the 'missing' items was deducted from the final payment if/when if finally arrived. A customer of his wrote to me praising one of my DVDs he'd just purchased from the Magic Factory - even though I'd not shipped merchandise to him in over 7 years! Long & short of it - he is a liar and a thief. Period. What goes around, comes around. Karma is a bitch, Hank. No pity here.
Turner March 25, 2013 at 07:27 PM
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