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Category: The Economy

  • REPRISE: ‘Blue Paint,’ Part 3 Of Fantasy ASD Series

    Today we are republishing Part 3 of our ASD fantasy courtroom series, the continuation of the cross examination of “Mrs. Doe.”

    This scenario is fiction. The dialog is fiction. No government or ASD secrets are being divulged. (We don’t know any government or ASD secrets.) The dialog is based on what already is in the public record or on the Internet about the ASD case. It is designed to make some of the issues more understandable.

    One of the reasons we’re republishing Part 3 is because ASD President Andy Bowdoin filed court documents yesterday, claiming he didn’t know ASD was illegal until the government seized tens of millions of dollars from the firm last summer.

    It was a remarkable claim, considering that ASD members routinely were scolded for calling ASD an “investment” company. Indeed, some ASD members got downright angry in forums when others used the word “investment.” In the August forfeiture complaint, the prosecution cites an instance in which an ASD member instructed an undercover agent never to use the word “investment” because it could catch the attention of the wrong people — namely, law enforcement.

    Indeed, ASD required its own language to operate, something addressed in Part 3 of our fantasy ASD series. At the same time, ads for ASD dating back to 2007 appeared on the Internet, telling prospects that ASD deposits were insured by the FDIC and that the company provided “shelter” from the FTC and the SEC, issues also addressed in Part 3. The SEC, of course, is the agency that regulates the securities markets — and an agency that has successfully prosecuted autosurfs for selling unregistered securities by calling them “advertisements.”

    Simply put, it is the reason ASD members scolded other ASD members for using the word “investment.” They knew what the vulnerability was, but Bowdoin nevertheless is making the claim that he didn’t know what ASD was doing was illegal.

    About two months after Part 3 was published last fall, prosecutors went to court, accusing Andy Bowdoin of having paid an employee to surf for Bowdoin’s son so the younger Bowdoin could earn rebates. People surfing for other people undermines claims that ASD was an “advertising” company, as opposed to an “investment” company, another topic covered in Part 3.

    Fantasy Courtroom Scene 3: ‘Blue Paint’

    Prosecutor: Mrs. Doe, earlier we discussed the principle of ‘Garbage in, garbage out,’ and you told us that, if the data was corrupt, the result could be corrupt. Correct?
    Mrs. Doe: Yes. Correct.
    Prosecutor: And you said that ‘Garbage in, garbage out’ also applies to language: If somebody told a lie — and if that lie was repeated on the Internet — it could lead to a corrupt result. Correct?
    Mrs. Doe: Correct.
    Prosecutor: You live in the United States, right?
    Mrs. Doe: Yes.
    Prosecutor: Would you agree the economy could be better?
    Mrs. Doe: Yes. That’s why I was looking forward to the ASD business. It creates wealth for everybody who participates.
    Prosecutor: Let me stop you there for a moment, Mrs. Doe: You just said ASD creates wealth for ‘everybody,’ right?
    Mrs. Doe: Yes. Correct.
    Prosecutor: You’d be among ‘everybody,’ right?
    Mrs. Doe: Yes.
    Prosecutor: But earlier you said you spent $12,000 on ASD ads and made only $500 through sales of your product. During the previous year, when you weren’t with ASD, you spent $1,000 on local classified ads and with Google, and made $10,000. Didn’t ASD put you in a hole?
    Mrs. Doe: Yes. But I was going to make up the difference and get in profit with the ASD rebates.
    Prosecutor: But ASD didn’t guarantee rebates, Mrs. Doe. So, the prospect of getting a rebate always was in doubt, meaning it was in doubt 100 percent of the time. True? And since the Terms of Service could change at any time, the prospect of getting any return at all from ASD always was in doubt, meaning it was in doubt 100 percent of the time. True?
    Mrs. Doe: Do we really have to go down this road again?
    Prosecutor: I understand you’re frustrated, Mrs. Doe.
    Mrs. Doe: That doesn’t even begin to describe it . . .
    Prosecutor: But you still agree with ‘Garbage in, garbage out?’
    Mrs. Doe: Yes.
    Prosecutor: Why?
    Mrs. Doe: Because there is no denying that bad data can lead to a bad result. My 6-year-old knows that.
    Prosecutor: Earlier you said you had three children, two of whom are in college. So, your 6-year-old is your third child?
    Mrs. Doe: Yes. My husband and I are very blessed. Our daughter was born when I was 44, and she is perfect in every way. We were worried because of my age. But she is a beautiful, bright child, like her older brothers. She has provided more joy than I can even describe. Like I said, perfect in every way . . .
    Prosecutor: Life is about the kids, isn’t it, Mrs. Doe?
    Mrs. Doe: It certainly is.
    Prosecutor: Thanks for sharing your story about your daughter. For now, let’s return to the ASD business.
    Mrs. Doe: OK.
    Prosecutor: ASD wasn’t a bank, was it?
    Mrs. Doe: Of course not. Everybody knows that.
    Prosecutor: There’s that word again: ‘everybody’: Are you sure the word ‘everybody’ applies, Mrs. Doe?
    Mrs. Doe: Yes.
    Prosecutor: Mrs. Doe, please turn your attention to the screen for the overhead projector. I’m going to show you part of an ad from an ASD upline in 2007, the uppermost part of the ad, and ask you to read aloud the line that begins with the number 3.

    Claim that ASD deposits were FDIC-insured.

    Mrs. Doe: It says, ‘FDIC insured up to $100,000, using virtual money debit card payment options.’ Oh, my God!
    Prosecutor: Why’d you say, ‘Oh, my God!’ Mrs. Doe?
    Mrs. Doe: Because that ad says ASD purchases were FDIC insured!
    Prosecutor: Can you see, now, why I asked whether ASD was a bank?
    Mrs. Doe: Yes. Plainly.
    Prosecutor: Mrs. Doe, you’re 50. You have experience in business. You have a bank account. What does the FDIC do?
    Mrs. Doe: It insures bank deposits so people don’t lose money if the bank fails.
    Prosecutor: Would you agree that the FDIC has been in the news a lot recently?
    Mrs. Doe: Yes. Because of all the bank failures.
    Prosecutor: Mrs. Doe, you have three children, including the beautiful 6-year-old daughter you described. You have experience in business. You have experience in advertising. You’ve used ASD. You’ve used classified ads and Google. Did the newspaper or Google ever tell you advertising purchases were insured by the FDIC?
    Mrs. Doe: No. I am really angry about this!
    Prosecutor: Why?
    Mrs. Doe: Because it is total garbage.
    Prosecutor: Mrs. Doe, as I mentioned, this ad is from 2007. And you can see “2007” in the ad, correct?
    Mrs. Doe: Yes.
    Prosecutor: ASD deposits are not insured by the FDIC, are they, Mrs. Doe?
    Mrs. Doe: No. Of course not.
    Prosecutor: What does that line of the ad imply to you?
    Mrs. Doe: That ASD deposits are FDIC-insured.
    Prosecutor: So, using the principle of ‘Garbage in, garbage out,’ any proceeds that flowed into ASD as a result of that ad could create a problem, because the proceeds originated from the false premise that ASD deposits were FDIC-insured. Correct?
    Mrs. Doe: Yes.
    Prosecutor: And that ad was from 2007, so it’s more than a year old? We know that because the ad says ‘predicted to go mainstream by 4/1/07.’ Correct?
    Mrs. Doe: Correct.
    Prosecutor: Mrs. Doe, you have experience in business. And you have experience in advertising. As an owner of a small business, you have at least a basic understanding of accounting. Correct?
    Mrs. Doe: Correct.
    Prosecutor: How would a company account for money it received as a result of an ad that said deposits were FDIC-insured, when those deposits weren’t insured by the FDIC?
    Mrs. Doe: Honestly, I don’t have a clue.
    Prosecutor: Would you consider the money tainted in some way?
    Mrs. Doe: Yes.
    Prosecutor: If the company that received such money didn’t know it was receiving money based on a claim that deposits were FDIC-insured, would it change your opinion as a businesswoman that the money was tainted?
    Mrs. Doe: No.
    Prosecutor: Why not?
    Mrs. Doe: The money would be tainted whether or not the company knew it had come from a tainted source. The fact the company didn’t know it was holding tainted money doesn’t change the fact the money was tainted. If blue paint gets mixed with white paint, there’s still blue paint in the mix, even if you don’t know who put it there.
    Prosecutor: So, blue paint is bad?
    Mrs. Doe: It’s not bad if you want blue or a shade of blue. But if you want white paint and blue gets mixed into it, it’s bad.
    Prosecutor: So, one way to look at this is that an ASD promoter created ‘garbage’ and that money that flowed into ASD as a result of that ‘garbage’ was tainted with blue paint?
    Mrs. Doe: Yes.
    Prosecutor: Could ASD trust its numbers if it was in receipt of garbage and money tainted with blue paint?
    Mrs. Doe: No.
    Prosecutor: So, ‘garbage’ and blue paint could have been in the ASD system as early as 2007, based on the claim that deposits were FDIC-insured?
    Mrs. Doe: Yes.
    Prosecutor: What would happen if ASD was in receipt of tainted money, and that tainted money was deposited in a bank?
    Mrs. Doe: The bank would be in possession of tainted money.
    Prosecutor: Mrs. Doe, do you see the line in the ad that begins with the number 1?
    Mrs. Doe: Yes.
    Prosecutor: Please read it aloud.
    Mrs. Doe: It says, ‘The company is free to join indefinitely. Provides shelter from FTC and SEC.’
    Prosecutor: What is the FTC?
    Mrs. Doe: It’s the Federal Trade Commission.
    Prosecutor: Based on your life and business experience, what does the FTC do?
    Mrs. Doe: It makes sure businesses comply with laws — things such as false advertising.
    Prosecutor: Based on your life and business experience, Mrs. Doe, how do you read this section of the ad?
    Mrs. Doe: That ASD provides shelter from the FTC and the SEC, that ASD somehow can hide members from the FTC and the SEC.
    Prosecutor: Why would anybody need ‘shelter’ — to ‘hide,’ as you said — from the FTC and the SEC, Mrs. Doe?
    Mrs. Doe: I don’t know. It’s ridiculous, and I’m really angry about it.
    Prosecutor: Based on your life and business experience, what does the SEC do, Mrs. Doe?
    Mrs. Doe: It’s the agency that regulates the stock exchanges and the securities business.
    Prosecutor: The word ‘SEC’ appears right in the ad. Correct, Mrs. Doe?
    Mrs. Doe: Yes.
    Prosecutor: Does it strike you as odd that an ad for an advertising business would mention the SEC? When you purchased local classifieds and Google Adwords ads, did the newspaper or Google ever mention the SEC, that they provided ‘shelter’ from the SEC?
    Mrs. Doe: No.
    Prosecutor: But this ad is for ASD, a company that calls itself an ‘advertising’ company,’ and the ad says it provides ‘shelter’ from the SEC?
    Mrs. Doe: Yes.
    Prosecutor: Mrs. Doe, I’m going to ask you to silently read every word on the screen of the overhead projector and to remember what you read.
    Mrs. Doe: OK. Thanks. Give me a minute or two.
    Prosecutor: You’re welcome, Mrs. Doe. Please let us know when you’ve finished.
    Mrs. Doe: OK. I’m starting now . . .
    Mrs. Doe: . . . OK. I’ve finished.
    Prosecutor: Mrs. Doe, you’ve read every word on the screen of the overhead projector, correct?
    Mrs. Doe: Yes. Correct.
    Prosecutor: Did you see the phrase ‘advertising company’ or ‘advertisement’ mentioned anywhere?
    Mrs. Doe: No.
    Prosecutor: And yet this is an ad for a company that calls itself an ‘advertising’ company, correct?’
    Mrs. Doe: Correct.
    Prosecutor: Mrs. Doe, you’re 50. You have three children. You have experience in business. You’ve purchased advertising from multiple companies. Let me ask you, based on your experience, what does this ad appear to be selling?
    Mrs. Doe: It appears to be selling an investment, and protection from the Federal Trade Commission and the Securities and Exchange Commission. And it also is claiming that ASD purchases are insured by the FDIC.
    Prosecutor: Mrs. Doe, we have talked about ‘Garbage in, garbage out.’ Does this ad impress you as a case of ‘Garbage in, garbage out?’
    Mrs. Doe: Yes.
    Prosecutor: Why?
    Mrs. Doe: Because people could have put money into ASD, believing they were making a deposit that was insured by the FDIC. And they could have put money in, believing earnings somehow were sheltered from taxation or that they’d be out of regulatory reach by the FTC and the SEC. The word ‘advertising’ wasn’t even mentioned, and this clearly was the top of the page, the first thing people would see.
    Prosecutor: So, just to be clear, this ad, in your view, uses the language of banking and investments, not the language of advertising, and it uses the language of investments and banking in an objectionable way?
    Mrs. Doe: Yes.
    Prosecutor: Mrs. Doe, thank you. We’re going to switch gears for a minute now. Earlier we talked about your 6-year-old daughter, about how much joy she has brought to you and your husband and your two sons. Children, especially young children, like to help their parents. Agree?
    Mrs. Doe: Yes.
    Prosecutor: Did your daughter ever help you with the ASD business?
    Mrs. Doe: Yes.
    Prosecutor: In what way?
    Mrs. Doe: Sometimes she helped click on ads. The screen would count down, and she’d click on a colored box to load the next ad.
    Prosecutor: So, she was helping Mommy, by clicking on ads?
    Mrs. Doe: Yes.
    Prosecutor: How long did it take your 6-year-old to figure out how to click on ASD ads?
    Mrs. Doe: Oh, she figured it out instantly.
    Prosecutor: Were you with her all of the time, watching the same ads she was watching, while she was practicing her clicking?
    Mrs. Doe: I’d say almost always. Sometimes the phone would ring, and my attention would get diverted away from the ads while she was clicking and having fun.
    Prosecutor: So, she was a little girl, helping Mommy do her job.
    Mrs. Doe: Yes. It was harmless fun, and educational for her.
    Prosecutor: Mrs. Doe, you have three children, and you’ve been a mother for about 20 years, correct?
    Mrs. Doe: Yes.
    Prosecutor: Based on your experience as a mother, would you say that most 6-year-olds could master the task of clicking on ASD ads?
    Mrs. Doe: Oh, my, yes.
    Prosecutor: Can your daughter read?
    Mrs. Doe: She’s in the first grade, and already reads at a second-grade level.
    Prosecutor: Could your daughter help Mommy shop in the Classified section of the newspaper?
    Mrs. Doe: Not quite yet.
    Prosecutor: If Mommy had to type a search string into Google that was above a second-grade level, could your daughter help with that?
    Mrs. Doe: No, that’s still a couple of years away.
    Prosecutor: But your daughter could help Mommy with ASD?
    Mrs. Doe: Yes. Clicking on ads is truly easy. It was part of the beauty of ASD.
    Prosecutor: But you wouldn’t want too many 6-year-olds clicking on your ads, right? A 6-year-old isn’t apt to make a purchase, when the products are marketed to business people. Correct?
    Mrs. Doe: Yes.
    Prosecutor: Could ASD tell if a 6-year-old was clicking on ads?
    Mrs. Doe: No.
    Prosecutor: Do you see that as a problem?
    Mrs. Doe: I’d see it as a problem if too many 6-year-olds were clicking on ads. Those ads cost $1 apiece.
    Prosecutor: Could a 5-year-old master clicking on ASD ads?
    Mrs. Doe: Yes, I believe my daughter could have done it when she was 5.
    Prosecutor: Could she have done it when she was 4?
    Mrs. Doe: I’d say probably. Kids get started on computers very early these days. They had computers in preschool.
    Prosecutor: Would you agree that newspapers and Google have a sort of built-in filter that prevents 6-year-olds from helping Mommy?
    Mrs. Doe: I’m not quite sure what you mean.
    Prosecutor: Well, let’s take newspapers. A 6-year-old would have to comprehend an ad, meaning she would have to be able to read the ad and understand what purpose it served, in order to help Mommy? Agreed?
    Mrs. Doe: Yes. Agreed.
    Prosecutor: And with Google, a 6-year-old would have to be able to type a complex search string in order to help Mommy shop, if Mommy, for example, was shopping for anything beyond the vocabulary and knowledge base of a 6-year-old. Agreed?
    Mrs. Doe: Yes.
    Prosecutor: But a 6-year-old could help Mommy shop on ASD, because reading comprehension and a vocabulary weren’t required. What was required was an ability to recognize a color, when it came time to click on the next ad. And that’s something a 6-year-old could do. Correct?
    Mrs. Doe: Correct. But I think you’re picking on 6-year-olds. My daughter loved to help — and it was cute and sweet.
    Prosecutor: You sell decorative autumn baskets. Correct, Mrs. Doe?
    Mrs. Doe: Correct.
    Prosecutor: From a pure business standpoint, with your knowledge of advertising, you wouldn’t want too many 6-year-olds or 5-year-olds or 4-year-olds clicking on your ads. Correct?
    Mrs. Doe: Well, no. I’d want potential buyers to click on my ads.
    Prosecutor: So, you agree that a 6-year-old clicking on ads is not a potential buyer, right?
    Mrs. Doe: Right.
    Prosecutor: And you agree that the local newspaper and Google have filters that would prevent a 6-year-old from helping Mommy?
    Mrs. Doe: Yes.
    Prosecutor: And you agree that ASD lacked such a filter?
    Mrs. Doe: Yes.
    Prosecutor: Mrs. Doe, a minute ago you suggested I was picking on 6-year-olds. Let’s talk about another group. Let’s talk about college kids, kids such as your two sons.
    Mrs. Doe: OK.
    Prosecutor: Would you agree that college kids can read the newspaper Classified section with full comprehension and could type complex search strings into Google with full comprehension?
    Mrs. Doe: Yes.
    Prosecutor: And so, beyond any doubt, they’d be able to read the ads on ASD with full comprehension.
    Mrs. Doe: Yes.
    Prosecutor: So, in that sense — and I’m being serious here — unlike a 6-year-old, they could contribute something to Mom beyond the recognition of colors, if Mom needed help with ASD?
    Mrs. Doe: Yes.
    Prosecutor: Did your college-age children ever help you with ASD?
    Mrs. Doe: Yes.
    Prosecutor: How?
    Mrs. Doe: Well, they surfed for me if my computer was down or we were away for a few days.
    Prosecutor: So, just to be clear, you didn’t always do your own surfing to earn rebates. Sometimes the boys surfed for you. Correct?
    Mrs. Doe: Correct.
    Prosecutor: Did you ever surf for the boys?
    Mrs. Doe: Yes.
    Prosecutor: So, just to be clear, ASD members could surf for other ASD members: sons for Moms, Moms for sons, upline sponsors for downline members, downline members for upline sponsors.
    Mrs. Doe: Yes.
    Prosecutor: So, ASD couldn’t prevent people surfing for other people?
    Mrs. Doe: No.
    Prosecutor: Did the boys help you with ASD in other ways?
    Mrs. Doe: Well, as I said earlier, they didn’t have their own businesses. Because of that, they advertised the URL for my basket business on ASD.
    Prosecutor: Did ASD ever verify that your kids had businesses of their own or try to stop them from advertising your basket business?
    Mrs. Doe: No.
    Prosecutor: Earlier, you said you spent $12,000 advertising your basket business on ASD. Correct?
    Mrs. Doe: Yes.
    Prosecutor: How much did your children spend to advertise your basket business?
    Mrs. Doe: They each spent $5,000.
    Prosecutor: So, a total of $10,000? Right?
    Mrs. Doe: Right.
    Prosecutor: So, if we add your $12,000 to their $10,000, we arrive at $22,000. Correct?
    Mrs. Doe: Correct.
    Prosecutor: And that would have bought 22,000 clicks for your basket business, correct?
    Mrs. Doe: Yes.
    Prosecutor: Mrs. Doe, earlier you said your basket business generated $500 in sales after your $12,000 ad expenditure. But the real number is $500 in sales after a $22,000 ad expenditure, because your boys spent $5,000 apiece to advertise your business. Correct?
    Mrs. Doe: Earlier, you only asked about my expenditure. You didn’t ask about theirs.
    Prosecutor: Respectfully, Mrs. Doe, I’m asking about it now. The real number is $500 in sales from a $22,000 ad expense, correct?
    Mrs. Doe: Yes. I feel silly when you put it that way.
    Prosecutor: But is that not the way it is, Mrs. Doe? Isn’t that the math?
    Mrs. Doe: Yes. That’s the math.
    Prosecutor: Mrs. Doe, earlier you said your business grossed $10,000 the year before ASD, based on an ad spend in classifieds and on Google of only $1,000. Correct? And you acknowledged that you spent $12,000 on ASD this year, an amount that exceeded the gross sales of your business the previous year by $2,000. In other words, you spent more on advertising this year than your business even took in last year. Correct?
    Mrs. Doe: It’s not as bad as that sounds.
    Prosecutor: Is it not true it’s actually worse than that sounds, Mrs. Doe? Your boys spent $10,000 advertising your business, which brings your total ad expenditure to $22,000, for a business that grossed only $10,000 the previous year. You outspent your gross sales by better than two to one. Is that not correct?
    Mrs. Doe: Yes. That’s correct. But you’re forgetting about the rebates. We would have gotten all of that back and more.
    Prosecutor: But the rebates weren’t guaranteed, Mrs. Doe. The Terms could change at any time, and advertising purchases were nonrefundable. Didn’t you and your boys have $22,000 at risk? Didn’t you make a bet that ASD would continue to pay rebates? And if you were compounding your earnings by taking out 20 percent in cash and — as you said — ‘reinvesting’ 80 percent, weren’t all of your paper profits at risk? Weren’t you betting that ASD would pay a very handsome dividend?
    Mrs. Doe: Well, yes.
    Prosecutor: And isn’t that what Wall Street investors do? Isn’t Wall Street about taking calculated risks with money? Some people bet that stock prices will go up, and others bet they will go down? Don’t some people buy stocks because they have a history of paying dividends?
    Mrs. Doe: Yes.
    Prosecutor: Mrs. Doe, earlier you said that you could get in trouble for calling ASD an investment company. Do you remember saying that?
    Mrs. Doe: Yes.
    Prosecutor: Who told you that?
    Mrs. Doe: The forum people. I used the word ‘investment’ in one of my posts, and they scolded me.
    Prosecutor: They scolded you for calling ASD an investment? Didn’t you and your sons have $22,000 at risk? And wasn’t that money at risk because ASD didn’t guarantee rebates and could change the Terms of Service at any time?
    Mrs. Doe: Yes.
    Prosecutor: So, your capital was at risk, just like on Wall Street, and forum members scolded you for calling it an investment?
    Mrs. Doe: Yes.
    Prosecutor: What’s one thing you had in common with the forum members?
    Mrs. Doe: Well, we all belonged to ASD, for one thing.
    Prosecutor: Was there anything else?
    Mrs. Doe: We all spent money on advertising and looked forward to earning rebates.
    Prosecutor: So, all of you were members of a common enterprise — in other words, ASD. And all of you had money at risk because rebates weren’t guaranteed, and all of you had the expectation of earning money due to the ongoing success of ASD?
    Mrs. Doe: Yes.
    Prosecutor: Does that sound like an ‘investment’ to you, Mrs. Doe?
    Mrs. Doe: Well, yes. I never understood the forum paranoia about calling it an investment.
    Prosecutor: Ever hear the phrase a ‘skunk by any other name,’ Mrs. Doe?
    Mrs. Doe: Yes.
    Prosecutor: Please explain to us what you believe the phrase to mean.
    Mrs. Doe: Well, a skunk by any other name would still be a skunk.
    Prosecutor: So, if you called a ‘skunk’ a ‘rose,’ it would still be a skunk?
    Mrs. Doe: Yes.
    Prosecutor: And if people decided to call an investment company an advertising company, it still would be an investment company?
    Mrs. Doe: Yes.
    Prosecutor: Mrs. Doe, forgive me. I can’t help but notice you are smiling, and that’s the first time I’ve seen you smile since I began to ask you questions. Why are you smiling, if you don’t mind me asking?
    Mrs. Doe: Because they told me on the forum that you were stupid. And I can tell, now, that you aren’t stupid.
    Prosecutor: How can you tell I’m not stupid?
    Mrs. Doe: Because you got me to reveal my secret.
    Prosecutor: What secret?
    Mrs. Doe: That I believed it was an investment all along, and was afraid to say it.
    Prosecutor: Why are you no longer afraid to say it?
    Mrs. Doe: Because I’m 50, married, the mother of three, own a business, own a bank account, have purchased ads in multiple places, and understand a few things about accounting, such as ‘Garbage in, garbage out.’ And there’s one more reason.
    Prosecutor: What would that be, Mrs. Doe?
    Mrs. Doe: Blue paint.
    Prosecutor: Earlier you said you were angry about the content of the ad. Why?
    Mrs. Doe: Because of all the blue paint. The claim that ASD deposits were insured by the FDIC is blue paint, in my mind. So is the claim about ASD providing shelter from the FTC and the SEC. So is the preoccupation with scolding people who call the money they spent with ASD an investment and all the talk about ASD being a ‘no-brainer’ and ‘fool-proof’ and the importance of having a ‘diverse portfolio.’
    Prosecutor: Blue paint isn’t good if you want white paint, is it, Mrs. Doe?
    Mrs. Doe: No.
    Prosecutor: Thank you for your time, Mrs. Doe.

  • Ramping Up The AdSurfDaily Insanity

    UPDATED 11:41 A.M. EDT (March 12, U.S.A.) AdSurfDaily President Andy Bowdoin, acting as his own attorney, acknowledged in court filings yesterday that the company had been operating illegally when the government seized tens of millions of dollars last summer.

    The concession was nuclear. It undermines the work of his previous paid attorneys and puts Bowdoin in the position of having to explain previous representations given the court that are completely at odds with what he is saying now.

    At the same time, it undermines self-filed pleadings Bowdoin entered into the record last week. Meanwhile, it undermines pleadings by others, including four people who told the court that they were permitted to enter into commercial contracts with whomever they pleased and for whatever commercial interest they pleased.

    Bowdoin now has told the court that he was operating an illegal commercial enterprise, thus nuking the argument of Curtis Richmond and three others. Richmond, himself a pro se litigant, is linked to a sham Utah “Indian tribe” known for filing vexatious pleadings that make tortured legal constructions.

    “Professor” Patrick Moriarty, an ASD mainstay, has advanced commercial theories similar to Richmond’s. Moriarty got nuked yesterday, too, only a few days after congratulating Bowdoin in a column for his excellent, pro-se pleadings.

    Andy Bowdoin’s pleadings, though, are jeopardizing the freedom of members of his family, ASD insiders and top promoters, and strategic shills.

    Yesterday, the Pro-ASD Surf’s Up forum celebrated the filings. The forum Mods appear not to have connected the dots that Bowdoin just nuked them. Some of the Mods and members set up a site to promote AdViewGlobal (AVG), which has close ties to ASD. Bowdoin nuked AVG yesterday, too.

    Today Surf’s Up has banned at least one member for not carrying Bowdoin’s water bucket. The forum even has banned members who post unflattering opinions about Bowdoin or ASD on other forums.

    The Mods can tell you until they’re blue in the face that Bowdoin’s filings were something to celebrate; the announcement, as always, came with exclamation points, both in the thread and in an email Surf’s Up members received.

    But this was nothing to celebrate if you’re a top promoter, an insider or a strategic shill. And it certainly was nothing to celebrate  if you’re a rank-and-file member of ASD: Bowdoin just told you he ripped you off. His excuse was that the government didn’t give him fair notice that he was ripping you off.

    Surf’s Up, which previously postioned Bowdoin as a genius, now is telling you his genius didn’t extend to the recognition of a Ponzi scheme and money-laundering operation. A Mod explained that Andy didn’t know he was ripping people off because the government never told him until after it seized the cash.

    ASD advertised CEP Trust.
    ASD advertised CEP Trust.

    It is a steaming pile. ASD once advertised that it used CEP Trust, the failed payment processor run by the operators of the CEP Ponzi scheme. This Blog published a screen shot of ASD’s CEP pitch months ago, along with a screen shot of an ad that told the audience that ASD deposits were insured by the FDIC.

    Bowdoin’s claims do not pass the giggle test — not that anybody is laughing at this point. There simply is no delight in unmasking these lies.

    Claim that ASD deposits were FDIC-insured.
    Claim that ASD deposits were FDIC-insured.

    This Blog has refrained from calling Surf’s Up the “Loony Bin” as it is known elsewhere, and it has refrained from using the phrase “Kool-Aid drinkers,” except in cases such as quotations. We have used the word “crackpot” to describe “Surf’s Up.” It was the least-objectionable word we could think of to instill a sense of the madness taking place at Surf’s Up.

    Despite everything that happened to ASD last summer, the insiders at AVG implemented a new surf and started collecting money. The operation has ASD’s fingerprints all over it, and the inescapable conclusion is that Bowdoin’s pleadings in the ASD case are setting the stage for the planned defense of AVG.

    The operative word in the previous sentence is “planned.” Bowdoin and insiders got caught again. Now they are desperately trying to wiggle out of a prosecution against AVG by making the no “fair-notice” claim. It is utterly preposterous, and yet the Surf’s Up Mods serve it up daily.

    AVG, by the way, is still online — despite Bowdoin’s concession to a federal judge and the prosecution that ASD was operating illegally.

    They have taken no hints — including the RICO lawsuit filed by other ASD members in which Bowdoin, ASD Attorney Robert Garner and Golden Panda Ad Builder President Clarence Busby were accused of racketeering. None of the principal defendants has filed a single piece of paperwork in the case — not after two months.

    We believe it likely there are sealed criminal indictments in the ASD case. At the same time, we believe it probable that some ASD/AVG insiders know they are targets of a criminal probe.

    And we believe it equally likely that Bowdoin and the insiders have shielded members from this knowledge, while using Surf’s Up to whip up support. If the Mods have insider’s knowledge they are at risk of indictment. Even a whiff of it is enough.

    No AVG participant also in ASD, for example, will be able to claim they did not know the possible consequences of their actions as they pertained to AVG. And with George Harris, Bowdoin’s stepson; Gary Talbert, a former ASD executive; and Chuck Osmin, a former ASD employee who testified for ASD at the evidentiary hearing in the AVG lineup, there will be no credible way to claim ignorance. Nate Boyd, listed as the “Protector” of the AVG association, formerly was the head of compliance for ASD, members said.

    Do not be surprised if you see the no “fair notice” argument ported over to AVG.

  • BREAKING NEWS: Bowdoin Files Motion To Dismiss In Which He Acknowledges AdSurfDaily Was Illegal

    UPDATED 10:06 A.M. EDT (March 12, U.S.A.) Did Andy Bowdoin just sink AdSurfDaily’s ship — and also the ship of AdViewGlobal?

    In a court filing today, Bowdoin, the president of ASD, made a stunning acknowledgment that the company was operating illegally.

    Bowdoin’s acknowledgment came in the purported form of a motion to dismiss the forfeiture complaint against proceeds tied to the firm, which prosecutors said engaged in wire fraud, money-laundering, selling unregistered securities and operating a $100 million Ponzi scheme.

    “The defendant did not know or realize that his conduct was illegal until this instant case was filed against him,” Bowdoin said, referring to himself as “defendant.”

    Bowdoin contends in the pleading that the case is “quasi-criminal” and that he was denied due process and fair notice that his conduct was illegal.

    Bowdoin, however, is not a defendant in the forfeiture case. His self-filed pleading references the forfeiture case on its title page, but appears to be a response to a case that never was brought.

    For days, the Pro-ASD Surf’s Up forum has been applauding legal filings Bowdoin made last week and encouraging others to do the same.

    But today’s filing could cause Bowdoin’s remaining support to evaporate because of his concession that ASD was operating illegally. Bowdoin had spent months insisting ASD was legal and collected tens of millions of dollars from members last year, all the while advertising ASD as completely legal and above-board.

    Bowdoin now is acting as his own attorney. AdViewGlobal (AVG), an autosurf with close ties to ASD, recently formed a private association and turned to a firm known as Pro Advocate Group  for advice.

    Karl Dahlstrom is associated with Pro Advocate Group.  In 1997, Dahlstrom was sentenced to 78 months in federal prison for his role in a securities scheme.

    Today’s filing by Bowdoin is potentially devastating both for ASD and AVG because of the concession that ASD was operating illegally. Prosecutors could claim the document has the effect of a signed confession.

    Bowdoin’s stepson is an AVG trustee. So is Gary Talbert, AVG’s chief executive officer and a former ASD executive. Chuck Osmin, a former ASD employee who testified for the firm at a hearing last year, also works for AVG. Nate Boyd, whom ASD members said once was a compliance officer for ASD, is listed as the “Protector” for the AVG association. Some of the Mods and members of Surf’s Up started a forum for AVG.

    Bowdoin’s pleadings today appear to attempt to manufacture a criminal defense out of whole cloth, by rewriting the history of the forfeiture case — a civil proceeding — and turning the case into something it never was: a criminal prosecution against Andy Bowdoin. The only defendants in the case to date are money and property prosecutors claim are the proceeds of a criminal enterprise.

    At the same time, today’s pleadings may be designed so potential ASD co-defendants in any criminal case that evolves will have a legal template for a self-filed defense. There have been reports that bank accounts owned by ASD members beyond Bowdoin have been seized in the past two weeks.

    Meanwhile, the cheerleading for Bowdoin at the Surf’s Up forum appears to be particularly unseemly now because today’s pleadings had everything to do with Andy Bowdoin, and nothing to do with the rank-and-file members who’d been asked to support him. The document does not cite the membership in a single place.

    Read today’s Bowdoin pleadings.

  • EDITORIAL: Arons Retracts Statements On Friedman

    Jack Arons, a Florida man sued for libel and slander last week by Dallas attorney Larry Friedman, announced today that he is retracting statements he made about Friedman on the Internet.

    “As far as Larry Friedman and his Law Firm is concerned I retract all statements made against them,” Arons said. He posted the retraction in online forums covering the AdSurfDaily case.

    “Although I can not change what course of actions that have taken place concerning my statements I will no longer post anything derogatory concerning him or his firm,” Arons said.

    Today we are renewing our call for Friedman to drop his lawsuit against Arons. At the same time, we call on Friedman to exercise judicious restraint and not to bulldoze Arons in any settlement negotiations.

    Meanwhile, we call on Friedman to fire the ASD Members Business Association (ASDMBA) Trust as a client. The de facto head of the Trust is severely damaging Friedman’s law brand. Friedman should fire the Trust and get his shingle out of harm’s way. Let the Trust litigate against Friedman if it so chooses. The Trust has no credibility. Members who funded the Trust say it also has no money and is operating in the red.

    Arons does not have a lawyer. He lives in the type of manufactured home that is common throughout Florida. He is not wealthy. Over the weekend, he worked on self-written, pro se drafts to fight Friedman’s lawsuit, asking for input from nonexpert forum posters.

    On Monday, he was served with papers designed to force him to travel from Tallahassee to Dallas at his expense to sit for a Friedman deposition on Thursday. Arons is at a monumental disadvantage. He has had no time to think and is ripe to be bulldozed.

    Larry Friedman should not bulldoze Jack Arons. To do so would be shameful, and yet a bulldozing is something some of his colleagues actually might applaud because this bulldozing would be a particularly wicked one. The pity-there-was-an-unoccupied-seat-on-the-sunken-lawyer-bus  joke is not a joke about a bus; it is a joke about bulldozers driven by attorneys.

    Friedman claims Arons is a menace because of Internet postings, while his de facto client openly is engaging in menacing behavior, complete with references to stalking and chasing people.

    Jack Arons is not the menace in this case; he was the convenient target because people were complaining to the Texas Bar about matters pertaining to the Trust, and Friedman blames Arons for stirring the pot.

    Friedman brought a Howitzer against a Web critic and sympathetic figure armed with a small peashooter. It was maximum overkill: Friedman sued in Dallas March 5. Arons was served in Florida March 7. On March 9, Arons was notified to appear in Dallas March 12 to provide a deposition to Friedman.

    In between, a person purporting to be “Bob Guenther,” the de facto head of the Trust, appears to have adopted the role of Friedman’s goon. In previous mentions of the purported Guenther, we described him as appearing to act as a bouncer. We’re using “goon” today because the purported Guenther now has referenced Arons’ 6-year-old daughter in a menacing forum post.

    That is the act of a goon, not a bouncer. We believe Friedman is appalled and perhaps even frightened by the behavior of his de facto client. It is our expectation that Friedman will fire his client. Not to do so is to turn a blind eye to the damage his brand is suffering at the hands of his client — something he was unwilling to do when it came to Jack Arons, a mere flea met by a Howitzer that could shoot from Texas to Florida.

  • Purported ‘Guenther’ References Arons’ Young Daughter

    UPDATED 12:44 P.M. EDT (U.S.A.) A person purporting to be “Bob Guenther” referenced the 6-year-old daughter of Jack Arons in a post at the ASD-Biz Forum yesterday. The reference was beyond the pale and easily could become yet another matter sprouting from the AdSurfDaily case for law enforcement to investigate.

    The language from the posting is reproduced verbatim below. We took a screen shot and reduced its size to fit into the border of this column.

    “Rookie,” the poster wrote in a message directed at Arons. “Look around you, the Fat Ladies have been singing all day,, See you in court dude, and how old ios that adopted daughter, Texas Court my friend, welcome to the real world…”

    Here is the screen shot:

    guentheraronssmall

    A poster purporting to be Guenther has a history of making menacing comments, including threats to visit people at their homes.

    In an odd twist yesterday, a self-described, purported “30 something female” began to post under the  “Bob Guenther” account at the ASD-Biz forum. The purported female appeared to champion “Bob Guenther.”

    Like “Bob Guenther,” though, the purported female couldn’t resist including a passive-aggressive rant, saying the female posters at the forum needed to watch their diets, start working out “and find a man…. You obviously don’t get out much and need a lot more than a computer can provide…”

    Owing to what we view as an implicit threat against the family of Jack Arons and others, we have made the decision to publish an IP address we have associated with a poster who identified himself as Bob Guenther in January. The comment to this Blog was submitted and published on Jan. 16.

    Here is the IP address: 72.165.15.198. It resolves to Dana Park Office Center in Tucson, Arizona. Over the weekend, the person at the ASD-Biz forum purporting to be Guenther suggested he was near Mexico and planned to travel there. The geographic location to which the IP resolves is near Mexico.

    Meanwhile, this Blog received an email — as distinguished from a comment left on the Blog — from a person who identified himself as “the ‘infamous’ Bob Guenther” yesterday. Given recent developments and a pattern that suggests Bob Guenther routinely engages in menacing behavior, we have made the decision not to respond to the email.

    ASD-Biz members reacted with anger at the post referencing Arons’ daughter. Dallas attorney Larry Friedman sued Arons last week, asserting libel and slander for comments Arons allegedly had made on the Internet.

    The person purporting to be Guenther in the forum announced the Friedman lawsuit in two threads and provided links to PDFs of the documents.

    Friedman is an attorney for the ASD Members Business Association (ASDMBA) Trust. Bob Guenther is the de facto head of the Trust. Posters at ASD-Biz viewed the lawsuit as an attempt to chill speech. Prior to the lawsuit, some ASDMBA members said they had filed complaints against Friedman with the Texas Bar and Texas Attorney General Greg Abbott.

    The lawsuit against Arons followed. Posters at the ASD-Biz forum say Guenther appears to be trying to spread the chill. Forum posters said they would not be silenced by threats.

    Some posters said they intended to file complaints today.

    After threatening additional lawsuits at the ASD-Biz forum — and after an editorial that ran on this Blog appeared over the weekend — the poster purporting to be Guenther at the ASD-Biz forum then appeared at least briefly to switch courses.

    Instead of threatening lawsuits, the person purporting to be Guenther appeared actually to encourage members to file complaints with authorities.

    In one post, the person purporting to be Guenther provided a link to Abbott’s office, the office of Florida Attorney General Bill McCollum and the Internet Crime Complaint Center. At the same time, in an apparent jibe, the poster also provided a link to PETA, People for the Ethical Treatment of Animals.

    The poster then provided a link to the office of Sen. John Cornyn, and then implied he had inside connections in Abbott’s office.

    “By the way if you want to call Greg Abbott, I have his direct line and that of his assistant, would you like that too,” the purported Guenther wrote.

  • EDITORIAL: Larry Friedman, Drop The Lawsuit

    UPDATED 6:33 P.M. EST (U.S.A.) Dallas attorney Larry Friedman represents the ASD Members Business Association (ASDMBA) Trust. Friedman has sued Florida resident Jack Arons for slander and libel, asserting that Arons — a self-styled truth-seeker whom Friedman describes as a “felon” and a “vigilante” and an Internet “menace” — has told untruths and slimed him online.

    The filing of a lawsuit against Arons strikes us as a severe remedy and a warning to others not to ask too many uncomfortable questions. It’s hard not to see things that way when a person purporting to be Bob Guenther, the de facto head of the Trust, appears to be acting as Friedman’s publicist and bouncer — and using Friedman’s law shingle as a weapon.

    Friedman assesses the harm from Arons’ alleged slime at $50,000. He filed a 12-page lawsuit, but swore only to a single paragraph in the document in a verification on the final page. Regardless, Friedman walked away with a temporary restraining order designed to mute Arons.

    Critics at the ASD-Biz forum say the document reads like a broad bid to chill legitimate  discussion about ASDMBA. Prior to the filing of the lawsuit, some ASDMBA members said they filed complaints against Friedman with the Texas Bar and the office of Texas Attorney General Greg Abbott.  The members want to know how ASDMBA is spending money it collected.

    And they want to know why no ASDMBA litigation has been filed to date, whether ASDMBA even can gain standing in a forfeiture case against the alleged proceeds of a criminal enterprise, and why the Trust says it still owes Friedman money. The kinds of questions ASDMBA members say they want answered certainly are reasonable.

    Friedman’s client is the ASDMBA Trust, not the individual members who provided funding and comprise the association. The original plan was for Friedman to communicate with members through the Trust, which effectively is under the control of Bob Guenther, who identified himself a Friedman client in matters that did not pertain to ASDMBA. Guenther introduced Friedman to the members in a conference call when the Trust was being formed last summer.

    The trouble with Friedman’s claim that the Trust is the proper information gateway, according to members, is that Guenther doesn’t answer questions and has released only a broad accounting of how ASDMBA spends its money. These members say the accounting is far too vague. They also complain about verbal bullying from Guenther, who has cited a longtime friendship with Friedman.

    It’s all well and good that Friedman’s client is the Trust. Friedman, in effect, is saying members should turn to Guenther for answers, and that very well could be proper if Friedman has an attorney-client relationship with the Trust. But when members can’t get the answers they seek from the Trust or become the subject of a passive-aggressive rant or verbal threat from Guenther, where do they turn?

    Some of them say they turned to the Texas Bar and Abbott.  The lawsuit against Arons followed — and was announced by a person who purported to be Guenther in two separate threads at the ASD-Biz forum.

    One of the posts announced the announcement, pointing viewers to a separate thread that contained the actual announcement. The poster purporting to be Guenther was the first person to post links to the lawsuit documents, before any information appeared on the Dallas court site and before Arons was served.

    How the lawsuit information was disseminated creates the appearance that Guenther is working as Friedman’s flack and bouncer. Even at the very moment this post is being written, a person purporting to be Guenther is over at the ASD-Biz forum threatening to extend Friedman’s long arm from Dallas and sue other people. The claim is that no one can say they haven’t been warned about Friedman’s ability to file libel lawsuits.

    The implication is that Guenther himself wants to spread the chill. In a juvenile insult, Arons was referred to as “Rookie.” The message was rookies get sued and eaten for lunch by the professionals, so don’t ask too many questions.

    Still, however, there has been no transparent accounting from the complaining members’ point of view. A lack of transparent accounting certainly isn’t consistent with professionalism — and was one of the reasons ASDMBA members said they turned to the Texas Bar and Abbott to address their concerns.

    Members want to know why ASDMBA, for example, appears to have spent thousands of dollars on what was vaguely described as contract services and Internet expenses. It is possible to purchase web hosting for a site that would accommodate ASDMBA’s needs for $24 a year, not thousands of dollars.

    People know that. They also know that vague accounting sometimes is a signature of abuse.  Their concerns are not silly. They could be addressed in minutes by Bob Guenther and the Trust.

    And yet the concerns aren’t being addressed, according to members. Meanwhile, Jack Arons is being called a “Rookie”  and getting sued, and a poster purporting to be Guenther is announcing the lawsuit with great fanfare and opining that 80% of men are “internet pussies who couldn’t work their way out of a wet paper bag.”

    Yes, really.

    “Jack Arons Sued, Served and Shut Up, Finally…” reads the over-the-top headline, in the thread that announces Friedman’s legal handiwork.

    There were reports this morning that Arons’ Internet connection was taken down as a result of documents faxed to his ISP.

    Friedman’s quickest route to restore a reputation he claims was damaged is not to sue Jack Arons; it is to insist that Guenther and the Trust be straightforward in their dealings with members who contributed money and, if they’re not, to fire the Trust as a client.

    As things stand now, the person purporting to be Guenther appears to be staining Friedman’s reputation by acting as a bouncer against people who might be inclined to file complaints with the Texas Bar and Abbott. What’s more, the temporary restraining order is so broad that it appears to restrain people sympathetic to Arons even from contacting Friedman to let him know what’s going on at the forum.

    Appearances matter. It looks like the person purporting to be Guenther is doing Friedman’s bidding for him and seeking to insulate himself from criticism and legitimate questioning by dangling Friedman’s shingle as a weapon. At a minimum, this situation creates the appearance of impropriety. It looks like thuggery.

    The poster purporting to be Guenther shows virtually no restraint. The ASD case has never been about politics, but Guenther — who seems not to possess a thimble full of PR savvy — routinely cites his conservative credentials in forum threads about ASD or ASDMBA. It’s as though he can’t even conceive that ASD and ASDMBA have Democrats and liberals in their membership ranks and that politics has no place in this particular business discussion.

    ASDMBA members weren’t asked about their political leanings when they joined. They were told that the association was going to litigate in their interests. They didn’t join to be told they weren’t conservative enough or Republican enough to be taken seriously. And they certainly didn’t join to be made the subjects of juvenile ridicule by Guenther and threats that they, too, will get sued if they don’t play the game by rules he defines.

    On the ASDMBA website, Guenther is directing bluster at William Cowden, the federal prosecutor handling the ASD case. Guenther had made a big show of emailing questions to Cowden, who is under no obligation at all to provide Guenther any answers. The ASD case is an active, ongoing investigation. Cowden wouldn’t discuss the government’s prosecutorial plans during an active investigation even if Congress were to subpoena him. He’s certainly not going to jump through Guenther’s hoops.

    Larry Friedman should drop the lawsuit against Jack Arons. At the same time, he should stop Guenther from using his attorney’s shingle as a weapon. Little wonder that attorneys are made the subject of jokes and outright ridicule when this kind of thing is happening in full public view.

    ASDMBA should provide a full, itemized, transparent accounting. Bob Guenther should end any involvement with ASDMBA and rid himself of the notion that people are too stupid or too afraid to hold him accountable.

  • Jacks Arons Purportedly Sued By Larry Friedman

    UPDATED 12:40 P.M. EST (U.S.A.) A person posting as “Bob Guenther” at the ASD-Biz forum reports Jack Arons, a mainstay in the AdSurfDaily case and a driving force behind an effort to get the ASD Members Business Association (ASDMBA) to provide a verifiable accounting of association spending, has been sued by Larry Friedman for slander and libel.

    Arons also was accused of defamation, business disparagement and tortious interference. Arons said he had not yet been served. The case was filed in Texas, Friedman’s home. Arons lives in Florida.

    The claim was made under a headline titled “Jack Arons Sued, Served and Shut Up, Finally . . .” The purported author was Bob Guenther, known for a lack of decorum.

    Some ASDMBA members have been encouraging others to file complaints against Friedman with the Texas Bar for his handling of ASDMBA’s affairs. Others have suggested that complaints should be filed with the office of Texas Attorney General Greg Abbott.

    Friedman is an attorney for ASDMBA, which is not associated with AdSurfDaily Inc. ASDMBA was formed in August in the aftermath of the seizure of tens of millions of dollars from ASD amid allegations of wire fraud, money-laundering, selling unregistered securities and running a $100 million Ponzi scheme.

    Some ASDMBA members have demanded Bob Guenther provide a straightforward accounting of how the association spends its money. Members said they believed Friedman would file a lawsuit to protect their interests, but no lawsuit has been filed to date.

    Guenther has served as a spokesman for ASDMBA, sometimes catching the ire of ASDMBA members for what they describe as his use of menacing or threatening language and refusal to provide a detailed accounting of how ASDMBA spends its money.

    “Anyone involved with his illegal activities or false accusations may suffer the same consequences,” the poster claiming to be Guenther said. Arons was referred to as “Rookie” in a separate post.

    The lawsuit described Arons as a felon and a vigilante and a menace who has damaged Friedman’s reputation.

    Why ASDMBA has not produced the type of accounting that would ease members’ concerns is unclear. Also unclear is why litigation ASDMBA members said they were expecting hasn’t been filed. The dispute has been raging for weeks.

    ASDMBA has been collecting money for months. At least one member who contributed funds went on to file his own motion in the ASD case — a motion not related to ASDMBA, but one that used the Curtis Richmond litigation blueprint. Richmond is associated with a sham Utah “Indian” tribe known for filing vexatious litigation.

    Months after ASDMBA began collecting money — and while it still was collecting money — a prominent Washington, D.C., law firm brought a class-action lawsuit against AdSurfDaily, accusing it of racketeering. Three ASD members were named the original plaintiffs.

    ASDMBA members who’d been wondering since August when the association litigation would be filed once again complained about being left on the sidelines. They cite confusion over how ASDMBA money is being spent and the association’s litigation plan.

    In what some ASDMBA members described as a bid to chill speech and undermine their efforts to have authorities investigate Friedman and ASDMBA, the lawsuit seeks a temporary restraining order. Among other things, the complaint seeks to restrain parties from “filing false complaints with state agencies against F&F [Friedman & Feiger] and encouraging or duping ASDMBA investors to file false complaints to state agencies or other entities.”

    A judge purportedly has granted the restraining order.

    It is illegal to file false complaints, and people can be charged criminally and sued civilly for doing so. It’s hard to imagine any jurisdiction that discourages or bans the filing of truthful complaints.

  • EDITORIAL: Andy Bowdoin, Have You No Shame?

    Andy Bowdoin, have you no shame? Once again your closest followers and insiders are asking rank-and-file members to believe you are acting in their interests. They do this after you turned to the membership in August and asked for letters of support while not sharing details members needed to make informed decisions.

    The membership delivered more than 3,000 letters. And then the lies were exposed, and they looked like fools for having lent their voices to this awful chorus. Andy Bowdoin should be held accountable for that. So should the followers and insiders who are helping him cloud the issues.

    Members should ask Bowdoin why he was running an ad for a failed, dissolved business in his own rotator. And they should ask why Bowdoin was paying an employee to surf for his son. They also should ask why a police report never was filed when Russian hackers purportedly stole $1 million from ASD — and why a police report wasn’t filed when others purportedly stole money from the firm.

    Those questions are just for starters, of course. There are lots of suspicious financial transactions involving family members and insiders.

    Playing The Deflection Game

    Some of those pulling strings are doing it because they have financial exposure; some are doing it because they have criminal exposure, and some are doing it for both reasons. Even so, some are almost catastrophically ignorant of the danger they are in. The information is being disseminated by crackpots and filtered through crackpots. Much of it is self-validating drivel, the stuff from which indictments are made.

    If you’re an AdSurfDaily member, you’ll serve yourself ill if you attach any importance to any of today’s self-filed legal pleadings by Andy Bowdoin or if you listen to anything the closest followers and insiders have to say. You got hoodwinked the first time. Don’t let it happen again.

    Think of his principal cheerleaders and major promoters as potential co-defendants in both civil and criminal prosecutions. Ask yourself if you’re being asked to provide cover for criminals before you invest in any of this, including the writing of letters to politicians.

    Bowdoin does not dispute a single fact in today’s filings. All three documents offer technical challenges to the forfeiture actions. The documents paint Bowdoin the victim of a police state despite the fact he hasn’t been arrested or incarcerated. It is a subdued rant against a perceived police state. Nothing more.

    Any person who tells you that Americans are free to sign contracts and engage in commerce for any purpose that pleases them is a crackpot.  If this were the case, drug dealers and customers could escape prosecution simply by agreeing not to call a crime a crime.

    The documents appear to have been written by someone who wishes the case were a criminal indictment, not a civil forfeiture proceeding. The person may get his wish soon enough. Prosecutors wouldn’t have to use a word Bowdoin said in the presence of any Secret Service agent to bring an indictment or get a conviction.

    Bowdoin also appears to be confused about his own case — something that’s not surprising, considering he once told members that Ponzi charges had been dropped against him in Florida when they had never been brought to begin with.

    In his current pleadings, Bowdoin appears to be claiming he submitted to forfeiture under duress. But he never submitted to the forfeiture of the money and property he points to in today’s pleadings. He has submitted only to the forfeiture of money and property seized in August, not December, and Bowdoin appears to be trying to have the December forfeiture reversed while not mentioning the August forfeiture or providing corresponding dates when specific actions took place. At present, the documents appear to show that Bowdoin isn’t challenging the August seizure of $93.5 million and other property, including two homes.

    Members should ask him about that. They need to know if he is challenging the August seizure. They need to know precisely why he appears only to be challenging the seizure of property linked to his family members and Golden Panda President Clarence Busby.

    So Simple, Anybody Can Be A Lawyer

    Earlier Bowdoin had competent attorneys from a prominent law firm. He also paid $24,000 to retain an expert witness. All of these people went to real law schools and are members of the bar.

    Neither the attorneys nor the expert could score a win for ASD at the Sept. 30-Oct. 1.  evidentiary hearing that ASD itself requested. Bowdoin could have scored his own win by producing documents and audited financial statements that demonstrated ASD was not a Ponzi scheme. He didn’t do it. Not only did he not do it, he didn’t even do what his attorneys asked him to do, namely submit documentation to them to aid in the preparation of his case in the forfeiture matter.

    And now he’s doing what Andy Bowdoin does: playing the victim and creating hope where none exists. He did largely the same thing when he was accused of a huge fraud in Alabama a decade ago.

    You see, the whole, ugly mess in Alabama that resulted in felony charges being filed against Bowdoin was not his fault.

    Bowdoin told the St. Petersburg Times that “he ran into trouble in Alabama because his company, Mobile International, sought to raise $1-million through a stock issue, and someone was improperly paid a commission to sell the stock,” according to the newpaper.

    “That nullified the registrations that our attorney had done with the state of Alabama,” he said.

    Bowdoin did not explain why he pleaded guilty to felonies if he had done nothing wrong and how one couple got hoodwinked out of $450,000. Bowdoin and his cronies bought expensive cars and expensive office trimmings with the money.

    World-class crackpots are pulling Bowdoin’s strings now. Don’t be surprised if he gets indicted soon and takes a haf-dozen or more people down with him. An alleged $100 million Ponzi scheme is still extraordinary, despite its seeming smallness when compared to Bernard Madoff.

    The government should leave no stone unturned in its investigation into Bowdoin’s actions. On Aug. 18, Bowdoin filed an emergency motion that asked the court to free up money so ASD could operate post-seizure.

    Bowdoin did not advise the court from which it sought emergency relief in the Aug. 18 brief that ASD had more than $1 million on deposit in a bank in Antigua. Instead Bowdoin told the court that ASD couldn’t pay its bills.

    “ASD needs emergency relief,” Bowdoin said in Aug. 18 filings. ” . . .  In a matter of a few days, ASD has gone from a vibrant internet advertising business with approximately 100,000 members to a hollow shell without a working office and without the means to resume its business . . .  It has also been unable to pay its bills (to creditors, such as its landlord) and is hurtling down into a steep financial tailspin. To provide one concrete example, on August 14, 2008, ASD’s hosting company threatened to shut down the company’s servers because its bill is unpaid.”

    Only after prosecutors pointed to the Antigua money on Aug. 25 did Bowdoin acknowledge its existence in court briefs. He declared an emergency despite the fact ASD had more than $1 million offshore — in an account under a different name — and he didn’t tell members about the Antigua money until prosecutors raised the issue.

    Why not?

    At first, part of the circus surrounding ASD was mildly amusing, despite the fact a $100 million, international Ponzi scheme is very serious business. But all the air is out of the balloon now, and the government should pursue justice that is equivalent with crimes being committed right in plain sight.

    This is not a comedy; it is a tragedy.

  • BREAKING NEWS: Bowdoin, Acting As Own Attorney, Files Motion To Dismiss AdSurfDaily Forfeiture Case

    Andy Bowdoin.
    Andy Bowdoin.

    UPDATE 4:13 P.M. EST (U.S.A.) Andy Bowdoin, acting as his own attorney, has filed a motion to dismiss the AdSurfDaily forfeiture case.

    At the same time, Bowdoin appears to have filed a motion to reverse his earlier decision to submit to the forfeiture of certain property seized by the government.

    Bowdoin’s filing, however, does not appear to contest the forfeiture of tens of millions of dollars seized by the government in August. It appears to apply to property seized from members of his family in December and from Golden Panda President Clarence Busby.

    It is possible that a document is missing from the case file or has yet to be added. The petition to reverse the forfeiture, as filed, references only property seized in the December forfeiture action.

    Today’s Bowdoin filings are dated and signed Feb. 25, 2009, exactly one day before AdViewGlobal (AVG), an autosurf that defines itself as an offshore company and shares common management with ASD, announced it was going underground by forming a private association.

    Incredibly, AVG makes the claim it is not associated with ASD despite the presence of common management, common promoters and at least one common employee, Chuck Osmin. Osmin testified for ASD at the Sept. 30-Oct. 1 evidentiary hearing. Gary Talbert, a former ASD executive who is now the chief executive officer of AVG, filed a sworn affidavit in the case.

    George Harris, Bowdoin’s stepson, is listed as a trustee for the AVG private association. So is Talbert. Property was seized from Harris in the December forfeiture complaint.

    Harris is the son of Edna Faye Bowdoin, Andy Bowdoin’s wife.

    Andy Bowdoin said his decision to submit to the forfeiture was made under “severe duress” and was a “grave mistake and error.” He accused the government of “fraud, trickery and deceit.”

    Meanwhile, Bowdoin has filed a motion to suppress evidence, saying he was illegally interrogated by the U.S. Secret Service. Bowdoin claimed agents did not advise him of his Miranda rights — the right to remain silent.

    In his motion to dismiss, Bowdoin said the court was obligated to dismiss because it lacked jurisdiction. Bowdoin said the case should be viewed as a quasi-criminal matter, not a civil case.

    “There was no probable cause even to file a complaint in this instant case,” Bowdoin asserted.

    Why Bowdoin filed the documents as his own attorney isn’t clear. But the documents have the hallmarks of documents filed by inexpert litigants belonging to underground legal “associations” that purport to help nonlawyers navigate tricky waters.

    AdSurfDaily and AdViewGlobal recently have been linked to such underground associations. One of them is Pro Advocate Group, which says it can help nonlawyers and nondoctors establish private “associations” that enable members to practice law and medicine without a license.

    Bowdoin’s pleadings, in general, are much more respectful than documents other litigants acting as their own attorneys recently have filed in the case.

    Unlike Curtis Richmond and others who used the Richmond litigation blueprint, Bowdoin, for instance, does not accuse the judge and prosecutors of crimes and demand a specific result in a compressed time frame at the peril of prosecution.

    But he did accuse the government of trickery, saying the Secret Service “did not follow the supreme law of the land” in its treatment of him.

    “One cannot break the law in an attempt to ‘uphold the law,’” Bowdoin said.

    Moderators of the Pro-ASD Surf’s Up forum have hinted for days that something special was coming in the case. If this is it, “special” means that Bowdoin now is acting as his own attorney and citing English Common Law as one of his resources.

    How much Bowdoin spent on the lawyers previously handing his case is unknown. His earlier decision to surrender to the forfeiture, however, imperiled ASD promoters who made money. It would be hard for them to claim they were entitled to keep proceeds of what prosecutors said was a $100 million Ponzi scheme when Bowdoin himself surrendered claims.

    Prosecutors, however, always have had the option of litigating against Bowdoin’s promoters no matter what Bowdoin did.

    ASD members have reported in recent days that the Secret Service has seized the bank accounts of some individual ASD promoters, including people who also are promoting AdViewGlobal. Bowdoin has been under pressure from members who were unhappy about his two-month silence.

    He did not tell members about a second forfeiture complaint filed against ASD-connected assets in December. Nor did he tell members about his January decision to surrender the money. Both issues created problems for ASD promoters.

    Read Bowdoin’s motion to dismiss.

    Read Bowdoin’s motion to reverse his earlier decision to forfeit property.

    Read Bowdoin’s motion to supress evidence.

  • Sign Of The Apocalypse? Ning.com Surf Sites Removed

    Ning.com sites by David Courtney that promoted autosurfs have been taken offline without explanation. It is unclear if the removal is permanent, but sites for MegaLido, AdGateWorld and BizAdSplash went offline last night and remain offline this morning.

    “This social network has been taken offline by its owner,” each site said. “It’s likely that the owner will bring it back online shortly.”

    The sites have been offline for at least 11 hours.

    Courtney also promoted Noobing, which is under fire from members for collecting money, paying rebates of up to 3 percent for a while, and then slashing rates to a fraction of 1 percent. Noobing blamed the rate cut on an unclear ruling in the ASD case and implored members to complain to the government.

    The surf also is under fire from the deaf community.

    Courtney said he’ll no longer write about Noobing in his newsletter, and he also announced that he won’t publish information about AdViewGlobal to protect members of a newly formed private association. Meanwhile, Courtney said he’d no longer publish information about the rebate-paying histories of AdGateWorld or BizAdSplash.

    At the same time, Courtney announced he was down on Aggero Investment, which crashed and burned over the weekend after collecting money until the bitter end.

    “Roger from Aggero really dropped a bomb on us over the weekend,” Courtney said. “Whereas just 13 days prior Roger was saying how great and wonderful everything was going, and even raised the maximum investment from $3,000 to $5,000, a mere two weeks later he announced that the program was in trouble and that he was closing.

    “This announcement was further shocking due to the fact that just a couple of days prior, Roger announced that Premium Ads Club was closing up but that those of us in Aggero had nothing to worry about. Less than 48 hours after that announcement, he told us that Aggero was in fact having problems.”

    In other ASD news, an ALL-CAPS POSTER named “David” — not David Courtney — screamed in multiple threads at the Pro-ASD Surf’s Up forum last night for people to wake up and not let ASD’s big winners hang onto their ASD money.

    David implored the winners to turn over their earnings to the government so ill-gotten gains could be distributed among the rank-and-file losers. One poster assured David that the winners weren’t acting in their own self-interest by trying to rally troops to write letters and rail against the government.

    But David didn’t buy it, and continued to post in ALL CAPS. A poster then appealed to the Mods to shelter Surf’s Up members from the high truths he was telling. Eventually his posts were deleted.

  • Purported Joe Shoop ASD Letter Was On Website Registered To Litigant Who Sued Chase Bank By Posting Bond Of ‘Twenty-One Dollars In Silver Coinage’

    UPDATE 8:14 P.M. EST (U.S.A.) With each passing day the AdSurfDaily case reveals new and strange details about a subculture that appears to have firm roots in the organization. It is a subculture of rants against the government for perceived injustices, underground business “associations” that purport to permit nonlawyers and nondoctors to practice law and medicine, and legal filings that seek to undermine banks’ abilities to collect on debts.

    Today a post appeared on the Pro-ASD Surf’s Up forum purporting to take viewers to a page from which they could download a Microsoft Word template  of a letter to send the government to protest its actions in the ASD case. The author of the letter was identified as ASD promoter Joe Shoop, and the website — credittechs.net — was registered to Ricky Jackson.

    In 2004, Ricky Jackson and Regina Jackson sued Chase Manhattan Mortgage Corp. in federal court for the Eastern District of Missouri to overturn a mortgage foreclosure. The documents in the case purported to show that Ricky Jackson had posted a bond consisting of “twenty-one dollars in silver coinage” in a bizarre bid to undermine the bank’s interest in the property.

    The Jacksons, according to filings, ordered the bank to respond to the document within three days or lose all of its rights in the case, which appears to have started in Missouri state court and morphed into multiple federal cases.

    U.S. District Judge Catherine D. Perry ultimately dismissed the Jackson complaint against the bank with prejudice, saying the pleadings were nonsense.

    “This document is even more incomprehensible than the initial complaint, ” Perry said of the 21 Silver Coins filing.

    For days now, the Surf’s Up forum has been suggesting the ASD case soon will take a legal turn for the better — from ASD’s point of view. One Surf’s Up Mod pleaded with a member to “just hold on — a little bit longer now baby.”

    But pleadings filed in the case recently by ASD members have used the template of Curtis Richmond, a California man associated with a Utah “Indian” tribe a judge ruled a sham.

    Four motions to intervene have been filed in recent weeks in the ASD case. All four used the Richmond template. They accused Judge Rosemary Collyer, U.S. Attorney Jeffrey A. Taylor and Assistant U.S. Attorney William Cowden of crimes.

    Richmond, a nonlawyer, has been a thorn in the side of banks from coast to coast. His name appears in lawsuits in which borrowers claimed not to owe lenders money because they had “assigned” their debts to him. Meanwhile, Richmond has tried to have litigation opponents in debt cases arrested.

    On Feb. 26, an autosurf known as AdViewGlobal, which has close ties to ASD, announced it was forming a “private association.” The company to which it turned for advice is Pro Advocate Group, which says it can set up individuals to practice law without a license.

    Karl Dahlstrom, who is associated with Pro Advocate Group, was sentenced in 1997 to 78 months in federal prison for his role in a securities scheme.

    The credittechs.net website registered to Jackson features a media player with the ASD logo, and also appears to host a credit-repair organization set up as a private association.

    “At Credit Techs we are not credit counseling or credit negotiators, we are credit debt ELIMINATORS,” the site says. “We can help stop the credit companies from stealing your hard earned money. Our specialty is credit cards and unsecured debt. We are an organization of members who help one another out with such financial matters.”

    Credit Techs also says this:

    “Members of groups who are competent nonlawyers can assist other members of the group achieve the goals of the group in court without being charged with ‘unauthorized practice of law,’” the site says.