At his sentencing, Pala was given a break for his cooperation with the government, but had the sting worked, it would have cut years more off his sentence, Nathan said. "The case reflects the pitfalls and the success of a cooperation agreement," he said.

The people Pala had been trying to turn in, however, are still running the scam, Nathan said. "Most regrettably, it turns out that the big fish got away with the crime and they remain in operation."

Pala pleaded guilty to fraud and tax evasion charges in U.S. District Court for the District of Massachusetts in April 2010. In addition to the 82-month sentence, he must pay a $7.9 million fine, along with $2.2 million in back taxes to the U.S. Internal Revenue Service.

The IDG News Service