PatrickPretty.com

Month: September 2010

  • Michael Goldberg Pleads Guilty In $100 Million Ponzi Scheme Featuring Bogus ‘Diamond’ Sales And Bogus Ties To JP Morgan Chase Bank; Gov’t Describes Scammer As Financial Predator And Pitchmen As ‘Feeders’

    EDITOR’S NOTE: The story of Michael Goldberg’s long-running Ponzi scheme is one that also includes a form of domain-name fraud. Goldberg, for example, created a website that used the name of JP Morgan Chase. Scammers routinely seek to piggyback off well-known brands to separate people from their money, sometimes using the names of famous firms to cover their tracks or create “legitimacy” out of thin air. Such domain schemes may feature the unauthorized use of a company’s name in a domain registration or violate trademarks in other ways. Fraudsters also may register  a .org domain to plant the seed that a purported business “opportunity” is connected with a charity or register a name that is very close to the name of a well-established company, perhaps by adding words to the company’s name or varying the spelling of a company’s name. If you’ve been following our coverage of Data Network Affiliates, Narc That Car/Crowd Sourcing International and MPB Today, for instance, perhaps you’ve noted that .org websites were used by affiliates to promote the companies — even though none of the multilevel-marketing (MLM) firms is a charity.

    Here, below, the story of a Ponzi scheme that used domain fraud to fleece investors.

    The wantonness of Michael S. Goldberg’s 12-year Ponzi scheme was stunning. He told clients he invested in “diamond contracts” when he did not.

    And Goldberg, 39, of Wethersfield, Conn., also told clients he invested in “distressed assets from JP Morgan Chase Bank,” federal prosecutors said. Goldberg, though, did not invest in distressed Chase assets.

    What he did, prosecutors said, was create a web domain that used the Chase name, supplementing his web of lies by creating documents that used Chase’s name and the URL of the bogus Chase website so investors could not discover the fraud, prosecutors said.

    Not to be outdone, Goldberg also paid “finder’s” fees to attract new business and created bogus domains in the names of other companies, prosecutors said, referring to the compensated pitchmen as “feeders.”

    “When an investor questioned Goldberg about his business relationships, either with Chase or with any other company, he often created false documents and other items to induce investors to believe that his business relationships were legitimate, including inventories and/or manifests, contracts, business checks, bank statements, business cards and company identification cards,” prosecutors said.

    “Goldberg also created domain names in the names of actual companies, including Chase, that would be listed on false documents in case an investor attempted to verify the authenticity of the documents,” prosecutors continued. “In addition, Goldberg opened actual bank accounts in the names of the companies to whom he purported to be selling foreclosed business assets, without the permission of those companies, that could also be used to create the false impression that he had a business relationship with the companies.”

    A top federal prosecutor described the fraud, which duped 350 people into plowing $100 million into nonexistent diamond contracts and nonexistent Chase deals that paid “returns” in Ponzi proceeds, as overwhelming.

    “For 12 years, this defendant lured hundreds of investors with one false promise after another, the end result being financial misery for many of them,” said U.S. Attorney David B. Fein of the District of Connecticut.

    Losses may total more than $30 million, prosecutors said.

    Meanwhile, a veteran FBI agent described Goldberg as a financial predator.

    “Michael Goldberg’s actions have devastated the financial security of hundreds of innocent investors,” said Kimberly K. Mertz,  special agent in charge of the New Haven division. “The FBI, along with our law enforcement and regulatory partners, will continue to police the actions of those preying upon the investing public.”

    Aside from a brief period in 1997, Goldberg hadn’t dabbled in diamonds — and “he did not have any relationship with Chase,” prosecutors said.

    Goldberg, who confessed to the scheme last year, faces up to 60 years in federal prison after his guilty plea to three counts of wire fraud. Sentencing is scheduled for December. The investigation was conducted by elements of President Obama’s Financial Fraud Enforcement Task Force.

  • MLM Wireless Distributor’s Delusion Exposed: Walmart To Release Its Own Cell-Phone Plan: $45/Mo. For Unlimited Talk/Text And 100 MB Of Data — With No Contract Or Credit Check

    UPDATED 9:32 P.M. EDT (U.S.A.) If you’ve been bashing your brains out in an unsuccessful bid to sell cell-phone packages MLM-style — and if you believed Data Network Affiliates (DNA) when it said in April that it was offering an unlimited talk and text package for $10 a month with a free phone — you have one week left to snap out of your delusion that DNA is your ticket to MLM wireless riches.

    You also have a week left to snap out of your delusion that various wireless MLM companies are going to sue each other into magical prosperity and raid customers/prospects and distributors from other wireless MLM firms — and use the customers/prospects and distributors to amass giants pots of wealth that are going to create a new wave of MLM millionaires.

    On Sept. 20, Walmart is introducing Walmart Family Mobile, its first self-branded wireless plan. The service will operate on the T-Mobile network and is billed as providing a “family of three savings of up to $1,200 per year.”

    The monthly cost is $45 for unlimited talk and text. A line for a second family member is only $25, and 100MB of data per family is included at no extra charge.

    “Activated accounts come with a free preloaded 100MB WebPak — which provides access to the internet — for every line of service,” Walmart said. “The WebPak is shared among all lines on an account and unused data never expires.”

    Walmart said that additional WebPak refill cards can be purchased at its retail stores or website.

    The plan, which is targeted at families that like to talk and text in carefree volume at a set fee and are not heavy users of cell phones to access the Internet, comes with the best of both prepaid and postpaid wireless service.

    “Walmart Family Mobile has phones for the whole family from Samsung, Motorola and Nokia, including phones with the Android Operating System, QWERTY keyboard, touch screens and other features,” Walmart said. “Since there is no annual contract, customers can upgrade anytime by purchasing a new handset with no extra fees or contract commitment.”

    There is no credit check with the plan. Customers do have to purchase a phone, meaning that no free phone will be provided in return for a contract commitment.

    The Associated Press is reporting that a low-end phone is available for $35 and a high-end phone is available for $249.

    Walmart also offers plans known as Common Cents and StraightTalk that appeal to specific groups of customers interested in paying between $20 and $45 a month, depending on their usage patterns and personal tastes.

    Walmart said earlier this year that more than 1 million people had become prepaid StraightTalk customers in the months after the plan was made available in 2009. StraightTalk has two monthly price points — $30 and $45 — depending on a customer’s usage pattern and personal tastes. Common Cents, meanwhile, provides a cell-phone plan that meets many customers usage patterns and personal tastes for $20 a month prepaid.

    Some wireless companies that operate as MLMs have been scrambling to maintain relevance as Walmart and major cell-phone carriers have concentrated on creating plans that reduce costs and fit the needs of customers across the purchasing and usage spectrum. There has been considerable unease and infighting in the MLM wireless sphere as distributors battle for the business of a limited universe of people interested in purchasing plans from commission-based MLM salespeople when a simple trip to Walmart or a cell-phone store can give them what they need at an attractive price.

    Did you really believe that DNA could provide unlimited talk and text for $10 a month with a free phone?

    And when DNA later unannounced its $10 unlimited plan with a free phone — while at once acknowledging it had no experience in the cell-phone business and hadn’t studied pricing plans before announcing “GAME OVER” and declaring itself the world’s low-price leader — did you really believe that anything it said could be taken seriously moving forward?

    Some affiliate pitches still are claiming DNA offers unlimited talk and text for $10 a month with a free phone. It is unclear if DNA, which also purports to collect data that can help the government and the AMBER ALERT program rescue abducted children, has any cell-phone plan or any relationship with any carrier or provider.

    DNA, which has an “F” rating from the Better Business Bureau, also has told churches that it was their “MORAL OBLIGATION” to pitch a purported, commission-based mortgage-reduction program targeted at people who are facing foreclosure.

    The company described the purported mortgage-reduction program as a “Church Fundraisers (sic) DREAM Come True.”

  • UPDATE: Ponzi ‘Shakedown’ Suspects Who Impersonated Federal Agents Get 6 Months’ Home Detention And Are Placed On Probation For 2 Years

    Three people charged with conspiring to impersonate federal agents in a bid to rattle the nerves of a Ponzi scheme suspect and recover money have been sentenced to 180 days of home confinement and placed on federal probation for two years.

    A fourth defendant in the shakedown scheme avoided a sentence of home confinement but was placed on federal probation for two years.

    The bizarre shakedown scheme unfolded in March 2009, when Michael David Sanders, 43, of Fair Oaks, Calif.;  Craig Anderson, 41, of Chicago; Sean Smartt, 42, of Sacramento; and Cassandra Moore, 27, of Beverly Hills, Calif.,  entered a California hedge-fund office suite in a bid to recover investor money “lost in a Ponzi scheme carried out by federal defendant Anthony Vassallo,” the FBI said.

    “The defendants entered dressed to give the impression of authority (bullet proof vests, ear pieces, fake credentials, hand cuffs, and badges),” the FBI said.  “Sanders and Anderson announced they were with the FBI and the United States Security and Exchange Commission.

    “In their guilty pleas the defendants admitted to creating an environment that was intimidating and causing the individuals to believe that they were not free to leave,” the FBI continued. “Anderson told the hedge fund operators that they had until noon on Monday, March 9, 2009, to wire $378,300.16 to a Patelco Credit Union bank account in the name of the ‘Spirit Foundation’ and to send an e-mail confirmation to an e-mail address they provided. No money was ever turned over to the defendants.”

    Moore was the only defendant who avoided home detention.

    The shakedown bid was connected to the the alleged Equity Investment Management and Training Inc. (EIMT) Ponzi scheme that gathered more than $40 million.

    It is illegal to impersonate a federal agent. Had the defendants not accepted a plea deal and not qualified for probation, they could have been sentenced to federal prison. Each pleaded guilty and accepted the deal. The IRS assisted in the probe.

  • EDITORIAL: Animated Attack On Obama Goes Missing From MPB Today Affiliate’s Sales Arsenal; PP Blog Declines Request From Affiliate’s MLM Sponsor To Remove Story That Describes Bizarre Sales Pitch Painting President As Nazi

    Regular readers of the PP Blog know that it supports the efforts of President Obama’s Financial Fraud Enforcement Task Force to weed out the purveyors of schemes who brought the U.S. and much of the world economy to its knees. Obama is a Democrat.

    What readers may not know is that the Blog is written by a Republican who celebrates America’s entrepreneurial spirit, its market economy, its job-creators, its Great Defenders of Freedom, its Great Guardians of Liberty.

    The PP Blog concerns itself with matters of interest to readers who embrace online commerce and see the Internet as an outlet that is pivotal to future economic expansion. How wonderful would it be, say, if Americans and the other peoples of the world who are living in poverty could harness their entrepreneurial spirits and the power of the Internet to engage in legitimate commerce and elevate the standard of living worldwide?

    And how wonderful would it be if companies and individuals who already are benefiting from financial success could use the Internet to create a legitimate turbine that generates sustainable jobs that pay a pride-producing wage and freelance sales and vendor positions that create bright financial futures?

    Although the PP Blog focuses on business and generally avoids politics, today it makes an exception: When the President of the United States — regardless of party — is attacked to drive business to an online multilevel-marketing (MLM) firm, it must be noted for posterity that the MLM sphere has reached a new and deeply disturbing low.

    To call the anti-Obama, animated screed by an affiliate of MPB Today “tasteless” would be a gross understatement. It harms MPB Today, which is the subject of a “review” by the U.S. Department of Agriculture amid affiliate claims the company has been endorsed by the government. Various government agencies — regardless of what political party controls the White House and the Congress — have warned repeatedly for years that one of the scammer’s most important tools is the shovel that plants the seed that the government endorses a “program” or “business opportunity.”

    MLM “opportunities” are infamous for planting this cancer-spreading seed. Members of AdSurfDaily, for instance, planted the seed that President George W. Bush had given ASD President Andy Bowdoin an award for a lifetime of business achievement. Bowdoin fanned the pollination of the seed by taking his “award” on the road with him and even posing with it.

    The clear aim of the claim was to make prospects believe that ASD could not possibly be a scam because the President of the United States would not give an important business award to a scammer.

    It turned out that the “award” actually was a memento for making campaign donations to the National Republican Congressional Committee. In effect, Bowdoin had made the donations to the NRCC in return for banquet tickets. Records show that Bowdoin made the donations during a period of time in which federal prosectors say he was operating an international Ponzi scheme that perhaps ensnared more than 100,000 people.

    It is a virtual certainty that Bowdoin, who’d been charged with felonies in Alabama in a previous securities swindle and was given a suspended jail sentence, used Ponzi proceeds to make the donations.

    Harm spreads virally when such bogus seeds are planted and take root on the Internet.

    But getting back to the matter of the MPB Today affiliate’s Obama-bashing sales pitch . . .

    Walmart and Walmart’s Sam’s Club name now have been harmed because the MPB Today affiliate used the name of Sam’s Club in the animated attack, which painted Obama and Secretary of State Hillary Clinton as Nazis — with Obama as a cowering Nazi and Clinton as a drunken one wearing “puke colored” clothes purchased from Big Lots, a discount retailer.

    This occurred while other MPB Today affiliates were claiming that MPB, which dispenses Walmart gift cards to winners in the MPB 2×2 matrix cycler, was under “contract” with Walmart, that MPB members were “partners” with Walmart, that MPB sells food “vouchers” that can be exchanged for Walmart gift cards and that the MLM program was “Govt. certified with Food Stamps!”

    As incredible as it seems, Michelle Obama — the First Lady of the United States — was depicted in the affiliate’s animation as experiencing an embarrassing gas attack in the Oval Office after sampling “beans” at a Sam’s Club store. A dog depicted in the pitch more or less said that the First Lady was stinking up the joint.

    Good grief!

    The pitch also harms the image of U.S. business in general because it sends the message that “anything goes” in American Capitalism as long as it returns a profit, the precise message U.S. companies now under indictment or investigation were sending when they brought the financial sector to its knees.

    Meanwhile, it specifically harms online business. Much of the world already believes the Internet is one giant cesspit, in no small measure because of the business practices of certain MLM programs and affiliates of MLM programs.

    At the same time, it harms the Republican party, which is trying to make gains in the upcoming midterm elections. It would be easy, for example, for the Democrats to seize on the message that the sales pitch for MPB Today is just another example of wretched GOP excess and hatred embedded in code. The most bizarre thing about the pitch is that it seems to presume that it is a perfectly acceptable business practice to alienate MPB members and prospects who might be Democrats and Obama supporters — as well as Republicans who actually respect and admire the President even if they disagree with his policies and do not share his political philosophy.

    Even though the MPB Today affiliate’s precise party or political affiliation is not known, it seems clear that the affiliate sees nothing wrong with mixing business with inflammatory, divisive politics,  and is not enthusiastic about the current Democratic leadership. In this sense, it also harms the Democratic party. Political pranksters and Obama opponents could paint the MPB pitchman as a Democratic saboteur or a Tea Party activist seeking to create dissension in the ranks, something that could inure to the benefit of Republicans.

    Most of all, though, the pitch hurts America. Much of the world looks to America for both financial and moral leadership. What the world got in the context of the promotion for MPB Today is yet-another impossibly ham-handed attempt to sell an MLM product at any price — even at the price of American prestige.

    Segments of the MLM trade already are infamous for their inability to sell products without lying, for resorting to gutter tactics, for using sales pitches to reimagine products as something they are not and for setting the stage for tens of thousands of people to get fleeced in one spectacular scam after another that goes “viral” on the Internet.

    Today the PP Blog received a request from a person who described herself as the sponsor of the MPB Today affiliate who produced the anti-Obama screed to “delete” the Blog’s stories on the reprehensible sales pitch.

    “The animated short video on MPB with Hilary and Obama was created by a member I sponsored into MPB and the film has since been taken down,” the sponsor noted. “The member agrees it may have been in poor taste and chose to delete it. Please do the same.”

    Welcome to the often-bizarre world of MLM — a world in which the affiliate who authored a political attack on the President of the United States to gain payments from a 2×2 cycler matrix pushed on known Ponzi forums such as ASAMonitor  “agrees” only that the pitch “may have been in poor taste” and the dutiful sponsor seeks to make sure the the record gets deleted.

    Although the PP Blog verified that the sales pitch had been deleted from the animation site, the Blog is declining to delete its coverage of the matter. All people engaged in MLM need to see it. If they are interested in being taken seriously, they need to condemn it.

    MPB Today should issue a statement that condemns it.

    In May 2009 — just days after the Obama administration announced a crackdown on international financial fraud — the PP Blog received a request from KINGZ Capital Management to delete a story about the AdViewGlobal (AVG) autosurf’s claim that it had secured KINGZ as an offshore wire facilitator to make it easier for Americans (and other peoples of the world) to send money to an obvious Ponzi scheme that had risen from the ashes of ASD, yet another Ponzi scheme

    The PP Blog declined the request. KINGZ later was banned by the National Futures Association for turning a blind eye to the actions of Trevor Cook, a now-convicted felon who operated an international Ponzi scheme that caused investor losses of at least $158 million. The scheme traded on religion. A federal judge called it “wretched, tawdry and cheap.”

    History will record that AVG made the claim about  its new relationship with KINGZ on the very same day in May 2009 that Obama himself announced the fraud crackdown. By June 25, 2009, AVG suspended autosurf cashouts, taking an unknown sum of money sent in by members with it. It is known that many AVG members also were members of ASD, the subject of a racketeering lawsuit and two federal complaints that sought the forfeiture of more than $80 million. The government won both forfeiture cases. The decisions by U.S. District Judge Rosemary Collyer now are under appeal by Bowdoin.

    It also is known the ASD victims have been targeted in promotions for MPB Today. If that’s not enough, it also is known that at least one MPB Today affiliate’s pitch page includes links to at least 100 “surfing” programs, as well as a link to Data Network Affiliates (DNA).

    DNA, yet another MLM program, purports to collect license-plate data that can aid law enforcement and the AMBER Alert program rescue abducted children. Even as DNA and affiliates are claiming to be interested in helping law enforcement, the company says it is selling a spray product that prevents cameras from snapping photographs of license plates at intersections that use electronic systems to enforce traffic laws.

    As DNA is doing this, it also is telling churches that they have the “MORAL OBLIGATION” to recruit affiliates for a purported mortgage-reduction program targeted at people who are facing foreclosure. Meanwhile, MPB Today also is targeting foreclosure subjects in sales pitches, and some MPB affiliates are using religion in sales pitches to attract MLM members.

    Both MPB Today and DNA are operating in Florida, which has one of the highest concentrations of foreclosures in the United States and is near the top of the list in U.S. bank failures.

    So, no. The PP Blog will not delete its coverage of the MPB Today affiliate’s attack on Obama.

    All of America — all of the world and all of the MLM universe — needs to see that the President of the United States was right in May 2009 when he announced the fraud crackdown and was right in November 2009 when he announced the formation of the Financial Fraud Enforcement Task Force.

    The PP Blog has no doubt — none whatsoever — that corrupt elements within the MLM universe are doing everything in their power to use the Internet to bleed wealth from hard-working Americans and other hard-working peoples of the world, and that the corrupt transfer of wealth is leading to losses of billions of dollars globally. Simply put, these reprehensible — if not downright criminal business practices — are a money grab on a colossal scale.

    Proceeds from fraud schemes are difficult to trace. Money moves at the speed of an electronic impulse. Any number of nefarious enterprises, including narcotics traffickers, organized crime and terrorist groups, could be tapping into the fraud stream. There is no doubt that some of the criminal enterprises are dressed up as legitimate MLMs or employ a direct-sales business model that pays commissions to attract new money.

    Stand strong, Mr. President. Your efforts to turn off this criminally gushing Ponzi and fraud spigot not only are commendable, but also are in the interest of U.S. national security, the safeguarding of which is your highest duty to the American people.

    The photos below are for posterity. We are publishing them even as we wonder if nothing is off limits if it helps an MLM offer convert — and even as we wonder why the MLM trade seems so willing to repeatedly attribute its image problem to only a “few bad apples” while simultaneously calling the industry’s critics “haters.”

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  • MPB Today Affiliate Website That References Food Stamp Program Has Links To At Least 100 ‘Surfing’ Programs — Some Of Which Already Have Gone Belly-Up; ‘Ken Russo’ Defends Program On Ponzi Forum

    A promotional website for the MPB Today multilevel-marketing (MLM) program specifically references the U.S. Food Stamp program administered by the U.S. Department of Agriculture and includes links to at least 100 “paid to surf” programs, including programs that use domains registered offshore and programs that appear already to have failed.

    Separately, an MPB Today affiliate is using a YouTube video to inform prospects that they are better off not buying groceries from a Florida-based company linked to the MLM program. Instead, the affiliate suggested, incoming members should follow the herd and not purchase groceries from Southeastern Delivery in a bid to earn a higher payout later from MPB’s 2×2 cycler matrix.

    “When you join MPB Today, you buy or purchase a $200 food voucher — food voucher,” stressed the affiliate in a video pitch. “That puts you into the business.

    “You can purchase food with that voucher,” he continued. “Or you can wait and do the business and exchange that voucher for a Walmart gift card . . . which I did and everybody else is doing.”

    During the portion of the video in which the affiliate was stressing the importance of following the herd — a snippet of about 60 words — the word “voucher” was used four times. The use of the word — coupled with a published statement by MPB Today that it charges up to 50 percent of the cost of the order to ship groceries and ships only “dry-goods” — gives rise to questions about whether MPB Today actually has a product behind the business “opportunity.”

    “We ship ONLY non-perishable dry-goods only,” MPB Today stresses on its website, using the word “only” twice in a seven-word sentence. Because the firm’s purportedly high shipping costs, dry-goods “only” policy and lack of dollar-stretching generic products, questions have been raised about whether the firm and its affiliates are deliberately steering members to the matrix program and seeking to minimize or eliminate grocery orders from outside its base of operations in Pensacola.

    The video first was referenced by “Ken Russo” on the Ponzi-pushing ASAMonitor forum as a “very concise . . . presentation” that outlines the advantages of the MPB Today program.

    “Ken Russo,” who also pushed the Regenesis 2×2 cycler program that became the subject of a U.S. Secret Service probe last year that featured undercover operatives and the surveillance of a Dumpster into which business records were tossed, opined on the ASAMonitor Ponzi forum that he has “concluded that MPBToday is one of the best and most practical programs I have ever seen in the network marketing industry.”

    In April 2009, while pitching Regenesis on ASAMonitor, “Ken Russo” observed that “ReGenesis is an excellent program which lends itself to a team effort approach which will greatly enhance the Automated Recruiting System that they provide to ensure that each and every member is credited with 2 personal referrals.”

    By August 2009, the Secret Service had applied for and executed search warrants in the Seattle area as part of its probe into Regenesis, according to court documents. The agency informed a federal judge that it had kept certain subjects under surveillance for five weeks and that it had linked the scheme to a securities fraudster who had been released from federal prison in January 2009.

    The agency laid out allegations of an elaborate fraud involving multiple individuals, multiple bank accounts, multiple addresses and multiple company names. Agents said they observed complaint letters directed at the firm being discarded into a Dumpster that was kept under constant surveillance.

    Also found in the Dumpster were copies of checks sent in by customers, other documents that included customers’ names and information to identify them personally, complaint faxes sent by customers and a letter from a law firm complaining about false, misleading and deceptive advertising, according to court filings.

    In the promo that specifically referenced the Food Stamp program, meanwhile, the affiliate claimed that MPB Today sells “prepaid” groceries.

    “This grocer is so legitimate that they are legally authorized to accept payment via EBT,” the affiliate claimed. “EBT is an abbreviation for Electronic Benefits Transfer which is the method now used for distributing the federal Supplemental Nutrition Assistance Program (SNAP). As of Oct. 1, 2008, SNAP is the new name for the federal Food Stamp Program. One word —> LEGITIMATE !”

    The clear implication of the claim is that, because the government approved Southeastern Delivery to accept Food Stamps, the MLM program also passes muster. The word “voucher” also is used on the Food Stamp pitch page, and the page includes links to multiple autosurfing sites and other highly questionable business opportunities.

    One of the programs pitched on the page is Data Network Affiliates (DNA), which purports to collect license-plate data that can aid law enforcement and the AMBER Alert program rescue abducted children. Like MPB Today, some affiliates of DNA used an image of Donald Trump to pitch the purported license-plate data program. Trump’s image appeared for 10 continuous minutes in a pitch for DNA, while a narrator said the company had “incredible” people on speed dial. DNA, which lists an address in Boca Raton, Fla., uses a domain registered behind a proxy in the Cayman Islands and says it can help members avoid traffic tickets by providing them a protective spray that purportedly shields intersection cameras from taking pictures of license plates, has an “F” rating from the Better Business Bureau for not responding to customer complaints.

    DNA once claimed that churches have the “MORAL OBLIGATION” to help it pitch a purported mortgage-reduction program. Florida is plagued by mortgage fraud — and scammers who are targeting foreclosure subjects.

    MPB Today is targeting foreclosure subjects in a video sales pitch. Trump’s image was removed from the MPB Today website Tuesday.

    In a video accessible from the page in which the MPB Today Food Stamp claim is made, another affiliate is shown cashing his check from Southeastern Delivery at an FDIC insured bank. The video captures the voice of the bank teller.

    In this YouTube video, an MPB Today affiliate cashes his check from Southeastern Delivery at an FDIC-insured bank. The page from which the video is accessible shows August prices for Southeastern Delivery, which appears to have no money-stretching generic products. Among the name-brand products listed was Starbucks coffee — $14.28 for 20 ounces of House Blend.

    The affiliate then was videotaped inside a Walmart store making a purchase with a Walmart gift card sent to him by the MLM program. This section of the video captured the face of a Walmart employee.

    Later, the affiliate was taped inside a taco store. In an apparent gag, the affiliate attempted to pay for his purchase with a Walmart gift card. This section of the video showed the faces of at least three taco-store employees. The employees, whose faces now are on YouTube along with the face of the Walmart employee and the voice of the bank employee, appear to be confused about what is happening.

    It is unclear if any of the workers knew they were being videotaped or audiotaped for an affiliate’s commercial for MPB Today.

    MPB removed an image of a Walmart store from its website Tuesday. Walmart has not responded to questions posed by the PP Blog. The U.S. Department of Agriculture (USDA) is conducting a review of claims made about the MPB Today program.

  • MPB Affiliate Says Members Are ‘Partners’ With Walmart And That Program ‘Guaranteed’ Not To Be Scam; Separate Promo Depicts Michelle Obama As Experiencing Oval Office Gas Attack After Sampling ‘Beans’ At Sam’s Club

    This promo for MPB Today claims affiliates become "partners" with Walmart and that business owners are "Granted FREE Groceries" for referring business to the MLM program. The promo appeared last night on a site that is heavily advertising the program — even after Walmart's name had gone missing from the landing page on MPB Today's website.

    UPDATED 10:42 A.M. EDT (U.S.A.) Using the soundtrack from the legendary rock band Heart’s 1985 hit single “What about love,” an affiliate of MPB Today is claiming on YouTube that the company’s members become “partners” with Walmart and that MPB’s multilevel-marketing (MLM) program is “Guaranteed” not to be a scam.

    Heart could not be contacted immediately to determine if the MPB affiliate was authorized to use the song, which features the voice of Ann Wilson, in a sales promotion for an MLM program tied to a Florida-based grocery company known as Southeastern Delivery.

    Walmart has not responded to a request last week from the PP Blog that asked the company to comment on legal and regulatory issues surrounding the use of its name in promotions for MPB Today. The Blog specifically asked Walmart if it knew that MPB Today was using the company name in sales pitches and that at least one affiliate had claimed that Walmart gift cards distributed by MPB to its purported customers could be converted to Walmart prepaid Visa cards, which can be used the same as cash.

    The Blog also asked Walmart if it was affiliated with MPB Today and whether it approved of the use of its brand in the MPB Today MLM program.

    On Tuesday, the MPB Today website removed images of a Walmart store and business titans Donald Trump and Warren Buffet. It was unclear if Walmart, Trump and Buffet had forced the removal.

    Even after MPB Today removed the images, an affiliate promo appeared online last night that claimed MPB Today members were “partners” with Walmart. Ads for MPB Today have targeted Food Stamp recipients, senior citizens, Ponzi scheme victims, foreclosure subjects, people of faith and members of the public who are unhappy with the administration of President Barack Obama.

    One animated ad for MPB Today depicted First Lady Michelle Obama as having experienced a gas attack after sampling “beans” at Sam’s Club. Sam’s Club operates under the Walmart flag.

    This animated pitch for MPB Today depicts First Lady Michelle Obama as having an embarrassing gas attack in the Oval Office after sampling "beans" at a Sam's Club. In the promo, Michelle Obama later gets knocked out by a drunken Hillary Clinton, who is portrayed as a Nazi. President Obama gives Clinton a left-handed Nazi salute in the promo.

    The ad, which portrayed President Obama and Secretary of State Hillary Clinton as Nazis, potentially could alienate customers regardless of their political views. Why an affiliate would imply in an ad that MPB Today prefers Obama opponents as customers is unclear. Such a caustic ad potentially could injure multiple brands because MPB affiliates have claimed Walmart is affiliated with the firm and the name of Sam’s Club appears in the anti-Obama promo.

    MPB Today operator Gary Calhoun has a poor record with the Better Business Bureau for his operation of a previous company, United Pro Media. The company’s predecessor firm, Trim International, was ordered by the U.S. Food and Drug Administration to stop violating federal law in its marketing of a product positioned as a treatment for Lou Gehrig’s Disease, cancer and other severe medical conditions.

    The U.S. Department of Agriculture said last week that it was conducting a review into claims made about MPB Today. The agency said yesterday that its review was ongoing.

    MPB Today is being marketed on social-media sites. It also is being marketed on at least three forums that are infamous for promoting Ponzi schemes.

  • Images Of Walmart, Donald Trump, Warren Buffet Removed From MPB Today Website; Testimonials Go Missing, Too; Affiliate Bashes Obama, Hillary Clinton In Promo

    An animated promo for MPB Today portrays President Obama as a weakling who cowers to Secretary of State "Hitlary Clinton," who is depicted as a drunken, sobbing Nazi wearing "puke colored" clothes purchased at Big Lots, a discount store. First Lady Michelle Obama is portrayed as suffering from a gas attack in the Oval Office after sampling beans at a Sam's Club store.

    UPDATED 7:32 P.M. EDT (U.S.A.) Images of a Walmart store and business tycoons Donald Trump and Warren Buffet have gone missing from the landing page of a website operated by MPB Today, a multilevel-marketing (MLM) firm that operates a 2×2 cycler matrix tied to a grocery business known as Southeastern Delivery in Pensacola, Fla.

    The website images appear to have been removed yesterday. It was unclear if Walmart, Trump and Buffet forced the removal. It is common for promos for MLMs to imply endorsements from famous companies and people — even if no such endorsements exist.

    Testimonials from customers purportedly happy with Southeastern’s grocery-delivery business also have been removed.

    Separately, an animated affiliate promo for MPB Today is bashing the Obama administration, painting Secretary of State Hillary Clinton as a Nazi and showing a cowering Obama saying “Heil Hitlary” and giving Clinton — who apparently is drunk on wine — a  left-handed Nazi salute while First Lady Michelle Obama is conked out on the floor of the Oval Office.

    A prompt in the animated video says it was produced by a “Real Mentor, Not Merely a Marketer” for MPB Today. It was not immediately clear if the affiliate was seeking to build an MPB organization that consisted solely of Obama opponents. Also unclear is why the affiliate believed it prudent to bash the President of the United States in his or her bid to woo prospects and recruit affiliates.

    As Michelle Obama is emerging from a comatose state, a thought balloon attributed to her animated image asks, “I feel so woozy, like I got clunked in the head with Hitlary’s whine, what just happened??”

    The 1:40 video is filled with sophomoric and caustic humor — a dog is shown thinking that Clinton is a “Brown Noser” and the animation tries to pull off a gag about Michelle Obama’s need for the product Beano while in the Oval Office, for example.

    An embarrassed Michelle Obama is shown observing that her gas problem was caused by “beans” she sampled at Sam’s Club, a chain of stores under the Walmart flag. President Obama is shown saying he “borrowed” $200 to join MPB Today and “wrote it off” — apparently at the expense of taxpayers.

    “You what??” a horrified Michelle Obama counters. “You borrowed the money to join MPB Today? Who’d loan YOU money??”

    Walmart did not respond to a request for comment last week from the PP Blog about the use of its name in MPB Today promotions. Some MPB affiliates routinely are using Walmart’s name in sales pitches. One affiliate in a separate video claimed that MPB Today had a “contract” with Walmart and that the MLM program was “Govt. certified with Food Stamps!”

    The U.S. Department of Agriculture (USDA) said last week that it was conducting a “review” of claims made about the program. The agency said today that it was continuing to review the situation.

    The animated pitch featuring the Obamas and Clinton asks prospects to visit a website that suggests that “just” a $200 One-Time” purchase with MPB Today can “Totally Eliminate Your Grocery Bill.”

    MPB Today has been targeted at Food Stamp recipients, Ponzi scheme victims, foreclosure subjects and people of faith — and now, apparently, at people who are not enthusiastic about Obama’s presidency, U.S. policy at the Department of State and Hillary Clinton’s clothing choices.

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  • MPB Today Operator Was Subject Of Inquiry By U.S. Food And Drug Administration For ‘Cell Rejuvenator’ Product That Claimed To Treat Lou Gehrig’s Disease, Alzheimer’s, Down Syndrome

    This MPB Today pitch claims a $200, "ONE-TIME" grocery purchase from Southeastern Delivery can "TOTALLY ELIMINATE" future grocery bills.

    Gary Calhoun, the operator of a multilevel-marketing (MLM) program that is targeting Food Stamp recipients, Ponzi scheme victims, foreclosure subjects and people of faith, received a warning letter in 2006 from the U.S. Food and Drug Administration for his marketing of a product that claimed to treat multiple diseases, according to federal records.

    Calhoun, who now operates an MLM program known as MPB Today and a grocery business tied to the program, was ordered by the FDA to stop violating provisions of the Federal Food, Drug, and Cosmetic Act. The grocery business is known as Southeastern Delivery LLC.

    On Friday, the U.S. Department of Agriculture (USDA) said it was opening a “review” of claims made in the MPB Today program and the associated grocery business.

    The FDA’s letter pertained to a Calhoun-operated business known as Trim International and a now-defunct website known as MyTrim.com. Calhoun also operated a business known as United Pro Media LLC, which became a subject of complaints to the Better Business Bureau and was given an “F” rating, the BBB’s lowest rating on a 14-step scale.

    In 2006, according to the FDA, Calhoun was marketing a product known as “TCR Cell Rejuvenator.” The agency said the product was positioned as a treatment for “Neurodegenerative diseases: Alzheimer’s, Parkinson’s, amyotrophic lateral sclerosis, axonal and other neuropathies, Down’s and other syndromes.”

    Amyotrophic lateral sclerosis (ALS) commonly is referred to as Lou Gehrig’s Disease, in recognition of the famed New York Yankees’ first baseman, the subject of the tear-jerking 1942 movie “The Pride of the Yankees,” which starred Gary Cooper. Gehrig died in 1941.

    TCR Cell Rejuvenator also was positioned as a treatment for “recurrent Herpes, common cold and flu,” amid MyTrim claims it could be used “to treat patients with Alzheimer’s, Parkinson’s, cancer and other infectious diseases and neurological disorders,” according to the FDA.

    Meta tags on the site also referenced “prostate cancer,” the FDA said.

    Calhoun was ordered by the FDA to notify it “in writing within 15 working days of receipt of this letter about the steps that you have taken to correct” violations. The company eventually went out of business.

    “[T] he introduction or delivery of a new drug into interstate commerce without an FDA-approved application is a prohibited act,” the FDA advised Calhoun. “No such applications exist for this product.

    “Furthermore, many of the diseases or conditions for which this product is offered are not amenable to self-diagnosis and treatment by individuals who are not medical practitioners,” the FDA said. “Therefore, adequate directions for use for these conditions cannot be written so that a layman can use this drug safely for its intended purposes.”

    The agency said Calhoun had misbranded the product because the “product’s labeling fails to bear adequate directions for its intended uses for those diseases or conditions which are not amenable to self-diagnosis and treatment.”

    MPB affiliates claim a single grocery purchase of $200 through Southeastern Delivery can result in free groceries for life.

    Read the FDA’s warning letter to Calhoun.

  • PHOTO EDITORIAL: The MPBToday Flap: Affiliates Target Food Stamp Recipients, Ponzi Scheme Victims, People Of Faith, Foreclosure Subjects — And Say Government Backs MLM Cycler Matrix Tied To Florida Grocery Business

    EDITOR’S NOTE: UPDATED 3:12 P.M. EDT (U.S.A.) Florida-based MPBToday is one of the programs pitched on Ponzi boards such as ASAMonitor, MoneyMakerGroup and TalkGold. It also is being pitched via email and on social-media sites such as YouTube. All three of the forums are referenced in court filings — including filings in criminal cases — as places from which Ponzi schemes are promoted. Pathway to Prosperity, just one of the schemes promoted on the forums, was alleged in May to have defrauded more than 40,000 people across the globe while gathering more than $70 million.

    MPBToday is a multilevel-marketing company tied to a Pensacola grocery company known as Southeastern Delivery LLC. The U.S. Department of Agriculture (USDA) said Friday that it was conducting a “review” of affiliate claims. Precisely what claims USDA will review is unclear.

    Some affiliates are encouraging recipients of Food Stamps to join the program, which claims a $200, one-time expense can led to free groceries for life. Other affiliates have targeted victims of the alleged AdSurfDaily Ponzi scheme in sales pitches. Still others are using religion to sell the program. The program uses the word “foreclosure” in its sales pitch. Florida has one of the highest foreclosure rates in the United States. More than 9,000 people showed up at the Palm Beach County Convention Center late last month to seek foreclosure relief.

    One potential area of inquiry is whether Food Stamp recipients somehow can use their allotment to qualify for MPB Today’s MLM program. Another potential area of inquiry is whether Food Stamp money somehow is being used to pay MLM commissions. Because MPB Today says Southeastern Delivery assesses a shipping charge of up to 50 percent for the home delivery of groceries — and because affiliates purport that food “vouchers” and food “credits” can be acquired, perhaps in the form of a Walmart gift card MPB Today sends in the mail — another potential area of inquiry is whether Food Stamp money somehow can be converted to pay for items such as electronics and prepaid Visa cards. One MPB Today affiliate said the firm’s high shipping costs were a reason for Southeastern Delivery’s Food Stamp customers to join the MLM program.

    Claims have been made that the MLM program is “certified” by the government, “acknowledged” by the government and that Walmart is affiliated with MPB Today. Walmart has not responded to a request for comment from the PP Blog.

    Here are some photos of promotions for MPB Today from around the web. (Red highlighting added by PP Blog):

    In this YouTube video and text pitch, a claim punctuated with exclamation marks is made that the program is "Govt. certified with Food Stamps!" and that there is a "contract with wal mart!" The word "scam" appears multiple times in the pitch — in an apparent bid to drive traffic to the site from prospects seeking to determine if there is any scam-related information on MPB Today.
    MPB Today positioned on YouTube as a good opportunity for people of faith. The words "Christian" and "scam" are used to drive traffic to the site.
    In a money-waving Blog post, an MPB Today affiliate with a California address shows a check for $300 and a Walmart card.
    In this video for MPB Today on DailyMotion, visitors are encouraged to visit a .org affiliate site for the company, even though MPB Today is not a charity. The video claims members can purchase "electronics," even though MPB Today says it is in the grocery business and affiliates are targeting Food Stamp recipients in sales pitches.
    MPB Today affiliates display check and Walmart card on YouTube after videotaping check-opening ceremony. The program is described as a "NO BRAINER."
    This document on file in Florida shows that Southeastern Delivery LLC, the grocery arm of the MPB Today MLM program, once was known as William Lindsay Properties LLC. The name change occurred in January 2010. Gary Calhoun, the operator of MPB Today, is associated with both firms, according to records.
    On Aug. 25, the PP Blog received an unsolicited sales pitch for MPB Today via an email to the Blog's support address. Among the claims in the pitch, which did not include an unsubscribe link, was that "Walmart is thrilled" with the results of MPB Today. The pitch was targeted at members of AdSurfDaily, a company the PP Blog regularly covers because ASD is implicated by the U.S. Secret Service in an alleged Ponzi scheme involving tens of millions of dollars. A similar pitch was sent to another website that covers AdSurfDaily-related news.
    The names of Walmart and Sam's Club referenced by "Ken Russo" at the ASAMonitor forum, which is notorious for promoting Ponzi schemes.
    In this video, a check and Walmart card are displayed. Unlike other checks written in Southeastern Delivery's name, this check was written in the name of MPB Today Inc. The video, which captured a check-opening ceremony, shows a Walmart "In Store Credit" card
    In this video, an MPB Today affiliate gives a sales pitch while driving an automobile. A check and Walmart card were presented when the vehicle stopped at a highway intersection.The pitch claims a "ONE-TIME" expenditure of $200 can "TOTALLY ELIMINATE" grocery bills.

  • BULLETIN: USDA Conducting ‘Review’ Of Food Stamp Claims Made By MPB Today Affiliates; ‘We Take This Matter Very Seriously,’ Agency Says

    BULLETIN: UPDATED 9:21 P.M. EDT (U.S.A.) The U.S. Department of Agriculture (USDA) has opened a “review” of claims made by affiliates of a Florida-based, multilevel-marketing company, the agency said late this afternoon.

    Members of MPB Today, an MLM program owned by a Pensacola-based grocery seller known as Southeastern Delivery, have targeted recipients of Food Stamps in promotions for the MLM program.

    The agency did not say precisely what claims it would check in its review. MPB Today claims in a video sales pitch that a “one-time” purchase of $200 in groceries from Southeastern can “totally eliminate” future grocery bills.

    “We take this matter very seriously,” a USDA spokeswoman told the PP Blog. “We are reviewing the situation.”

    In general, the spokeswoman said, the agency wants “to make a determination if any regulations are being violated.”

    MPB Today operates a 2×2 cycler matrix that is coupled with the home delivery of groceries. As the PP Blog first reported yesterday, some MPB Today affiliates are advising Food Stamp recipients that the high shipping costs of home-delivered groceries from Southeastern Delivery provide a compelling reason for them to join the MLM program and recruit other members.

    Other MPB Today members have produced check-waving videos, placing them on YouTube to drive business to the firm. One of the YouTube videos claims the MLM program is “Govt. acknowledged.” The video further claims that Walmart is “affiliated” with MPB Today.

    Walmart has not responded to a request for comment from the PP Blog.

    Southeastern’s shipping costs for home-delivered groceries may total 50 percent of an order, according to the MPB Today website.

    A Food Stamp recipient with a $200 order with Southeastern would be spending up to $300 to gain the same $200 of purchasing power offered by a local, walk-in grocery retailer.

    Because of the high shipping costs, the Food Stamp customer should join the MPB Today program to qualify for free shipping and MLM payments for getting others to join, an affiliate suggested in a promotional Blog post titled “Shop Online With Food Stamps.”

    In a Blog post, one MPB Today affiliate claimed that Southeastern Delivery, MPB Today's parent company, had the "sole right" to accept EBT debit transactions for Food Stamps in its market area. (Red highlight added to screen shot by PP Blog.)

    Southeastern is authorized to accept Food Stamps, according to a USDA database. One MPB Today affiliate, however, claimed that Southeastern had “the sole right in their area to accept EBT (equivalent to food stamps/card across the US.).”

    If the claim is true, it would mean that the government was favoring one local Food Stamp-participating retailer over another or creating a condition in which financially strapped consumers from Maine to California would be tempted to send their Food Stamp money to a Florida grocer that suggested a one-time payment could result in MLM riches that would end all food worries.

    EBT is the government’s acronym for “Electronic Benefits Transfer” under the Food Stamp program, which is known as SNAP. SNAP stands for Supplemental Nutrition Assistance Program, and is administered by USDA.

    The affiliate’s claim that Southeastern had the “sole right” in its market area for EBT Food Stamp transactions is dubious. A USDA database shows that at least 25 stores within 2.39 miles of Southeastern’s immediate market area in Pensacola are authorized to accept Food Stamp transactions, including a Walmart that is less than a mile from Southeastern’s business address.

    A federal database shows that at least 25 retailers in Southeastern's immediate market area are authorized to accept Food Stamp transactions.

    There also are two Winn Dixie supermarkets within 1.2 miles of the address, according to the federal database.

    The claim has led to questions about whether MPB Today affiliates were trying to steer nationwide business to Southeastern at the exclusion of authorized Food Stamp retailers that do not charge shipping fees, do not seek to solicit customers for an MLM program and may be more competitive on shelf prices.

  • Prisoner Who Ran Scam From Florida Jail Sentenced To 21 Years In Federal Prison; Willoughby Farr of West Palm Beach Operated ‘Cramming’ Scheme

    Willoughby Farr

    A Florida man who operated a long-distance billing scam from the West Palm Beach County Jail has been sentenced to 262 months in federal prison.

    Willoughby Farr, 46, used three Palm Beach companies to pull off the “cramming” scam in which consumers were billed for calls they did not make, prosecutors said. He also faces a $34.5 million judgment in a successful civil lawsuit filed by the FTC, which referred the case to the Justice Department. The U.S. Postal Inspection Service then conducted a criminal investigation that led to the prosecution of Farr on mail-fraud charges.

    “When the unscrupulous and the dishonest line their pockets with consumers’ hard-earned money, we will hold them accountable,” said Tony West, assistant attorney general for the Civil Division of the U.S. Department of Justice. “As this sentence demonstrates, the Justice Department has put a priority on protecting the public from fraudulent schemes. This case should also remind consumers to carefully review their telephone bills for unauthorized charges.”

    A top postal inspector said consumers need to be aware that fraudsters want their money.

    “Crammers like Farr are eager to post bogus charges to consumers’ accounts,” said Henry Gutierrez, inspector in charge. “The Postal Inspection Service will work tirelessly with its law enforcement partners to deter fraudulent use of the mails and to protect the American consumer.”

    Wifredo A. Ferrer, South Florida’s top federal prosecutor, said postal inspectors did a “superb job” of reverse-engineering the scheme.

    “[This] case demonstrates the effectiveness of cooperative law enforcement efforts, which can put an end to fraudulent schemes, and then bring wrongdoers to justice,” Ferrer said, giving a nod to both postal inspectors and the FTC.