URGENT >> BULLETIN >> MOVING: Massachusetts Halts WCM777, Says It Was Selling Unregistered Securities And Targeting Brazilian Community
URGENT >> BULLETIN >> MOVING: (10th Update 9:28 p.m. ET U.S.A.) Massachusetts has halted the WCM777 multilevel marketing scheme, saying it was associated with entities in Hong Kong, the British Virgin Islands and the United States and selling unregistered securities. In Massachusetts, the state said, the scheme was targeting the Brazilian community.
In a filing by the office of Massachusetts Secretary of State William Galvin, the state says it opened a probe into WCM777′s business practices in September.
Identified entities include World Capital Market Inc. of Pasadena, Calif., an asserted offshoot of a banking enterprise in the British Virgin Islands; WCM777 Inc., a dissolved Nevada business with an office in City of Industry, Calif; and WCM777 Limited of Hong Kong.
WCM777 purports to sell “cloud” Internet services. The investment scheme spread in part through weekly pitches in August and September by a WCM777 distributor using a “function room” at a Massachusetts hotel, the state said.
Investors were lured with promises they’d receive “profit sharing” and an ability to “purchase stock options” in the run-up to an asserted IPO in 2014, the state said.
The Massachusetts filing is a consent order. WCM777, according to the order, has agreed to cease business in the state and to provide refunds to all Massachusetts investors. The scheme netted at least $300,000 in the state from about 160 investors, the vast majority of whom were members of the Brazilian community, according to the order.
“Nearly all” of the investors bought into the scheme at the $1,999 level — the level that promised the highest daily payout, according to the order.
Promos advertised returns of “over 90 percent” in 100-day cycles, the state said.
WCM777 has neither admitted nor denied the allegations, the state said.
Attorneys for WCM 777 made the refund offer on Nov. 13 after presenting the state a spreadsheet on Oct. 14 showing information on Massachusetts participants, according to the order. The document does not say whether other states also are investigating WCM777. The nation of Colombia is known to be investigating WCM777.
Ming Xu is identified in the Massachusetts consent order as the founder and president of WCM777 Inc.
WCM777 promoters refer to Ming Xu as “Dr. Phil.” A Twitter account associated with the name of “Dr. Phil Ming Xu” displays WCM-related content and photos of Ming Xu with luminaries such as former U.S. Vice President Al Gore and Apple co-founder Steve Wozniak.
The photos appear to have been taken at a California business event earlier this month at which all three men spoke.
Meanwhile, there’s a photo of Ming Xu surrounded by adoring followers. The photo appears to come from the same meeting from which this video emerged:
Read the Massachusetts Consent Order.
Read Oct. 30, 2013, PP Blog story on WCM777, which appears to have promoters interested in pitching the purported opportunity to churches and their entire congregations.