URGENT >> BULLETIN >> MOVING: CONSOB, Italian Securities Regulator, Takes Action Against Alleged Profitable Sunrise Promoter

URGENT >> BULLETIN >> MOVING: The Italian securities regulator CONSOB has filed a suspension order that names an alleged promoter of Profitable Sunrise, amid allegations that Profitable Sunrise is an investment program.

The agency said it observed pitches for ProfitableSunrise on a WordPress Blog under the control of “Daniele Verzari, who presents himself to users of the website as the ‘founder’ of the Vdproject Italy team.”

Verzari, according to CONSOB, now is banned from promoting Profitable Sunrise and programs known as “Vityazi” and “Bestforinvest.” In a separate order, the agency said Bestforinvest operated at the domain bestforinvest.org.

Promos for Bestforinvest were “carried out in the absence of the prescribed authorizations,” CONSOB said.

In the past, CONSOB has acted against promoters of HYIP schemes such as Club Asteria and JSSTripler/JustBeenPaid.

Profitable Sunrise had at least five investment programs, according to Investor Alerts or cease-and-desist orders filed by securities regulators in the United States. One of the purported “plans” was known as the “Long Haul,” which purported to pay interest of 2.7 percent a day. Payouts from the bizarrely named “Long Haul” plan were touted as an “Easter Gift” and were due yesterday.

Profitable Sunrise members are complaining about not getting paid. The “opportunity’s” website has been offline for nearly three weeks.

Both the United Kingdrom and Zew Zealand have issued alerts about Profitable Sunrise. So have at at least 34 state and provincial regulators in the United States and Canada.

Here is the text of the April 2 CONSOB order, as presented in English on the agency’s website:

Under the terms of Art. 101, section 4, lett. b), of the Consolidated Law on Finance, Consob has suspended, for a period of 90 days, the advertising activity relating to offering to the public the investment programmes entitled Vityazi, Profitable Sunrise and Bestforinvest carried out, through the website www.vdprojectitaly.wordpress.com by Daniele Verzari, who presents himself to users of the website as the “founder” of the Vdproject Italy team (Resolution No. 18510 of 27 March 2013).

In relation to the three investment programmes, on the basis of the descriptions provided on the website www.vdprojectitaly.wordpress.com and, in relation to the programmes Profitable Sunrise and Bestforinvest, on the basis of the descriptions on the “official” websites, there seem to be the characteristics of an investment of a financial nature, the notion of which implies the presence together of the three elements: (i) an investment of capital; (ii) an expectation of a return of a financial nature; (iii) the assumption of a risk associated with the investment of capital. Indeed, all three investment programmes require investment of an initial capital of an indeterminate amount, with the exception of the programme entitled Bestforinvest which provides for a minimum and maximum investible capital of between 100 and 9,000 US dollars.

The activity carried out through the website www.vdprojectitaly.wordpress.com leads to the well-grounded suspicion that the advertising activity performed in relation to the public offering of financial products breaches Art. 101, section 2, of the Consolidated Law on Finance which states that “before publication of the prospectus it is forbidden to make any advertising announcement regarding the public offering of financial products other than community financial instruments”, and that the said activity is still being performed. Hence the urgency of the measure, adopted in accordance with Art. 101, section 4, letter b, of the Consolidated Law on Finance.

CONSOB’s issuance of the order is important because it demonstrates that individual promoters can be held accountable for schemes that push unregistered securities even if they are not the operator of a “program.”

Whether Verzari will defend against the CONSOB action and receive any help with potential legal bills from “Roman Novak” and Profitable Sunrise is unclear. “Roman Novak” is the purported operator of Profitable Sunrise.