I am updating this donation post at 11:30 a.m. (EDT) on Aug. 7. Donations have been received from 12 readers, and the Blog is back from the edge of the abyss. Thank you, dear readers.
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This Blog does what it does because its author — and many, many of its readers across the globe — are deeply concerned that criminals and hucksters have created what effectively are templates that enable fraud on a scale unprecedented in the history of mankind.
It wasn’t all that long ago that the damage a pickpocket could do was limited to, say, the size of the crowd a local community celebration or carnival that came to town once a year could draw. If Dad was the family breadwinner — and if Dad deposited his paycheck on a Friday night, took out $100 in cash, stuck it in his wallet and headed to the park to meet Mom and the kids — Dad was the pickpocket’s mark.
More than one Dad could get hit, of course, but the supply of Dads at a local event was limited. A pickpocket could put Dad and his family on boxed macaroni and cheese or soup for a couple of weeks, to be sure. And a pickpocket could turn Mom into a creative cook and storyteller — beans and wieners on one day and wieners and beans on the next, she might joke to the kids — but the pickpocket could not visit devastation on the family.
That all changed with the Internet and with the speed at which money moves these days. Put simply, the pickpocket no longer has to wait for a community event or for the carnival to come to town. He or she could use electronic templates, study what was “working” to the maximum criminal effect, create their own carnival audience — and start picking the pockets of a global audience of sums that put individuals and families in ruin.
The criminal template for HYIPs and autosurfs, for example, are getting more diabolical, more sinister. The template gets tweaked — perhaps called something else — but still is misery waiting to happen. The pickpockets have created what in effect is a criminal combine of pickpockets. This combine, however loosely associated, is eviscerating wealth at the local level in tens of thousands of communities across the globe and transferring it to a select few.
Perhaps most galling is that the criminal ventures are presented as the latest and greatest in Capitalism. People down on their luck and struggling to get through lean times are particularly susceptible to this message. Indeed, the crooks know what “works.” On one day, the criminal message may be targeted to people of faith; on the next, it may be targeted at people angry at the government — either for doing too much, or too little.
Over the years, the PP Blog has been chastised for being a puppet to the government masters, for being too stupid to recognize that Social Security is a Ponzi scheme (or pyramid scheme), for cheerleading for the law-enforcement agencies, for not exposing the Great Conspiracy at the Federal Reserve, for being a Democrat, for being a Republican, for being a Nazi, for being a Socialist, for being against the little guy.
Friends, what I am is an American journalist who happened across the greatest crime story in history while publishing was going though the greatest upheaval in its history. This crime story only is expanding, and the situation only is getting more dangerous. I need the help of my readers to continue to cover it.
This month’s need is on the order of $550. Please help if you’re able.
BULLETIN: The Zeek Rewards MLM “program” that is married to a penny-auction site known as Zeekler and plants the seed that an annualized return in the hundreds of percent is possible has declared that “all” Zeek criticism has been “unprofessional” and based on “false information.”
Some Zeek affiliates have said that Zeek provides a payout that averages about 1.4 percent a day, a figure higher than the AdSurfDaily Ponzi scheme.
Zeek has preemptively denied it is an investment program or “pyramid scheme.” Regardless, Zeek has a presence on HYIP forums referenced in federal court filings as places from which Ponzi schemes are promoted. The company has used offshore payment processors linked to numerous fraud schemes and employs business model similar to the $110 million AdSurfDaily Ponzi scheme.
Zeek, which has members in common with ASD, gathers sums of up to $10,000 from members. Like ASD, it claims it is not offering an investment program. But Zeek now is blasting unspecified “North Carolina Credit Unions” for circulating a purported “internal memo” that allegedly was “at once unfavorable to Zeek Rewards and false.”
The Zeek Blog post was attributed to acting COO Gregory J. Caldwell, who replaced acting COO Dawn Wright-Olivares. While acting COO, Wright-Olivares once suggested that, if Zeek instructed members to change their preference in dispensing toilet paper in their private bathrooms (top-rolling vs. bottom rolling), they should do it.
Wright-Olivares now is Zeek’s “Chief Marketing Officer,” with Caldwell holding her former job, according to the company.
Caldwell, according to the Zeek Blog post, now is warning Zeek members to stick with the company line or face the consequences. The post did not spell out those consequences.
“It’s counter-productive for Affiliates to fan the flames of issues that are the proper responsibility of Zeek Corporate…and it’s a violation of the Zeek Policies and Procedures for which violators will be held responsible,” the post attributed to Caldwell and dated today read in part.
A North Carolina credit union had slandered Zeek, according to the post attributed to Caldwell on the Zeek Blog (italics/bolding added).
Zeek Rewards policy is to act quickly to support the Zeek reputation and the future of your business. Upon learning of the memo slandering Zeek, I called the head of Risk Management to track down the origin of the memo. Upon being discovered, the person responsible admitted he really didn’t know anything about the laws regarding direct selling or how to identify a legitimate network marketing company or opportunity. Like all our critics, he was behaving unprofessionally by acting on false information.
We intervened, shut down the misinformation at its source, and that would have been that…were it not for the inappropriate action of one of our own Affiliates who posted the memo online where it has been picked up and is now being used by our critics.
Prior to being arrested on Dec. 1, 2010, by the U.S. Secret Service amid allegations he was at the helm of an Internet Ponzi scheme that planted the seed affiliates received a return of 1 percent a day but were not making an investment, ASD President Andy Bowdoin also complained about slanderous critics. Bowdoin pleaded guilty in May 2012 to a Ponzi-related charge of wire fraud.
Although Bowdoin posted bond and remained free after the Secret Service brought its case, he is now jailed in the District of Columbia, amid allegations he continued to promote fraud schemes after the Secret Service seized more than $80 million in the ASD Ponzi case in August 2008 and after Bowdoin was arrested on Ponzi charges in December 2010. Federal prosecutors identified those schemes as AdViewGlobal and OneX.
Bowdoin, 77, is scheduled to be formally sentenced in the ASD case on Aug. 29.
Some Zeek members also have promoted OneX, which reportedly used at least one of the same offshore processors as Zeek (SolidTrustPay).
Zeek members also have been linked to a “program” known as JSS Tripler/JustBeenPaid and purportedly operated by Frederick Mann, a former ASD pitchman who may have ties to the so-called “sovereign citizens” movement. ASD also had ties to “sovereign citizens,” including the now-jailed Kenneth Wayne Leaming (false liens/harboring fugitives/possessing firearms illegally after prior felony conviction/false uttering) and Curtis Richmond, who once accused the federal judge overseeing the ASD case of “TREASON” and as many as 60 felonies.
JSS/JBP purports to provide a return of 730 percent a year. JSS/JBP uses at least two of the same offshore processors used by Zeek (SolidTrustPay and AlertPay, now Payza).
Meanwhile, Zeek promoters also have been linked to a “program” known as Regenesis 2×2, which came under Secret Service scrutiny in 2009 and also had a presence on the Ponzi boards.
Before the ASD Ponzi raid by the Secret Service in 2008, ASD had moved “several million” dollars into SolidTrustPay, according to court records. AlertPay also is referenced in filings in the ASD Ponzi case. Both firms are referenced in filings in the Pathway to Prosperity HYIP Ponzi case brought in 2010 by the U.S. Postal Inspection Service.
Filings in the Pathway to Prosperity case also reference the TalkGold and MoneyMakerGroup forums — forums on which Zeek, JSS/JBP, ASD and the Legisi HYIP Ponzi scheme had a common presence. SolidTrustPay, meanwhile, was mentioned in filings in the Eagle Trades LTD fraud case. Terrance Osberger of Eagle Trades was indicted last month by a federal grand jury in Ohio on one count of wire fraud and 48 counts of money-laundering.
Eagle Trades also had a presence on the Ponzi boards.
The Blog post attributed to Caldwell came on the heels of a report yesterday by BehindMLM.com that the North Carolina State Employee’s Credit Union (NCSECU) had concerns about Zeek. (Link to BehindMLM story below.)
In June, the office of North Carolina Attorney General Roy Cooper said it had concerns about Zeek. Cooper’s office expressed those concerns after a North Carolina television station suggested Cooper’s office had determined Zeek to be operating legally. Zeek’s Blog linked to the TV station’s report, but the TV station later removed the report. Cooper’s office said that no determination that Zeek was operating lawfully had been made.
BULLETIN: The “K. Chang” Hub on Zeek Rewards is back online after an absence of days. The site went missing after HubPages.com reportedly received a purported complaint for trademark infringement, copyright infringement and libel attributed to a “consultant” for Rex Venture Group LLC, Zeek’s purported parent company.
“K. Chang” reported the return of the Hub at 2:50 p.m. (EDT).
EDITOR’S NOTE: In Ponzi Land, HYIPs that suggested returns of 1 percent (or more) per day “worked” to line up lambs for the slaughter. So did autosurfs that planted the 1 percent a day (or more) seed. Now, 1 percent a day (or more) “auction” sites are “working.” Will they mushroom globally like HYIPs and autosurfs, setting the stage to fleece participants in unprecedented numbers?
Apparently now fully recovered from his purported bout with Dengue fever, legendary HYIP huckster “Dave” is back — this time with something called “DailyCashMania” (DCM) that appears to be married to a nascent penny-auction site known as “HawkPay” that is luring affiliates amid DCM promises it will offer a “mega-prize” of a $10,000 cash voucher.
One MoneyMakerGroup Ponzi forum promoter of DCM declared it “The ONLY Matrix supported by a [sic] Auction site.”
HawkPay says it will offer “scratch” auctions. A graphic for a “test listing” (Canon camera) on the site reads “SCRATCH TO SEE YOUR PRICE.” When that graphic is clicked, this message loads: “Your scratch will cost 1 bid and the product price will be lowered with $.10.”
ASD’s chatter about the Presidency quickly brought out the U.S. Secret Service, which discovered ASD affiliates were being paid with money from other affiliates: a classic Ponzi scheme. The Secret Service also discovered that political donations made by ASD President Andy Bowdoin came from Ponzi money.
Other prelaunch hype for BidsThatGive claimed that affiliates of the “program” could get filthy rich, so rich the company would pay to name a hospital or orphanage after them.
Meanwhile, the Zeek Rewards MLM “program,” which is married to a penny-auction site known as Zeekler, has announced a new slate of officers at Rex Venture Group, the purported parent company of the Zeek businesses. Even as the company was making the announcement, posters on the MoneyMakerGroup Ponzi board were sharing “I Got Paid” posts. Another poster placed a link to something called ZeekCalc, a purported earnings calculator apparently created by a Zeek fan.
“This is a online FREE Zeekrewards Profit Calculator that allow [sic] you [to] predict your profit from the Zeekrewards Program,” the calculator site claimed. “With this tool it’s easy and fast [to] calculate your future income or future earnings of the new people who join the program.”
Among the apparent Zeek affiliates bragging about their Zeek payouts at MoneyMakerGroup in the run-up to Zeek’s announcement about its new officers yesterday was legendary Ponzi promoter “strosdegoz,” a former cheerleader for “Dave’s” scams, along with the OneX scam and the ClubAsteria scam — and many others. “strosdegoz” has claimed to be a member of 35 HYIP boards.
Among other things, Club Asteria traded on the names of the World Bank and the American Red Cross. Hank Needham, one of Club Asteria’s purported managers, was a former AdSurfDaily pitchman and cash-gifting enthusiast shown on videotape opening packages of cash from at least two countries.
“Just received two payments now,” “strosdegoz” posted of Zeek on MoneyMakerGroup on July 29. He simultaneously was promoting Bidify, yet another emerging penny-auction site. Others joined “strosdegoz” in the Zeek “I Got Paid” cheerleading chorus on MoneyMakerGroup, including a poster known as “jumpin.”
“You’ve got cash!” a post yesterday from “jumpin” began. “Rex Venture Group LLC . . . just sent you money through Payza.”
The post went on to claim a July 30 Zeek payment of $23.98 from Rex Venture, Zeek’s purported parent company.
“Ken Russo,” another Ponzi forum legend, also has made “I Got Paid” posts that cited payments from Rex Venture. In May, “Ken Russo” claimed on the TalkGold Ponzi forum that he’d received $34,735 from Zeek since Nov. 14, 2011. “Ken Russo” posts on Talk Gold as “DRdave.”
Just plain “Dave” of the emerging DCM scam perhaps is most infamous for a “program” known as JSS Tripler 2, which appears to have based its name on the JSS Tripler/JustBeenPaid “program” purportedly operated by Frederick Mann, a former ASD pitchman. JSS Tripler 2 soon morphed into something called T2MoneyKlub and launched a companion scam known as Compound150.
T2 Money Klub and Compound150 appear to have collapsed after “Dave” purportedly was battling back from a bout with Dengue fever.
But now “Dave” appears to be back with DCM and its work-in-progress “scratch” auction.
The new Rex Venture Group officers announced yesterday, according to Zeek’s news Blog, include Greg Caldwell as “acting COO”; Josh Calloway as CTO; Clifton Jolly “to head up PR”; Angie Fiebernitz as CFO; and Alex de Brantes as executive director of training and support services.
Meanwhile, according to the Zeek Blog, Peter Mingils “is rockin’” over the “Certified Trainers course curriculum as Zeek’s Training & Incentives Coordinator,” and “Robert Mecham and OH Brown are banging out video after video and Zeek’s “FANTASTIC NEW BUSINESS CARDS!”
Dawn Wright-Olivares is Zeek’s new “Chief Marketing Officer,” after previously serving as “acting COO,” according to the Zeek Blog.
“We are writing you today and requesting your assistance. It has come to our attention that your website Hubpages.com is broadcasting and delivering content that is both copyrighted and, [sic] Trademark Protected. In addition, the content constitutes a tortuous [sic] interference with us and our 1.2 million independent advertising reps around the world.” — From communication dated July 22 and allegedly sent to HubPages. (Bolding added by PP Blog.)
UPDATED 10:23 A.M. EDT (U.S.A.) Using the pronouns “we,” “our” and “us” — while butchering a legal term and implying he had the authority to act on behalf of Rex Venture Group LLC — a purported Rex Venture “consultant” appears to have caused HubPages.com to disable a Hub written by “K. Chang” that is critical of the Rex-owned Zeek Rewards MLM “program.”
How long the “K. Chang” Hub will remain offline and whether it even will return are unclear. A Hub is an article on a specific topic. The “K. Chang” Hub questioned whether Zeek was a legal and viable business.
Zeek, which operates a penny-auction site known as Zeekler, plants the seed affiliates of the Zeek MLM “program” can earn a return in the hundreds of percent per year by sending it sums up to $10,000 and placing a daily ad for the company online. The firm has preemptively denied it is operating a “pyramid scheme.” And it claims it will ban members who describe Zeek as an investment program, despite the implication of a spectacular return and despite the fact Zeek’s business model closely resembles that of AdSurfDaily.
ASD, like Zeek, advised members not to describe the “program” as an investment program. Moreover, both ASD and Zeek had (or have) a purported “advertising” component. Zeek members place ads as part of the “program”; ASD members clicked on ads. The U.S. Secret Service seized more than $80 million from ASD-related bank accounts in 2008. ASD President Andy Bowdoin later was accused of operating a massive online Ponzi scheme that had ensnared tens of thousands of people globally.
Bowdoin faces sentencing on a Ponzi-related charge of wire fraud next month and has been banned from multilevel marketing, Internet programs and mass marketing. Zeek has listed some known ASD participants as “employees.”
In what is emerging as the latest bizarre drama involving Zeek, the “K. Chang” Hub about Zeek went missing earlier this week in the aftermath of a purported complaint for “Copyright, Trademark infringement” dated July 22 and submitted to HubPages.
The complaint, according to information “K. Chang” said he received from HubPages, was submitted by “Robert Craddock” and implied “Craddock” was acting on behalf of Rex Venture Group LLC, Zeek’s purported parent company.
Whether “Craddock” actually had the backing of Rex Venture/Zeek when submitting the complaint is unclear. “K. Chang” now says he’s trying to get the answer to that question.
The PP Blog was unable to reach Zeek for comment.
“Craddock,” according to the complaint, advised HubPages that the phrases “Zeekler; Zeek Rewards; Shopping Daisy” were protected by copyright and that “K. Chang” somehow was violating those purported copyrights. The complaint also alleged trademark infringement and libel.
Whether “Craddock” had the backing of Rex Venture/Zeek to make those claims also is unclear. Rex is not listed as the owner of any of the three trademarks allegedly cited by “Craddock” in the complaint to HubPages. “K. Chang,” meanwhile, says he’s willing to correct his Zeek Hub if there are errors of fact.
New Confusion Emerges
Screen shot: Source: Justia.com
Perhaps the biggest of the early issues surrounding the Hub flap is whether North Carolina-based Rex Venture or its Zeek arm even owns the trademarks “Craddock” allegedly brought to the attention of HubPages as part of a bid to bring down the “K. Chang” site.
Information on Justia.com, which tracks trademark applications, suggests the marks are owned by Ebon Research Systems LLC. A federal database maintained by the U.S. Patent and Trademark Office, meanwhile, references Ebon Research as “Owner” and “(APPLICANT).”
Ebon Research is a company based in Florida. The firm lists Dr. Florence Alexander and Stanley Alexander Sr. as its managing members, which leads to questions not only about whether “Craddock” had the backing of Rex Venture/Zeek to bring the complaint, but also whether he had any standing to complain to HubPages about any Zeek-related matter.
Reached by the PP Blog for comment yesterday and told about the “K. Chang” circumstance and the copyright/trademark complaint at HubPages, a woman who identified herself as Dr. Florence Alexander of Ebon Research said she had “no knowledge” of any trademark or copyright complaint filed at HubPages against “K. Chang.”
“I don’t even know what HubPages is,” she said. Alexander added that she “certainly” knew of Zeek, but declined to answer questions about whether Ebon Research had a business relationship with Zeek or Rex Venture. She then ended the call, explaining that a family matter required her immediate attention.
Compare the trademark numbers listed in this screen shot of a section of the infringement complaint attributed to Rex Venture Group to the numbers in the screen shot above.
The PP Blog reached Ebon Research by dialing a phone number published for the company on the website of a U.S. government agency that identifies the firm as an “interested vendor” of the U.S. Environmental Protection Agency. A separate, nongovernment website styled “EbonResearchSystems.com” uses the same phone number for Ebon Research published on the government website and the same street address for Ebon Research published in Florida corporation records.
The nongovernment website that uses the Ebon Research name to form its URL publishes the logos of several government agencies, including the U.S. Department of Justice, and the agencies are identified on the website as members of a “federal client list.” Ownership of the domain is unclear because it is registered through Domains By Proxy.
Whether Alexander will have additional comments later that could clarify the Zeek issues is unknown.
“K. Chang” noted yesterday that “Craddock” had identified himself in an email as a Rex Venture Group “consultant” interested in obtaining “K. Chang’s” phone number to discuss Zeek-related matters.
“I’m following up about the content you published on HubPages, regarding Zeek Rewards and companies connected with or believed to be connected with,” “Craddock” wrote, according to “K. Chang.” If you would respond with a number so I can discuss this matter with you.”
“K. Chang” added that “Craddock” used a Gmail address when contacting him, not an address linked to any of the Rex Venture domains.
That communication was signed “Robert Craddock” on one line, with the name of “Rex Venture Group LLC” appearing on the next line, according to “K. Chang,” who posts on the PP Blog in addition to maintaining the now-missing HubPages site.
After “K. Chang” received that communication, “K. Chang” received another one from “Craddock” that introduced the specter that a “corporate attorney” for Zeek “will also want to weigh in on this discussion if that is what it takes to keep your posting from being re-published on Hub Pages or anywhere else, as we believe and know this story contains false information and is disruptive to our affiliates.”
Like the actual complaint to HubPages by “Craddock,” the emailed communication to “K. Chang” also used pronouns such as “we” and “our.”
The actual complaint to HubPages, according to “K. Chang,” ended with these words (italics added):
“Rex Venture Group LLC has not given authorization, past or present, for any use, [sic] of its trademarks, [sic] copyrighted phrases. Nor does it allow, or has authorized any publication of material that is defaming and causes a business disruption for is [sic] affiliates around the world. Again I would like to thank you for your prompt attention to this matter.
UPDATED 6:36 P.M. EDT (U.S.A.) To hear some folks in HYIP Ponzi Land tell it, “opportunities” can avoid the long arm of the law by preemptively prohibiting affiliates from using certain words — “investment” and “security,” for two examples. Regardless, court records show that hucksters who played linguistic games to mask their fraud schemes confronted investigators who neatly exposed their wink-nod wordplay.
The following is from a transcript of a May 2007 U.S. Secret Service recording in which undercover agents posing as prospects were talking to Gregory McKnight of Legisi inside Legisi’s office in Michigan. McKnight and Legisi later were implicated in a $72 million Ponzi scheme that in part was promoted on the MoneyMakerGroup forum:
McKnight: ” . . . it is not an investment.”
Agent 1: “Okay.”
McKnight: “I hope you have any idea — if you have any inkling of an idea that it is an investment, then you should really . . .”
Agent 1: “I’m sorry.”
McKnight: “This is a loan to my corporation.”
Agent 1: “Okay.”
“Agent 2: “What’s the difference?”
McKnight: “The difference is — if I am selling investments and I am not registered with the SEC, I am going to prison.”
Agent 2: “Oh.”
Outcome: McKnight, adjudicated liable civilly in a case brought by the SEC and ordered to pay millions of dollars in restitution and penalties, is scheduled to be sentenced on a criminal charge of wire fraud on Sept. 11. The U.S. Secret Service brought the criminal case.
The following is from Paragraph 43 of the August 2008 complaint for forfeiture that targeted tens of millions of dollars in bank accounts tied to the AdSurfDaily Ponzi scheme, which gathered at least $110 million. ASD also was promoted on the Ponzi boards (italics added):
“The [undercover agent] asked her about investing with ASD. She immediately said, ‘Don’t call it investing, you know what I mean, we can get in trouble if we say that, we have to be careful.”
Outcome: A federal judge ordered the civil forfeiture of more than $80 million, including the forfeiture of more than $65.8 million in ASD President Andy Bowdoin’s personal bank accounts and more than $14 million in bank accounts linked to Golden Panda Ad Builder, another autosurf. The U.S. Secret Service brought the civil case.
The following is from the November 2010 criminal indictment against Bowdoin. The prosecution quoted from an email from Bowdoin in which the ASD patriarch himself laid out the wink-nod nature of the 1-percent-a-day ASD program and explained his bid to skirt securities laws by coming up with naming conventions to keep the government at bay (italics added):
“[L]et’s don’t (sic) use the words investment and returns. Instead, lets (sic) use ad sales and surfing commissions. The Attorney Generals in the U.S. don’t like for us to use these words in our program.”
Outcome: Bowdoin, currently jailed amid allegations he pushed other fraud schemes after the seizure and after his arrest and posting of bond, is scheduled to be sentenced on a criminal charge of wire fraud on Aug. 29. The criminal charge was brought after an investigation by the U.S. Secret Service.
And what about AdViewGlobal (AVG), the alleged 1-percent-a-day knockoff of ASD that prosecutors now say they’ve linked to Bowdoin? From the PP Blog’s April 27, 2009, report about the AVG forum warning members not to call AVG an investment program (italics added):
A Mod at an AdViewGlobal forum set up by Mods and members of AdSurfDaily has warned AVG members not to refer to their purchases as “investments.”
Rather, the Mod said, AVG members purchase “advertising” and are not “investing” or “investors.”
Posts that used the terminology of investments would be deleted, the Mod warned.
AVG members currently are stressing a so-called “80-20? strategy as a means of keeping the program viable for the long-term.
Analysts, however, point out that the “80-20? plans — taking out 20 percent in cash and letting 80 percent ride with the companies — are just another way to keep cash within ready reach of autosurf Ponzi schemes to sustain the deception.
There is not a single, documented case in the history of autosurf prosecutions in which the use of the word “advertising” to describe what the government views as an “investment” program involving the sale of unregistered securities has succeeded as a means of fending off a prosecution.
In other words, the government has made it plain that you can’t avoid prosecution by using other terminology to describe an investment program.
Regardless, many surf companies continue to insist that the use of the word “advertising” as a replacment for “investing” somehow insulates surfs from prosecution.
Outcome: Unknown. The AVG forum mysteriously disappeared, as did AVG itself. In April 2012, federal prosecutors announced in court filings that they’d linked Bowdoin to AVG.
Virtually all of the material quoted above has been a matter of record for at least three years. In the case of Legisi, it has been a matter of record for more than four years.
Wordplay, though, still is in play among “programs” that purport to pay members outsized percentages that correspond to annualized returns in the hundreds of percent per year. In the past 24 hours on the MoneyMakerGroup forum, for example, these posts (below) appeared in the context of the Zeek Rewards “program.” The first post used the word “investment.” Perhaps ignorant of history (or maybe not), the poster quickly followed up in the second post by saying the use of “investment” was a mistake and that what really was meant was that he or she had purchased “Bids.”
It was hard not to hear the echoes of ASD and AVG members doing largely the same thing summers ago, sometimes after being scolded by the purported forum masters.
Using rhetoric commonly associated with the “sovereign citizens” movement, a GOP candidate for a state Senate seat in Iowa abruptly quit the race on July 4 and declared herself “U.S. Senator in the Republic of the United States Of America.”
Businesswoman Randi Shannon now calls herself “Senator Randi Shannon,” Patch.com is reporting.
Much remains mysterious about Shannon’s departure from the race and apparent decision either to appoint herself a “Senator” or to accept such an appointment from a purported alternative government. Although the word “sovereign” does not appear in a four-page letter received by Patch.com from Shannon that apparently seeks to explain the recent bizarre events, some “sovereign citizens” have been known to adopt political titles and the titles of royalty.
Monty Ervin, for example, declared himself “governor” of Alabama in its “original jurisdiction.” His wife, Patricia Ervin, once declared herself a “Most Christian Princess” who’d been “certified” by Prince George, whom she described as the “Arch Treasurer” for “The United States of America” in the “Treaty of Paris of 1783,” according to court filings.
Monty Ervin later was sentenced to 10 years in federal prison for a bizarre tax scheme. Patricia Ervin was sentenced to do her time on “40 consecutive weekends.”
Perhaps the most curious part of Shannon’s letter is the even tone. Despite the extraordinary assertions included in the letter, Shannon writes with something that approaches utter detachment, as though dropping out of a Senate race while simultaneously declaring oneself a Senator is just an ordinary life choice. Here are snippets from the letter (italics added):
I want to especially thank my fellow Ron Paul for President Supporters, My Fellow Members of Liberty, My Friends who home school as did I, the many Pro-Life Members who have been so supportive of my candidacy over these past few months, and of course all my supporters in the Republican Party who have offered me so much help and encouragement, including many Republican Office holders here in Iowa, I promise you, your efforts on My behalf will be remembered.
Let me now announce to everyone in Iowa, I have become aware of the existence of the Original Republic for The United States of America. “We the People” re-inhabited our lawful de jure (de jur- “by right of lawful establishment”) government on March 30th, 2010. This is The Republic founded in 1787 and then abandoned during The Civil War in the 1860s . . .
Therefore, in order to affect the most good on behalf of The People of Iowa’s 34th District and in keeping with my conscience, I have accepted the position of U.S. Senator in The Republic of The United States of America, where I may better serve You and All of The People of Iowa. I want you to know I have taken an Oath to Uphold, Support and Defend The Constitution of The United States of America. This I will do to the best of my ability, So Help Me God.
From a post Friday at the Payza Blog at the close of U.S. business hours in the East. Companies sometimes make announcements late on Fridays to minimize PR fallout. Payza's announcement may put it at odds with customers who populate well-known forums whose members push HYIP and other scams that help fraud spread globally on the Internet
EDITOR’S NOTE: Payza seems to have taken an important step Friday in the battle against online fraud. The payment-processing company perhaps deserves an accolade for that. But it’s too soon to heap praise on Payza. We are particularly concerned about the phrasing of a specific line in Payza’s altered User Agreement. More on that below . . .
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UPDATED 7:29 A.M. EDT (JULY 17, U.S.A.) Is Payza, the payment processor operating in Canada that recently changed its name from AlertPay, finally doing the right thing?
Or is it just lip service?
Payza has announced on its Blog that it is banning programs that show “[a]ny indication or demonstration of a literal rate of return on a contribution, payment or investment, while not being licensed to sell or solicit.”
Notice the phrasing (emphasis added): “any indication of a literal rate of return . . .”
What, precisely, does Payza mean? That expressing a literal return rate no longer is OK, but all can be cured if Payza’s current HYIP purveyors and Ponzi-board hucksters hide veiled or direct references to the return (perhaps in the back offices of HYIP affiliates or someplace else out of view of the public and search engines) or somehow find a word combination that avoids a literal expression of a return and instead relies on a deeply couched expression?
This is an important question because the HYIP “industry” cannot exist without the financial vendors that enable it, either by turning a blind eye or choosing not to peel back a single layer of the onion because choosing to see is bad for profits.
The last thing the “industry” needs is an invitation to become even more clandestine in its dealings, even more clever in its use of linguistic deception, information suppression or outright misinformation. The threat to individuals and the world’s financial infrastructure posed by con men and teams of accomplices in the thousands or hundreds of thousands already is untenable.
Payza needs to reassess its use of the phrase “literal rate of return.” Left untouched, that phrase easily could turn what’s already a dangerous, wink-nod “industry” into even more of one, thus providing scammers a new back door and actually making the problem of international financial chicanery on the Internet even worse.
Because AlertPay basically chose for years to gorge itself on HYIP fees and not to take the clues offered by the prosecution of e-Gold in the United States (by members of the same team that prosecuted the AdSurfDaily autosurf HYIP, BTW) and the disintegration of e-Bullion (while its operator stood accused of arranging the brutal contract slaying of his wife, a potential witness to e-Bullion’s Ponzi-sustaining fraud), we cannot yet offer Payza three cheers.
Owing to AlertPay’s history of choosing in e-Gold and e-Bullion-like fashion to see no evil, we question whether use of the word “literal” is just a means of signaling the scammers to do a better job of using language to disguise an investment program as something else or to hide and/or otherwise bury language that speaks to the investment elements. In the past few weeks, for example, the Payza-dependent JSS Tripler/JustBeenPaid “program” suddenly changed the language on its home page to say it offers a “LEGALLY COMPLIANT & PATENTED SYSTEM.”
Let’s pause for a moment to state the obvious, something that somehow often gets overlooked by HYIP apologists: Real people — living, breathing human beings — are being sucked into these utterly contemptible “programs” that are being enabled by processors such as Payza and SolidTrustPay.
And suddenly — out of the blue — JSS/JBP announced it was using a “WORLD RENOWNED LAW FIRM” to assure compliance. These things bizarrely clashed with recent claims by Frederick Mann, the purported operator of JSS/JBP, that attorneys could not be trusted, that government employees weren’t welcome in the “program,” that registering with securities regulators was a sign “you’ve signed up to be a slave, part of the slave system, and then they have jurisdiction over you and can shut you down” and that JSS/JBP members had nothing to fear because the “program” had no presence in the United States.
Now, all of a sudden, JSS/JBP has found the religion of compliance — or at least the language of the religion of compliance.
The New Religion Of Compliance
The Payza-dependent Zeek Rewards MLM “program” also is preaching the religion of compliance, even as it plants the seed that it can provide a JSS/JBP-like annual return of between 365 percent and 730 percent without being the Bernard L. Madoff Investment Securities LLC of multilevel marketing.
Part of what Zeek appears to be doing falls along the lines of not expressly stating a literal return. Welcome to the world of vomitous MLM in the year 2012. The players are eager to tell you what they’re not, less eager or completely unwilling to tell you what they are, and can bring a virtually unlimited supply of Stepfordians to the fore to help them cloud the issues.
Zeek has told the public it is not a “pyramid scheme.” It now says it will ban members who describe the “opportunity” as an investment program, despite the seed Zeek plants that participants can earn a return of between 1 percent and 2 percent a day. Some Zeek affiliates are practically tripping over themselves these days in what strikes us as a bizarre race to see how many times they can fit the words “attorneys” and “compliance” in their forum “defenses” for Zeek.
This Blog has not seen one instance in which a Zeek attorney has described the “program” as legal. Even so, we’ve seen plenty of examples in which Zeek affiliates implied that attorneys had given Zeek the all-clear and at least a few examples in which affiliates implied that agencies such as the SEC and FTC had scrubbed Zeek for compliance and found it in fine fettle. There have been hugely disingenuous claims from Zeek affiliates in this area — everything from describing the lack of any action against Zeek by the SEC or FTC as evidence that the agencies had examined Zeek and found nothing lacking to planting the seed that the lack of any action by the agencies is proof that Zeek is operating lawfully.
Zeek itself played this miserable game. In June, a North Carolina television station carried a report that suggested Zeek had been found to be operating lawfully by the office of North Carolina Attorney General Roy Cooper. Zeek linked to the TV station’s video report on its news Blog and certain Zeek promoters pointed to the report as proof of Zeek’s legitimacy.
But Cooper’s office said it never said Zeek was operating lawfully. After the TV station was contacted by Cooper’s office, which was concerned about the clarity and accuracy of the video report, the station removed the report. The incident produced one of those awkward moments that too often accompany the MLM trade: Zeek plainly liked the TV report because it construed Zeek as operating lawfully. The report then became a tool in Zeek’s PR arsenal — and Zeek wanted to make sure its affiliates had the same tool. It used its Blog to point affiliates to the video, and some of them predictably used it as evidence the Zeek critics were wrong and to plant the seed that Zeek had passed muster in North Carolina.
By linking to the report, Zeek tried to maximize its PR hand. When the report was removed, Zeek had nothing to say. The post on Zeek’s news Blog in which the company originally crowed that “Zeek Makes the Channel 2 News” now has been removed. Although the precise date and time in which Zeek removed the post are unclear, a Zeek affiliate with his own Blog sought to capitalize on the TV station’s report in a post that still remains.
That post featured a three-tiered headline that screamed, “Zeek Reward [sic] featured on Chanel [sic] 2 News[.] Zeek Reward [sic] featured on Chanel [sic] 2 News[.] Zeek Reward [sic] makes it on TV. Get In On the Action!”
This post on the "Empower Network" Blog of a Zeek affiliate included a three-tiered headline and a link that pointed readers to a TV station's report about Zeek. Like Zeek itself, the "Empower Network" is an MLM "opportunity."
The affiliate’s post included a graphic that described Zeek as a “Passive Income!” opportunity. One link on the site pointed to the now-removed TV station video. Another link, however, pointed to post that included a YouTube version of the TV station’s report. That YouTube report included a headline and “crawler” in a language other than English.
Like the post that included the three-tiered headline about Zeek’s TV appearance, the second post included the graphic that described Zeek as a “Passive Income!” program. The claim about passive income speaks to the heart of the issue of whether Zeek is selling unregistered securities as investment contracts and trying to disclaim its way out of an encounter with regulators.
Although a TV station took down its link to a video report on Zeek, a YouTube version apparently existed.
The Culture Of Willful Blindness
Confusing messages appeared repeatedly when the AdSurfDaily Ponzi case was playing out. All of it was monumentally embarrassing to MLM. In one instance — while it was awaiting a key ruling from a federal judge in October 2008 on whether it had demonstrated it had sufficient income and was not a Ponzi scheme at a hearing it requested and the judge granted in the interests of justice — ASD insiders leaked a story that ASD expected a revenue infusion of $200 million from a penny-stock company.
The ASD Stepfordians immediately raced to forums to spread the good news. But skeptics immediately questioned the claim, pointing out that Praebius Communications — the penny-stock firm that supposedly was going to provide ASD a $200 million injection — did not even publish audited financials. SEC records later showed that, in October 2008, the same month ASD was awaiting the court decision and claiming a new $200 million was coming on board, Praebius stock was being pumped in a fraudulent-touting scheme.
Over time, serious questions were raised about whether certain MLMers within ASD were engaging in bids to obstruct justice. Rumors were planted that federal prosecutors had secretly admitted ASD was not a Ponzi scheme but were clinging to the case as part of a bid to save face. In 2008, ASD members who did not even question the bizarre claims coming from ASD or ASD insiders raced to forums and spread a false report that Ponzi charges had been dropped against ASD in Florida. That development prompted the attorney general of Florida to issue a statement that, not only had Ponzi charges not been dropped against ASD in the state, they’d never been brought to begin with. Indeed, Florida charged ASD with operating a pyramid scheme.
The names of both AlertPay and SolidTrustPay appear in court filings in the ASD Ponzi case. It is hardly coincidental that both Zeek and JSS Tripler/JustBeenPaid also have ties to the same processors, which are offshore from a U.S. perspective. These processors are the e-Golds and e-Bullions of Canada. They also are referenced in the Pathway to Prosperity Ponzi case, which the U.S. Postal Inspection Service called a global fraud affecting 40,000 people from 120 countries. In December 2010, the federal prosecutors handling the ASD case made the first public filing that referenced e-Bullion in the context of ASD.
In 2011, e-Bullion operator James Fayed was convicted of arranging the contact slaying of Pamela Fayed, his estranged wife who was found slashed to death in a Los Angeles-area parking garage. There is absolutely no doubt — zero — that e-Bullion was enabling Ponzi schemes. James Fayed has been sentenced to death for arranging the brutal killing of his wife, a potential witness against him.
It is beyond the pale — and almost beyond belief — that certain MLMers continue to insist there is something noble about these miserable money games, that they somehow represent the best of the free market and the entrepreneurial spirit, that they’ve somehow succeeded where other MLMs have failed.
What they are are recipes for financial and personal destruction that operate as slow-motion Ponzi schemes. They need to be destroyed, not duplicated. Far from being exciting, new niches — as some MLMers tell the story — they are form-shifting monsters that spread the greatest financial cancers devised in the history of mankind. They are so dangerous that external fraudsters target them as a means of unloosing secondary frauds — everything from the issuance and passing of bogus checks to organized credit-card fraud. Some of them have been linked to narcotics-trafficking or money-laundering operations. Some of the investigators who assisted in the ASD Ponzi case also developed this case.
From our May 16, 2010 report on the EMG/Finanzas Forex case (italics added):
Research by the PP Blog suggests the purported investment program was so sordid that promoters even claimed some of the funds were being used for the “humanitarian” purpose of assisting kidnapping victims in Colombia. In a sickening display of marketing theatrics, a claim was made that investors could “adopt” kidnapping victims for a payment of $1,000 and that the company would set aside $500 in corporate funds for each victim so that their families could have bright futures if the victims ultimately were released by their captors . . .
The HYIP scheme allegedly was associated with an entity known as Evolution Market Group (EMG), which purportedly had a Forex component known as FinanzasForex. Investigators alleged in January that there were schemes within schemes in a tangled web of domestic and international deception that featured dozens of bank accounts, shell companies and various fronts for money-laundering enterprises, including companies purportedly in businesses such as real estate and car washes.
The scheme was so corrupt, according to court filings, that some investors were told that, in order to leave the program whole, they had to recruit new investors, have the new investors pay them directly — and use the proceeds from the new investors to “recover” their initial outlays . . .
A Glimmer Of Hope
We do find a glimmer of hope in Payza’s announcement because Payza’s use of the phrase “any indication” implies it actually intends to exit the fraud-enabling business and intends to protect its reputation moving forward and make it harder for viral scammers who use its service to rob people without the aid of a gun.
A return — plainly stated or implied — would seem to fall under the “any indication” umbrella. Another indication is the presence of a “program” on the Ponzi boards. (Like ASD and EMG/Finanzas Forex, Zeek and JSS/JBP have a presence of the Ponzi boards.)
Yet another indicator of fraud is disclaimer language that seeks to cloud regulatory issues by planting the seeds that payouts are not guaranteed and that joining a “program” with a plainly stated or implied return does not constitute making an investment.
Much of the HYIP fraud “industry” exists because of the wink-nod deal and the willful blindness of the purveyors, including serial scammers with global reach and payment processors that gorge themselves on fees while serving what effectively are criminal combines consisting of like-minded individuals and “teams.”
Also banned, according to the Payza Blog post, is the the “[s]elling of Unregistered/Unlicensed Stocks, bonds, securities, options, futures, or investments in any entity or property, including (but not limited to) corporations and partnerships or sole proprietorship . . .”
Meanwhile, Payza says this (italics added):
“Solicitation, marketing campaign, direct selling or any other comparative effort will be considered a violation of the User Agreement. If you are registered or licensed to take such action, you may be requested to present documentation demonstrating authority to do so from a Securities Exchange Commission, Commodities Futures Trading Commission or other equal and comparative agency.”
Language in the full, six-paragraph announcement is exceptionally formal, bordering on the florid. But if the aim is for Payza to say no to fees and wrest itself from the wretched, pain-producing universes of HYIPs, autosurfs, cycler matrices and other “programs” that reach across national borders and fleece people on a global scale, the ornate language will become only a tiny footnote.
What’s far more important is that Payza will have said no to the scammers and a subculture of eager, greedy pitchmen who help financial crime spread globally and line their pockets on the current (or pending misery) of their marks.
It is possible these days for a scammer hiding in the darkest corners of the Internet to pick the pocket of a “customer” and contribute to a mortgage foreclosure or even the failure of a bank a continent away. Such “programs” often are pushed in the purported name of freedom itself, as a purported means of helping a neglected Everyman escape the shackles of poverty and become a free man who’s escaped his tyrannical captors.
But because the scammers’ schemes constantly evolve and because they often rely on overblown prose to disguise the fraudulent nature of their “programs,” it is going to take more than just words from Payza to incorporate any real change.
For example, could an “opportunity” that simply comes up with different naming conventions and avoids the traditional language of investments fool the checkers at Payza? Or could an “opportunity” that shields Payza from information perhaps by publishing it only in the back offices of the “opportunity’s” members escape scrutiny?
And because HYIPs and their willfully blind, serially disingenuous promoters already are infamous for wink-nod presentations, the use of disclaimers and even outright denials that an investment program of any sort is being offered, will the criminal minds who dominate this cancerous space go into overdrive to come up with new and more clever ways to disguise fraud schemes?
What To Watch For
Will panic engulf the HYIP sphere because of the Payza annoucement? Here are some things to look for:
Masked investment “programs” — perhaps aware they are under scrutiny — taking once-public forums offline and engaging in bids to further compartmentalize information and scrub negative information.
Management and affiliates of such “programs” making veiled or direct references to “attorneys” and “compliance” as a means of suggesting they are wholly lawful and embrace responsible corporate citizenship.
Increased lead times between “program” payment cycles, perhaps initially explained away as “growing pains.”
Payment bottlenecks to develop as “programs” horde cash or cash equivalents and become fearful that once-reliable enablers are hopping off the wink-nod fraud train because they realize the real world no longer is going to tolerate international lawlessness so a scammer on the TalkGold or MoneyMakerGroup forums can get rich by picking the pockets of senior citizens, deaf people, the unemployed and the struggling. (Also known as the AdSurfDaily problem.)
An uptick by scammers in the use of floridspeak as a means of talking around serious legal issues and masking the investment elements of a “program.”
The creation of bogus “regulatory agencies” and “trade groups” to create the appearance that a responsible party with legal authority is monitoring the store. (Note: A bogus regulator was an element of the George Theodule Ponzi scheme in Florida.)
The sale of purported memberships in these purported “regulatory agencies” and “trade groups.”
Read the Payza post, which was made Friday at the close of traditional business hours in the Eastern United States.
From YouTube sales pitch for BidsThatGive by Randy Jeffers. (Children's faces masked by PP Blog.)
EDITOR’S NOTE: It is true that far too many of the world’s children live in poverty. It also is true that children may become the objects of criminals who engage in human trafficking and that children are exploited in the sex trades. It is equally true that legitimate charities exist to combat these horrific situations and that one MLM “program” after another has tried in recent times to tug at the human heart and “marry” their “programs” to a purported cause. If you desire to improve the human condition for the masses of children, it likely is best to donate directly to a legitimate charitable organization, rather than joining a get-rich-quick scheme that says it is doing good work behind the scenes.
** __________________________________________ **
UPDATED 6:57 P.M. EDT (U.S.A.) WARNING: The following development in MLM La-La Land may be harmful to your gag reflex.
Zeek Rewards, the U.S.-based MLM “program” that wraps itself in the American flag, collects sums of up to $10,000 from participants, plants the seed affiliates can earn a return of between 1 percent and 2 percent a day while insisting it is offering neither securities nor an investment program, has a payout scheme similar to the AdSurfDaily Ponzi scheme and securities swindle, is married to a penny-auction site known as Zeekler that has told successful bidders for sums of U.S. cash that they can receive their money via offshore payment processors and preemptively denies it is a pyramid scheme, has some emerging, U.S.-based competition.
The name of the “program” is “BidsThatGive” — and it unabashedly tugs at heartstrings while at once asking prospects to imagine themselves behind the wheel of a grand automobile and feeling good because they also could become a “Contributor” for $10 a month, a “Guardian” for $50 a month, a “Benefactor” for $100 a month” or a Global Ambassador” for $250 a month and pile up mountains of cash while they’re displaying a social conscience.
Two of the core aims of the “program,” according to a nine-minute video promo running on YouTube, are to help impoverished children and children who’d been exploited and became “sex slave[s].” The prelaunch of BidsThatGive appears to have been timed to coincide with the Independence Day holiday period in the United States.
One of the assertions in a the YouTube video is that the “rewards” the company provides include “an orphanage and a school, church or hospital built in your name.” All of this apparently is possible because BidsThatGive has a “global business model” and employes a “concept” known as “PPSC,” which stands for Private Profit Sharing Company.
But before we get to the uber bizarre, let’s address the run-of-the-mill bizarre in this latest entry in MLM La-La Land.
BidsThatGive is a little bit Andy Bowdoin. Indeed, the emerging penny-auction company with an MLM-style compensation plan, claims it’s not an MLM program and tells prospects they’re “probably not going to sleep at night” once they understand the profit potential. Bowdoin, the infamous AdSurfDaily Ponzi schemer, told prospects that ASD was not a “network marketing company” and used largely the same line about all the sleepless nights excited prospects would experience.
Meanwhile, BidsThatGive is a little bit like AdViewGlobal (AVG), a collapsed 1-percent-a-day Ponzi autosurf federal prosecutors said in April 2012 had ASD ties. AVG once claimed that one of its desires was to save the rainforest through charitable contributions. BidsThatGive also resembles ClubAsteria, which offered outsize weekly returns ranging from 3 percent to 8 percent and told prospects that its charitable arm would provide relief to victims of the devastating earthquake in Japan last year. ClubAsteria also purported to provide aid to children and claimed its mission was to elevate the word’s poor out of poverty.
And BidsThatGive also resembles DataNetworkAffiliates (DNA), which tied itself to the U.S. AMBER Alert system for rescuing abducted children and said its “token system” could help prevent child poverty.
“Help DNA Feed A Million. OVER 1000 AN HOUR DIE. The DNA Token System Can Prevent This!” the company exclaimed.
Among other things, DNA used a YouTube video to trade on the name of Adam Walsh, the 6-year-old who was abducted and murdered in Florida in 1981. Adam’s father, John Walsh, became a prolific advocate for children and later became the host of the “America’s Most Wanted” television series.
DNA, which was associated with longtime MLM huckster Phil Piccolo, appears not to have helped a single abducted child or a single child living in poverty. Affiliates, though, tried to plant the seed that the DNA “program” was backed by Oprah Winfrey and Donald Trump. When DNA’s CEO resigned suddenly in 2010, the company waited nearly a week to announce the departure — and then misspelled the former CEO’s name.
BidsThatGive Operator
Randy Jeffers, an MLM aficionado, is the purported operator of BidsThatGive, according to promo videos on YouTube. Jeffers also presides over a nonprofit entity known as “Liberty Kidz,” which says its “[v]ision is to empower a child to be all that he or she is created to be, by providing homes, help and hope for discouraged, displaced and distressed children of the world.”
A similarly named Jeffers’ entity known as Liberty International LLC filed for bankruptcy in August 2010, listing about $1.94 million in debt and $641 in assets, according to federal records. The assets consisted of the balance of a business checking account.
What follows are comments from Jeffers in the nine-minute sales pitch for BidsThatGive on YouTube (italics added):
You know, there are so many terrible things that happen to children all over the world. Right now a little boy is dying of hunger, a little girl just got sold by her mother and is being forced into life as a sex slave.
Right now, children are being physically abused, and then there’s so many children that are just left by themselves and there’s no one there to love or care for them. I don’t know why bad things happen to innocent little children, but they do. But here’s what I do know: All of us can do something about it.
You see, that’s our No. 1 purpose. This company was founded to be a true partnership between those children, the children’s charities that it supports and its affiliates who make it all happen.
A ‘Founding Member’
One of the founding members of BidsThatGive is Glen Woodfin, according to 6:56 promo video dated July 2 and running on YouTube.
Woodfin describes himself in the video as an American who once moved to Brazil to be with his “multimillionaire” fiance who had 90 employees. Enjoying the “good life” on the beach while sitting around drinking “coconut milk” was fun for a while, but ultimately led to a desire to become more productive and to develop an online skill set. Woodfin ultimately discovered he had a talent for search engine optimization and that clients were interested in those services.
Glen Woodfin, who says he's done SEO for a Presidential candidate, does a little dance in his Bids That Give sales pitch on YouTube.
His SEO skills ultimately became so good that “I was hired by somebody running for President . . .,” according to Woodfin, who narrates the video. He did not identify the candidate.
Woodfin, however, goes to to explain that he was fortunate to know author and White House adviser Doug Wead, who wrote “All The President’s Children,” a New York Times Bestseller. (Wead’s Wikipedia entry says he advised GOP Presidents George H.W. Bush and George W. Bush.)
Apparently in the market for SEO advice, Wead turned to Woodfin, according to the video.
“He said, ‘Glen, we’ve got one of the Presidential children about to get married in three weeks, and we don’t have a website up. Can we get in there and get to the top of the search engines with it?’” Woodfin recalled.
That Presidential child, according to Woodfin, was Chelsea Clinton, daughter of former President Bill Clinton and U.S. Secretary of State Hillary Clinton.
Over the weekend Chelsea Clinton got married, Woodfin said, his SEO techniques on Wead’s behalf put a site known as ChelseaClintonWeddingWatch.com at the top of the rankings. (Chelsea Clinton was married on July 31, 2010.)
When NBC News anchor Lester Holt was interviewing Wead, Woodfin said, Holt mentioned the website Woodfin had put at the top of the rankings, apparently attributing the feat to Wead.
Neither BidsThatGive nor Jeffers is mentioned in the first three minutes of the Woodfin video. But at roughly the 3:03 mark, Woodfin announces, “I’m going in business with a gentleman named Randy Jeffers. Randy Jeffers started the No. 1, fastest-growing MLM of all time, called Destiny. They put in 1 million distributors in 18 months.”
Woodfin goes on to say that Jeffers recently called him and offered him a “founder’s membership” in BidsThatGive.
“While he’s talking, the hair start[s] standing up on my arm, and I got thrilled,” Woodfin recalled. “As a matter of fact, every time I get off the phone with him now, I’m just, ‘Thank you for putting this together.’ It’s based on penny auctions . . .”
It’s not known whether Woodfin contacted the White House, Wead, Clinton and Holt as a courtesy to let them know he’d be using their names in a YouTube pitch for Jeffers’ BidsThatGive. What is known is that namedropping is common in the MLM sphere — often without the knowledge of those whose names are dropped.
Although the Woodfin pitch did not imply that any of the celebrities or institutions mentioned in the pitch endorsed BidsThatGive, the implication was clear that BidsThatGive prospects who joined under Woodfin would gain access to an SEO expert who’d worked for a Presidential candidate and knew a Presidential adviser.
Neither the Jeffers’ video nor the Woodfin video referenced the Liberty International LLC 23-month-old bankruptcy filing. Nor did either video address any of the potential problems BidsThatGive could encounter from regulators.
Like the Zeek Rewards’ business model, the BidsThatGive model resembles that of ASD. In 2008, the U.S. Secret Service seized more than $80 million from ASD-related bank accounts, including $65.8 million in the personal accounts of Andy Bowdoin.
Court records showed that ASD was trading on the name of then-President George W. Bush. Analysts saw it as a transparent bid to sanitize the “opportunity” by trying to link it to the White House.
Major politicians from both sides of the aisle have seen their names used in promos for “opportunities” that proved to be Ponzi schemes.
Former President Clinton’s name and image were used by the Mantria Corp. Ponzi scheme. Clinton is a Democrat.
U.S.-based Xocai features attractive products in attractive packaging. The behavior of some of its supporters is decidedly less than attractive, something that is generating negative headlines in Europe and the United States.
From the Stepfordian cheerleading for the Zeek Rewards MLM “program” (and its purported nonguaranteed, nonreturn return of between 1 percent and 2 percent a day) to the mind-bending and long-running circus surrounding AdSurfDaily (1 percent a day with an operator who was a recidivist securities huckster and now has pleaded guilty in the ASD MLM Ponzi case) and JSS Tripler/JustBeenPaid (2 percent a day while fretting about “cruise missile” attacks on its server by purported criminal governments bent on destroying free enterprise), a certain sphere of the MLM universe has been serving up a symphony of the bizarre.
But what reportedly occurred in Norway recently in the MLM sphere not only is bizarre, but also makes some MLMers look like a gang of out-of-control, conspiring thugs and extortionists.
BehindMLM.com is reporting today on lawsuit threats and other hair-raising taunts directed at a Norwegian critic who raised questions about how the Xocai MLM “opportunity” was being presented in Norway.
Xocai is a brand of chocolate marketed by Nevada-based MXI Corp. MXI stands for Marketing Xocolate International Corp., according to the company.
No legitimate MLM company or MLM affiliate should tolerate or model this fantastically ill-advised behavior, which can have severe repercussions and is creating negative headlines for both Xocai and MLM.
It is the worst possible sort of “public relations” in “defense” of a company. Not only does it smack of a bid to force mob rule in the Internet Age and speak to issues of extortion, emotional blackmail and the disingenuous whitewashing of ill intent, it raises very real concerns about how a mob can undermine free speech and jeopardize the security of individual MLM critics and their family members, friends and associates.
It is worth noting that supporters of AdSurfDaily also threatened to sue critics. At the same time, it’s worth noting that a threat to sue an ASD critic for $40 million in July 2008 became part of a government series of exhibits in the ASD Ponzi case.
But the story about the negative PR Xocai suddenly is experiencing goes far beyond simple lawsuit threat reportedly made in its name. Indeed, the story of the lawsuit threat is gathering attention because of companion threats, even as company says it is trying to build a powerful brand.
Xocai says it recently obtained a trademark on the phrase “Healthy Chocolate” and seeks to become a business icon. These things are commendable, and the company has made its accomplishments and goals part of its PR stable.
“Approval of the ‘Healthy Chocolate’ trademark represents a significant milestone for MXI,” said Andrew Brooks, founder and chief operating officer of MXI Corp., in a May 21 news release on the company’s website.
“We’ve increasingly become known as the ‘Healthy Chocolate’ company, utilizing proprietary formulations of premium ingredients, along with cold-processing techniques, to retain the nutritional potency of cacao and açai berries,” said Brooks. “With this milestone, we now have another important tool to establish ourselves as the icon for Healthy Chocolate, both inside and outside our industry.”
We’re wondering today whether the company, which plainly states it seeks to become a business icon and clearly values its brand and its new trademark, finds the BehindMLM story disturbing enough to repudiate the behavior that is the subject of the story.
The PP Blog will provide space to Xocai should it choose to speak to the events in Norway. It could score a lot of PR points by denouncing those events and putting it on the record that it will not tolerate MLM thuggery in its name.
Every word of the BehindMLM story is worth reading. (Link below.)
The upshot is this: An apparent Xocai “defender” unhappy about a series of Blog reports planted the seed that the company would be filing a “a seven digit lawsuit” against the Blogger. The lawsuit, according to the “defender,” was backed by the majority of a trade association consisting of 9,000 Norwegian Xocai members.
But the menacing reportedly didn’t stop there.
In fact, according to the BehindMLM story, it devolved into a situation in which the “defender” planted the seed that other Xocai “defenders” would make trouble for the Blogger with his private employer. To maximize the chill, the “defender” made sure the critic knew that an intelligence-gathering operation was occurring behind the scenes and that Xocai supporters might just appear at his gate and at the gates of his loved ones.
Of course, the Xocai “defender,” a purported “association,” washed its hands of any suggestion its intent was anything less than noble. The seeds planted that the life of the Blogger, his personal security and the security of his loved ones could be ruined in an instant if he didn’t behave in a certain way — well, those things apparently were not to be viewed as threatening. It was just business, or so the disingenuous, vomitous talking points of the “defender” go.
Our view is that is just the latest example of something we’re inclined to describe as an evolving MLM radicalism. It is particularly dangerous because certain parts of the MLM universe are known to reflexively model anything that “works” with complete disregard for the consequences.
It reminded us of what happened to this police chief in Georgia earlier this year. The chief allegedly was targeted in an intimidation campaign by a “sovereign citizen.”
The bid to “defend” Xocai by trying to make a Blogger believe everything he valued in life could be gone in an instant is deplorable. It is ugly past comparison. Unfortunately it is hardly unique in the recent annals of MLM’s Thug Wing.
I’ve delayed putting up this month’s donation post as long as I could, but we’re at the edge of July and have a new round of bills to pay. This month’s need is on the order of $550. Please give if you’re able. By giving last month, a small handful of readers were responsible for each story you’ve read this month and for keeping our entire archive of 1,681 stories, 6,975 tags and more than 12,000 other links online.
