Like Profitable Sunrise, “GlobalMutualFunds” appears to be targeted at Christians.
A Facebook site initially used to drive traffic to the massive Profitable Sunrise international fraud scheme again is being used by boatsharks looking to find victims struggling in the water.
Among the new schemes being promoted on the Facebook site is something called RChange. RChange advertises that users “Top-up/Cash-out by Western Union or Hong Kong local transfer INSTANTLY,by Money Gram or International Bank Wire within 1 day. Unverified member may top-up via Western Union and withdraw via bank wire,western union or money gram directly.” (Unedited by PP Blog.)
Among the other claims of RChange is that “We do not accept registrations from individuals or companies based in the United States of the America. This includes US citizens residing overseas.”
Also being promoted on the Profitable Sunrise Facebook site (and on Facebook itself) is a “program” known as “Global Mutual Funds.” Facebook has issued a warning that “Facebook thinks this site may be unsafe.”
The pitch for Global Mutual Funds on the Profitable Sunrise Facebook site claims, “RECEIVE TOTAL OF $5,000 INCASH FROM 100 PEOPLE IN NEXT 30 DAYS. THIS LEGIT! & LUCRATIVE PROGRAMME HAS EMPOWERD SO MANY PEOPLE AROUND THE GLOB.” (Unedited by PP Blog.)
Like Profitable Sunrise, Global Mutual Funds appears to be trading on Bible verse.
Meanwhile, TelexFree, a “program” under investigation in Brazil amid claims it is conducting a massive pyramid scheme, again is being promoted on the Profitable Sunrise Facebook site.
Rolaids products are back on store shelves after a recall that lasted nearly three years — and that may come as particularly good news for sufferers of the ongoing Zeek Rewards sickness.
And with the TelexFree MLM story potentially churning hundreds of thousands of stomachs and getting stranger and stranger with each passing week, Rolaids may have a chance of regaining its past glory under the new leadership of Sanofi US and its consumer-health business Chattem Inc.
One way to look at Zeek Rewards is as a sort of reverse Rolaids, a brand of antacids that provides heartburn relief and became legendary for its claim that it consumed “47 times its weight in excess stomach acid.”
Another way Rolaids worked its way into the American consciousness was by asking a simple question that Sanofi says became “one of the most recognized advertising taglines of all-time”:
“How Do You Spell Relief? R-O-L-A-I-D-S.”
Zeek: The ‘Reverse Rolaids’
While wanting you to believe that it cured financial pain for small businesses and upstart entrepreneurs, Zeek and its combined MLM and auction “programs” actually created it by consuming victims at 44 times its weight. We arrive at this rounded figure (and reverse-Rolaids observation) by dividing the estimated number of Zeek “losers” (840,000) by the population of the North Carolina city of Lexington (18,936).
Indeed, Zeek was to causing financial pain what Rolaids was to relieving your sick stomach.
In August 2012, the SEC described Zeek as a massive Ponzi- and pyramid scheme that duped people into believing it paid a legitimate return of about 1.5 percent a day.
Zeek, through Rex Venture Group LLC, operated from Lexington, turning a Southern city famous for its hospitality and delectable barbecue into the MLM Heartburn Capital of the World.
Rolaids products were pulled from store shelves in late 2010, because “wood and metal particles were potentially introduced into the products during the manufacturing process at an outside supplier” and because customers detected “a musty or moldy scent,” according to the AP and NBC News.
Lexington, unfortunately, inherited the MLM Heartburn Capital title from Quincy, Fla., home base of the $119 million AdSurfDaily MLM scam in 2008. Zeek, the SEC said, gathered about $600 million.
A court-appointed receiver has been gathering up money for Zeek victims for more than a year and prepping to sue Zeek profiteers and insiders. He’s also in the process of seeking court approval to dismantle Zeek’s Heartburn Factory in Lexington.
Though coincidental to the dismantlement of Zeek in a tranquil American city that never wanted the MLM Heartburn Capital title from Quincy, the comeback of Rolaids amid continuing stomach-churning events in MLM La-La Land perhaps is occurring at the perfect time.
BULLETIN: (UPDATED 9:04 P.M. EDT (U.S.A.) The SEC has sanctioned MLMHelpDesk Blogger Adam “Troy” Dooly, amid allegations he accepted money from the Zeek Rewards MLM “program” operated by Rex Venture Group LLC without disclosing to Blog readers and radio listeners that Rex “was paying him” to publicize the Zeek venture.
Section 17(b) of the Securities Act “prohibits publishing, giving publicity, or circulating ‘any notice, circular, advertisement . . . or communication which, though not purporting to offer a security for sale, describes such security for a consideration received or to be received, directly or indirectly, from an issuer . . . without fully disclosing the receipt, whether past or prospective, of such consideration and the amount thereof,’” the SEC said.
Zeek has been described by the SEC in court papers (August 2012) as a $600 million Ponzi- and pyramid fraud that was selling unregistered securities as investment contracts. Dooly consented to the sanctions and an accompanying cease-and-desist order without admitting or denying wrongdoing.
“In each instance of public relations or promotion in various media outlets, Dooly failed to disclose to his readers and listeners that RVG was paying him for such publicity,” the SEC asserted in an administrative filing dated today. “Dooly believed that, pursuant to a non-disclosure agreement, RVG maintained the exclusive right to determine whether or not to disclose Dooly’s consulting agreement and the amount of compensation. Because RVG did not authorize such disclosure, Dooly declined to reveal his compensation and, in at least one instance, Dooly denied (or misled his audience about) receiving compensation from RVG (apart from reimbursement of expenses) when asked about his compensation during a public radio program.
Dooly, 49, has settled with the SEC by agreeing to pay disgorgement of $3,000, prejudgment interest of $98.81, and civil penalties of $3,000 to the court-appointed receiver in the case. The receiver is Kenneth D. Bell, who is in the process of preparing lawsuits against Zeek winners and insiders.
From the SEC (italics added):
2. From at least April 2012 until August 2012, Dooly served as a paid consultant to Rex Venture Group, LLC (“RVG”), the parent company of ZeekRewards.com (“ZeekRewards”), the self-described “affiliate advertising division” for a penny auction website known as Zeekler.com. ZeekRewards operated as a multi-level marketing program offering subscription memberships to affiliates who then recruited new affiliates and bought and gave away as samples, or sold, bid packages for the penny auction website. Rather than promoting penny auctions, however, RVG primarily marketed ZeekRewards to investors as an opportunity to earn passive income indefinitely through their participation in the program.
3. Under two successive contracts, RVG agreed to pay Dooly $6,000 per month to provide various consulting and public relations services that included, among other things, responding to negative press about RVG and ZeekRewards; providing live reporting from company events; conducting video chat interviews to “promote company, founders, officers, products and culture”; and providing media exposure to facilitate market penetration and improve public perception. In furtherance of the foregoing, Dooly promoted ZeekRewards on his website, MLMHelpdesk.com; posted blog entries and youtube.com videos giving publicity to ZeekRewards; and conducted at least one radio interview promoting the company.
4. Dooly provided the agreed services until ZeekRewards was shut down by the SEC in August 2012 for operating an illegal pyramid and Ponzi scheme. For all his services, Dooly earned $24,000 in consulting fees, but he never received the last $6,000 payment because the company’s assets were frozen (thus receiving only $18,000). Of that total, $3,000 or approximately 17% was attributed to public relations or promotion in various media outlets.
EDITOR’S NOTE: In case you haven’t seen the series finale, there are no spoilers in this post. “Breaking Bad” ended its original run on AMC, and America said goodbye (or good riddance) to Walter White, the money-launderer next door, last night. The fictional White, of course, had been pursuing clandestine wealth, recklessly disregarding the safety of his family, destroying the lives of people who got in the way of his self-consuming greed and risking U.S. national security for five TV seasons. (At one point, he’d amassed at least $80 million in cash — enough to equip a small army of thugs or terrorists had they found its hiding place. Lo and behold, a group of neo-Nazi racketeers/murderers in part supplying Czech narcotics traffickers through a Houston-based methylamine supplier and upstart meth manufacturer did find it. Put another way, a white-supremacist group that openly shot at cops and murdered a bicycle-riding child to prevent him from tattling about the heist of a train carrying a meth precursor gained unwarranted economic power in the tens of millions of dollars.)
Like the world of narcotics traffickers, the HYIP world is filled with Walter White-types, the wire fraudsters and money-launderers next door. Beyond that, claims of great faith in God and miraculous money-making systems often accompany HYIP schemes. If you’re repeatedly joining murky HYIP schemes or pushing them, you’re engaging in the same sort of self-indulgence and self-deception chronicled each week on “Breaking Bad,” a program whose greed- and desperation-driven central character — Walter White — openly defies the U.S. government, helps crime thrive in the United States, Mexico and (now) Europe, sets the stage for political instability and for hostilities to develop among friendly nations, and rationalizes it as a necessary means of making money for his family.
The MLM equivalent of a Walter White could be in your upline or downline. Such a figure also could be very close to the money flow, staying out of sight but positioning himself to influence or even extort the public face of the scheme.
White broke bad when he morphed from a mild-mannered, noble but financially struggling chemistry teacher and family man into a brutal and conniving meth kingpin after his cancer diagnosis — on the theory that manufacturing and selling meth would help him pile up some cash to provide for his family after his death. Bodies in Mexico and the United States have piled up around him ever since, including the bodies of 167 people who perished when two planes collided over Albuquerque after an air-traffic controller who couldn’t concentrate on work accidentally directed them into each other because he’d been reduced to emotional rubble by his daughter’s drug-related death. (She asphyxiated on her own vomit; the airplane death toll in Albuquerque was only one less than the real-life Oklahoma City domestic-terrorist attack in 1995, which killed 168 when the Alfred P. Murrah Federal Building was bombed by Timothy McVeigh.)
Another body was that of White’s own brother-in-law, a DEA agent murdered by a neo-Nazi White had hired to kill his business partner (and onetime chemistry student) Jesse Pinkman, the boyfriend of the woman who drown in her own puke. Yet-another body (actually a body part) was that of a DEA informant’s head mounted on a turtle after being severed by a Mexican cartel to send a message. The head and turtle were booby-trapped with explosives that detonated, killing a DEA agent. Still-another body was that of Gus Fring, a Chilean national, New Mexico drug kingpin and onetime White boss who laundered funds through chicken restaurants, pretended to be a supporter of the DEA and was killed by a wheelchair bomb planted by White in the nursing home in which Fring’s enemy Hector Salamanca, a onetime cartel enforcer, resided.
White’s form of money-laundering was the classic car wash. But the writers easily could have provided him a different front, perhaps that of respected teacher who’d gravitated to the commodities field and relied on MLM-style pitchmen and boiler rooms to drum up business for the side operation and help clean up the cash.
** _______________________________ **
James C. Howard III
Court documents in the Commodities Online Ponzi caper describe “purported” purchases of “iron ore” and “related equipment” by the Florida-based firm in Mexico. The documents also point out that the enterprise was led by two individuals previously convicted of narcotics crimes in the United States and that more than $5 million mysteriously was wired to “accounts in Mexico” in March 2011 after one of the felons approved the wiring “directions” of the other — this after the first felon had received an SEC subpoena and the second had found out about it.
Separately, the court-appointed receiver in the case says that, “after substantial investigation, including extensive interviews, depositions, and on-site investigation conducted both in the United States and Mexico, the Receiver concluded that the Defendants had no recoverable iron ore or related equipment in Mexico.”
What they did have in Mexico, if anything, remains unclear. Also unclear is how much of the money sent to Mexico will be recoverable
More than two years after the SEC moved against Commodities Online, the precise nature of its business remains murky. As noted above, one of the things that is known is that two of the firm’s managers were associated with narcotics earlier in their lives and had criminal records for felonies and and yet somehow had managed to become investment executives.
Now, one of those felons — James Clark Howard III — has pleaded guilty to mail- and wire-fraud conspiracy for his role in the Commodities Online scam.
And, according to Howard’s proffer in the criminal side of the case, he approved the “directions” of fellow felon Louis N. Gallo III to wire millions of dollars to Mexico after Howard had been subpoenaed by the SEC.
Gallo was in Mexico, according to the proffer — and that’s an oddity because he was on U.S. federal probation at the time. The Sun Sentinel newspaper reported in 2012 that “Gallo was sentenced in 2008 in New Jersey for bank fraud, intent to distribute cocaine and transmitting a threat to injure.”
And, according to the proffer, Howard was one of the controllers of an enterprise known as SSH2 Acquisitions Inc., which has been sued amid allegations it, too, was conducting a Ponzi scheme. Howard also has been implicated in a separate Ponzi scheme targeting Haitian-Americans in Florida.
Terralynn Hoy, who has not been accused of wrongdoing, is listed in Nevada as a onetime director of SSH2. SSH2 sued Howard, alleging he was conducting a Ponzi scheme.
Hoy earlier had been a cheerleader for AdSurfDaily, which proved to be a $119 million Ponzi scheme. After that, she became a cheerleader for AdViewGlobal, a 1-percent-a-day Ponzi scheme federal prosecutors linked to ASD President Andy Bowdoin, now serving a 78-month sentence in federal prison for the ASD scam. Hoy later was listed by Zeek Rewards as an “employee.” In August 2012, the SEC described Zeek as a $600 million Ponzi and pyramid scheme.
Bowdoin, like Howard, was a convicted felon, according to court records.
AdViewGlobal launched in 2009, even as ASD was the subject of a major federal investigation. Zeek, whose business model strongly resembled the models of ASD and AVG, launched after both ASD and AVG had collapsed. With two convicted felons linked to the narcotics business at the helm, Commodities Online appears to have gathered more than $20 million.
After similar reports in July, there are new reports today that members of the TelexFree MLM “program” have been targeted in hacking and phishing schemes. Such fraud bids often accompany HYIP schemes. One such report appeared on Facebook, where a self-identified member of TelexFree claimed she had two TelexFree accounts and that both had been hacked. The poster further claimed her email account had been compromised and that she was having trouble contacting TelexFree.
Separately, the Blog of TelexFree pitchwoman Faith Sloan is reporting on “FAKE EMAILS / PHISHING EMAILS” apparently associated with a bogus domain that marries the name of one of TelexFree’s payment processors to that of TelexFree to form a dotcom.
In the email, TelexFree members are advised to click on a link to “enable” a new payout system.
The email is fake, according to FaithSloan.com.
“DO NOT CLICK ON ANY OF THE LINKS! DO NOT DO IT!” the site advises.
In mid-August, TelexFree affiliates excitedly announced the firm was using Global Payroll Gateway (GPG) to process payouts due members. By Sept. 22, there were reports that TelexFree had dumped GPG (or the other way around) and that TelexFree was switching to I-Payout. Coinciding with these reports were reports that TelexFree was filing for bankruptcy, but a court in Brazil rejected the filing.
Faith Sloan purportedly is spearheading an effort to popularize TelexFree in Peru. The “program” is under investigation in Brazil and is alleged to be a massive pyramid scheme. Sloan previously was associated with Zeek Rewards, alleged by the SEC last year to be a $600 million Ponzi scheme and pyramid fraud. She also has been associated with “Profitable Sunrise,” a “program” the SEC said earlier this year was conducting a massive international swindle. Other Sloan “programs” included Noobing, part of the business mix of Affiliate Strategies Inc., alleged by the FTC to have conducted a large-scale government-grants swindle. Noobing in part was aimed at people with severe hearing impairments.
Despite the investigations in Brazil and reports of death threats aimed at a judge and prosecutor involved in the TelexFree case, some members — including Sloan — continue to sing the praises of the “program.” Some affiliates claim that $15,125 sent to TelexFree fetches at least $42,075 in a year.
Members have been encouraged online to make deposits in TelexFree accounts at Bank of America and TD Bank, although competing reports have suggested that TelexFree has pulled out of Bank of America. These reports were attributed to “Steve Labriola, Director of Marketing for Telex FREE, Boston.”
TD Bank recently agreed to pay $52.5 million to settle claims it was acting as a facilitator for Scott Rothstein’s epic Ponzi scheme in Florida. Rothstein, a former attorney, is a convicted racketeer serving a 50-year prison sentence for his $1.2 billion Ponzi scheme.
TelexFree has U.S. arms in Massachusetts and Nevada. Some affiliates have claimed they can speed the flow of money to the firm and have encouraged prospects to make copies of deposit slips and banking information and email them to sponsors for “expedited” service. Affiliates of the $119 AdSurfDaily Ponzi scheme in 2008 pitched their downlines in similar fashion. At a minimum, the practice puts followers at risk of identity theft. It also may set the stage for money-laundering and other crimes to occur between and among TelexFree members.
There was a claim on Facebook yesterday in which New Zealand and Australian prospects of TelexFree were told that an “australian and new zealand group . . . can help sponsor others in there and pay them in through our back office easy to transfer cash there.”
The FaithSloan Blog bizarrely announces that TelexFree has “killed” GPG, a payment processor.
If continuing to recruit during multiple pyramid-scheme probes even as a judge and prosecutor reportedly had been threatened in Brazil with death were not enough, another MLM PR disaster is unfolding: The Blog of Faith Sloan, late of Zeek Rewards and Noobing, an HYIP Ponzi scheme that ripped off people with hearing impairments, wants TelexFree members to know why the alleged pyramid scheme no longer is using Global Payroll Gateway (GPG).
“We killed them,” FaithSloan.com reports flatly on the fate of GPG.
No so, according to FaithSloan.com, which is claiming TelexFree “killed” GPG because it “Could not handle the 50,000 accounts that came into their system.”
TelexFree now has turned to “ipayout’s globalewallet,” according to FaithSloan.com.
Whether TelexFree planned to “kill” IPayout if any hiccups developed in its purported processing of money for TelexFree was not disclosed in the undated post announcing that TelexFree had “killed” GPG. The apparent message in the TelexFree branch of MLM La-La Land, however, is that affiliates will ignore or downplay unsettling events in Brazil such as the pyramid probes and reported death threats and will blame any company that fails to find favor with TelexFree and its international army of cross-border pitchmen.
TelexFree appears to have sought to transition to GPG in mid-August, with affiliates trumpeting the firm on the web as the answer to TelexFree’s troubles. But problems developed within weeks (if not days), and TelexFree affiliates then announced the firm was switching to IPayout. In about a month, GPG went from the penthouse to the doghouse in the minds of certain TelexFree promoters. Now, IPayout apparently has been given the chance to occupy the penthouse in the incongruous world of TelexFree. Will it slip into the TelexFree doghouse and perhaps be “killed” by the firm, like rival GPG before it?
Within days of the announcement that TelexFree had brought IPayout aboard after the purported failure of GPG, TelexFree executive Carlos Costa announced that TelexFree was seeking bankruptcy protection in Brazil. While making the announcement, Costa curiously waved the flags of Portugal and Mediera. Like former AdSurfDaily President Andy Bowdoin, Costa also suggested God was on the company’s side.
Bowdoin is serving a 78-month prison sentence in the United States. His ASD “program” was a $119 million Ponzi scheme. Among other things, Bowdoin claimed a 2008 raid on his “program” that promised a precompounding payout of 1 percent a day was the work of “Satan.”
Some TelexFree affiliates claim that $15,125 sent to the company fetches a profit of at least $42,075 in a year. Images of Jesus Christ have been used in TelexFree promos.
A court-appointed receiver determined that Noobing was impossibly upside-down. Affiliate Strategies Inc., the U.S.-based parent company, registered several corporations offshore, including Noobing, formed in the Caribbean island of Nevis; ASI Management Inc., formed in Belize on March 24, 2009; Landmark Publishing Group LLC, formed in Nevis on March 25, 2009; Landmark Publishing LLC, formed in Nevis on March 25, 2009; International Research and Writing Group LLC, formed in Nevis on July 1, 2009; and International Publishing Group LLC, formed in Nevis on July 1, 2009.
All in all, the receiver said in 2009, “the ASI defendants have formed and operated eighteen additional Kansas LLCs as subsidiaries of Defendant Apex Holdings International LLC.” The receiver proposed a plan by which all assets tied to Noobing’s parent would be sold — right down to a stainless-steel wastebasket in the women’s restroom.
In 2010, the PP Blog interviewed a 64-year-old woman with a profound hearing loss. The interview was conducted through the woman’s interpreter. The woman told the PP Blog she has lost $5,300 in Noobing and could not sleep at night. Noobing later was added as a receivership defendant. The receiver said that Noobing and 14 other companies under the ASI umbrella had become the subjects of “numerous inquiries” from “tax authorities,” creditors and “former independent contractors.”
TelexFree has U.S. footprints in Massachusetts and Nevada. The firm also now purports to be operating in England. TelexFree is the subject of multiple pyramid-scheme probes in Brazil, where it operates through an entity known as Ympactus Comercial Ltd.
There have been reports that at least one judge and one prosecutor involved in the Brazil probe have been threatened with death.
HYIP fraud schemes spread in part because promoters engage in serial disingenuousness and ignore red flags such as unusually consistent returns, claims of guaranteed payouts and the circuitous flow of money. Some TelexFree affiliates have provided ASD-like coaching tips to prospects on how to speed the flow of money to the firm.
Carlos Costa displays the flag of Madeira while announcing TelexFree is seeking bankruptcy protection.
UPDATED 7:21 A.M. ET Jan. 21, 2013, to correct misspelling. With pyramid-scheme probes under way in multiple Brazilian states and affiliates also filing actions against the company, TelexFree says it is seeking bankruptcy protection in Brazil. Early details are sketchy.
Here’s TelexFree executive Carlos Costa making the announcement while waving the flags of Portugal and Madeira and referencing God:
TelexFree operates in Brazil through Ympactus Comercial Ltd. The firm has U.S. arms in Massachusetts and Nevada. Affiliates appear to have established TelexFree-related firms in Florida and California.
Memphis has rescinded this 2012 proclamation that suggests a “sovereign theocratic government” independent of the existing governments of the Americas had been formed. (Source: screen shot.)
UPDATED 10:55 A.M. EDT (U.S.A.) The city of Memphis, Tenn., has joined the city of Fayetteville, N.C., in rescinding a 2012 “Moorish American Week” proclamation that apparently was rubber-stamped before the context of the proclamation was understood.
Among other things, the proclamations in both cities claimed a “sovereign theocratic government” had been formed inside the United States. But the Memphis proclamation appears to have gone one step farther than the document heralded last year in Fayetteville. Indeed, the Memphis proclamation appears to suggest a “sovereign” Moorish” government independent of the existing governments of North America, Central America and South America had been formed.
From a statement by the office of Memphis Mayor A C Wharton, as reported by WREG (italics added):
The proclamation in question was presented to Mayor Wharton for his signature. Mayors from other major cities have signed the same proclamation from this group which demonstrates that most mayors’ offices do not routinely investigate every group or individual that requests this document. We did not issue a proclamation to this group in 2013.
Some purported “Moorish Americans” claim the laws of the United States do not apply to them, even though they live in the country. This has led to bizarre confrontations with police in (at least) Illinois, Maryland, Georgia and Tennessee.
EDITOR’S NOTE: At the time of the publication of this story, the PP Blog was experiencing trouble loading graphics. The probable cause of this is a conflict between certain plugins used by the Blog. We are working to correct this problem . . .
** _____________________________ **
UPDATED 12:25 P.M. EDT (U.S.A.) TelexFree, an alleged pyramid scheme operating as an MLM that has U.S. arms in Massachusetts and Nevada and effectively was shut down in June in Brazil (by court order in Brazil) but continues to operate elsewhere, seems on the cusp of cementing itself as a marquee example of cross-border fraud.
Several days ago, the company inexplicably began to publish the address of a purported office in the United Kingdom in Watford — near London. Today an apparent TelexFree promoter writing on a media site in Brazil appears to be instructing Brazilian affiliates to enroll with the firm by using any address in London, thousands of miles away. This coaching appears to originate from a hotmail address. (See story/comments thread in Portuguese; see translation of story/comments thread via Google Translate.)
The center of London is approximately 5,700 miles away from the center of Rio de Janeiro, the Brazilian city that will play host to the 2016 Olympics. London hosted the 2012 Olympics. There are dozens of pyramid-scheme probes under way in Brazil, in the run-up to the 2016 Summer Games.
Even more troubling than the suggestion that Brazilians should fabricate a London address to enroll in TelexFree is a suggestion from another apparent TelexFree affiliate on the same site in Brazil that affiliates should appear at the door of a judge of the Supreme Court of Brazil. It is unclear from the English translation of the post whether any protest aimed at the judge would occur at the Supreme Court or at his personal residence. Plenty of peaceful protests occur in Brazil. But a protest at the residence of a judge potentially would introduce the specter of menacing — something that was present in the AdSurfDaily Ponzi case in the United States.
Purported American “sovereign citizen” Kenneth Wayne Leaming — a figure in the ASD story — was convicted earlier this year of multiple charges, including filing bogus liens against public officials involved in the ASD case. The evidence in the case strongly suggested that Leaming intended to stalk the children of the Chief Justice of the United States at the school they attended — as part of a plot to serve paperwork on the Chief Justice.
TheTelexFree story is similar in certain key ways to the ASD story. For starters, some ASD members refused to believe that a crime had been committed against them and taunted prosecutors and the U.S. Secret Service with threats. There have been reports in Brazil of death threats against a judge and a prosecutor. Both the ASD and TelexFree schemes were targeted at Christians. Meanwhile, members of both “programs” were promised preposterous, unusually consistent returns. In the ASD case, the precoumpounding returns computed to an annual return in excess of 300 percent. Some TelexFree promoters have claimed that sending $15,125 to TelexFree results in a tripling or quadrupling of the money in a year.
Beyond that, it almost certainly is the case that some TelexFree affiliates also were pitchmen for ASD and for Zeek Rewards, an MLM “program” described by the SEC last year as a $600 million Ponzi- and pyramid scheme. This leads to questions about whether criminal MLM combines are driving business to purported “opportunities” despite the legal, financial and social consequences. In April 2013, the SEC said a “program” known as Profitable Sunrise was using a mail drop in England as part of a massive scam that used a series of offshore bank accounts potentially to fleece people of faith of millions and millions of dollars.
Now, TelexFree purports to be operating from England. The mere listing of a business address is not proof that no scam is occurring, despite repeated bids by HYIP schemes to create an air of legitimacy by publishing an address or registering it with a government. Profitable Sunrise, for instance, had a registered address. So did Zeek. So did AdSurfDaily. Both of the TelexFree addresses in the United States appear to be virtual offices or mail drops.
And TelexFree affiliates have been sending confusing messages for months on how to send money to the firm. This sometimes signals that money-laundering, wire fraud or another crime is occurring. Some of the TelexFree affiliate bids strongly resemble events at ASD — events that led to the criminal indictment and subsequent sentencing of ASD President Andy Bowdoin to a 78-month prison term. (Also see Aug. 21 PP Blog story on a TelexFree shift to yet another payment processor.)
BehindMLM.com is reporting that “rampant fraud” may be affecting TelexFree’s operations.
Despite at least seven pyramid-scheme probes into TelexFree, an apparent affiliate of the MLM “program” was promoting it yesterday on Facebook — on a site once used to lead cheers for the Profitable Sunrise scheme.
A Facebook cheerleading site for Profitable Sunrise — alleged in April by the SEC to have conducted an offering fraud that may have gathered tens of millions of dollars through offshore bank accounts — again is being used to drive dollars the TelexFree scheme. The same Facebook site has been used to drive cash to multiple schemes. Some of the schemes already have disappeared, taking unknown sums with them.
“100% Guaranteed Get Paid To Post Telexfree Ads,” a post on the Profitable Sunrise site roared yesterday. There was no mention that at least seven pyramid-scheme probes into TelexFree are under way in Brazil.
The TelexFree pitch on the Profitable Sunrise Facebook site is surrounded by claims that a “conference call” has been held with a purported Profitable Sunrise “Admin” and that a new call will be held today and that some sort of good news is in the offing.
With respect to Profitable Sunrise, a post dated Aug. 21 declares that the U.S. government “Is The Crooked One.”
In 2010, FINRA said that HYIP fraud schemes were spreading though social-media sites through which pitchmen seek to sanitize the scams by making them appear to be legitimate programs.
“Whack-a-mole” also is an element in the scams: As soon as one scam is shut down, others pop up to replace it. The interconnectivity of the schemes and the willful blindness of many participants put banks and payment processors in the position of becoming warehouses for fraudulent proceeds, leading to questions about money-laundering, wire fraud and national security.
In August 2012, the SEC said the Zeek Rewards MLM scheme had gathered at least $600 million through a combined Ponzi- and pyramid scheme. The final haul of Profitable Sunrise, which the SEC described in April 2013 as a scheme operated by an apparent ghost, is unknown.
By some estimates, TelexFree has gathered $300 million or more. Some promoters have planted the seed that TelexFree was “authorized” by the U.S. government. The U.S. government does not authorize such schemes.
BehindMLM.com is reporting today that investigators in Brazil have established promotional links between TelexFree and BBOM, another alleged fraud scheme operating in Brazil.
BULLETIN: Zeek Rewards members are being targeted in a new scheme with ties to the Phil Piccolo organization and are being solicited for sums ranging from $600 to $60,000 “in return for ” . . . “guaranteed 50 percent interest” from a purported “unique and legal loan system” over an unspecified time period, the PP Blog has learned.
The offering, which hints of some sort of falling out with Zeek’s management, has been styled on YouTube as “The Diamond Club by TRUE CASH.” The emerging “program” was the subject of an email pitch yesterday that appears to have been targeted by an unknown party at former Zeek “Diamond” affiliates, potentially including some of Zeek’s largest “winners” who have exposure to clawback lawsuits filed by the court-appointed receiver and who previously have been solicited to make contributions to a purported defense fund for Zeek affiliates. Zeek “losers” also could be targets.
Previous schemes linked to Piccolo include the uber-bizarre Data Network Affiliates (DNA) “program” and One World One Website (OWOW), an equally bizarre money grab. (Use the PP Blog’s search function for information on those “programs.”)
In August 2012, the SEC described Zeek as a $600 million Ponzi- and pyramid scheme. In April 2013, the SEC took down a purported “loan” program known as Profitable Sunrise that may have gathered tens of millions of dollars through an alleged offering fraud. How the “The Diamond Club by TRUE CASH” offering intends to collect money is unclear, although a website to which pitchmen are directing traffic includes the logo of SolidTrustPay, one of the offshore processors used by Zeek.
Certain members of a Zeek-related email chain received the purported “Diamond Club” pitch yesterday. Hinting of bad blood, the pitch appeared below this headline, “Zeek Management Belongs in Prison – On 8/27/2013 I earned over $500,000 – I will pay your way in from $600 to $3000.”
How the $500,000 purportedly was earned was not explained. Also unclear was the identity of the sender. Among the claims in the pitch is this one (italics added):
IF YOU LOST $10,000 IN ZEEK OR RECRUITED 10 PEOPLE IN ZEEK I WILL PUT UP $3,000.00 FOR YOU
The principal part of the pitch claims this: “I just made $500,000.00[.] I will put up the $600 minimum for you – You pay me back ‘ONLY OUT OF COMMISSIONS’. If you are already in one of TCN 12 opportunities and want to be on my “DIAMOND CLUB” Team then you need to re-sign up. If you are resigning up you will need a new e-mail address. Get a free g-mail account from Google.”
From the lower-right corner of the True Cash Network website. Source: Aug. 30 screen shot.
In the same email, the pitch points recipients to a YouTube video and a website URL of ThePowerTeam.TrueCashNetwork.Com. “TrueCashNetwork” is using the same acronym used by TextCashNetwork (TCN), an earlier scheme linked to Piccolo and Joe Reid, a longtime huckster associated with Piccolo. On the TrueCashNetwork website, an emblem labeled SiteLock SECURE appears, along with the word “Passed.” The emblem incongruously includes the name of “TEXTCASHNETWORK.COM,” even though it appears on the TrueCashNetwork domain. The TrueCashNetwork domain appears to have been registered behind a proxy on June 28, 2013.
Reid, according to the TrueCashNetwork website, is the new TCN’s “Master Referral Agent” or “MRA.”
Precisely what happened with the original TCN, a purported daily deals site that purportedly used text-messaging, never has been clear. The emerging TCN, however, appears to have access to the original’s database and appears already to have used it to create affiliate links for “old” TCN members — this despite the fact TextCashNetwork is listed in Wyoming as a “dissolved” entity and its members may not have given permission to be ported to the “new” TCN.
These links shown in Google search results are showing the name of “textcashnetwork” in the URL. But all of them rotate to True Cash Network.
The “new” TCN purports to be operating as “True Cash Network, Inc.” Disputes, according to its website, will be handled under Wyoming law, but there appears to be no corresponding registration for True Cash Network in the state. Meanwhile, the “new” TCN is using the same Boca Raton (Fla.) business address as the “old” TCN. The old TCN once curiously purported that a member’s agreement with it “may not be transferred or assigned without prior written consent of REX Venture Group.”
Rex was the operator of Zeek Rewards and one of the defendants in the SEC’s Ponzi case.
True Cash Network — like TextCashNetwork before it — appears to be positioning itself as an MLM company that pushes affiliate products, including a “Medical Savings Plan,” X8 Energy Gum, Parcman Male Enhancer and more.
While TCN was operating as TextCashNetwork, the Piccolo organization appears to have tried to dupe people into believing the company was owned by Johnson & Johnson, a component of both Dow Jones and the S&P 500 and an internationally famous maker of pharmaceuticals and consumer products that are household names.
