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Tag: Rosemary Collyer

  • PROSECUTION BOMBSHELL: Accused Ponzi Schemer Andy Bowdoin Traveled To Costa Rica In 2008 To Explore Option For Offshore ‘Autosurf’ Firm; AdSurfDaily’s Internal Software System Identified Member Payouts As ‘ROI,’ Despite ASD Claim It Was Not Offering Investments

    Andy Bowdoin

    BULLETIN: UPDATED 9:29 P.M. ET (U.S.A.) Prosecutors have advised a federal judge that AdSurfDaily President Andy Bowdoin and unnamed “others” traveled to Costa Rica in the spring of 2008 to get the lay of the land for an offshore autosurf that would be “another version” of ASD.

    The alleged trip occurred less than two years after the SEC accused 12DailyPro, an autosurf based in North Carolina, of selling unregistered securities in the form of investment contracts, prosecutors said.

    The explosive claim Bowdoin ventured offshore to pursue the creation of an ASD satellite may signal that the government views ASD not only as a Ponzi scheme, but as a business that deliberately sought to dial up its efforts to circumvent U.S. laws and create an even greater Ponzi war chest by establishing a footprint outside the United States.

    Since at least February 2006, the SEC has described the autosurf business model as anathema and a form of obvious securities fraud. Bowdoin was well aware of the SEC lawsuits and scrutiny domestic autosurfs such as 12DailyPro, PhoenixSurf and CEP had sparked in 2006 and 2007, prosecutors said.

    Meanwhile, investigators have evidence that shows ASD’s internal software system described payments to members as “ROI,” an acronym that that means “return on investment,” prosecutors said.

    The assertions by prosecutors — if proven true — may undermine ASD’s defense strategy of arguing it was an “advertising” program, not an “investment” program.

    Prosecutors did not identify by name the surf allegedly contemplated for Costa Rica. In late 2008 and early 2009, a surf with close ASD ties known as AdViewGlobal (AVG) debuted. The launch occurred about four to five months after the U.S. Secret Service seized $65.8 million from the personal bank accounts of Bowdoin in August 2008.

    Bowdoin’s trip to Costa Rica occurred before the ASD seizure, prosecutors said. If true, the claim could be used to prove ASD was seeking an exit plan even before the Secret Service raid. In 2008, prosecutors asserted that Bowdoin had moved millions of dollars offshore and talked about purchasing a home in another country.

    AVG purported to operate from Uruguay, but had servers that resolved to Panama. Some ASD members have said Bowdoin was a silent partner in AVG.

    Prosecutors described the “ROI” development as just another ASD incongruity, advising U.S. District Judge Rosemary Collyer that Bowdoin was well aware that a serious securities challenge could be made against his firm and chose to ignore the risk and misinform members.

    Beginning as early as January 2007, “[O]thers warned Bowdoin that ASD was nothing more than an investment scheme and that the program needed to be changed if it were to operate legally,” prosecutors argued in a brief to Collyer. “Bowdoin did not heed that advice and continued unabated in offering members higher returns than banks or brokerage firms. Moreover, based on his prior criminal experience, Bowdoin was well aware of the securities regulations and knew he was offering a security.”

    Any argument that ASD was not offering “investment contracts” as defined under the Howey Test should be dismissed, prosecutors said, arguing that ASD meets all three prongs of the Howey Test.

    Bowdoin sought about three weeks ago to have the criminal charges filed against him dismissed, arguing that ASD met none of the three Howey prongs.

    Nonsense, prosecutors said.

    ASD’s advertising was “merely a cover for Bowdoin’s sale of a get rich quick scheme,” prosecutors said.

    And prosecutors also cited other alleged proof that ASD was running an investment program — namely that some employees were being paid in ASD “ad packs.”

    “Bowdoin and the employees of ASD treated the ‘ad packages’ as shares from which they could expect to earn returns,” prosecutors argued.

    Prosecutors also pointed out a section of ASD’s Terms of Service that stated the firm “will” pay members 125 percent of the money they paid in. At the same time, prosecutors quoted video evidence of Bowdoin wooing members by focusing on ASD as a money-making opportunity.

    Bowdoin, prosecutors said, eventually limited the amount of money investors could pay ASD “because he did not want any one member dominating the return pool.”

    The prosecution’s assertions occurred against the backdrop of dozens of competing claims by ASD members who filed pro-se pleadings in the civil portion of the case that asserted the government had no “EVIDENCE.”

    Members made the claim despite the fact that some of the evidence against ASD had been part of the public record for more than a year at the time the claims were made in 2009.

    In a footnote to Collyer, prosecutors said they’d be happy to present the actual video of Bowdoin making various claims instead of simply quoting from a transcript.

    “[T]he government’s review of ASD’s bank records revealed that of the approximately $31 million ASD paid out to early members, more than 98% of that money came from monies paid to ASD by other members,” prosecutors said.

    Although ASD claimed to have funding sources beyond advertising payments made by members  — things such as banner ad sales and ebooks  — those outlets provided only de minimis revenue, prosecutors argued.

    “Each night, there was nothing more than new members funds to divide among existing members,” prosecutors argued. “Moreover, Bowdoin himself admitted, on video, that members funds are pooled and they will share in the profits and losses equally.

    “Specifically, Bowdoin, in the ‘New Member Success Video,’ claimed that “[w]hen sales increase, the rebates increase. When sales decrease the rebates decrease . . .”

    “Clearly Bowdoin, through ASD, was pooling all of the member’s funds which allowed him to make the requisite return payments,” prosecutors said.

    Prosecutors also argued that the ASD case should remain in Collyer’s courtroom in the District of Columbia. Bowdoin argued that the case should be transferred to Florida, in part because he and many witness live there.

    Although prosecutors agreed that many prospective witnesses live in Florida, they argued that witnesses reside in multiple jurisdictions because of the national and international scope of the case.

    In addition to Floridians, witnesses the government may present hail from the District of Columbia, North Carolina, Nevada, Oklahoma, Iowa and  elsewhere, prosecutors asserted.

    ASD also had members from at least 18 countries, and conducted “rallies”  in Illinois and Minnesota, among other states, prosecutors said.

    Read Bowdoin’s claims that the charges against him should be dismissed and that ASD did not meet any of the three Howey Test prongs.

  • URGENT >> BULLETIN >> MOVING: Accused Fraudster Andy Bowdoin Enters Defense That Could Provide Legal Cover For Autosurf Ponzi Schemes If He Wins Case; ASD Operator Claims Business Model Stands Up To ‘Howey Test’ Scrutiny

    Andy Bowdoin

    BULLETIN: In an argument that almost certainly will give comfort to operators of some of the most corrupt and insidious businesses on the Internet, AdSurfDaily President Andy Bowdoin has advised a federal judge that his company and business practices are legitimate because they stand up to scrutiny when the “Howey Test” is applied.

    Bowdoin, 77, made the argument despite the fact the government claims that he signed a proffer letter at least two years ago in which he acknowledged ASD was operating illegally and that the prosecution’s material allegations were all true. In 2009, Bowdoin acknowledged in his own court filings that he had made statements against his interests over a period of at least four days in the hopes of avoiding a prison sentence by cooperating with investigators.

    But Bowdoin now says criminal charges of wire fraud, securities fraud and selling unregistered securities as investment contracts brought against him last year “must” be dismissed. It is believed that hundreds — if not thousands — of autosurfs are operating over the Internet at any given time.

    Separately, Bowdoin filed a motion to transfer the case to the Northern District of Florida’s Tallahassee Division from the District of Columbia, saying that trying the case in Florida was the fair and most cost-effective thing to do. The government is expected to oppose Bowdoin’s bid to move the case from Washington to Tallahassee.

    U.S. District Judge Rosemary Collyer, who was assigned the civil forfeiture case against Bowdoin’s assets after the U.S. Secret Service raided ASD in August 2008 and ordered $65.8 million found in Bowdoin’s personal bank accounts ceded to the government after nearly a year and a half of litigation, also was assigned the criminal case. Criminal charges against Bowdoin were announced in December 2010.

    Although Bowdoin previously claimed Collyer was biased against him and sought unsuccessfully to have her removed from the civil case, he has not raised the issue of bias so far in the criminal case. Instead, he petitioned Collyer for an order that would remove the case from her courtroom and put it in the hands of a federal judge in Florida, arguing that most of the witnesses in the case resided in Florida and that hearing the case in Collyer’s court would force unnecessary costs and transportation burdens on both Bowdoin and witnesses.

    An affidavit signed by Bowdoin requesting the transfer was filed yesterday. It appears to have been notarized by Judy Harris of Tallahassee, whom some ASD members said operated the AdViewGlobal (AVG) autosurf with her husband, George Harris. George Harris is the son of Bowdoin’s wife, Edna Faye Bowdoin, and a Tallahassee home owned by the Harrises was seized in an ASD-related forfeiture complaint filed in December 2008.

    Both George and Judy Harris benefited from the ASD Ponzi scheme because a $157,000 mortgage on their house was retired with Ponzi proceeds, prosecutors said in December 2008.

    The Harrises also received a car valued at nearly $30,000 from the scheme, and the car also was paid for with Ponzi proceeds, prosecutors said.

    Florida records show that Judy Harris has been a licensed notary since at least October 2008. Why she would notarize a document for Andy Bowdoin when she, her husband and her mother-in-law were alleged to have been a beneficiaries of the ASD Ponzi scheme was not immediately clear.

    AVG, which purported to be headquartered in Uruguay and launched after the seizure of assets linked to Bowdoin and the Harrises, suspended payouts to members in June 2009. The surf blamed members’ greed for its problems. The name of Judy Harris also appears in a document filed in April 2009 with the Florida Department of State that canceled the fictitious registration of AVG, which also was known as the AV Global Association.

    Andy Bowdoin’s New Argument

    Prosecutors have not responded to Bowdoin’s new assertion filed yesterday that ASD can stand up to Howey Test scrutiny. A blistering response is expected in the days ahead because a ruling in Bowdoin’s favor to dismiss the case or an outright win by Bowdoin at trial could have grave economic and security implications for the United States.

    Autosurfs operate in the darkest corners of the Internet, fueled by corrupt promoters and scammers who position them as legitimate  “advertising” businesses that share revenue with participants. Untold sums of money — believed to be in the billions of dollars — have disappeared in recent years, and prosecutors say the enterprises operate as virtually pure Ponzi schemes.

    Purveyors almost certainly would view any win by Bowdoin as a mandate that legalized Internet-based Ponzi schemes and created a virtual license to collect vast sums of money and simply pocket it by claiming member payouts, which ASD called “rebates,” were not guaranteed.

    “[N]o guarantee or promise of any profits, any specific level of rebate payouts, or return on an alleged ‘investment’ occurred during the AdSurfDaily operation,” Bowdoin claimed. He also asserted that the allegations against him were Constitutionally vague and that none of the four civil cases brought against autosurfs — 12DailyPro, PhoenixSurf, CEP Holdings and the forfeiture case against ASD’s assets filed in 2008 — has clarified the legal issues.

    “As none of these actions has proceeded to final judgment, no judicial opinion has yet clarified whether payment of membership fees by advertisers into auto-surf businesses constitute unregistered sales of ‘securities,’ as alleged by the government,” Bowdoin claimed.

    The criminal charges “must be dismissed because the ad-surf business model employed by AdSurfDaily, Inc. and [Bowdoin’s] related businesses, as alleged in the indictment, cannot constitute an SEC-regulated ‘investment contract’ security as defined under the three-prong test established” by Howey, Bowdoin argued.

    The Howey Test is a threshold securities test and litigation benchmark from the 1946 U.S. Supreme Court decision in S.E.C. v. W.J. Howey Co. The decision spoke to the issue of what constitutes an “investment contract.”

    Bowdoin now claims the entire case against him is fatally flawed because he never sold investment contracts as defined under Howey.

    “[T]he Howey test,” Bowdoin argued, “determines whether a particular instrument or transaction is a prohibited, unregistered ‘investment contract’ by searching for the presence of three factors: ‘(1) the investment of money (2) in a common enterprise (3) with an expectation of profits to be derived solely from the efforts of the promoter or a third party.”

    ASD did not meet any of the three prongs of the Howey Test, Bowdoin argued.

    It was not an investment because ASD was an advertising company, not an investment company through which participants placed money at risk in anticipation of profit, Bowdoin argued. Therefore, he asserted, ASD did not meet the first Howey prong.

    Meanwhile, Bowdoin argued that ASD did not meet the second prong because participants did not place their money in a “common pool” put at risk in expectation of a profit.

    “[T]here was no ‘common enterprise’ at work here,” Bowdoin argued.

    And because ASD members had to click on ads and view them to get paid, they performed “actual efforts,” taking the third prong of the Howey Test out of play, Bowdoin claimed.

    “Here, the payment of both rebates and referral commissions were directly tied to the actual efforts of the advertisers,” Bowdoin argued.

    Prosecutors, though, asserted in the ASD forfeiture case that ASD told investors that rebates “will” be paid until investors received back 100 percent of the money they plowed into the scheme, plus a profit of 25 percent.

    Gerald Nehra, an attorney and expert witness for ASD in the forfeiture case, conceded under cross examination in 2008 that the ASD Terms of Service specified that rebates “will” be paid.

    Bowdoin’s most recent arguments also put him with odds with dozens of ASD members who claimed in court filings that the government had no “evidence” and no “witnesses.”

    In his filings yesterday, Bowdoin said he believed that the “vast majority” of the prosecution’s witnesses resided in Florida. He said he planned to counter them with witnesses of his own — as many as 136 — including George and Judy Harris, Rob Cefail of InTouch Marketing of Clearwater, and Tari Steward, who also provided Clearwater-based marketing services.

    At least 56 of ASD’s witnesses were ASD employees, Bowdoin said. The document was notarized by Judy Harris.

  • BULLETIN: CFTC Conducts Major Sweep; 14 Forex Firms Accused Of Illegal Solicitation Of U.S. Citizens; Actions Filed In New York, Chicago, D.C. And Kansas City

    BULLETIN: The Commodity Futures Trading Commission has gone to federal courts in New York, Chicago, the District of Columbia and Kansas City and simultaneously filed 14 lawsuits against Forex companies to enforce registration requirements and provisions of the Dodd-Frank Act.

    One of the lawsuits — one filed in the District of Columbia against a Nevada company known as Kingdom Forex Trading and Futures Ltd. that claims to be a “legally registered company in Belize and Nevis” — alleges that the firm was not registered with the CFTC but that U.S. customers were instructed to send money via wire and credit/debit cards.  Money also can be sent by Liberty Reserve, a payment processor favored by online financial schemes. Liberty Reserve says it operates from Costa Rica.

    The case against Kingdom Forex has been assigned to U.S. District Judge Rosemary Collyer, the same judge assigned to hear the AdSurfDaily autosurf Ponzi scheme cases.

    This morning, Liberty Reserve was advertising on its website a company known as FXOpen.com. FXOpen.com, according to the CFTC, is the website of a firm known as FXOpen Investments Inc. — yet-another of the defendants sued in the sweep.

    FXOpen is described in the complaint as “company of undisclosed origin” that claims “its headquarters is located at Ebene Heights No. 34, Cybercity Ebene, Mauritius.”

    It also claims to have “worldwide regional offices” in Cairo, Egypt; Paris, France; Kuala Lumpur, Malaysia; Jakarta, Indonesia; Almaty, Kazakhstan; and Moscow, Russia, CFTC charged.

    “FXOpen’s websites, including www.fxopen.com, are hosted on servers” in the United States, CFTC charged in the complaint.

    The firm, whose website would not load this morning when visitors clicked the link at the Liberty Reserve page, is accused of directly soliciting U.S. investors and claiming U.S. law does not apply to it.

    “[I]n the ‘Forum’ section of its website, FXOpen representatives specifically solicit United States residents to open accounts with FXOpen, in part by advertising that potential customers in the United States can escape United States laws and regulations by opening accounts with FXOpen,” CFTC charged.

    “For example, on October 5, 2010, in response to a question regarding whether FXOpen could accept applicants from the United States after October 18, 2010 following recent CFTC rulings, an FXOpen representative answered with a post, stating, ‘Since we don’t have an office in the US, nor are we an affiliate of a US based broker, we are not bound by CFTC rulings. Rest assured we will be able to accept US clients for the foreseeable future unless a legal impediment appears,’” CFTC charged in the complaint.

    All of the companies named defendants in the sweep are accused of “illegally soliciting members of the public to engage in foreign currency (forex) transactions and that they are operating without being registered with the CFTC,” the agency said.

    Among the defendants are domestic and offshore companies.

    Here is the lineup of defendants in what the CFTC described as a major nationwide sweep:

    • EuroForex Development LLC, a Delaware LLC.
    • FIG Solutions Limited Inc., a Delaware corporation.
    • ForInvest, a Delaware corporation.
    • FXOpen Investments Inc., a Delaware LLC.
    • FXPRICE, a Delaware LLC.
    • GIGFX LLC., a Delaware company.
    • InovaTrade. Inc., a company with purported offices in Florida.
    • InstaTrade Corp., d/b/a InstaForex, a British Virgin Islands company.
    • InvesttechFX Technologies. Inc., a Canadian corporation located in Toronto.
    • J&K Futures. Inc., a company with purported offices in California and New York.
    • Kingdom Forex Trading and Futures. Ltd., a Nevada company.
    • Prime Forex LLC, a Delaware LLC.
    • Wall Street Brokers LLC, a Delaware LLC.
    • ZtradeFX LLC, a Connecticut LLC.

  • Two Days Before Remissions Deadline, ASD Members Receive Yet-Another Confusing, Highly Questionable Email That Suggests Victims Seeking Restitution Should Tell Administrator That Program Was Not An Investment

    Andy Bowdoin.

    Some AdSurfDaily members have received an email that appears to be attributed in part to Sara Mattoon, the embattled autosurf firm’s former spokeswoman. The most recent correspondence fractures facts, suggests the government has no credible witnesses or evidence in its wire-fraud and securities-fraud case against ASD President Andy Bowdoin and implies suggestions given to recipients are a legal “opinion” from a qualified expert.

    The date upon which the email was sent was unclear. At least one former ASD member reported receiving a copy of it today.

    Like previous emails, the content of the email appears to be a compendium in which Mattoon and perhaps others assembled information and passed it along as though it were fact.

    Among the claims are that federal prosecutors are creating victims out of thin air, that the government is engaging in trickery, that a pyramid-scheme case filed against ASD in Florida “was decided in ASD’s” favor, that “the government is in a very bad position to win a jury trial,” that prosecutors have “have no material tangible evidence and no credible witnesses to prove their case” — and that the remissions program is a “scam.”

    Contrary to the claims in the email, the pyramid case brought by the state of Florida was not decided in ASD’s favor. The case did not go to trial, and no judge ruled that the government’s case was fatally flawed. Moreover, no judgment was issued in ASD’s favor.

    State prosecutors said they dismissed the Florida civil case because two final orders of forfeiture already had been entered by U.S. District Judge Rosemary Collyer in civil litigation in federal court and that victims had a compensation remedy through the federal remissions program.

    The deadline for filing a claim through Rust Consulting Inc. — the official claims administrator — is Jan. 19. There have been repeated attempts by some ASD members to discredit Rust, which is under contract with the U.S. government to administer the program.

    A list of Florida victims already had been submitted to Rust, Florida prosecutors said. In October 2010, Florida confirmed it had dismissed the state-level pyramid case. Two months later, in December 2010, Bowdoin was charged criminally under federal law with wire fraud, securities fraud and selling unregistered securities. An investigation into his business practices has been under way since July 2008.

    Regardless, the most recent email suggests that government evil is afoot.

    “And we all need to be very pragmatic about this,” the email read in part, citing a purported “opinion” without providing the source of the opinion. “We purchased advertising legitimately. … Now it’ll be up to a real jury, and if ASD/Andy have lawyers that are even remotely competent, the verdict will be not guilty.”

    Bowdoin was arrested Dec. 1. Federal prosecutors accused him of operating a Ponzi scheme that had gathered at least $110 million. Bowdoin, 76, is free on bail.

    In the email, the criminal charges against him were pooh-poohed, apparently by the author of the “opinion.”

    “But the bottom line on all of this is twofold,” the email read. “First, the government is in a very bad position to win a jury trial – they have no material tangible evidence and no credible witnesses to prove their case. Second – all these ‘scams’ including the Rust group are ploys, most likely instigated by the government to try and turn up ‘witnesses’ who will say they have been victims of investment fraud. But those who will say that can be torn apart by the ‘Terms and Conditions’ they agreed to during Defense cross-examination. The other witnesses – the government agents (or informers) can also be torn apart during cross examination. The vote by the jury must be unanimous in a felony case BEYOND A REASONABLE DOUBT and the government knows that they simply don’t have the evidence or the witnesses to get by that.”

    Repeated claims have been made by some ASD members for months that the government lacked both witnesses and evidence. Despite the claims, the government announced last week in court filings that it had gathered at least 500,000 pages of emails and at least 100,000 pages of bank records as part of the probe.

    Meanwhile, prosecutors said the U.S. Secret Service had identified at least 40,000 potential ASD victims.

    Like a previous email, the most recent email also suggested that ASD members should use the remissions form to claim ASD was not an investment program. Such an approach potentially could result in a situation in which participants disqualified themselves from receiving restitution from assets seized in the case by the U.S. Secret Service.

    Prosecutors alleged that ASD was an investment business masked as an advertising company.

    Even so, some ASD members are sticking with an assertion that ASD was a legitimate advertising firm.

    “If you feel that you want to fill it out, [the claims form] must be mailed to [Rust] by 1/19/11,” the email read. “If you do choose to fill it out, then where your signature would be, you may want to write the words ‘See Addendum.’ Then attach a statement something like this (in your own words):

    ‘I am very clear that this was not an investment and that I was purchasing advertising. And, since the government shut down my advertising company and I therefore did not get the advertising I paid for, I would like to get my advertising money back from whomever is holding it now.’

    “Sign it and send it in with the forms supplied by Rust,” the email advised recipients.

    At the same time, the email solicited prayers and cautioned against working with AnShell Financial Services, a company that says it is helping some ASD members fill out the remissions form for a fee.

    Rust, the official claims administrator, has specifically disclaimed any affiliation with AnShell and has urged caution in dealing with the firm, which is approved neither by Rust nor the government.

    Some ASD members appear to be as paranoid about the work AnShell is doing for certain members as they are about the government and Rust.

    “The form you received from Sheldon Drobny, CPA/AnShell Financial Services is someone who was retained by a group of ASD/Golden Panda members to get their money back from the government,” the most recent email read. “This is the company that is holding the conference calls. If you feel you want to participate, be careful here also. Use the same attitude there: you didn’t make an investment; you purchased advertising. There is danger that this could be used against ASD also. Pray about it and decide for yourself if you want to participate.”

    The email ended by citing the name “Sara” as the sender.

    “That’s all I have for now,” the email concluded. “I am still very swamped caring for my husband and I am not a lawyer so I can’t really advise you further and answer any questions. Hope this is helpful. I still haven’t been able to process all the emails I received from ASD members in the Fall of 2009, giving me their change of e-address, so please pass it on to all ASD members you know. God’s Blessings, Sara.”

  • BULLETIN: 40,000 Potential Victims Identified So Far In ASD Case; Government Says Autosurf Firm May Not Have Entered All Names In Database

    Andy Bowdoin

    BULLETIN: Federal prosecutors now say that a Florida company whose operator is accused of running an international Ponzi scheme may have defrauded 40,000 or more victims and may not have entered all the names of people who gave it money into the firm’s database.

    Andy Bowdoin, the president of AdSurfDaily, was indicted last month on charges of wire fraud, securities fraud and selling unregistered securities. Prosecutors now have revealed in court filings that the U.S. Secret Service seized ASD’s database during the probe, which began in July 2008.

    ASD’s database contains 97,000 names, including the names of members who joined for free, prosecutors said in a motion that asks U.S. District Judge Rosemary Collyer to approve a plan by which websites would be used to help locate additional victims and keep victims in general informed about developments in the case.

    “The government is not certain that this list is a complete list of all people who provided money to ASD and who potentially lost their money,” prosecutors said. “It appears from the investigation that there may be members who provided funds to ASD but whose information ASD did not enter into its database.”

    Some ASD members claimed the company had as many as 120,000 members.

    To date, prosecutors said they had identified “approximately 40,000 known potential victims.” The victims’ list includes “individuals who contacted the U.S. Attorney’s Office directly and identified themselves as losing money in their ASD investment, members who agents identified as potentially losing money with ASD and Golden Panda Ad Builder members.”

    Golden Panda was the purported “Chinese” option for ASD members. It was operated by Clarence Busby of Georgia, according to court filings.

    Bowdoin, prosecutors said in their motion, was operating ASD “essentially as his own piggy-bank.”

    Beyond that, prosecutors said, “as far as the Government is aware, there is no available accurate compilation” of all individuals or entities that lost money in the scheme.

    All victims have the right to be “reasonably heard” and to be kept up to date on proceedings, but the sheer number of ASD victims and a lack of records makes it “impracticable to give individualized notice to each potential victim.

    A web-based system of notification through email and a government site and the remissions site set up by Rust Consulting Inc. of Minnesota will help victims stay informed of their rights, prosecutors said in their motion to Collyer.

    “In light of the fact that Bowdoin operated an Internet based scheme, it is reasonable to assume that victims will have access to the internet and will be able to easily access information on the government’s website,” prosecutors said. “Moreover, the government will include on the remission website a link to the U.S. Attorney’s Office’s website for victims seeking information about public proceedings in the criminal case.

    “The Government respectfully submits that the proposed notice procedure is reasonable to give effect to the rights of the potential victims in this case, and requests that the Court enter the proposed order,” prosecutors said.

    Similar accommodations have been made in other securities-fraud cases, including the Bernard Madoff case, prosecutors said.

  • Is Andy Bowdoin Renewing His Efforts To Have Federal Judge Removed From Case? Accused Ponzi Swindler Faces New Filing Deadline To Argue For Case Transfer

    Andy Bowdoin

    Accused Ponzi swindler Andy Bowdoin of Florida-based AdSurfDaily has been granted an extra two weeks to argue that the criminal case against him should be transferred from U.S. District Court for the District of Columbia.

    Through his attorneys, Bowdoin informed U.S. District Judge Rosemary Collyer on Jan. 3 that he intends to file a Rule 21 motion to transfer his trial to another federal court. Under Rule 21, a defendant can argue that he cannot receive a fair and impartial trial in a specific district. Meanwhile, a defendant can argue that the trial should be moved for the convenience of the parties and witnesses.

    It was not immediately clear if prosecutors would oppose the motion. Bowdoin initially was ordered by a federal magistrate judge to file his motion within two weeks of his Dec. 17 arraignment in Washington. Collyer now has granted Bowdoin’s request for an extension to file. The new deadline is Jan. 18.

    In December 2009, Bowdoin sought to have Collyer removed from the civil-forfeiture case in which the U.S. Secret Service seized tens of millions of dollars from his personal bank accounts. Collyer refused to step down. In January 2010, she decreed the money forfeited to the U.S. government, which has established a process through which ASD victims can file a claim for a share of the seized proceeds.

    In an affidavit in support of his 2009 disqualification motion, Bowdoin claimed Collyer had a “deep seated animosity” toward him and that the judge “has a personal bias and prejudice” against him.

    Ironically, Bowdoin’s motion to disqualify Collyer in the civil case was docketed on Dec. 17, 2009. Exactly one year to the day later — on Dec. 17, 2010 — Bowdoin made his first appearance in the criminal case in the District of Columbia. Federal agents arrested Bowdoin in Florida on Dec. 1, 2010, after an indictment from a grand jury that began meeting in May 2009 was unsealed.

    Collyer did not preside over Bowdoin’s initial appearance in Washington, but has been assigned the criminal case. She issued her first ruling yesterday: a minute order that granted Bowdoin’s request for the two-week extension to file his Rule 21 motion.

    ASD member Curtis Richmond, who emerged as a figure in the civil litigation after filing pro se pleadings that accused Collyer and Chief U.S. District Judge Royce Lamberth of operating a “Kangaroo Court,” also sought unsuccessfully to have Collyer removed from the case in 2009.

    Richmond has been linked to a sham Utah “Indian” tribe that once sought unsuccessfully to have a federal judge removed from a different case on the eve of trial by claiming the judge owed Richmond $30 million.

  • Now, Highly Confusing, Competing Claims About The AdSurfDaily Remissions Program Appear On RipoffReport.com; Post Fractures Facts; DON’T BE CONFUSED

    Andy Bowdoin

    First, don’t be confused. Rust Consulting Inc. is the official claims administrator under contract with the U.S. government to handle claims from victims of the alleged AdSurfDaily Ponzi scheme. ASD also is known as ASD Cash Generator.

    See this document at Justia.com. It is signed by Ronald C. Machen Jr., the U.S. Attorney for the District of Columbia, and appears on the court docket of U.S. District Judge Rosemary Collyer. The document lists the URL for the official claims site: http://www.adsurfdailyremission.com

    Today a highly confusing report appeared on RipoffReport.com suggesting that, not only was ASD a ripoff,  but so is the claims program. The PP Blog became aware of the report after receiving a message from Google Alerts, which the Blog uses to track mentions of ASD Cash Generator across the web.

    The PP Blog sought to contact Rust about the Ripoff Report, but it was past business hours. The Blog left a detailed message for the firm.

    Here is the headline of the Ripoff Report: “Asd cash generator ad Surf daily remission administrator Beware…scam, Internet . . .”

    Meanwhile, the report says this, “do not reply to remission forms that says from secret services asking for your bank account and social security number informations. secret services do not send out such forms asking specific account numbers. and secret services do not use post office box numbers address.”

    At the same time, the report urges readers to “report your forms to your better business bureau.”

    Other mistakes dot the Ripoff Report — for example, the Minnesota address of the claims administrator is listed as the address for ASD and the URL for the official claims site is incorrect.

    The U.S. Secret Service conducted the ASD investigation. Rust, the government-approved claims administrator, is using a Post Office Box to receive completed claims forms. The company specifically informs ASD members on the remissions site that it is asking victims to provide bank-account information so they can receive restitution by electronic deposit.

    “Payment will be disbursed by electronic funds transfer after all Remission Forms are decided,” the company notes on the website. “Therefore it is necessary to ensure that the section requiring your banking information is completed in full on the Remission Form in order to receive a remission payment.”

    The official remissions form also asks for a Social Security number or Employer Identification Number (EIN).

    Why a poster on RipoffReport.com appeared to imply that the “secret services” did not authorize the information to be gathered was unclear. The U.S. Secret Service has the duty of assisting the U.S. Department of Justice in reviewing the claims.

    The ASD case has been marked by one bizarre event after another. In recent weeks, some ASD members have tried to confuse others about the remissions process.

    ASD President Andy Bowdoin, who was indicted on felony charges earlier this month, is scheduled to make his first court appearance in the District of Columbia tomorrow.

  • Leaming Claimed Small Town Targeted Him For ‘DEATH’; Second Woman Blocked By Federal Judge From Filing ‘Notary’ Claim In AdSurfDaily Case Has Leaming Tie; Leaming And ASD Figure Christian Oesch Try To Sue United States

    Kenneth Wayne Leaming, also known as "Kenneth Wayne" and "Keny."

    UPDATED 5:52 P.M. ET (U.S.A.) A Washington state man emerging as a figure in the AdSurfDaily forfeiture case claimed a small town targeted him for “DEATH” and threatened to kill him by “HUNTING” him down “in screaming packs and mobs” and using “several armed street gangs” that served as police, according to records.

    Kenneth Wayne Leaming of Spanaway filed a lien for $10 million in 2009 against the city of Puyallup, Wash., in the case. Among the claims were that Puyallup engaged in terrorism by controlling “multiple electronic broadcast media” and employing police who used “chemical and biological weapons,” “machine guns” and “explosives.”

    The lien was notarized by Tina M. Hall, a Leaming business associate and another emerging figure in the ASD case. Hall’s notary license was revoked last month. Leaming has been linked by the Anti-Defamation League to an “extremist group” known as “Little Shell Pembina Band of North America.”

    Puyallup is a city of about 33,000 in Pierce County.

    Pattern Of Filing Astronomical Liens

    In a separate case in which Leaming’s name is referenced as a co-defendant with Janice Kay Bryson, a lien for more than $19 billion was placed against several individuals and the city of Fife, Wash., another small town in Pierce County. Records show that Leaming has been assessed sanctions of at least $15,000 in Washington state for filing false liens.

    Fife has a population of about 4,800. Puyallup, named in the $10 million lien, somehow also became a party along with Fife in the $19 billion lien.

    Lien For Billions Filed Against Hospital With Historic Roots To St. Francis Of Assisi And The Order Of Poor Ladies Founded By St. Clare

    Leaming also filed a bogus lien for $9.2 billion against St. Clare Hospital, a faith-based facility in Washington state that admitted 6,995 patients, handled 48,363 patient visits to its Emergency Department and received 26,114 outpatient visits during the 2008 fiscal year.

    Hall also affixed her notary seal to the lien against St. Clare, which is operated by Franciscan Heath Systems and traces its faith-based healthcare mission in Washington state to 1891.

    The Franciscan Order is named after St. Francis, known the world over as St. Francis of Assisi, who died 784 years ago, in 1226, after rejecting earthly wealth and living in poverty as a street preacher. He is one the most revered figures in the annals of Christianity.

    One of the first followers of the man who became known as St. Francis of Assisi was Chiara Offreduccio. She became known as Clare of Assisi and, after being elevated to sainthood, St. Clare. Clare of Assisi was the founder of the Order of Poor Ladies which, like the Franciscan Order, rejected earthly wealth. The Order of Poor Ladies went on to become known as the Order of St. Clare, known the world over as the “Poor Clares.”

    Leaming sought to attach “all tangible and intangible property” of the St. Clare Franciscan facility, including its money, furnishings and fixtures, according to records. St. Clare was Leaming’s community hospital in Spanaway. Ironically, AdSurfDaily members had positioned ASD in promotional materials as the invention of a Christian “genius” and an attractive way for people of faith to make enormous sums of money by clicking on advertisements for less than 20 minutes a day.

    Members who recruited other members were paid commissions of 10 percent. Commissions for second-level recruits in the MLM scheme were set at 5 percent. ASD member and purported company “trainer” Robert Fava claimed in a testimonial that he made $1,000 a day from ASD.

    ASD President Andy Bowdoin, speaking at an event in Las Vegas in May 2008, exhorted attendees to “to have an attitude of gratitude with God” and imagine themselves in possession of “a big check coming in from AdSurfDaily.” Bowdoin thanked God from the stage for developing him into a “money magnet.”

    Video from the Las Vegas event shows members standing in line to turn money over to ASD — and employees placing paperwork into plastic baskets. By Aug. 1, 2008, about two months after the Las Vegas gathering, the U.S. Secret Service seized tens of millions of dollars from 10 personal bank accounts held by Bowdoin, amid allegations of money-laundering, wire fraud and operating a Ponzi scheme. Court filings placed the amount seized from Bowdoin at $65.8 million.

    One of his personal accounts contained more than $31.6 million; another contained more than $23.7 million. Prosecutors said ASD was not Bowdoin’s first brush with the law. In the 1990s, he pleaded guilty to felonies that flowed from an Alabama securites caper, avoiding prison by agreeing to make restitution to victims.

    About $14 million more under the control of Clarence Busby and an ASD-related  company known as Golden Panda Ad Builder also was seized by the Secret Service. The abbreviation “Rev.” was attached to Busby’s name 120 times in an ASD-related court filing that accused the company and unnamed co-conspirators of racketeering.

    Busby was accused by the SEC in the 1990s of participating in three prime bank schemes in which investors were promised enormous returns that did not materialize.

    Why Leaming, who acknowledges an “Almighty Creator” only known as “I am” in documents that identify Leaming as “Postmaster,” would seek to vex and bankrupt a faith-based hospital and two small towns in Washington state is unclear.

    Also unclear is why any ASD member would put faith in the purported legal skills of Leaming, who was accused of the unauthorized practice of law in the state five years ago and was the subject of a protection-from-abuse order filed by a notary public who claimed he coerced her into notarizing documents.

    At least two notaries public have lost their licenses in Washington state after performing work for Leaming, according to records.

    At Least 3 ASD Filers Have Leaming Ties

    Excluding himself, Leaming now has been linked to at least three people who either filed or attempted to file documents in the ASD case: Hall, Christian Oesch and Kathryn E. Aschlea.

    On June 11, 2010, Aschlea was blocked by U.S. District Judge Rosemary Collyer from filing a document styled “Claim by Notary Presentment/Acceptance” in the ASD forfeiture case in the District of Columbia.

    The nature of the blocked filing is not publicly known.

    Records in Washington state identify a woman by the same name as a notary public. Meanwhile, Kathryn Aschlea is listed as a business partner of Kenneth Wayne Leaming in a venture known as FAN NW LTD INC. Aschlea is listed as a “governing person” and vice president of the firm, with Leaming — shortening his name to “Kenneth Wayne” by dropping the surname “Leaming” in the registration — listed as president and a “governing person.”

    The unsuccessful bid to file in the ASD case occurred more than five months after Collyer issued a final order of forfeiture that granted the government title to the money seized by the U.S. Secret Service from Andy Bowdoin. Collyer signed an order in July 2009 that awarded the money seized from Busby’s Golden Panda to the government.

    Federal prosecutors announced more than two years ago that money declared forfeited would be used to compensate victims.

    Prosecutors brought the forfeiture case to enforce wire-fraud and money-laundering laws, according to court records. A racketeering statute also is referenced in the forfeiture complaint.

    Collyer has consistently ruled that nonparty claimants have no standing in the ASD case.

    On July 2, 2010 — nearly six months after Collyer issued the final forfeiture order and four months after Bowdoin appealed it — Collyer blocked Leaming and Christian Oesch from filing a document styled “Notice of Final Determination and Judgment by Christian Oesch and Kenneth Wayne.”

    Like Aschlea and Hall,  Oesch has a business tie to Leaming. A Leaming company known as AMERICAN INTERNATIONAL BUSINESS LAW INC. is listed as the registered agent for an Oesch-controlled company in Washington state known as HUMAN ECONOMIC RESOURCE SOLUTIONS LTD.

    Records list Hall as vice president of AMERICAN INTERNATIONAL, with Leaming as its president.

    Records suggest that within days of the July 2 docket entry in which Collyer blocked “Kenneth Wayne” and Oesch from filing the document styled “Notice of Final Determination and Judgment,” Leaming set the stage for ads positioning him as an “attorney” or “lawyer” to appear online. Those ads were removed by Justia.com, Oyez.org and Cornell University Law school earlier this month, after questions were raised about whether Leaming was a licensed attorney.

    Records show there have been multiple complaints about Leaming engaging in the unauthorized practice of law in Washington state. At least one of the complaints came from a woman who lost her notary’s license in 2005 as a result of notarizing documents on Leaming’s behalf, according to records.

    The woman also filed for a protection-from-abuse order against Leaming, according to records maintained by the Washington State Bar Association, which redacted the woman’s name in a 2005 letter to Leaming that accused him of the unauthorized practice of law.

    Records at the U.S. Court of Federal Claims show that “Kenneth Wayne” and Christian Oesch filed a complaint against the United States on July 23, 2010, about three weeks after Collyer rejected their bids to file a document on the ASD docket in U.S. District Court for the District of Columbia.

    A public link to the complaint is not available. The docket, however, shows that the U.S. Department of Justice has filed a motion to dismiss the complaint. Whether Leaming and Oesch even can establish that the U.S. Court of Federal Claims (COFC), which typically hears contract disputes in a limited number cases in which the government waives sovereign immunity, has jurisdiction to hear an ASD-related dispute is far from clear.

    Leaming is listed as an “agent” for “MYHUB GROUP LLC” on the COFC docket. A company by that name is listed in Nevada records as in “default,” with Christian Oesch as its manager.

    Earlier this month, some ASD members received an email that referenced “MYHUB.” The email appeared to be a compendium assembled by ASD member Sara Mattoon. The same email referenced a purported “legal opinion” by “Keny.”

    “Keny” is a nickname used by Leaming.

    The email asserted that ASD members who filed a restitution claim through Rust Consulting, the government-approved claims administrator, might face a lawsuit from a group of ASD members.

    “Again, we are asking that our Claimants do not engage in the DOJ’s Remission Process, as long you want to maintain being part of our Group Claims whatsoever,” the portion of the email attributed to MYHUB read in part. “If you are indeed wanting to eat on the other side of the fence, you must let us know before you submit anything to the DOJ, without causing us potential harm and further damages. In case you were to fail to notify us, we would have a possible claim against you, and that’s not what you want us to do in the first place.”

  • DEVELOPING STORY: Tina M. Hall, VP Of Firm Linked To Kenneth Wayne Leaming, Had Notary License Revoked For ‘Professional Misconduct’; Woman With Same Name Sought To Intervene In AdSurfDaily Case

    A document that appears online features this purported likeness of Kenneth Wayne Leaming and purports to explain why he shortens his given name to "Kenneth Wayne."

    The state of Washington revoked the notary license of Tina M. Hall of Spanaway last month for “professional misconduct,” according to the Department of Licensing.

    Hall also is listed as vice president of American International Business Law Inc., a Spanaway company some AdSurfDaily members have said is performing legal work for a group of members.

    Separately, a woman identified as Tina M. Hall was denied leave to file pleadings in the AdSurfDaily forfeiture case by U.S. District Judge Rosemary Collyer on Jan. 27, 2010, and Feb. 12, 2010, according to the docket of the case. Each of the denied filings was styled “Claim by Notary Presentment.”

    Hall’s notary license was revoked about eight months later, according to records. Why the state took the action was not immediately clear. An entry on the state’s website notes a “finding” of professional misconduct and a revocation until March 3, 2015.

    The nature of the pleadings Hall apparently attempted to file in the ASD case was not immediately clear. Several weeks earlier, on Jan. 4, 2010, Collyer issued a forfeiture order that granted the government title to more than $65.8 million seized by the U.S. Secret Service from the personal bank accounts of ASD President Andy Bowdoin in August 2008.

    “Kenneth Wayne,” whose full given name is Kenneth Wayne Leaming, is listed as president of American International. The court docket in the ASD case shows that “Kenneth Wayne” was denied leave to file by Collyer on July 2, 2010. The denied pleading was styled “Notice of Final Determination and Judgment by Christian Oesch and Kenneth Wayne.”

    Oesch earlier had sought to intervene in the case by filing a pleading styled “MOTION to Set Aside Forfeiture & Civil Asset Forfeiture Reform Act of 2000 as Facts and Law will Prove.” Collyer denied the motion.

    Dozens of pro-se litigants sought unsuccessfully to intervene in the ASD case.

    Leaming, who goes by the nickname “Keny,” is believed to be the author of a purported “legal opinion” that some ASD members are using to discourage victims from filing a claim for restitution through the official claims administrator.

    Although Leaming advertised himself as a lawyer and published a fee structure of $250 an hour or $150 an hour for prepaid clients on websites operated by Justia.com, Oyez.org and Cornell University Law School, he does not appear to be a licensed attorney. Justia, Oyez and Cornell subsequently removed the listings, which used an address in Spanaway and the name of American International.

    Research by the PP Blog suggests Leaming began publishing the ad just days after Collyer denied him leave to file on July 2. The Washington State Bar Association sent Leaming a letter in 2005 that accused him of the unauthorized practice of law and being physically and emotionally abusive toward a notary public and coercing her to notarize documents.

    A document dubbed “Evidence of Name and Nationality” with Leaming’s full name (first, middle and last) and purported likeness appears online. The photo used in the document is similar to the photo used in the now-removed ads on the Justia, Oyez and Cornell websites. Using exceptionally formal language and stilted prose, the document purports to explain why Leaming drops his surname except for “familial” use.

    “On or about 20 December A.D. 1955 Edna Lottie and Raymond Roy, family LEAMING, begot an offspring son as a gift granted by the Almighty Creator, only known as ‘I Am’, granted it the proper name Kenneth Wayne, and the Nationality of an American National,” the document reads.

    “Kenneth Wayne also inherited the right to the family name LEAMING according to the historic practice of customs and usages,” the document continues. “Kenneth Wayne, having knowledge of the historic practice of customs and usages, and to avoid the confusion inherent in only being known as a son of ‘I Am’, presents himself according to is given name ‘Kenneth Wayne’ when acting as and for himself, and elects to only reference the family name (surname) when acting in a familial capacity.”

  • DISTURBING: Email Received By Some ASD Members Suggests They Could Be Sued For Participating In Refund Program; Records Suggest ‘Legal Opinion’ Was Offered By Man Named In Complaints For ‘Unauthorized Practice Of Law’ And Linked To ‘Extremist Group’ By Anti-Defamation League

    In a bizarre and unsettling development, some members of AdSurfDaily who may be planning to file for restitution through the official claims administrator have received a confusing and threatening email from a “group” of ASD members.

    The email, which appears to be a compendium that cobbles together communications from the group and asks ASD members to pass along the information, implies that ASD members who file for restitution through the government-approved process may face legal action from the group, which has or will file claims against the “illicit UNITED STATED (sic) OF AMERICA INC. et al” for its prosecution of the ASD Ponzi scheme case brought by the U.S. Secret Service in August 2008.

    The lawsuit threat appears to be targeted at ASD members who are planning to file a restitution claim through Rust Consulting Inc. of Minneapolis. Rust Consulting is under contract with the government to administer the restitution program through a process known as remission in which ASD members must certify they are crime victims.

    Pasted into the email is a purported “legal opinion” by a person described as “Keny” of “AMERICAN-International Business Law inc. (sic).”

    “Keny” does not appear to be the source of the lawsuit threat. Rather, the email quotes a purported “legal opinion” by “Keny” — and then implies members who file through Rust Consulting may be sued by members of the group. The email asks members not to file for a refund through the official process.

    “Please send me your response(s) and I will manage the feedback timely,” says an email signed “MYHUB.” “Again, we are asking that our Claimants do not engage in the DOJ’s Remission Process, as long you want to maintain being part of our Group Claims whatsoever. If you are indeed wanting to eat on the other side of the fence, you must let us know before you submit anything to the DOJ, without causing us potential harm and further damages. In case you were to fail to notify us, we would have a possible claim against you, and that’s not what you want us to do in the first place.

    “We very much appreciate your understanding in this rather sensitive time of legal dealings,” the email continues. “No worries, we are just getting started to fight for and along with you. If you feel that this email could help some of your friends in ASD that are not part of our Group Claims, we are allowing you to share and forward this email as long it doesn’t end up in Blogs et al., but then again, people need to be informed since they can’t read and or understand the legal language or the meaning of words any longer.”

    Google search results include multiple references to “AMERICAN-INTERNATIONAL BUSINESS LAW INC” and a person referenced as “Keny.”

    One of the references appears on a website operated by Cornell University Law School under a heading of “Legal Services & Lawyers.” The Cornell reference identifies a person named Kenneth Wayne Leaming of AMERICAN-INTERNATIONAL BUSINESS LAW INC. of Spanaway, Wash. The Cornell site notes that correspondence should be sent to the attention of “Keny” and that Kenneth Wayne Leaming practices “Admiralty/Maritime, Business Law, Estate Planning and Native American Law.”

    Records at the Practice of Law Board at the Washington State Bar Association (WSBA) say that Kenneth Wayne Leaming, also known as Kenneth Wayne, was accused of the unauthorized practice of law by clients in 2005.

    One client accused Leaming of “actively market[ing] legal services via seminars and the internet” and of providing “legal advice” and preparing “pleadings for many clients,” according to WSBA.

    Another client accused Leaming of contracting with him “to assist him in avoiding an IRS lien on his home” and failing to provide the services.

    On Dec. 20, 2005, WSBA said in a letter to Leaming that his “conduct constitutes the unauthorized practice of law.” The final disposition of the matter was not immediately clear. Also unclear is whether Leaming ever was a licensed attorney or authorized to practice law in any state.

    Separately, the Anti-Defamation League (ADL) lists Leaming as a member of an “extremist group” known as “Little Shell Pembina Band of North America.”

    Leaming, according to ADL, is a “self-described ‘recognized international lawyer’ who once served as a deputy sheriff and member of the Civil Rights Task Force, a “sovereign citizen group that has used badges and raid jackets to resemble law enforcement officers.”

    “His CRTF partner, David Carroll Stephenson, was ordered by a federal court in March 2004 to stop promoting an alleged tax scam that allowed people to avoid an estimated $43 million in federal income taxes,” according to ADL.

    The identity of “MYHUB” was unclear in the email received by ASD members. Portions of the email were pieced together by a sender known as “Sara.” A person named Sara Mattoon once served as ASD’s official spokeswoman and is referenced in a court filing by the Secret Service in 2009.

    In the email, “Sara” referenced remarks attributed to “Keny” as a “legal opinion about why it may be unwise for you to fill out the [Rust Consulting] form, aside from it working against ASD.”

    The “Sara” email then reproduces the “MYHUB” email and the purported “legal opinion” by “Keny.”

    The purported legal opinion describes the Rust Consulting website, which is listed in court documents as the official site for ASD victims, as “almost exclusively a propaganda site to get the viewer to ‘believe’ the gov’t LIE that advertising via network marketing on the internet is somehow bad business and fraudulent, and solicit false testimony from the viewer based on the false information!”

    In yet-another email received by ASD members, a fellow member referenced as “Robert” also referred to the claims program administered by Rust Consulting. The email from “Robert” includes an unattributed opinion, meaning the identity of the person who offered the opinion is unclear.

    “If members feel it absolutely necessary to complete the remission form now instead of waiting a little longer for the legal process to be completed then they may want to write on a separate piece of paper and have it notarized saying that they were not an investor,” according to the opinion contained within the email from “Robert.”

    Members also should swear that “they purchased advertising for their website and that they were happy with their purchase,” according to the unattributed opinion circulated by “Robert.”

    “The govt is trying to trick people into saying it was an investment,” the opinion claimed.

    Separately, an apparent ASD member known as MMG7 who posts on the MoneyMakerGroup Ponzi forum left a scathing missive yesterday in an ASD thread at the forum.

    “The same people who abused their power, under the color of law, back in August of 2008 and basically *shut down* the company without due process are up to yet additional tactics to *CREATE VICTIMS* out of thin air,” the post read in part.

    “The general consensus is that once they can *create victims* they can then turn around and use it against ASD or even YOU.

    “It is VERY HEALTHY to question their motives. Remember, these are the same people that ruined the lives of 100,000+ people in the blink of an eye without so much as having to provide an explanation for their actions.

    “Could it be they thought ASD would roll over and play dead so they could put a feather in their cap and claim victory? Not to mention being able to keep a hefty sum of members monetary property.”

    The MoneyMakerGroup forum is referenced in a May filing by the U.S. Postal Inspection Service as a place from which Ponzi schemes are promoted. The filing accused an entity known as Pathway To Prosperity of conducting an international Ponzi scheme that defrauded more than 40,000 investors across the globe.

    MMG7 did not explain in his post how he arrived at the conclusion that ASD was denied due process in a court case that has featured more than 175 filings and a hearing called at ASD’s request to free seized money.

    ASD’s request was denied in November 2008 because it did not demonstrate at the hearing it requested to prove its legitimacy that it was operating lawfully and was not a Ponzi scheme, according to court records.

    ASD President Andy Bowdoin later met with federal prosecutors over a period of at least four days. Bowdoin, according to court filings, signed a proffer letter and acknowledged the government’s material allegations in the case were all true.

    Although Bowdoin initially contested the forfeiture of tens of millions of dollars seized in the case, he submitted to it in January 2009. By the end of February 2009, however, Bowdoin reentered the case, acting as his own attorney and seeking to reassert his claims to the money. Months of legal wrangling followed, and Bowdoin was forced to hire new attorneys. A federal judge ruled last fall that Bowdoin would not be permitted to reenter the case, and an order of forfeiture was signed in January 2010.

    Nor did MMG7 explain how he had arrived at his conclusion that the government “ruined the lives of 100,000+ people in the blink of an eye without so much as having to provide an explanation for their actions.”

    Court records plainly show that that the government explained in considerable detail to at least two federal judges why it sought the authority to seize tens of millions of dollars contained in the personal bank accounts of Bowdoin, who was accused of swindling investors in an Alabama securities caper in the 1990s. Moroever, the government has said all along that it intended to establish a restitution pool from the assets seized in the case.

    The implementation of both the pool and the restitution/remission process were delayed by appeals filed by Bowdoin.

    Bowdoin was sentenced to prison in the Alabama case, but avoided jail time by agreeing to make restitution, according to records.

    Clarence Busby, his business partner in the AdSurfDaily/Golden Panda Ad Builder venture, also swindled investors in a separate securities scheme in the 1990s, according to the SEC.

    At the same time, MMG7 did not explain how he arrived at his conclusion that the government “shut down” ASD. Records show that ASD was permitted to continue to display advertising after the seizure, but that Bowdoin chose not to do so.

    Prosecutors say that, despite ASD’s claims to a federal judge that it had no money to operate, the company had $1 million in an account under a “different name” on the island nation of Antigua.

    Records show that Bowdoin did not reveal the existence of the Antigua money to members until after ASD had asked the court for emergency cash to pay its rent and webhosting bill.

    U.S. District Judge Rosemary Collyer, whom Bowdoin and another member later tried to have removed from hearing the case, refused to release funds to ASD.

  • NOTE TO ASD VICTIMS: Rust Consulting Inc. Is The ONLY Authorized Claims Administrator; Don’t Be Confused By Claims Another Company Can Expedite Refunds

    ASD's Andy Bowdoin.

    In early September, federal prosecutors informed U.S. District Judge Rosemary Collyer that an official website had been established to inform victims of the alleged AdSurfDaily Ponzi scheme about the remissions and restitution process.

    The government’s filing, which lists the URL of the website — http://www.adsurfdailyremission.com/ — is a public record. It has been on Collyer’s docket since Sept. 2. It is signed by three federal prosecutors, including Ronald C. Machen Jr., the U.S. Attorney for the District of Columbia.

    What the filing means is that the government has formally notified Collyer that it has done what it said it would do all along: Arrange for ASD victims to receive restitution from seized funds through a formal process known as remission.

    The remissions website is operated by Rust Consulting Inc., which is under contract with the government to handle the remissions and restitution process.

    The PP Blog has seen reports and received inquiries from readers about a company known as Anshell Financial Services LLC (AFS). Among other things, AFS claims to be able to “expedite” the process of recovery. It also claims it has “established an efficient business relationship” with Rust, the official claims administrator.

    Not so fast, says Rust.

    “Rust Consulting, Inc. is an independent claims administrator that has been retained by the U.S. Secret Service to assist in processing Remission Forms,” Rust said. “Neither the U.S. Secret Service nor Rust Consulting, Inc. are in any way affiliated with or endorse AnShell Financial Services.”

    AFS published a document on its website that says it will charge a recovery fee to assist ASD, Golden Panda and LaFuenteDinero members. The document was called a “retainer agreement.”

    “The fee for these services is a retainer of the lesser of 10% of your investment or $1,000 against 10% of the recovered investment,” AFS said. The company also noted in an email to victims that it may be “intimidating and unpleasant” to work with the government.

    There is no need to pay any company to recover money seized by the Secret Service in the ASD case. Contrary to claims made by some ASD members, the government has said all along that it intends to form a restitution pool from the seized assets. It has hired Rust to administer the process and the pool.

    As things stand today, the pool is not fully funded because of appeals filed by ASD President Andy Bowdoin. The government is 3-0 in the forfeiture litigation so far, and 1-0 in the appeals process — with a Bowdoin appeal remaining to be decided.

    Among the bizarre claims circulated by some ASD members is that prosecutors placed approximately $80 million seized in the case in interest-bearing accounts that generated $1 billion or more in revenue.

    Some ASD members claimed prosecutors were partying with the money and had stolen at least some of it. Others claimed Collyer was conspiring with another federal judge to deny ASD members justice.

    Even as some ASD members were making one bizarre claim after another, others added to strange nature of the case by claiming there were no “witnesses” and no “evidence” against ASD in the case.

    These claims were made despite the fact Collyer conducted an evidentiary hearing in open court over a two-day period in the fall of 2008. ASD members attended the hearing and even testified. Evidence was tested and witnesses examined by both the government and the ASD side.

    Some of the evidence against ASD has been in the public record since Aug. 5, 2008. Regardless, dozens of members continued to insist there was no evidence against the company.

    In November 2008, Collyer ruled that ASD had not demonstrated it was a lawful business and not a Ponzi scheme.

    Bowdoin later signed a proffer letter and acknowledged the government’s material allegations all were true. He met with prosecutors over a period of at least four days, and gave information against his interest because he believed that cooperation possibly could help him avoid a prison sentence, according to Bowdoin’s own court filings.

    In January 2009, Bowdoin submitted to the forfeiture. In March 2009, he said through a letter released on the now-defunct Surf’s Up forum that he changed his mind after consulting with a “group” of members. Bowdoin tried to renew his claims to the money, but the effort failed after a months-long court battle.

    Bowdoin next tried to have Collyer removed from the case, another effort that failed. He has blamed lawyers from both sides of the case for his legal predicament, and claimed his continuing fight was inspired by a former Miss America.