URGENT >> BULLETIN >> MOVING: Feds Arrest 3 ‘Leaders’ Of Alleged Cash-Gifting Scheme; Conspiracy, Wire Fraud And Tax Fraud Charged; ‘Defendants Attempted To Intimidate A Participant Who Had Questioned The Legality Of The Gifting Table Scheme,’ Prosecutors Say

So, you think your cash-gifting “sponsor” has your best interest at heart?

Three women who were “leaders” of a cash-gifting scheme in Connecticut were arrested earlier today on charges of conducting a pyramid scheme and engaging in a conspiracy, wire fraud and tax fraud, federal prosecutors said.

The scam operated between 2008 and 2011, reached beyond Connecticut’s borders and allegedly featured an element of “intimidation” aimed at a prospect who questioned the purported opportunity.

Prosecutors today published snippets of emails sent over multiple months and linked to the alleged scheme, which gathered purported “gifts” $5,000 at a time using a food theme.

“[K]eep bringing in new blood,” one of the emails allegedly read in part. “It is a fact when women get excited about making money, they tend to over extend . . .”

Another email allegedly advised in part that potential recruits needed “to Shit or get off the pot . . .”

It has been known for months that a grand-jury probe into so-called “gifting tables” has been under way in Connecticut. That probe now has resulted in the arrests of Donna Bello, 55, of Guilford;  Jill Platt, 64, of Guilford; and Bettejane Hopkins, 66, of Essex.

An indictment filed yesterday that names Bello, Platt and Hopkins also includes the word “co-conspirators,” suggesting others may be charged.

“The indictment alleges that the three defendants ran a pyramid scheme designed to enrich themselves at the expense of other participants,” said U.S. Attorney David B. Fein.  “In addition, the indictment alleges that the defendants tried to use the pretext of ‘gifting tables’ as a way to avoid paying taxes on the substantial illegal proceeds of their scheme.”

Fein noted that the probe, which is being led by the IRS, is ongoing.

Bello, Platt and Hopkins “conspired to defraud the IRS by misrepresenting to recruits and participants that monies given and received during the scheme were legally considered tax-free ‘gifts’ under the IRS code and that lawyers and accountants had approved gifting tables as legal ventures that generated tax-free proceeds,” prosecutors said.  “The indictment further alleges that Bello, Platt and Hopkins filed false tax returns that failed to report income generated from the scheme.”

Prosecutors today also released snippets of emails linked to the alleged cash-gifting scammers.

“[W]e need to keep silent and under the radar,” one of the emails read in part, prosecutors said.

Another allegedly read in part, “[A]s women we like our own stash. Keep it in a safe.  Keep it quiet because rather not have red flags raised.  Hiring accountants and atterneys [sic] is costly.”

A third allegedly read in part, “I am not a . . . saint . . . . I’m teaching you all how to make an extra 80 grand a year . . . . Isn’t that enough?”

Meanwhile, a fourth allegedly read, “It’s sort of a joke that I refer to our freezer as the ATM.” A fifth allegedly read, “They have had enough parties. Its [sic] costing us a small fortune in their food and wine delights. No more parties until they commit with the cash.”

From prosecutors (italics added):

. . . a gifting table is configured as a four-level pyramid, with eight participants assigned to the bottom row, four participants assigned to the third row, two participants assigned to the second row, and one participant assigned to the top row.  The top row participant is referred to as the “dessert,” the two participants on the second row as “entrees,” the four participants on the third row as “soup and salads,” and the eight participants on the bottom row as “appetizers.”  To join a gifting table, new participants were required to pay $5,000, typically in cash, to the dessert, that is, the participant occupying the top position on the pyramid.  The $5,000 payment, which was fraudulently characterized as a gift, secured the new participant a position as an appetizer on the bottom row.  Participants moved from the bottom row of the pyramid and progressed through a gifting table by recruiting additional people to join.  When eight new participants joined a gifting table, each having made a $5,000 “gift” to the person occupying the dessert position at the top of the pyramid, the dessert left the gifting table and kept the $40,000 paid by the eight new participants.  That particular gifting table was then split, with the two participants occupying the Entree position on the second row moving to the top position (dessert) of two new pyramids.  The other incumbent members of the gifting table moved up a row on one of the two newly-formed pyramids, and the search for 16 new participants began.  The success of the gifting tables depended on new participants joining and making the $5,000 “gift.”

The indictment alleges that from approximately 2008 to 2011, Bello, Platt and Hopkins oversaw and profited from this gifting tables pyramid scheme.  The defendants recruited individuals to join the scheme, prepared and distributed materials to recruits that contained false representations, and misrepresented to recruits and participants that gifting tables was not a pyramid scheme.  The indictment further alleges that in May 2010, the defendants attempted to intimidate a participant who had questioned the legality of the gifting table scheme.

Read the indictment, which includes information investigators allegedly gleaned from emails.

 

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11 Responses to “URGENT >> BULLETIN >> MOVING: Feds Arrest 3 ‘Leaders’ Of Alleged Cash-Gifting Scheme; Conspiracy, Wire Fraud And Tax Fraud Charged; ‘Defendants Attempted To Intimidate A Participant Who Had Questioned The Legality Of The Gifting Table Scheme,’ Prosecutors Say”

  1. Quick note: I fixed the link to the indictment above a minute or two ago.

    Patrick

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  2. But…but…but this can’t be right. All the cash gifters have told us repeatedly that cash gifting is legal under IRS Tax Code, Title 26, Sections 2501-2504, and 2511. This is a conspiracy I tell you.

    If anyone did not get it, I am being sarcastic. What the cash gifting scammers don’t tell you is that there is one sentence in the code that makes cash gifting, as they present it, ILLEGAL. This sentence says, and I quote: “Your gift must be given with ABSOLUTELY NO EXPECTATION OF A RETURN OF ANY KIND.” Emphasis mine.

    You also have to understand they are quoting from the “Estate Tax Giving” section of the IRS Code, which cash gifting does not apply or even qualify, only the concept.

    But this never gets in the way of a good lie told by the cash gifters, especially those who claim that cash gifting is ordained by God.

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  3. I don’t know how much good this will do, but I am involved in a “Legal” cash gifting ACTIVITY. I understand that this was a report on a gifting table scheme. I am not involved in something illegal because it meets all of the requirements that the law has set forth. I invite someone from the staff of Patrick Pretty to check it out and see if what I’ve said is true.
    God Bless—
    Prophet Will D. Smith

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  4. Will… I refuse to address someone as “prophet”… how can you be sure that your gifting activity is indeed complying with the law? For that matter, with whose laws, and where? Jurisdictions differ, and claiming legality under one law gives you no defense against other laws.

    Why not post the name of your activity and what your handle, username, or inviter number is in it, so I can take a look and point out where they are misleading you?

    Or you can jump over to realscam.com, sign up, and send me a private message there to my account as ProfHenryHiggins.

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  5. Prof, Prophet Smith is in 2010 Blessings. If you click on his name you’ll find his page.

    Mr. Smith, perhaps the simplest legal definition of a gift is a voluntary transfer of property from one person or entity to another made without charge or consideration. A simple legal definition of consideration is something of value that is given in exchange for getting something from another person.

    That’s why organized cash gifting will never be legal. No one is joining one of these programs and coughing up cash without the expectation of receiving more cash in return so by definition they aren’t giving a gift, they’re participating in a pyramid scam.

    At this point perhaps it’s best to explain why these things are illegal. No money is magically created, it’s all one participant’s money landing in another participant’s pocket. So the only way for one person to end up with more money in their pocket then they started with is for someone (or several someones) to end up with less money in theirs.

    Or put another way, organized cash gifting is just a form of organized theft.

    And no, it isn’t legal.

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  6. He spelled ‘profit’ incorrectly.

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  7. Oh, I found it, all right GlimDropper. He’s on my list at realscam now (second of the three threads to date, near the end).

    Couldn’t find his address, but I’m fairly sure I know which church he worships at.

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