PatrickPretty.com

Category: Writing And Branding

  • BULLETIN: FLORIDA — AGAIN: FTC Seeks Contempt Sanction Against Firm That Allegedly Hawks Deceptive ‘Food Stamp’ Guide And Credit-Repair Services; Bizarre Website Linked To Defendants Rails Against ‘Greedy Politicians’

    BULLETIN: The Federal Trade Commission has gone to federal court in Fort Myers to seek contempt sanctions against Florida companies accused of encouraging prospects to misrepresent information on applications to receive Food Stamp benefits.

    Prospects who followed the advice could be charged with a crime, the FTC said.

    The companies and their principal also are accused of violating a March 2010 court order that prohibited them from marketing credit-repair and debt-elimination programs deceptively. Named in the contempt petition are Sam Tarad Sky, Allrepco LLC, Credit Restoration Brokers LLC (CRB), and Debt Negotiations Associates LLC.

    “In violation of the Stipulated Settlement Order, Contempt Defendants Sam Sky and
    his companies have launched a scheme to defraud economically distressed consumers who
    may be interested in receiving food stamps,” the FTC charged. “Specifically, taking cynical advantage of the recent economic downturn, Sky and his companies deceptively market a ‘Food Stamp Eligibility Tool Kit’ . . . to consumers seeking financial help. Sky and his companies market the product as an ‘automatic,’ ‘hassle free’ method by which ‘virtually
    everyone’ can receive food stamps ‘without any risk.’

    “In fact,” the FTC continued, “eligibility for food stamps remains strictly limited and the vast majority of Americans do not qualify. To side-step these longstanding limitations, Sky’s ‘guide’ encourages consumers to provide so-called ‘ideal’ information on their food stamp applications thereby misrepresenting their income and expenses. Following such advice is hardly ‘without any risk.’ Rather, it puts consumers at considerable risk of criminal prosecution for public benefits fraud. Finally, Contempt Defendants also violate the Stipulated Settlement Order by unlawfully requiring payment before performance for credit repair services and refusing to make required disclosures about the timing and risk of debt negotiation.”

    Today’s filing is rich with coincidences. For one, one of the accused firms — Debt Negotiations Associates — uses the acronym DNA. The DNA acronym also has been used by a separate, unrelated company known as Data Network Affiliates, which also operates in Florida. Data Network Affiliates offered a purported debt-reduction program tied to purported mortgage re-writes, while at once advising prospects it was in the business of gathering data to help the AMBER Alert program rescue abducted children.

    Data Network Affiliates, which is associated with Internet Marketer Phil Piccolo, later appears to have morphed into a company known as OWOW, which offered purported cancer cures and a “magnetic” product purported to have prevented a leg amputation. The purported “magnetic” product also was positioned as a device that could help tomatoes grow to twice their ordinary size and dairy cows produce more milk.

    In another rich coincidence, promoters of a Florida company known as MPB Today targeted Food Stamp recipients last year in promos that implied Food Stamp money could be used to join the MPB Today MLM program and that a $200, one-time purchase could result in free groceries for life.

    One promo for MPB Today even advised prospects to sell $200 worth of Food Stamps to a family member to raise the cash to join the MPB Today program. The promo, which appeared in the form of a news release, purported to be the byproduct of a thought that had popped into the promoter’s head on a drive home from “church” on a “beautiful Sunday afternoon.”

    The U.S. Department of Agriculture said last year that it was investigating certain claims about the MPB Today program.

    Read the extraordinary allegations outlined in the FTC’s contempt petition against Sam Tarad Sky, Allrepco LLC, Credit Restoration Brokers LLC (CRB), and Debt Negotiations Associates LLC.

    Among the allegations was that Sky had started a “new ficitious business” known as “Florida Consumer Assistance” to hawk the purported Food Stamp guide. The new scheme also featured the creation of a website known as MyFoodStampCard.com, according to the FTC.

    The website, which is still active, appears to make a series of political statements. Under a subhead of “THE SICKENING STIGMA,” for instance, the site says this:

    “The sickening stigma – most all of us grew up in a time where our parents and grandparents – worked hard – never took a hand out and wouldn’t ever let their credit go bad, or even miss a house payment! This is not the same America – ‘Political Greed is destroying our children’s future’ and our retirement opportunities.

    “If you 100% disagree with the previous sentence – then leave this website now.” the site barks.

    “Good people need to wake up!” the site continues. “Good people have lost their homes and lost their savings trying to do the ‘right thing’ – but what they didn’t understand is the ‘right thing’ is really now the wrong thing. Back in the day, doing the ‘right thing’ would’ve NEVER put good people in the positions that they’re in today.”

    The site eventually asks for “1 Easy Payment Of $99.95,”  instructing prospects that “You do not have to pay a private social worker $599 to give you assistance.”

  • BULLETIN: FTC Goes To Federal Court To Take Down Alleged Acai Berry Scam Operating On ‘Fake News Websites’; Some Domains Listed In Complaint Now Load Error Messages Or Blank Pages

    Is this an image of a "fake" reporter sometimes listed as "Julia," "Stacie" or "Karen," depending on the acai-berry site?

    BULLETIN: (Also see editor’s note below.) The Federal Trade Commission says a major law-enforcement initiative is under way to stop an acai-berry weight-loss scam that features “fake” news stories on websites that appear to be real media outlets but are really just sites that flog acai products. The agency appears to have filed at least six lawsuits against multiple defendants. Although the complaints are filed in Washington state and Illinois, the corporate and individual defendants do not all reside in those states, according to documents viewed by the PP Blog.

    Some of the defendants reside in Minnesota, Texas, Michigan, California and New York.

    Although the FTC said today that it did not plan to announce until Tuesday the names of the defendants in the cases alleging that fake news sites were hawking acai products, some sites that aggregate court filings are showing that the agency filed complaints Wednesday against Tanner Garrett Vaughn in Washington state; Ambervine Marketing LLC, Encastle Inc. and Zachary S. Graham in Illinois; Beony International LLC, Cody Adams and Mario Milanovic in Illinois; IMM Interactive Inc. in Illinois; Ricardo Jose Labra in Illinois; and Thou Lee in Illinois.

    Details of the filing that names Thou are unclear. Like the others, the Thou case is listed on Justia.com, with the FTC as the plaintiff and Thou as a defendant. The case number is sequential to the others, which suggests it was filed at the same time.

    Separately, Courthouse News Service has obtained a copy of the complaint against IMM Interactive, which once was known as Intermark Communications Inc. and does business as COPEAC and Intermark Media, according to the FTC. Courthouse News published the IMM Interactive complaint yesterday.

    It is unclear if the FTC  is filing actions in states beyond Washington and Illinois. The PP Blog checked several domain names alleged by the FTC to have delivered fraudulent news content about the acai berry. Each of the domains threw error messages.

    It was not immediately clear if the domain owners shut down the sites independently or if one or more federal judges ordered the sites taken down. Each of the URLs tested by the PP Blog had domain names that implied visitors were at a journalism site.

    “Millions of consumers are being lured to websites that imitate those of reputable news organizations,” the FTC said today. “The ‘reporters’ on these sites supposedly have done independent evaluations of acai berry supplements, and claim that the products cause major weight loss in a short period of time with no diet or exercise.

    “In reality,” the agency continued, “the websites are deceptive advertisements placed by third-party or ‘affiliate’ marketers. The websites are aimed at enticing consumers to buy the featured acai berry weight-loss products.”

    In past acai-berry cases, the FTC has said Internet Marketers had ripped off customers in promos featuring bogus testimonials and hidden continuity-billing schemes. Talk-show host and business icon Oprah Winfrey has filed lawsuits against acai promoters who’ve traded on her name.

    EDITOR’S NOTE: The acai-berry scandal is growing, and it may not be easy for promoters in the direct-selling sphere to contain or explain away. Some sites that appear to use “fake” reporters continue to be operational and appear to be hosted on any number of domain names owned by individual promoters. One “fake” reporter featured in “news” accounts appears to have been referred to by three different names, but also appears to be the same “person” — that is, the sites used the images of an attractive female  “reporter” and changed the “reporter’s” name. Details about how much weight the “reporter” purportedly lost also varied from site to site. One site we viewed had a disclaimer in small type at the very bottom of the page. The disclaimer appeared against a gray screen, which created a washing effect. The type was smaller than the type of the fake news report, which used black type against a white background. We could not read the disclaimer without glasses.

    Perhaps the most intriguing element of the developing story is why the promoters simply did not permit the acai-berry products to be sold on their own merits. An entire fantasy world featuring interchangeable, fake reporters or news anchors appears to have been created to drive sales.

    To be sure, today is not a banner day for Internet Marketers. When MLM and direct-sales aficionados in general wonder why there are so many critics, they need look no further than the acai-berry sector. Despite case after case in which the government and private litigants such as Oprah Winfrey alleged elements of false advertising and bogus business practices, purveyors of the schemes dialed up the acai madness to greater and greater extremes.

    A big section of the public no longer may know what is real and what is fake in the acai world. One of the reasons is that promoters also have used the names of real media companies to plant the seed that they endorsed the acai offers.  Today alone we have seen the logos of CNN, Forbes magazine, ABC, CBS News and USA Today in acai promos. The promoters clearly were trying to plant the seed that the famous media companies had endorsed the product.

     

  • BULLETIN: Corrupt MLMers Found Guilty Of Operating Pyramid Scheme And Stock Swindle; James A. Sweeney And Patrick M. Ryan Face Decades In Prison

    BULLETIN: In a case that could have been taken from the MLM and security swindler’s playbook, James A. Sweeney and Patrick M. Ryan have been found guilty by a state jury in California of operating a pyramid scheme and stock fraud and stealing $8.2 million after soliciting business at “seminars.”

    The men face more than 20 years each in prison. Prosecutors said they told members that their “opportunities,” known as Big Co-op Inc. and Ez2Win.biz, represented the “future of online commerce.”

    The firms were compared in promos to Google and eBay, and members were told an IPO was “imminent” and that “when the company went public, the stock would double or triple and [stockholders’] investment[s] could climb to well over $100 per share,” prosecutors said.

    At an October 2006 pitchfest attended by a state undercover agent, prospects were falsely told that the company that had taken Google public had been hired to manage Big Co-op’s purported IPO and that the company would go public in December 2006, according to the state.

    But no arrangements with Google’s IPO manager to take the firm public had been made and no “application to any governmental or regulatory agency to allow Big Co-op to make an initial public offering of stock in 2006, or at any other time thereafter” had been filed, the state charged.

    Filings by the California Department of Corporations paint a picture of affiliates making wild claims to drive business to the company. The company itself lured prospects by planting the seed they’d be driving a Mercedes Benz and wearing a Rolex wristwatch, according to state filings.

    Vague — and even wild claims of future success — often are part of MLM scams. It also is common for hucksters to plant the seed that a company “soon” will go “public” and become the “next” Google, Microsoft or eBay. At least one Big Co-op promoter declared the firm the next Walmart, according to records.

    Even if no claims that a firm will go “public” are made, it is common for MLM hucksters to leech off the brands of famous companies to create a sort of legitimacy by osmosis. In the universe of MLM fraudsters, it is common for hucksters to plant the seed that figures such as Donald Trump, Warren Buffett and Oprah Winfrey have endorsed the “opportunities,” when no such endorsement had occurred.

    Some MLM hucksters even have traded on the names of various presidents of the United States and other world figures.

    Sweeney, 64, of Afton, Tenn., and Ryan, 35, of Canyon Lake, Calif., were arrested in June 2009.

    By the time it was all over, more than 1,000 California residents had been lured into the scheme, prosecutors said.

    The scam “purported to be an online shopping hub where consumers could go to purchase thousands of goods and services at discounted prices from big-name retailers including, Sears, Target and Macy’s,” prosecutors said.

    Members were told they’d earn “rebates” and “rewards,” which never came. In reality, the state said, any “monetary gains” were based on a member’s ability to recruit people into a pyramid, have those people recruit others “and so on.”

    Taking another page out of the scammer’s playbook, the “opportunity” sold stock ranging in price from 50 cents a share to $5, “with two-for-one deals offered to investors willing to pay cash,” the state charged.

    “Sweeney and Ryan bought luxury homes, country club memberships, five Mercedes, and ran up $30,000 to $50,000 in monthly credit card bills,” prosecutors said. “Investor funds were also used to pay for an elaborate bachelor party in Las Vegas, a $23,000 wedding ring and a $100,000 wedding.”

  • Club Asteria Pitchman Uses Name Of Another Famous Bank In Ponzi-Forum Promo For ‘ThatFreeThing’; No Immediate Comment From JP Morgan Chase

    UPDATED 10:51 A.M. EDT (U.S.A.) The name of JPMorgan Chase — one of the most prominent financial institutions in the world — is being used by “manolo” in a pitch for the ThatFreeThing (TFT) MLM program on the TalkGold Ponzi scheme and criminals’ forum.

    “manolo” also is promoting Club Asteria (CA), a highly questionable “program” that trades on the name of the World Bank. The World Bank’s name also appears in promos on TalkGold and other Ponzi forums such as MoneyMakerGroup.

    JPMorgan Chase did not respond immediately to a request for comment about the use of its name in TFT promos and whether TFT and its affiliates were authorized to use the bank’s name in sales pitches.

    TFT affiliates in multiple forums and social-networking sites have been using the Chase name to drive “sign-ups” to the MLM by planting the seed that Chase will pay them $150.

    “Members are signing in (sic) their droves, and corporate businesses see this…now the back office is loaded with Tons of freebee’s (sic) …like Free $150 fro (sic) Chase bank !!!” a three-exclamation-point promo from a poster on Scam.com screamed yesterday.

    On TalkGold, meanwhile, “manolo” was circulating the Chase name in a post that asked, “Did you see the $150 you get for FREE when you open up a Chase Bank account?”

    “These types of freebies are HUGE when we post them because you can literally get someone to join for $25 and instantly show them how to put $150 in their pocket in the very first day,” the post declared.

    “manolo” appeared to be quoting an email sent to him earlier this month by “TFT Support.”

    Chase’s name also is referenced in a 12-page TFT thread on the MoneyMakerGroup Ponzi forum. There, within the TFT thread, promoter “strosdegoz” also is pitching something called Exotic FX, which purports to be a “PRIVATE ASSET HAVEN.” At the same time, “strosdegoz” is promoting a “program” known as “Cycle2Riches,” which appears to be a matrix cycler that uses a notorious business model that has been attacked by the U.S. Secret Service.

    “strosdegoz” and “manolo” are believed to be one-in-the-same. How either TFT or Club Asteria could assure members its income stream was not polluted by proceeds from fraudulent enterprises promoted on MoneyMakerGroup, TalkGold and other Ponzi forums is unclear.

    Both MoneyMakerGroup and TalkGold are referenced in federal court filings as places from which Ponzi schemes are promoted. Any new Chase customer who opened an account with the bank in response to the TFT promos on the Ponzi forums conceivably could cause fraud proceeds to flow into the bank. The Ponzi forums are populated by serial hucksters.

    TFT promos that reference Chase also are appearing on Facebook. Chase appears recently to have offered a promo by which certain customers who established a banking relationship with it and met other conditions could qualify for a $150 reward. Details about the Chase offer, which appears to have expired, were not immediately clear.

    Records suggest, however, that Chase never promised to put $150 in the pockets of new customers “on the very first day,” as the TFT promo implied. Moreover, Chase is Chase, and TFT is TFT. If the Chase offer was available to the public, there was no reason to pay TFT any money to gain access to the Chase offer.

    Chase currently is offering a $125 bonus to certain new customers through May 16, according to its website. But the offer varies by state and comes with conditions such as making a minimum opening deposit of $100 and establishing direct deposit from “payroll, pension or government benefits, such as Social Security.”

    New accounts come with banking fees if customers don’t meet the minimum qualifications, and no one gets the reward money instantly, according to the Chase website.

  • STATEMENT: PP Blog Comes Under Attack Again

    Today at approximately 5:18 a.m., the PP Blog came under attack from a swarm of international IPs. The attack appears to have disrupted operations for approximately two hours and 19 minutes.

    Functionality was restored at approximately 7:38 a.m., although signatures of the attack continued to appear. The attack appears actually to have begun prior to 5:18, with prelude signatures appearing overnight — prior to the arrival of an insurmountable swarm.

    The vast majority of IPs that appeared during the swarm were non-U.S. IPs. The PP Blog is published in the United States and focuses on U.S.-based crime and fraud schemes. Most of its traffic originates in the United States.

    After the disabling attack was abated, a second, smaller attack, appears to have occurred. Certain elements of the twin attacks are consistent with efforts to probe the Blog for vulnerabilities and to execute command strings that include thousands of characters. A “normal” command string contains perhaps dozens of characters.

    A professional analyst who reviewed a huge command string targeted at the Blog last week said it was consistent with a hacking attempt, meaning the attackers might have sought to break into the Blog’s server. Elements of today’s attacks were consistent with the same pattern. Nothing suggests the break-in bids — if that’s what they were — were successful. In any event, the traffic was so overwhelming that it knocked the Blog offline for more than two hours.

    The PP Blog experienced sustained DDoS attacks in October 2010 and November 2010, including one in which more than 6 million “hits” were directed to the Blog in three hours. The Blog also has been subjected to spoofing bids, relentless spam and other efforts designed to disrupt its publishing operations and create havoc.

    The image above captures a sudden wave of mostly international IPs that descended on the Blog beginning at 5:18 a.m. The sudden visitors mostly sought to pull “old” stories simultaneously — on a range of topics.

    Meanwhile, the image below shows that the PP Blog was knocked offline for more than two hours earlier today. An IP associated with China recorded the last “hit” on the Blog at 5:19 a.m. The next “hit” did not occur until 7:38 a.m. Because of certain signatures left by the visitors, the Blog believes that U.S.-based IPs also were a small part of the attack and that the event was engineered robotically.

  • STATEMENT: Another Unusual Event At PP Blog

    Yesterday, beginning at approximately 11:09 p.m., the PP Blog’s operations were affected by a swarm of sudden visitors. The swarm caused an outage that lasted for approximately 30 minutes.

    The vast majority of the visitors displayed non-U.S. IPs, and sought to pull a range of “old” stories or archived files. It is believed the event was engineered robotically. Logs suggest that almost all of the visitors never previously had appeared at the Blog.

    Last night’s event was the most recent in a series of unusual events in which international IPs swarmed the Blog. The PP Blog is published in the United States. Most of its traffic originates in the United States.

    On March 27 — a Sunday — the Blog recorded a brief unusual event. In Sunday’s event, a small number of IPs sent unusually long command strings to the Blog’s server. One such string included 3,283 characters. Normal command strings are far, far smaller. Other visitors also sought to send exceptionally lengthy commands. The 3,283-character string appears to have been a bid to summon the same “old” story multiple times simultaneously. The story referenced the AdSurfDaily case and the now-defunct pro-ASD Surf’s Up forum.

    The events of Sunday and yesterday followed on the heels of unusual events that occurred on March 9 and March 22. The unusual event that occurred on March 9 also featured a bid to send exceptionally lengthy command strings to the server. In the March 9 incident, multiple visitors with international IPs sought to pull simultaneously a story about the MPB Today “grocery” MLM and an unrelated story about a Ponzi scheme in New Jersey.

    Like last night’s event, the unusual event of March 22 featured the sudden appearance of dozens and dozens of international IPs simultaneously. An early analysis of last night’s event suggests the sudden swarm delivered traffic at a rate of more than 63 times the Blog’s ordinary volume.

    A sudden swarm of visitors with international IPs appeared at the PP Blog, beginning at approximately 11:09 p.m. (EDT) on March 28, 2011.

  • BULLETIN: Barry Minkow, Ponzi Fraudster Turned Pastor And Investigator After 7 Years In Slammer, Charged Criminally In Stock-Manipulation Scheme

    Barry Minkow, who presided over a colossal Ponzi scheme as a young man, spent seven years in federal prison and emerged to become a church pastor and tell the world he no longer was a criminal, has been charged criminally in Florida in a stock-manipulation scheme.

    Minkow, 44, allegedly induced law enforcement to open a probe into Lennar Corp., a homebuilder, by lying and then putting himself into position to profit from his lies by “trading Lennar securities for his own personal benefit,” federal prosecutors said.

    He was charged with conspiracy to commit securities fraud that involved his misuse of “material nonpublic information,” prosecutors said, saying Minkow had advanced a “shared unlawful plan” to hurt Lennar.

    Minkow is expected to plead guilty. He faces a maximum of five years in prison.

    After being convicted of operating the ZZZZ Best Ponzi scheme, one of the most notorious fraud cases of the 1980s, Minkow entered prison. He turned to the ministry after his release, and also founded the Fraud Discovery Institute in San Diego.

    Cultivating relationships with both the media and law enforcement, he told the world he now was wearing the hat of the fraud-busters, not the hucksters.

    Court documents identify him as a confidential FBI informant. But prosecutors now say he orchestrated a slime campaign against Lennar in 2009 with the intent of helping a co-conspirator who claimed he was owed money squeeze cash and stock out of the company.

    “When false statements are disseminated to deceive the investing public, whether they’re designed to prop up a company or tear it down, the FBI will dedicate all available resources to bring disseminators of such falsehoods to justice,” said William J. Maddalena, acting special agent in charge of the FBI’s Miami office

    As part of the plan, Minkow authored “false and misleading statements” about Lennar, creating news releases, emails and YouTube videos to allege “widespread improprieties in Lennar’s financial reporting and business structure,” prosecutors said.

    The false reports artificially depressed Lennar’s stock price, prosecutors said.

    Minkow, according to prosecutors, contacted the FBI, the SEC and the IRS in January 2009 with allegations of Lennar’s purported fraud. His acts induced the government to open an investigation.

    On March 13, 2009, Minkow contacted the FBI and IRS, confirming to agents that he knew he was “precluded . . . from shorting Lennar stock,” according to the federal complaint, which was filed in the form of an information.

    Three days later,  Minkow “misappropriated material nonpublic information” about Lennar and used it to purchase Lennar options through a nominee trading account, prosecutors said.

  • STATEMENT: Unusual Event At PP Blog

    At approximately 1:05 a.m. (EDT) today, the PP Blog began to experience unusually high traffic volume and a highly unusual traffic pattern. The source of the traffic is unclear. What is clear is that IPs from all over the world suddenly began to pull “old” stories, meaning that the URLs being pulled existed in the Blog’s archives — not in its current, front-page editorial well.

    The pattern strongly suggests the event was engineered robotically. It does not appear likely that the visitors were actual readers. Along with URLs for individual “old” stories, the URLs of archived files for certain dates in 2009 and 2010 were pulled. There appears to have been no follow-up clicks to the archived files, which strongly suggests the visitors did not intend to engage in any actual reading. No spam was received during the period, which suggests the visitors had a purpose other than spamming.

    Most of the visitors (the vast, vast majority, meaning on the order of 95 percent) displayed non-U.S. IPs. Dozens of international IPs making their first visit to the Blog sought virtually simultaneously to pull dozens of story links and links to archives.  Logs suggest that most of the IPs  had not been at the PP Blog prior to this morning’s event.

    The event appears to have reached its peak at 2:08 a.m.  Traffic to the Blog during the unusual event is preliminarily estimated at 10 to 20 times the normal volume.

    A similar event occurred at the Blog on March 9, although this morning’s event was much broader in scope. The March 9 incident involved about nine IPs;  today’s event involved dozens and dozens, with unusually large traffic volume from Europe, Asia, the South Pacific, Africa and South America. The Blog also recorded first-time visits from IPs in the Middle East.

    A server snapshot taken at 1:20 a.m. shows 17 “live” IPs pulling stories or archives exclusively from 2009 and 2010. Only one U.S. IP is present in the snapshot, and the U.S. IP was making its first visit to the Blog. The PP Blog is published in the United States. Most of its traffic originates in the United States.

    One of several maps that show a sudden burst of international traffic at the PP Blog on March 22, 2011. The pattern developed shortly after 1 a.m. (EDT) in the United States.

  • UPDATE: Club Asteria Members Use TalkGold Ponzi Forum To Announce That Firm Now Has More Than 200,000 Members; Separately, Some Members Grumble About Missing Payouts

    EDITOR’S NOTE: The adjective-inspiring story below is made possible by the incongruous behavior of online pitchmen who operate in an environment the Financial Industry Regulatory Authority (FINRA) described last year as a “bizarre substratum of the Internet.”

    Two promoters of Club Asteria, a business “opportunity” purportedly operated by a woman variously described as a former “Chairman,” former “Director” and former “Vice president” of the World Bank, have announced on the TalkGold Ponzi scheme forum that they’ve enrolled new recruits and that Club Asteria now has more than 200,000 members.

    “Ken Russo” advised TalkGold members that he had enrolled Club Asteria (CA) member No. 198920. A short time later, TalkGold member “manolo” announced he had enrolled CA member “200,600+”

    “It’s Official,” “manolo” declared. “Club-Asteria has over 200,000 Member!” (sic)

    The World Bank said last week that it once employed a woman named Andrea Lucas as director of the management systems and account department. The bank described the position as a staff job, and said Lucas worked in Washington, D.C.

    In this promo, Club Asteria is said to have been founded by a "former world bank Chairman." In a separate promo, Club Asteria is described as a site of "World Bank's former Vice president Andrea Lucas." The claim is made in a bold headline that features 24-point type.

    In MLM-style promotions, scores and scores of Club Asteria members globally have implied Lucas was a member of the World Bank’s board of directors. The World Bank, though, said that Lucas never was on the board of directors and had left her job at the bank in December 1986, nearly 25 years ago.

    Other Club Asteria members have described Lucas as a former chairman and vice president of the World Bank. At least one online promo for Club Asteria implies that Lucas is a current director of the bank.

    Get a “life time income wth (sic) help of world bank director,” the promo prompts viewers.

    On the MoneyMakerGroup Ponzi board today, Club Asteria members are complaining about cashout requests that have not been honored, slow or absent customer support and server troubles.

    Last week, Club Asteria asked members to put “a little extra effort into your Club-Asteria business over the next 15 days. We are asking you now to just use one extra hour each day to focus on the things that generate additional revenue, such as product and service sales as well as memberships.”

    The request was part of a promo on “HOW WE CAN HELP THE PEOPLE OF JAPAN” after the devastating earthquake and tsunami.

    Read a July 2010 story about an alert issued by FINRA.

  • STATEMENT: PP Blog Takes ‘Prudent’ Measures In Response To Security Concerns

    MARCH 18, 2011: The PP Blog today made certain prudent adjustments to its publishing well in response to security concerns. The adjustments center on how the Blog treats a tiny fraction of the thousands of pages in its archives, and what web browsers will display when readers visit those pages. The Blog will have no further comment.

     

     

  • Sea Of Incongruity Surrounds Club Asteria: As ‘Ken Russo’ Pushes ‘Opportunity’ On TalkGold Ponzi Board, World Bank Qualifies ‘Director’ Claims Made By Promoters

    The World Bank confirmed to the PP Blog this morning that a person named Andrea Lucas left its employment in December 1986, nearly 25 years ago. But Lucas was never a member of the World Bank’s board of directors, as many members of business “opportunity” known as Club Asteria have implied in online, MLM-style promotions for the firm.

    Rather, the World Bank described Lucas as a former department head among “many” department heads who held the internal title of director of an individual department. Lucas, the World Bank said, was director of the management systems and account department. She worked in Washington, D.C., according to the World Bank’s records.

    The PP Blog initially sought comment from the World Bank on March 3 about Lucas and various claims about Club Asteria made by members of the purported opportunity. Some of the claims have been made on the TalkGold Ponzi scheme and criminals’ forum. The World Bank’s name is being used in Club Asteria promos on TalkGold and other websites.

    A blurb for Andrea Lucas on the slow-loading Club Asteria website describes her in the first sentence as “former Director of the World Bank,” using an uppercase “D” in “Director” with no other qualifiers. The reference to the World Bank begins seven words into the profile. The profile also lists Andrea Lucas as  “founder and Managing Director of Club Asteria.” No other entities are referenced in the Andrea Lucas blurb.

    The blurb makes no mention that Andrea Lucas left her staff job at the World Bank more than two decades ago, when Ronald Reagan was President of the United States and Mikhail Gorbachev was General Secretary of the Communist Party of the now-dissolved Soviet Union.

    When Andrea Lucas last worked at the World Bank, George Herbert Walker Bush was Vice President of the United States and still more than two years away from his term as President. The “Black Monday” market crash of October 1987 had not yet occurred, and Iraq’s August 1990 invasion of Kuwait that led to the Gulf War was still nearly four years away. Modern-day accused shoplifter and actress Lindsay Lohan was five months old, and few people outside of Arkansas recognized the names of Bill Clinton and Hillary Clinton. Barack Obama, a community organizer in Chicago, had yet to enter Harvard Law School or meet Michelle Robinson, who’d become his wife and, later, First Lady of the United States.

    Regardless, Lucas and the World Bank are referenced repeatedly in online promos by Club Asteria members. Why the company and promoters had seized on the World Bank’s name when Andrea Lucas last was employed there nearly a quarter of a century ago as a young woman was not immediately clear.

    “Real Profit Sharing Program ! No Ponzi !” one affiliate promo preemptively screams. “Club Asteria from the Former Director of World Bank – Andrea Lucas.” The affiliate site includes a photo of a letter dated Dec. 14, 2010, and the letter appears to feature the World Bank’s letterhead and verify the former employment of Andrea Lucas at the World Bank.  It is positioned by the affiliate as a reason to trust Club Asteria.

    Why the affiliate would preemptively argue that Club Asteria was “No Ponzi” was unclear.

    Another promo describes Club Asteria as “a perfect home based business that specializes in the remittance business of sending funds back home.

    “We provide training, opportunities, consultation and one of the most sensational pay plans of our time,” the promo continues. Club asteria (sic) is run by a former Director of the World Bank and it (sic) set to take the net by storm.”

    “Ken Russo,” who posts at TalkGold as “DRdave” and promotes one highly questionable scheme after another, announced yesterday that Club Asteria’s membership ranks had soared to 187,481.

    The announcement occurred against the backdrop of a December warning by the Financial Fraud Enforcement Task Force led by U.S. Attorney General Eric Holder that visitors to websites and forums should be skeptical of claims.

    “Be wary of people you meet on social networking sites and in chat rooms, where investment fraud criminals have been known to troll for victims,” the Task Force warned.

    Except for its confirmation this morning that a person named Andrea Lucas once worked for the World Bank and its release of certain details about her employment nearly a quarter of a century ago, the World Bank declined to comment immediately about the linkage of its name to Club Asteria and the promos at TalkGold and other websites.

    The bank, however, confirmed it is aware of the claims. Meanwhile, some Club Asteria members are grumbling in forums about the firm’s slow-loading website and spotty customer support. Among the concerns is that the company recruited members under one set of rules, but may be trying to implement a new set that may force higher costs on participants who expect to get paid.

    Some Club Asteria members appear to be confused about whether Club Asteria conducts business from the United States or Hong Kong.

    How the company makes money beyond membership fees is unclear. Also unclear is whether the firm has significant revenue streams beyond membership fees. Club Asteria appears to publish no verifiable financial data.

    The World Bank is the most recent prominent international entity to have its name appear on TalkGold and other Ponzi forums that push highly questionable business pursuits. Last year, members of the purported MPB Today “grocery” program, which operates as an MLM, flooded websites and social-media sites such as YouTube with references to Walmart.

    It is common in the MLM sphere for affiliates to trade on the names of prominent business entities even if no ties exist. Walmart’s name also appeared in promos on the Ponzi boards.

    TalkGold, MoneyMakerGroup and ASAMonitor are referenced in federal court filings as places from which international Ponzi schemes are promoted. Even if Club Asteria is a legitimate enterprise, the mere fact it is being promoted on the Ponzi boards raises troubling questions about whether its revenue stream is polluted by proceeds from any number of fraud schemes operating globally.

    In recent weeks, federal agencies such as the SEC and CFTC have taken actions against schemes promoted on the Ponzi boards. Meanwhile, the FTC announced an action this week against an online enterprise that allegedly was not policing its affiliate sales force properly.

    The FTC charged Lester Gabriel Smith and Legacy Learning of Nashville, Tenn., with disseminating “deceptive advertisements by representing that online endorsements written by affiliates reflected the views of ordinary consumers or ‘independent’ reviewers, without clearly disclosing that the affiliates were paid for every sale they generated.”

    In bringing the case, the agency held Smith and Legacy accountable for claims made by affiliates.

    “Whether they advertise directly or through affiliates, companies have an obligation to ensure that the advertising for their products is not deceptive,” said David Vladeck, director of the FTC’s Bureau of Consumer Protection. “Advertisers using affiliate marketers to promote their products would be wise to put in place a reasonable monitoring program to verify that those affiliates follow the principles of truth in advertising.”

    See the FTC news release on Legacy Learning, which was assessed a $250,000 penalty.