NEW HAVEN REGISTER: Feds, State Investigating Cash-Gifting Schemes In Connecticut; Grand Jury Convenes; State AG Called Gifting Programs The Business Of ‘Parasites’ In Statement About ‘The Women’s Gifting Table’ Last Year

State and federal probes into cash-gifting schemes are under way in Connecticut, the New Haven Register is reporting.

Investigators are concerned about so-called “Women’s Gifting Tables,” and women soon will be called before a federal grand jury, the newspaper reported.

Similar probes are under way in Michigan. Seven women were charged with felonies last month, and the Michigan State Police issued a warning that gifting schemes targeting women were sweeping across the state.

The Connecticut probe began more than a year ago, when then-Attorney General Richard Blumenthal warned that the schemes were illegal and doomed to collapse. Blumenthal is now a member of the U.S. Senate, and the gifting probe now is under the direction of George Jepsen, Connecticut’s new attorney general.

Gifting is the business of parasites, Blumenthal said in November 2009, noting that “The Women’s Gifting Table” had been positioned as a “sisterhood” in which women provide a $5,000 gift to another woman in the network.

Participants were encouraged to take cash advances on their credit cards and even to sell their cars and family heirlooms to grease the “pernicious” pyramid-scheme wheel, Blumenthal said.

“As new women join the group, others move to higher ‘positions’ to eventually receive their own gifts totaling much more than their initial contribution,” Blumental said.

“Gifting clubs take more than they gift — often ending in economic ruin for participants and their families,” Blumenthal said. “A gifting club is merely a fancy name for an old-fashioned pyramid scheme that bleeds newcomers to feed the parasites above them. Even as I investigate, I urge all Connecticut citizens to immediately reject and report such schemes.

“Gifting clubs are the gifts that keep on taking,” he continued. “These fraudulent clubs exploit economic catastrophe — urging newcomers to sell their belongings, jeopardize their credit and assume devastating debt with deceptive and dangerous promises. Citizens facing foreclosure and job loss may risk everything for these ominous opportunities.

“State and federal law prohibit all pyramid schemes because each one is a house of cards doomed to collapse,” Blumenthal said. “Any offer involving upfront money payments with promises of riches, but no product or service, should be considered suspect.”

In August 2008 — in the days immediately following the seizure of tens of millions of dollars in the AdSurfDaily autosurf Ponzi scheme probe — some ASD members raced to forums in bids to recruit members for emerging cash-gifting schemes.

Efforts to recruit members for other autosurf and HYIP schemes also continued after the seizure of assets in the ASD case.

Some gifting schemes are targeted at people of faith and promoted as an opportunity to “pay it forward” to put cash in the hands of participants while positioning yourself also to get a pile of cash. The language of “pay it forward” increasingly has become a marker that a scam is under way.

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11 Responses to “NEW HAVEN REGISTER: Feds, State Investigating Cash-Gifting Schemes In Connecticut; Grand Jury Convenes; State AG Called Gifting Programs The Business Of ‘Parasites’ In Statement About ‘The Women’s Gifting Table’ Last Year”

  1. From May 2010:
    http://wflcenter.wordpress.com/2010/05/18/give-us-your-feedback-womens-gifting-circles/

    The structure in the women’s gifting table — which resembles a pyramid — has four levels composed of one person on the top, two below her, four below them and eight on the bottom level. Buying into the bottom level requires new members to attend an introductory meeting and costs $5,000, which goes into the wallet of the top position-holder.

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  2. Off topic – I found this & thought it would sound familiar to some:
    http://www.fool.co.uk/news/investing/2011/01/19/transcript-diary-of-a-scambuster.aspx

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  3. Tony H:

    That was priceless, and so true regarding Neil Faulkner’s introduction to reporting a potential scam. I knew what he was going to say before he ssid it. Benn there and done that too many times. It takes a long time to develop a relationship with kaw enforcement agencies in Europe, and to build their trust of your information.

    The feds here in the states have woken up they have to be proactive instead of reactive. It is why there are so many scams/Ponzi’s being shut down in mass. I hope our efforts have had something to do with that change of mindset. At least they are proactive now.

    Hopefully it won’t be too much longer before all the European agencies will do likewise. They have to learn a new mindset and that takes time to change.

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  4. My experience makes me tend to believe the British FSA is still on the lookout for WW2 food coupon scams.

    At the rate they’re moving forward, it will be at least another 20 years before it/they wake up to the fact crime ‘net crime is rampant.

    It may be 2011, but England STILL doesn’t have an online (or offline) facility for the reporting of ‘net based crime.

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  5. My experience makes me tend to believe the British FSA is still on the lookout for WW2 food coupon scams.

    That is not true, food rationing finished in 1954. However I believe an arrest is imminent for the fake Green Shield Stamps that were in circulation in 1973.

    Seriously though, the FSA is more responsive to boiler room scams than ponzi scams.

    A couple of scam/fraud stories from the BBC:
    Met police seize scam mail aimed at UK victims
    http://www.bbc.co.uk/news/uk-12272636

    Climate scientists targeted for fraud
    http://www.bbc.co.uk/news/science-environment-12219472

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  6. The original idea of cash gifting is genius. Original name – social financial network. If you team up with intelligent and honest people then this would work very good for decades. In some countries you still have to pay a tax for receiving gifts. This should be better named as an exchange of financial means with no guarantees and obligations.

    As it openly states it is a financial pyramid, it is absolutely legal. You don’t cheat anyone that this an investment programm (Ponzi scheme) because it’s definetely not. The only risk is if the system has a successful marketing system. The best marketing, of course, is pay-outs. Pay-outs in time always bring back even more participants.

    I have been involved in social financial network called MMM 2012. I am getting constant profits for 2nd year.

    Testimonials, legal and financial aspects, you can find at our team’s website: [Deleted by PP Blog.] We are just a small (little more then 1000 people), succesful part of this network. Total network boasts more then 35 000 000 people.

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  7. That’s quite the yard there.

    As it openly states it is a financial pyramid, it is absolutely legal.

    No they are not.

    You don’t cheat anyone that this an investment programm (Ponzi scheme) because it’s definetely not.

    Yes you do and it is. I will definitely not ever join one of these scams so there IS and end to it and someone DOES get cheated. It’s inevitable.
    Not having much success are ya lil fella?

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  8. Mark: The original idea of cash gifting is genius.

    Genius at making money for the genius who invented it and genius for those at the top of the gifters’ list, you mean.

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