Better Business Bureau Warns: Cash-Gifting Epidemic Online; Organization Says 22,974 Gifting Videos Posted On YouTube
In the days after the government’s August seizure of tens of millions in the AdSurfDaily probe amid Ponzi allegations, opportunists stepped in to fill the void by offering cash-gifting schemes.
Today, months later, opportunists trading on Ponzi pain are using the names of autosurfs and autosurf-related keywords to drive traffic to cash-gifting websites.
The Better Business Bureau (BBB) says gifting programs and gifting clubs are flourishing on the Internet, taking advantage of families struggling to make ends meet in the poor economy.
BBB has issued a warning “that cash gifting is not a legitimate way to make a few extra dollars, and in fact, is nothing more than a pyramid scheme.”
How widespread is the problem? BBB reports there are 22,974 cash-gifting videos on YouTube. The videos have garnered an “astounding 59,192,963 views,” BBB adds, citing statistics from TubeMogul, an online video analytics company.
Cash-gifting purveyors are “targeting people with some form of an affinity — such as women’s clubs, community groups, church congregations, social clubs and special interest groups, BBB says.
“Bernie Madoff isn’t the only guy with a Ponzi scheme,” says Steve Cox, a BBB spokesman. “Money-making opportunities promising big returns for little work are all over the Internet and are extremely enticing to millions of people struggling with today’s economy.
Run like there’s no tomorrow, warns Cox.
“Anyone tempted by slick cash gifting marketing appeals should run in the opposite direction, or they run the risk of being the next person ripped off by a pyramid scheme,†he says.
BBB said cash-gifting promotions typically are vague, adding that a video performer “might even open a FedEx envelope with cash inside to prove the effectiveness of the program.”
Scammers often tout the programs as fundraisers for a worthy cause or as “empowerment” programs to help people help themselves. Prospects may be asked to pay anywhere from $150 to $5,000 to join.
Money then is funneled to people farther up the pyramid, and participants then recruit more people to join in order to start making money themselves.
Beware of assertions the programs are legal and sanctioned by the IRS, BBB cautions.
“Almost every state has laws prohibiting pyramid schemes and/or assesses penalties on those who participate, and the Federal Trade Commission and many state attorneys general have issued warnings about cash-gifting clubs, BBB says.
Here are some questions consumers should ask, according to BBB:
- Do I have to make an “investment†or give money to obtain the right to recruit others into the program?
- When I recruit another person into the program, will I receive what the law calls “consideration†(that usually means money) as a result?
- Will the person I recruit have to make an “investment†or give money to obtain the right to recruit and receive “consideration†for getting other people to join?
If the answers are “yes,†BBB warns people to steer clear of the scheme.
“Don’t give in to tempting claims online and never buckle under to high-pressure sales pitches, even when they come from the mouth of a trusted friend, co-worker, neighbor or church member,” BBB advises.
Quick note: I did a quick calculation based on the BBB’s claim that 22,974 cash-gifting videos are posted on YouTube.
If the videos average five minutes in length, 114,870 minutes of video on cash gifting are available for consumption.
That’s nearly 80 days’ worth.
Patrick
This site was down for a bit. I thought Patrick had “done a runner” but I guess not.
Cash gifting even has its’ own Federal Trade Commission warning page:
The Gifting Club “Gotcha”
When is a gift not a gift? When it’s a “gotcha.”
http://www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt056.shtm
I thought Bob G had shut Patrick down like he did another forum thread when I couldn’t access the site. Then I realized who I was talking about.
Speaking of him, what’s happened? He hasn’t stuck his foot in his mouth , bragged about his prowess or issued any threats for at least a week (at least online). What up? Maybe he’s planting the Texas flag on Mars and we’ll see him announcing his new program via a webinar from the red planet.
Patrick –
I think your domain name is expiring in just a few days. You might want to check it out.
patrickpretty.com
– Martin
Hi dirty_bird,
The site had scattered outages yesterday due to a blown gasket of some sort at the host. I was on hold with the host after the first outage, when it came back up. They were getting a lot of calls. The average wait time on hold was said to be 25 minutes. The last time this occurred the company said a router had gone bad.
I didn’t call when the site went down the second and third time yesterday, because it clearly was something on the hosting side. The host’s help desk was offline, which told me the outage was affecting a lot of customers.
Total downtime was on the order of 2+ hours. The issues were resolved at roughly 12:30 A.M. EDT. Generally speaking, I’ve had very reliable service and few issues with downtime.
Thanks for caring. :-)
Patrick
Hi Martin,
The domain renewal will occur on April 12. Thanks for caring. :-)
Patrick
Isn’t it about time that the general public and the authorities in all countries WAKE UP to what is happening on the internet?
It is long past when we should be treating what appears on the internet as something that has mystical powers. It is a universally used communication and information storage tool that is only as good as the people who use it. It is not different or more reliable and trustworthy than any other form of communication, and in many ways is less reliable, as it is so easy to input erroneous data and tamper with information.
It is a wonderful advance that brings us all closer together Рbut its use in all parts of life is now so widespread, that it is time that p̬ople stopped being so naive about its veracity. It is also time that the authorities recognized its importance in our business and private lives and treated it with far higher priority.
Bob is currently taking sensativity training classes as the Richard Simmons Institute, working with Clay Aiken and Sir Elton John to help him assess other viewpoints.
(hey, it could happen)
In reality Boobie Bob is out reading all the posts so that he can give all the miss-information (After he has modified it for his purposes) to his buddy Larry who said that he was not going to have anything more to do with him.
Agreed.
1. The Conficker worm is presently updating, today. I have long wondered when someone would “get it right” when crafting a worm. This is the closest I have seen. It’s fairly impressive.
http://www.cnn.com/2009/TECH/04/09/conficker.activated/index.html
2. Large parts of San Jose and Northern California are without Internet or cell phone services due to deliberate cuts in some fiber optics cabling. AT&T, Verizon and others are affected. It’s quite scary that these providers have a single point of failure.
http://news.cnet.com/8301-1035_3-10216151-94.html
Patrick:
I’m seeing and more sophisticated gifting programs being advertised online.
Some of them are very clever, talking about paying it forward but putting “helping others”, “Charity” and “giving” out in front of the make money message.
It sure would be great if you could use your increasing “ponzi reporting celebrity” to do a few more stories on this burgeoning area of online fraud.
Your work is always appreciated.
Thanks in advance.
ARWR
[…] the BBB has added a video on cash-gifting scams and added to its previous warning about “thousands” of such schemes using YouTube and the Internet to […]