EDITORIAL: AdSurfDaily Refund Procedure Takes Weapon Away From Serial Ponzi Autosurf Promoters
The government has established a refund procedure for the AdSurfDaily, LaFuenteDinero and GoldenPandaAdBuilder Ponzi case that requires victims to file petitions for remission or mitigation.
Petitions must be filed in writing and under oath. The government will provide instructions. Patience is required because the case has not been litigated to conclusion.
“Under Section 9.8(a)(1) and (2) of Title 28 of the Code of Federal Regulations, in a petition for remission or mitigation of forfeiture a non-owner victim must demonstrate that it suffered a pecuniary loss of a specific amount directly caused by the criminal offense(s) underlying the forfeiture, or a related offense, and that the loss is the direct result of the criminal acts,” the government said.
We see this as a valid, useful approach, something that places a critical check on the wink-nod nature of autosurfs. Serial promoters now know — beyond a shadow of a doubt — that the government views autosurfs as criminal enterprises. If you played the game, you have to take proactive steps to get your money back, and you have to certify you were a crime victim.
It might be hard to certify yourself a crime victim if you’re still playing the autosurf game and your name pops up the next time an autosurf gets busted. It will be harder yet to persuade people that government “evil” led to your demise after you’d been warned repeatedly not to play the game.
Most members will view the refund procedure as a minor hurdle. After all, they relied on assertions Andy Bowdoin made that the program was legal. They were shocked at the seizure and appalled beyond measure as details about the depth of ASD’s deception came to light.
But this will be a bitter pill for some ASD members to swallow, perhaps particularly serial promoters, promoters who race from program to program and actively, even aggressively promote autosurf Ponzi schemes.
They were “shocked” by ASD developments only in the same sense Captain Renault was “shocked” at the gambling “going on” inside Rick’s Café Américain in “Casablanca,” which is to say they weren’t shocked at all. Like Renault, they pocketed their winnings and looked forward to pocketing some more in wink-nod fashion.
What the government is doing, plainly, is signaling autosurf participants that they’re not going to be able to claim victimhood in one autosurf while collecting profits and insisting all is legal and completely above-board in another.
What’s been most appalling about the ASD case is the insistence by some people that autosurfs are a harmless game. Even as autosurfs were folding and failing during the holidays, taking members’ money and leaving them with even deeper feelings of uncertainty and insecurity during lean economic times, they continued to promote these miserable businesses.
One board we visited a few days ago included a thread in which people were inquiring how to get ASD refunds while the same people were actively promoting other autosurfs. It is impossible to reconcile these conflicting messages, which must be both instructive and maddening from a prosecutor’s point of view.
Prudence, Professionalism, Sound Judgment
The reason there is money to distribute — and the government warns it won’t be 100 percent — is because dedicated public servants exercised prudence, professionalism and sound judgment in seizing the cash before ASD could plunder all of it or abscond with all of it and cite “rebates aren’t guaranteed” as its “out.”
It will take some time to get a refund. The government has to liquidate assets, and there is the issue of a second forfeiture complaint filed last month against other assets tied to the firm.
Although ASD has surrendered claims to assets seized in August, the forfeiture complaint filed last month was filed as a separate action. Included were real estate, automobiles, water craft and other items seized from favored participants, including Bowdoin family members. How that case will proceed is unclear. People from whom the property was seized can file claims and challenge the seizure, just as ASD did the first time around.
In any event — and if the government prevails in the second case — the cars and water craft are all “used” items now and won’t fetch anything that approaches 100 cents on the dollar, especially at auction prices. And who will want to buy the old Masonic Hall in Quincy for $800,000 like Bowdoin did? Because Florida has one of the highest foreclosure rates in the United States and is experiencing falling property values, none of the real estate is apt to be sold at anything that approaches a break-even price.
Also gone is the money ASD spent on legal fees.
Employees, Quincy Get The Shaft Because Bowdoin Misled Them
Quincy, Fla., is a proud community that is struggling. The riches of old largely are gone, which is why ASD gained acceptance in the community quickly. People were thrilled to hear an important new business was in town — a business that demonstrated that the power of the Internet could be harnessed even in small communities.
But Bowdoin fleeced Quincy, just as he had fleeced ASD members.
ASD always was unsustainable. The business model was unsustainable. Paying “rebates” was only one thing that made it unsustainable. ASD also had to pay employees. Whether they received checks or “ad packs” as compensation, the company could not pay them without putting an even greater strain on the Ponzi. “Ad packs” were the worst remedy of all because they created even greater deficits.
This doesn’t even take payroll taxes and other taxes into account. And it doesn’t take the light bill and equipment costs into account or the cost of compliance. One of the biggest reasons autosurfs are moving offshore is because they know they can’t get around the issue of selling unregistered securities by calling them “advertisements.” There is no sense spending money on compliance only to be told that the only way you can comply is to stop offering “rebates” and simply sell advertising for a fee. The riches evaporate when an autosurf company comes into compliance.
Rebates are what draws the crowd. It’s like giving away free food and drinks. Absent huge piles of disposable start-up capital or spectacular amounts of revenue from sources beyond “advertising” fees, however, an enterprise such as ASD can’t sustain itself. The best it can do is create the illusion of sustainability. The reason start-up capital has to be disposable in the ASD business model is because every dollar that floats into the firm creates a liability of $1.25.
No legitimate venture-capital firm would fund such a company. The model is unsustainable on its face. Due diligence by the venture capitalists would be reduced to its bare essence: If $1 in means $1.25 out, then this is a Ponzi scheme. It is no more complicated than that, which is why autosurfs rely on smoke and mirrors.
Refund Procedure
Here, verbatim, is a notice the Department of Justice posted yesterday:
U.S. Department of Justice
Jeffrey A. Taylor
United States Attorney
District of Columbia
Judiciary Center
555 Fourth St., N.W.
Washington, D.C. 20530
January 23, 2009 Update
Ad Surf Daily, La Fuente Dinero & Golden Panda Ad Builder
In two related civil forfeiture cases now pending in the United States District Court for the District of Columbia, the Department of Justice (though the United States Attorney’s Office) has alleged that funds and assets it seized from several Internet-based businesses, “Ad Surf Daily,†“La Fuente Dinero†and “Golden Panda Ad Builder,†constituted proceeds of one or more federal criminal offenses. Specifically, the government alleged that each of these three so-called autosurf businesses, which had promised income opportunities to paying members, were actually “Ponzi†schemes that violated the federal wire fraud and securities fraud statutes. Under federal law, all proceeds of such criminal offenses are forfeitable to the United States.
On January 13, 2009, in the first civil forfeiture lawsuit against over $53 million and other real and personal property, claimants AdSurfDaily, Inc., Thomas A. Bowdoin, Jr., and Bowdoin/Harris Enterprises, Inc. filed a “Motion for Leave to Withdraw Claims Release of
Claims to Seized Property and Consent to Forfeiture.†In that motion, these individuals and entities asked to have all previous challenges they had made to the government’s effort to forfeit the property named in that lawsuit withdrawn. On January 22, 2009, the Court granted that motion and deemed the claims withdrawn. Earlier, on September 22, 2008, the individuals and entities that had challenged the government’s lawsuit against funds seized from the Golden Panda Ad Builder operation also moved to withdraw their challenges to the government’s lawsuit.
The government intends to pursue each forfeiture case to its completion, and to perfect the forfeiture of all fraud proceeds as quickly as possible. Although the recent withdrawals of the prior challenges to the first forfeiture case should expedite resolution of that lawsuit, the forfeiture process is not yet completed. Moreover, even upon their forfeiture, disposition of noncash assets will take some time because such assets must be liquidated before any funds derived from those assets can be made available as victim compensation.
Individuals who sent money to Ad Surf Daily (or AdCashGenerator), La Fuente Dinero or Golden Panda Ad Builder, and who suffered a pecuniary loss, may choose to file petitions for remission or mitigation of the forfeiture with the Department of Justice. Under Section 9.8(a)(1) and (2) of Title 28 of the Code of Federal Regulations, in a petition for remission or mitigation of forfeiture a non-owner victim must demonstrate that it suffered a pecuniary loss of a specific amount directly caused by the criminal offense(s) underlying the forfeiture, or a related offense, and that the loss is the direct result of the criminal acts.
The Department of Justice will work with the records it receives to build a database of former members of these auto-surf “Ponzi†schemes. The Department will endeavor to contact members with information about how they may properly file petitions for remission or mitigation with the Department (in writing and under oath). The Department may employ individuals or entities to assist it in identifying potential petitioners, to assist them in filing petitions, and to expedite resolution of each petition it receives. Because some existing records may be incomplete or out of date, potential petitioners may want to provide to the Department their current contact information directly, preferably by completing the information submission form located at www.usdoj.gov/usao/dc/Victim_Witness_Assistance/adsurfdaily.html or by emailing information to the Department at usadc.adsurfdaily@usdoj.gov (Prospective petitioners who already provided such information, by submitting the form, email or letter, need not do so again.)
Prospective petitioners’ contact information should include, at minimum, full names, member numbers, total funds paid to Ad Surf Daily, La Fuente Dinero or Golden Panda Ad Builder, and methods of payment. Mailed correspondence should be directed to the Asset Forfeiture Unit of the United States Attorney’s Office for the District of Columbia, and sent to the address listed at the top of this memo.
The United States will not have access to funds before the forfeitures are concluded, and forfeiture orders issue from the Court.
I posted as much months ago that there would be no receiver, and that the only refunds would be through a fund set up by the DOJ for all members with no advantage for the members of the different groups banding together to pay legal fess etc…
I’ll talk to my various vassals, miscellaneous minions, friends of friends and people who know people and make damn sure that in order to get your ASD refund, you’re gonna be asked if you’ve joined any new surf sites that have popped up since then.
I’ve looked up the statute to check a few theories I have, and I’m more convinced that ever that a lot of people aren’t going to be getting their expected refund…
(a) Qualification to file. A victim, as defined in §9.2(v), of an offense that was the underlying basis for the criminal, civil, or administrative forfeiture of specific property, or a victim of a related offense, may be granted remission of the forfeiture of that property, if in addition to complying with the other applicable provisions of §9.8, the victim satisfactorily demonstrates that:
(1) A pecuniary loss of a specific amount has been directly caused by the criminal offense, or related offense, that was the underlying basis for the forfeiture, and that the loss is supported by documentary evidence including invoices and receipts;
(2) The pecuniary loss is the direct result of the illegal acts and is not the result of otherwise lawful acts that were committed in the course of a criminal offense;
(3) The victim did not knowingly contribute to, participate in, benefit from, or act in a willfully blind manner towards the commission of the offense, or related offense, that was the underlying basis of the forfeiture;
Section 3 gives a pretty wide out for the Government to exclude at the very least anyone who had any previous exposure to autosurfs or HYIPs.
Hi Gregg,
I remember reading your post that the government is seeking the level of pain it is going to take to put these Ponzi promoters out of business.
It seems very much that you were/are right about this.
One of the problems has been how to deal with wink-nod. Well, this is one way: Barriers to refunds on the grounds that participation is a criminal act and a certification that individual participants didn’t know the operation was criminal.
Not knowing the surf was a criminal enterprise will be believable one time. People will get only one drink from the well — and only if the story passes a plausibility test.
I do believe the government intends to distribute money to legitimate victims.
But I also believe it won’t tolerate or accommodate criminal, serial promoters, many of whom have very little of their own money tied up in autosurfs because they know it can be gone with the stroke of a judge’s pen or a decision by the operator to cut and run.
Perhaps one day a game plan for the serial promoters will come into full view — perhaps a sting covered by CNN and Fox News and MSNBC and other big media outlets.
These things are sucking wealth out of the economy and, in some instances, pitting members of church congregations and families and friends against one another.
Thanks for your comments.
Patrick
I’ll be seriously disappointed if they just blanket refund everyone and honestly I hope they’ll go after the ones that made big dollars here for ill gotten gains. I also hope they’re tracking the ASD clone programs, both as a list to screen the refunds and for further criminal actions. Nothing is going to stop these scams until the government refutes the excuses and explanations given, such as “off shore” claims by prosecuting them and the promoters who enable them.
Patrick,
I wouldn’t be a bit surprised to learn that the DOJ, (having all of ASD’s records, including emails and other correspondence subpoenaed by the federal grand jury), has created a “wish list” of ASD promoters they PRAY will file a sworn statement claiming to be victims. Perjury is very serious crime, as Alger Hiss and Bob Haldeman can attest.
Even if an ASD promoters know they left no written paper trail for the DOJ to find, before swear they are “victims” they’re going to have to either know or hope that another insider,hasn’t been given immunity to testify any time the government needs them, and is willing to make sworn statement to the government naming the “victim” as an insider. It might be one person’s word against another, but fighting a perjury charge is expensive, even if you “win.”
Keep writing…..this is getting even more fascinating.
Gregg and Patrick,
I am not so sure that the insiders and promoters will get snared by the refund process. I am guessing that most of them came out ahead. Most of them probably aren’t stupid enough to claim a refund on their unused Ad Pack balance either I’d guess, and most are probably already off to AVG. Certainly at least one moderator fromthe Advocates site has now posted that she was a big winner because she got in early, helped set up, and promote ASD. Maybe your minions would find that “interesting”
Hi Gregg,
Not sure if you noticed, but Ponzi operator Donald Manning, who just pleaded guilty in San Diego, was arrested in Nicaragua. So, the Feds don’t just go after the Manuel Noriegas.
See this post:
https://patrickpretty.com/2009/01/21/donald-manning-president-of-purported-offshore-investment-firm-faces-10-years-in-prison/
One of his partners, Cameron Campbell, was an attorney. Campbell currently is in prison. The company was incorporated in the Caribbean Turks and Caicos Islands.
Patrick
Hi Marci,
It is clear from the December forfeiture complaint that the government has interviewed people who have deep exposure.
The Russian hacker story, for example, was laid out. And prosecutors put time lines on things.
Patrick
Hi Entertained,
The message in the refund procedure, I believe, is something along the lines of, “The autosurf game is illegal. If you’re a repeat player or a serial promoter, you need to recognize that the government may become your opponent, rather than your advocate. If this is your first time, understand that you were a participant in a criminal enterprise whose illegality is well-documented online. We don’t want to see your name the next time we act against an autosurf.”
I think you’re probably right that the big players won’t be ensnared by the refund procedure. But they know the government isn’t messing around.
The refund procedure, which requires a sworn statement, gives them another form of notice that their behavior in recruiting people into autosurfs has the potential to create legal problems for themselves and those they recruit.
Regards,
Patrick
And hopefully gives notice to those who lost heavily after having been recruited by their “uplines” spruiking ASD as a legitimate opportunity.
Notice that legal action against their “uplines” has a far greater chance of success with Bowdoins’ admissions and the release of this document.
Hopefully courts will now be more likely to look favourably on such actions against serial promoters in the future.
I have often wondered just how the Government will handle Rayda and Robt. Fava who both conducted classes three times a week, separately, on HOW TO MAKE THE MOST MONEY THROUGH THE REBATES. These classes were scheduled weekly in the ASD web room. There was NEVER a class on how to promote your advertising..just how to make money through ASD. Both Rayda and Robt.Fava have gone on with no apparent worries to promote other ponzi’s!!
These 2 people were HUGE in promoting ASD via ASD..they answered questions and often assured people how ASD was a legitimate company and expounded on Andy’s background.
One has to wonder just WHY they are not worried..
I suspect they are worried, if they’re not, they’re whistling past the graveyard.
I’m with Gregg!! They should be very, very nervous. There is no blueprint out there telling them what to expect in the way of criminal charges. If the DOJ doesn’t pursue the criminal case against Andy they’re going to send a terrible message to this “business” community. If they do pursue it, the AUSA is going to figure out who knows what and how much he needs the testimony of each insider and promoters, then grant some immunity and prosecute others. The Andy’s of a con can’t bring in l00’s of millions on their own — they NEED the field promoters and their proven ability to sell the idea of making money without working for it, to really make it work. The SEC is a “shut up down” kind of prosecution — the DOJ seems to be going for a much more permanent “cure.”
But maybe they’ll just stick to civil forfeiture of funds, daring the promoters to win a case that Andy with his millions decided not to fight. They’ve clearly got some really good witnesses, banking and other records (emails are often a gold mine) the rallies, and the direct payments to some of these people along the lines of put in $l0,000 and a week later take out $l00,000. These don’t seem to be rebates, but payoffs for selling the palpably untrue to a new group of believers, to keep the money rolling end.
Take this guy, for example, whose website still contains the information shown below about ASD. You can’t accuse him of not being honest about ASD, can you? Check out where he talks about with ASD you don’t have to peddle worthless “excuse products” required by most home business programs.
“Franco Gonzalez is a professional online marketer, and industry coach. This company is making a total cross over into the business opportunity niche and has struck a clear chord with the marketplace. They pay easier than most other “business opportunitiesâ€, they are simpler in their operations, simple to run, and the normal average person can get paid here without the inherent hassles of having to peddle worthless ebooks, lotions, potions, and all the other “excuse products†that most info marketers, and home business program marketers have to deal with.
All these other marketers that compete with ASD are really threatened. Their ’systems’ basically take a bunch of work, carry a bunch of sales baggage, don’t convert nearly as well or fast and definitely don’t pay like ASD… having no real competitive edge… all they can do is go to slandering, scare tactics and other negative hype to try to steer people away from ASD”
http://www.theasdcashgeneratorreview.com/blog/
That is quite some article there – very revealing about the motivation of the professional marketers in joining ASD – and it doesnt seem to have been for the advertising!
Found an old email from way back winter 2007/08 talking about the ideas of Tari Steward to get ASD into the real mainstream of the network marketing opps – which led to the “millionaires club” and the airline promotions and the rally fever – and the removal of the 12,000$ cap on the amount of ad packs that could be held which is when the trouble really started.
which is when the trouble really started.
The REAL trouble started when Bowdoin accepted the first cent into ASD.
By definition, a ponzi fraud is technically bankrupt from the second it incurs its’ first debt, which is the second it accepts its’ first payment.
LRM РTouch̩! Cant fault that arguement. lol I think it would have been better to say that that is when things started to get out of hand for ASD. mea culpa
[…] it intended to liquidate real estate and other assets seized from ASD. Members seeking refunds will be required to file petitions and certify under oath that they were crime […]
Perhaps they *should* be nervous, but unfortunately they probably are not. One of the most persistent ponzi-pimps, TeamAaronShara, who promoted ASD have since moved on to something else are are still promoting some snake-oil rubbish. Didn’t even pause for breath.
[…] Bowdoin submitted to the forfeiture in January, meaning the case nearly was litigated to conclusion. His forfeiture decision put the government in position to begin an orderly process to implement a restitution program for participants who certified they were crime victims. The first step, according to the government, was to liquidate ASD’s assets. The government advised victims that patience would be required because it would take time to liquidate real estate and other seized assets and to carry out other administrative functions. (See story.) […]
My case is simple………….I gave them $12,000 and am paying INTEREST that I could use for serious needs!!
I never STARTED the program!!
Why is it taking so long for MY MONEY to be returned??
You may want to ask Andy why he keeps delaying the return of your money, or ask Guenther why his friends were far more important than you and others that he saw they got money back.
My case is simple………….I gave them $12,000 ………Why is it taking so long for MY MONEY to be returned??
And regretably the answer is simple too. Your money,k or what is left of itt, along with all other monies paid to ASD Inc ended up in personal bank accounts in the name of Andy Bowdoin. The money in traceable accounts in the US were seized by the US gov in August 2008 and have now been forfeited as being the proceeds of an illegal operation.
The US Gov have no obligation to return one cent to anyone but have, in fact, committed themselves to do so on a proportional basis. It wont be 100% because there isnt that much money left. There is a link on the right of this blog to the government site for victims of Mr. Bowdoin and friends
The delays in any restitution process are primarily due to the delaying tactics of said Mr. Bowdoin, as he tries to keep his sorry ass out of jail.