Ad Surf Daily: Andy Bowdoin Case Takes Criminal Twist
Wednesday, September 3, 2008
A grand jury is meeting to consider if criminal charges are warranted in the AdSurfDaily case, the St. Petersburg Times is reporting at TampaBay.com.
Meanwhile, ASD members have said on forums covering the case that a wide-reaching subpoena for ASD's documents and business records has been issued. This cannot be independently confirmed.
Some ASD members blamed the government last week for destroying an ASD database, suggesting that the government erased the database so it later could blame ASD for erasing it. No evidence has surfaced to date that a database was destroyed, let alone destroyed by the government.
But Andy Bowdoin last week preemptively suggested the government had destroyed vital ASD business records.
"The only people that have access to our servers other than us is the Government," ASD members quoted Bowdoin as saying during a conference call. "[W]e went to try to get some information from the database and guess what? The database was deleted. You can draw your own conclusions as to what happened. But fortunately, we have it backed up in several different places . . . that are unknown to others."
Why Bowdoin raised the database issue, suggested the government tampered with it -- and further suggested that the database was backed up in places "unknown to others" is unclear.
If a grand jury returns a criminal indictment, it would add a third track to the ASD case. On Aug. 5, federal prosecutors formally seized tens of millions of dollars and two homes from the firm, alleging in a civil forfeiture complaint that the currency and property were the proceeds of a Ponzi scheme.
Florida Attorney General Bill McCollum followed with a civil lawsuit, alleging ASD had engaged in unfair and deceptive trade practices.
Previous attempts to halt Ponzi schemes that used the so called "autosurf" model and paid viewers for watching advertisements were prosecuted by the Securities and Exchange Commission through civil lawsuits.
The SEC has smashed at least three autosurf companies in recent years, putting the companies into receivership. In at least one case, the receiver in the CEP Ponzi scheme forced the company into bankruptcy and successfully attached the earnings of the firm's top promoters, meaning they became responsible for surrendering their earnings to the bankruptcy court.
In other words, autosurf earnings are not safe in any context because the government considers the proceeds to be illegal profits, fruit from a poisonous tree.
ASD President Andy Bowdoin said last week that some ASD members were earning more than $54,000 a month. The government, however, says ASD was involvent and used money from incoming members to pay older program participants.
It is possible that the government will follow the model in the CEP Ponzi scheme case and attach every penny paid out to ASD's top participants.
Because previous autosurf cases were handled through civil lawsuits, not through criminal prosecutions, the program owners did not face jail sentences.
If a grand jury recommends criminal charges against ASD President Andy Bowdoin or others, it may mark the first time that individuals involved in promoting autosurfs faced jail time.
Noteworthy in the ASD case to date is the absence of the SEC and the presence of the U.S. Attorney's office in Washington, D.C., and the U.S. Secret Service. Civil lawsuits have done little to stop autosurfs from proliferating online.
It is possible that the government is taking the ASD case from the civil realm to the criminal realm to demonstrate that people who open autosurf companies do so at the peril of their money and their freedom.
Read the St. Petersburg Times story at TampaBay.com.
Labels: Andy Bowdoin grand jury, ASD criminal prosecution, ASD grand jury, ASD subpoena, St. Petersburg Times ASD, TampaBay.com ASD
posted by Patrick Pretty @ 9:25 AM,
1 Comments:
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At September 3, 2008 3:44 PM,
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Patrick: Thanks for your great summary and analysis. This (the criminal prosecutions) are exactly what needs to be done to finally get the attention of the big hitter leaders who've led their followers to slaughter time and time again.
