The SEC this afternoon declined comment on an order by a federal judge in Atlanta that could lead to the dismissal of the agency’s 2013 case against Profitable Sunrise, an alleged international pyramid scheme and offering fraud targeted at U.S. residents by one or more murky figures.
Such a dismissal almost certainly would embolden overseas HYIP scammers who reach into the United States over the Internet to steal hundreds of millions of dollars. Profitable Sunrise targeted Christians.
In April 2013, the PP Blog reported that the SEC alleged the “program” was using a “mail drop” in England and that “Profitable Sunrise operates for the benefit of unknown individuals and/or organizations doing businesses through companies formed in the Czech Republic and using bank accounts in the Czech Republic, Hungary, Latvia, and China, among other places.”
Two days ago, on Jan. 19, Judge Thomas W. Thrash Jr. ordered the SEC to show cause within 21 days why the case should not be dismissed — apparently for lack of prosecution.
“Decline comment beyond what we say in court filings,” the agency told the PP Blog today.
How the agency would proceed in the next three weeks was unclear.
Thrash’s order says there has been no action in the case since July 15, 2015, a period of more than six months.
From the judge’s order (italics added):
The above complaint was filed on April 4, 2013, on April 4, 2013 the Court granted plaintiff’s Motion for Temporary Restraining Order; on April 15, 2013 the Court granted plaintiff’s Motion for Preliminary Injunction; Clerk’s Entries of Default have been entered as to various defendants; on July 15, 2015 the Court directed the Clerk of Court to Receive Repatriated Funds. Since that date no further action has occurred; IS THEREFORE ORDERED that the plaintiff show cause in writing within twenty (21) days why the case should not be dismissed. The Clerk is DIRECTED to submit the case to the Court for further action at the expiration of the 21 days. SO ORDERED, this 19th day of January 2016.
One of the claimed “plans” of Profitable Sunrise was bizarrely dubbed the “Long Haul” and purported to pay 2.7 percent a day. At least 34 U.S. states and provinces in Canada issued Investor Alerts or cease-and-desist orders against Profitable Sunrise.
Among other things, the scheme demonstrated the dangers of doing business with exceptionally murky enterprises making claims that fabulous wealth would flow to investors. U.S. promoters working for commissions apparently believed the “program” was operated by “Roman Novak” and his brother “Radoslav,” a purported attorney.
Whether the brothers actually exist is unclear. So is the final sum gathered by the “program,” which had a presence on well-known Ponzi-scheme forums such as TalkGold and MoneyMakerGroup.
No receiver has been appointed to date in the Profitable Sunrise case. How victims would go about filing claims is unclear. So, too, is the amount of money available to victims from actions such as asset freezes.
Hungary is reported to have suspected Profitable Sunrise of money-laundering.
In May 2013, the PP Blog reported a Virginia man had petitioned the U.S. court for return of more than $57,000 wired to Profitable Sunrise. The SEC later objected to the petition, arguing it could open the floodgates to similar petitions while the agency was working to repatriate assets that one day could be distributed to victims.
Christian author James Paris has said he feared for his safety and the safety of his family when writing about Profitable Sunrise. (See PP Blog October 2013 comment on the matter at the RealScam.com antiscam forum.)
See PP Blog’s tag archive on references to Profitable Sunrise or use the Blog’s search function near the upper-right corner.
NOTE: Our thanks to the ASD Updates Blog.