UPDATED 4:07 P.M. ET (JAN. 17, USA) Globo.com is reporting that the hunger strike has ended — after nearly 42 hours. See note/links in Comments thread. Our original brief is below . . .
The URLs below are from various media sites in Brazil that are reporting on a hunger strike staged by a TelexFree promoter apparently unhappy with the pyramid-scheme probe in Acre.
UPDATED 11:39 P.M. ET U.S.A. There are reports today in Peruvian media that the government of Peru has shut down an office of the purported WCM777 “opportunity” and that criminality occurred. It is unclear from early reports whether arrests were made.
The regulatory authority in Peru is the Superintendency of Banking and Insurance.
WCM777, which is encountering regulatory scrutiny in multiple nations, recently changed its name to Kingdom777, according to BehindMLM.com.
Peru issued an Alert on WCM777 in December, saying the firm was collecting money unlawfully in the country.
As the PP Blog reported in November 2013, some promos for WCM777 claimed investors willing to plunk down $14,000 received a dividend of 35 times their initial investment over the course of a year.
Massachusetts halted WCM777 in November, saying the program was being targeted at Brazilian Americans and was selling unregistered securities.
On Nov. 21, the PP Blog reported that WCM777 may have ties to The Way TV and Media for Christ, which have been linked to a film production known as “Innocence of Muslims.” The trailer of the film reportedly sparked violence across the Middle East in 2012.
TelexFree executive Carlos Costa is keen on Botafogo. Source: YouTube video.
MLM’s HYIP wing appears to have triggered another PR disaster for the trade: Guaraviton, a longtime sponsor of the Botafogo soccer club in Rio de Janeiro, may be none too pleased with the club’s deal that brought on TelexFree as a No. 2 sponsor.
TelexFree is under investigation in Brazil, amid allegations it is a pyramid scheme. There have been reports about death threats against a prosecutor and a judge.
Guaraviton, a beverage-maker, is Botafogo’s main sponsor. The club’s deal with TelexFree was a “negative surprise” to Guaraviton, according to a story on Abril.com. Grupo Abril is a major media outlet in Brazil.
Ponzi schemer Allen Stanford’s sponsorships caused embarrassment in the worlds of cricket and golf.
Prior to the collapse of the AdSurfDaily Ponzi scheme in 2008, members claimed ASD would have a car in auto racing’s Indy 500. (See PP Blog report from Feb. 22, 2009: Stanford/Bowdoin: ‘A Tapestry Of Believable Lies’
URGENT >> BULLETIN >> MOVING: (4th Update 5:14 p.m. ET U.S.A.) The U.S. Department of Justice has sued North Carolina-based Four Oaks Bank, alleging that it turned a blind eye to fraud markers at Rex Venture Group LLC and processed “close to $60 million in ACH transactions in furtherance of the illegal scheme.”
Rex Venture was the operator of Zeek Rewards, which the SEC has described as a Ponzi- and pyramid scheme that gathered at least $850 million.
In “Spring 2012,” the Justice Department alleged, Four Oaks granted ACH access to Rex Venture, a merchant client of a payment-processing entity known as TPPP-TX.
Four Oaks did this, the Justice Department alleged, “despite knowing that: (1) Rex Venture’s principals could not be identified through business database searches; (2) the Bank could not independently verify the type of legitimate business in which Rex Venture Group was engaged; (3) one of the two addresses reported by the company was a vacant lot, and the other was a different business; and (4) the Social Security Number of one of the company’s purported principals was associated with a different person. A Bank official even concluded that the purported owner of Rex Venture Group “keeps changing company names so his reputation will not catch up with him.”
And, the Justice Department alleged, “By August 17, 2012, the public learned what Four Oaks Bank already knew or should have Known — Rex Ventures Group allegedly was a massive Ponzi and pyramid scheme.”
The lawsuit against the bank was filed yesterday by the office of U.S. Attorney Thomas G. Walker of the Eastern District of North Carolina. The Zeek Ponzi case is filed in North Carolina’s Western District.
In a statement today, Four Oaks said it had cooperated with the Justice Department and agreed to a settlement in which “the Bank does not admit any facts alleged in the accompanying complaint nor does the Bank admit to any liability. ”
Four Oaks also is accused in the complaint of aiding the processing of illegal payday loans and gambling transactions for other TPPP-TX clients.
See story at WRAL.com, which lists the settlement amount at $1.2 million.
Four Oaks is referenced in Zeek-related court files, including a 2012 filing in which the bank said it held a commercial account in the name of “Nx Systems Inc.”
TelexFree executive James Merrill shows off his Botafogo jersey. (Source: YouTube promo.)
What do you do when a Brazilian court freezes money and blocks new registrations for your “program” in that country, amid serious pyramid-scheme allegations?
Well, if you’re TelexFree, you file losing appeal after losing appeal. And then, while continuing the pyramid battle, you change your logo so no one can get the idea you ripped it off from the 2010 World Badminton Championship in Paris.
After that, you arrange for cameras to be rolling in the United States to capture the arrival of the limousine at the self-staged event (in Miami?) to announce your sponsorship of the Botafogo soccer club in Rio de Janeiro.
Then, with great fanfare, you videotape the signing of the Botafogo contract — and make sure the cameras capture your top executives at the signing ceremony wearing a Botafogo jersey. (Among the executives are James Merrill and Carlos Wanzeler.)
Finally, you make sure that Carlos Costa — your most well-known executive — gets a chance to be shown evangelizing for TelexFree and gesticulating wildly on YouTube while wearing a Botafogo jersey with the new TelexFree logo affixed.
(If you’re TelexFree, it apparently also helps if you use a split screen to show happy TelexFree affiliates wearing the old logo, a man holding what appears to be a check while the logo of the Best Western hotel chain and the old TelexFree logo appear in the background — and the arrival of a limo, of course.)
Adrian Marion Hill and Patricia Labarge. Source: Colorado Springs Police via Facebook
Adrian Marion Hill, a purported “sovereign citizen,” was arrested early today after a standoff with Colorado Springs police, the department announced on its Facebook and Twitter sites. Hill is 45.
Also arrested at the scene was Patricia Labarge, 27, the department said.
The incident began with a traffic stop at about 1:30 a.m. local time, police said.
From a statement by the police department (italics added):
When Officer’s contacted the driver, he partially rolled down his window and handed the Officer making the contact a piece of paper indicating that he (the driver) was a Sovereign Citizen. The driver rolled his window back up, and refused to communicate with Officer’s on scene. Containment was set on the vehicle, and open air communications with the occupants of the vehicle were established. Two passengers inside the vehicle complied with the lawful orders they had been given to exit the vehicle. After approximately one hour and twenty minutes of negotiations by telephone and loud speaker, the driver complied, and exited his vehicle. The driver of the vehicle was arrested for one felony warrant, criminal charges for obstruction and interference, and several traffic violations. One of the passengers was arrested for an outstanding warrant unrelated to the traffic stop.
The “Aunt Ethels” in the United States — older people with money — will be thrilled to join TelexFree once they see how their relatives, friends and neighbors are prospering, according to a promo.
A columnist at Jornal.US News Service is reporting in Portuguese that TelexFree members are receiving instructions on how to register for the “program” by using location-masking proxies and bogus information on their countries of residence.
TelexFree has been the subject of a pyramid-scheme probe in Brazil since at least June 2013.
The Jornal.US News column raises the prospect that tax fraud aimed at the U.S. government could be occurring. TelexFree has U.S. footprints in Massachusetts and Nevada. Some American promoters have ignored the probe in Brazil and continue to enlist recruits. They’ve also ignored reports of death threats targeted at public officials in Brazil involved in the TelexFree probe.
In December 2013, federal prosecutors said tax fraud had occurred at Zeek Rewards, an MLM “program” that has features similar to TelexFree.
Whether TelexFree is under investigation in the United States is unknown. Some U.S.-based promoters have claimed that $15,125 sent to the “program” fetches a return of at least $42,075 in a year, plus the full return of the initial outlay.
As the PP Blog reported on Aug. 4, 2013, the math of the claim is basically this: After recruits send in $15,125, they purportedly receive at least $1,100 a week for 52 weeks. That computes to $57,200. Subtract the original outlay of $15,125, and emerge $42,075 on the plus side, with the principal also fully returned. In this context, TelexFree essentially triples or quadruples the initial outlay over the course of a year, according to the promos.
Like the 2008 AdSurfDaily Ponzi scheme ($120 million) and the 2012 Zeek Rewards’ scheme (at least $850 million) that led to Ponzi charges in the United States, the TelexFree “program” has a purported “advertising” component. In ASD, members purportedly got paid for clicking on ads; in Zeek and TelexFree, members purportedly get (or got) paid for posting ads online, according to narratives by promoters.
As was the case with Zeek, puff pieces are being used in TelexFree to help the scheme spread.
And as was the case with ASD and Zeek, TelexFree “supporters” are singing the praises of the company and clashing with messengers of “negative” news. There have been at least two instances in Brazil in which apparent TelexFree promoters targeted media reports about suicide deaths of TelexFree members with offers to join the “program.”
On Sept. 9, 2013, the PP Blog reported that TelexFree promoters were encouraging prospects in Brazil to fabricate an address in England to register for the “program” and may be encouraging fellow members to menace public officials.
There were reports last month that a Brazilian prosecutor involved in the TelexFree probe had been targeted in a ghastly intimidation campaign.
SPECIAL REPORT: (Updated 5:48 a.m. Jan. 7, U.S.A.) N. Donald Jenkins Jr., an Arkansas attorney listed as a registered agent for Wandering Phoenix LLC, a firm federal prosecutors have linked to Zeek Rewards’ figure Dawn Wright-Olivares, was ordered disbarred on May 30, 2013, records show.
He thrice previously was ordered suspended from the practice of law and has a thick disciplinary history with the Arkansas Supreme Court Committee on Professional Conduct dating back to 2003. His full name is Newton Donald Jenkins Jr.
Jenkins Jr. once worked as the city attorney and prosecutor for Van Buren, Ark. He was paid an annual salary by the small town of more than $56,000 while maintaining a private law practice that repeatedly landed him in trouble.
A long string of corporate revocations accompanies the name of Jenkins Jr. as a registered agent in Arkansas, a state in which the most common reason for revocation is a corporation’s failure to pay franchise tax. The string includes at least 125 names of revoked business entities. One of the revocation casualties was Jenkins Law Firm PLLC, the lawyer’s own firm.
Another revocation casualty, according to Arkansas records, was Wandering Phoenix, the business entity linked to Wright-Olivares through which prosecutors say she received Zeek payments. Either Wright-Olivares or Wandering Phoenix received $7.2 million, according to a federal charging document. Franchise tax nevertheless remained unpaid.
One law-license suspension order against Jenkins Jr. was stamped and docketed on Aug. 17, 2012, the same date the SEC moved against Zeek and the U.S. Secret Service announced it, too, was investigating the North Carolina-based MLM entity. Neither Zeek nor Wright-Olivares is referenced in the disbarment and suspension orders.
Did Wright-Olivares Have Business Relationship With Felon?
Records suggest — but do not demonstrate conclusively — that Wright-Olivares also had a business relationship with the late father of Jenkins Jr.: tax accountant N. Donald Jenkins, apparently also known as Donald Jenkins Sr. and Newton Don Jenkins Sr. “N. Donald Jenkins” — with no designation as either Jr. or Sr. — is listed alongside Jenkins Jr. as a registered agent for Wandering Phoenix. Meanwhile, “N. Donald Jenkins” also is listed as an officer and “Incorporator/Organizer” of Wandering Phoenix.
Wright Olivares was a 95-percent owner of Wandering Phoenix, according to criminal charges filed against her in North Carolina on Dec. 20. She has agreed to plead guilty to tax-fraud conspiracy and investment-fraud conspiracy, federal prosecutors said last month.
In the mid-1990s, Jenkins Sr. hatched a scheme by which he duped a man who’d approached him for advice about opening a computer business, according to federal records. Jenkins Sr., who was convicted on federal charges in 1999, encouraged the man to open a bank account and give him limited Power of Attorney.
The man complied, according to court records. After that, Jenkins Sr. entered into a merchant agreement with an Arkansas bank and defrauded the bank by depositing “over $78,000 in credit card slips reflecting sales purportedly made” by the computer business.
The slips “were drawn on credit cards recently issued to Jenkins [Sr.], his relatives” and the man who’d approached Jenkins Sr. for advice, according to court records.
But the man who’d approached Jenkins Sr. testified that the firm “never sold a computer, and that he never applied for or knew of the credit cards issued in his name,” according to court records.
“After the sales amounts were credited to the account, Jenkins [Sr.] would withdraw money through checks and ATM transactions,” according to court records.
In 1988, Jenkins Sr. was implicated by the state of Arkansas in a securities swindle and was arrested on criminal charges of theft by deception and lying to the Arkansas Securities Commissioner. The final outcome of the case could not immediately be determined. On March 23, 2009, ArkansasBusiness had this (and plenty more) to say about Jenkins Sr. (italics added):
Jenkins came to our attention way back when investors across Arkansas began accusing him of defrauding them of hundreds of thousands of dollars in elaborate investment schemes. Those civil lawsuits by angry investors drew the attention of criminal investigators, which culminated in Jenkins receiving a 27-month prison sentence following his August 1999 conviction.
The identities of the person or persons who owned the remaining 5 percent of Wandering Phoenix are unclear. What is clear is that Arkansas has revoked its corporate registration.
Enter/Exit ‘Wandering Rex’
Arkansas records also link Wright-Olivares to an entity known as Wandering Rex LLC. The registration of Wandering Rex also has been revoked.
Zeek operated through a North Carolina-based entity known as Rex Venture Group LLC, controlled by Zeek operator Paul R. Burks of Lexington. Why Wright-Olivares also had a “Rex” entity in Arkansas is unclear.
Wright-Olivares, 45, also appears to have controlled another Zeek-related entity known as Zeeklers.com. The Ozark, Ark., street address for the Zeeklers.com web domain is the same address listed in corporate records for Wandering Phoenix, one of the two revoked entities linked to Wright-Olivares, Zeek’s former COO.
Both Jenkins Jr. and his father were active in Republican politics in Arkansas. Jenkins Jr., for example, has a listing on the website of the Republication National Lawyers Association (RNLA) that identifies him as “Asst. Legal Counsel Republican Party of Arkansas.” The listing includes a link to the website of his law firm, but the domain is generating a “timed out” error message.
Meanwhile, the obituary for Jenkins Sr. as published in October 2012 at swtimes.com notes that he “served in various positions with federal, state and local candidates and Republican groups, including as chairman over the first and fourth Congressional districts, and chairman for Ronald Reagan for President. He was a true American patriot who held very strong opinions about people who tailgated him on the road.”
Disciplinary History Of Jenkins Jr.
How Wright-Olivares came to use the registered-agent services of Jenkins Jr. is unclear. It’s also unclear if Jenkins Sr. ever did any accounting work for her or if she knew him personally.
What is clear is that Jenkins Jr. has a long history of disciplinary action in Arkansas and that at least one of his other clients (a married couple) contracted with Jenkins Jr. after meeting with Jenkins Sr. in Jonesboro, Ark. The couple later filed a complaint against Jenkins Jr. for alleged inaction after he’d been hired to address a wage-garnishment issue with the IRS. In 2007, the state issued a formal reprimand known as a “CAUTION” against Jenkins Jr., finding that he “failed to return the messages” of his garnishment clients. The state also ordered Jenkins Jr. to apologize to the clients and to return their $900 retainer.
The 2007 “CAUTION” was the second against Jenkins Jr. The first was issued in 2003, after a client accused him of never informing the client that a lawsuit he’d filed on behalf of the client had been dismissed. Records say the lawsuit had been filed in the wrong county. The state ordered Jenkins Jr. to pay a $500 fine and pay the client $250 in restitution.
In February 2010, the state ordered the law license of Jenkins suspended for three months, after allegations surfaced that he’d improperly served yet-another client, had maintained “a frivolous proceeding” on behalf of the client in a disability case and had falsified court records. Later in 2010, the state reprimanded Jenkins, amid allegations he’d butchered yet-another client’s bankruptcy case.
On Aug. 17, 2012 — the same date as the Zeek action — the Arkansas Supreme Court Committee on Professional Conduct docketed a two-year suspension of the law license of Jenkins Jr. He was accused in that proceeding of filing a bankruptcy case in the wrong state, using the wrong state when filing 2008 tax returns for two clients and not filing 2009 tax returns for the clients, another married couple who had hired him.
One of the suspensions of the law license of N. Donald Jenkins Jr. was docketed on Aug. 17, 2012, the same day the SEC moved against Zeek Rewards. (Red highlight by PP Blog.)
Jenkins’ overall disciplinary history shows at least six actions: three suspensions, two “CAUTIONS” and one “REPRIMAND.”
In May 2013, Jenkins Jr. was disbarred. A special judge “found that, in the disbarment proceedings alone, Respondent had committed at least eight violations for conduct involving dishonesty, deceit, fraud, or misrepresentation.” And the special judge also observed that Jenkins Jr. had a prior disciplinary history of numerous other violations for serious conduct involving dishonesty, deceit, fraud, or misrepresentation.”
Hearty cuisine and the Internet are the things at The Healthy Hog. Source: 5News video.
EDITOR’S NOTE: A “razorback” is a wild (feral) hog present in certain U.S. states, including Arkansas. The University of Arkansas calls its sports teams the “Razorbacks.” Zeek Rewards Ponzi-scheme figure Dawn Wright-Olivares, an Arkansas resident, recently opened a Clarksville restaurant called “The Healthy Hog.” Though the words “healthy” and “hog” may appear to be in conflict, the marriage of such incongruous-sounding words might be perfectly at home, completely inoffensive and good for business in Arkansas, which is known as “The Razorback State.”
Until a TV report aired yesterday, Clarksville residents may not have known that Ponzi history has touched their town of fewer than 10,000 residents in a big way. The Johnson County community is known for its scenic beauty and annual Peach Festival.
5News (KFSM-TV in Fort Smith and KXNW-TV in Fayetteville) sent a crew to The Healthy Hog after Wright-Olivares was charged criminally and civilly in the Zeek Rewards Ponzi-scheme case in December 2013.
Zeek, the SEC says, gathered at least $850 million. Wright-Olivares appears to have parachuted into Lexington, N.C., from time to time as part of her role as Zeek’s onetime marketing maven.
Kenneth D. Bell, the court-appointed receiver in the civil case and the special master in the criminal case, has noted that Zeek operated from Lexington and drew in participants from at least 100 countries around the globe.
In terms of the number of victims and the creation of net losers (an estimated 800,000), the Internet-driven Zeek scheme may be the largest Ponzi scheme in U.S. history. By comparison, the 2008 AdSurfDaily Ponzi scheme — at the time considered the largest Internet-based Ponzi scheme in U.S. history — affected about 100,000 people and gathered about $120 million.
Wright-Olivares, 45, was Zeek’s former COO. She has settled the SEC civil case against her and agreed to plead guilty to Zeek-related criminal charges of investment-fraud conspiracy and tax-fraud conspiracy, federal investigators said. Her stepson, Daniel Olivares, 31, also has settled the SEC’s civil allegations and agreed to plead guilty to a criminal charge. In Daniel’s case, it’s a charge of investment-fraud conspiracy.
The criminal charges were the first in the long-running Zeek probe, which became public in August 2012 and also involves the U.S. Secret Service, the IRS and the office of U.S. Attorney Anne M. Tompkins of the Western District of North Carolina. The SEC filed its first Zeek-related civil case on Aug. 17, 2012, naming Zeek operator Paul R. Burks of Rex Venture Group LLC a defendant.
Bell has identified Alexandre “Alex” De Brantes, the husband of Wright-Olivares, as member of a group of alleged Zeek insiders. Images of De Brantes appear briefly in the 5News report. Bell is expected to file lawsuits against alleged Zeek insiders and “net winners” soon.
The office of the Securities Commissioner of Kansas has dismissed a civil action against Profitable Sunrise HYIP figure Nancy Jo Frazer and Ohio-based Focus Up Ministries, doing business as NJF Global Group. The dismissal was “without prejudice,” meaning that the state could file again under certain conditions.
In May, a month after the SEC brought a fraud action against Profitable Sunrise, the state said two Kansas residents invested in Profitable Sunrise through an organization known as the NJF Global Group Community.
“The NJF Global Group Community was operated by Focus Up Ministries, Inc. and its founder, Nanci Jo Frazer,” the state said at the time. “The NJF Global Group Community promoted Profitable Sunrise as a fundraising opportunity for religious-based and charitable organizations.”
Frazer was not charged in the SEC action. Apparent Frazer supporters have claimed she was a victim of “innocent ignorance.”
Frazer was named a defendant in an Ohio fraud action in July and was referenced in an earlier action filed in Minnesota. NJF Global Group is referenced in an alert by the Financial Markets Authority of New Zealand.
In May, Kansas became one of at least 36 U.S. states or provinces in Canada to issue cease-and-desist orders or Investor Alerts against Profitable Sunrise. At least four Kansas residents invested a total of at least $22,000 in Profitable Sunrise, the state said.
Purported Profitable Sunrise operator “Roman Novak,” whom the SEC said may be fictitious, appears not to have responded to any of the state-level actions or the SEC’s federal action. Profitable Sunrise was targeted at people of faith, the SEC said, alleging the purported “opportunity” was using a mail drop in England and bank accounts in other countries to fleece the masses.
One of the purported Profitable Sunrise “programs” was known as the Long Haul. It purported to pay interest of 2.7 percent a day with compounding available. Such schemes long have been associated with the HYIP sphere.
“Long Haul” payouts were due April 1, April Fool’s Day and the day after Easter 2013. The payouts never materialized.
“[Former State Rep. Brian] Palmer carried a cell phone provided by API and answered calls from potential investors even while on the House floor. To circumvent state security laws, Palmer assisted Ripley by providing documents to make the scheme appear legitimate and signed investment guarantees. And, with Palmer’s knowledge, Ripley used Palmer’s name and position as a public official to vouch for and sell the API scheme to potential victims.” — Office of Michigan Attorney General Bill Schuette, Dec. 20, 2013
A onetime Michigan statehouse member who’d earlier lost $400,000 in an offering fraud and responded by becoming a cheerleader for the thief who swindled him has pleaded no contest to a criminal charge of Neglect of Duty by a Public Official.
Strange as it sounds, it is not unusual in the fraud sphere for crime victims to turn into supporters of those who ripped them off or even to follow them to another scam in the hope of making up losses. The case against former Michigan Rep. Brian Palmer demonstrates that a victim’s behavior after a scam could have criminal consequences if he or she doesn’t break ties with a scammer.
Palmer, 64, of Romeo, reasoned that he could make up his losses in the offering fraud by assisting Jeffrey Ripley, who ran API Worldwide Inc. But API Worldwide proved to be a $9 million Ponzi scheme overseen by Ripley and fellow scammer Danny Lee VanLiere, the office of Michigan Attorney General Bill Schuette said.
“Ripley lost Palmer’s $400,000 on the investment and assured Palmer that he would get his money back if Palmer helped him with API,” prosecutors said. “Ripley gave Palmer credit for the $400,000 in API investments and Palmer cooperated with API because he believed he would receive a return on his lost funds.”
Palmer cooperated with investigators in the state probe conducted by Department of Attorney General’s Corporate Oversight Division and Public Integrity Unit and the Department of Insurance and Financial Services, Schuette’s office said.
In the API Worldwide scam, investigators said, senior citizens were lured into cashing out CDs and other investments and plowing the money into the purported “high-return” opportunity operated by Ripley, 61, of Sparta, and Danny Lee VanLiere, 62, of Grand Rapids.
From a statement by prosecutors (italics added):
Palmer met with potential investors on behalf of Ripley and API. With the knowledge that Ripley was attempting to circumvent the Securities Act, Palmer did not report the conduct to proper authorities.
Palmer carried a cell phone provided by API and answered calls from potential investors even while on the House floor. To circumvent state security laws, Palmer assisted Ripley by providing documents to make the scheme appear legitimate and signed investment guarantees. And, with Palmer’s knowledge, Ripley used Palmer’s name and position as a public official to vouch for and sell the API scheme to potential victims.
“Public officials are sworn to uphold the law,” said Schuette. “Those who break the public trust should face the consequences.”
The charge of Neglect of Duty by a Public Official to which Palmer pleaded no contest is a misdemeanor. Ingham County Judge Patrick Cherry sentenced the former legislator to “320 hours of community service that shall be served in a capacity helping seniors and the homeless,” Schuette’s office said.
A fine and costs totaling $405 also were assessed against Palmer, who conceivably could have been fined up to $1,000 and ordered to spend a year in jail.
Ripley and VanLiere pleaded no contest earlier this year to racketeering and selling unregistered securities.
Ottawa County Circuit Court Chief Judge Edward R. Post sentenced both men to serve six to 20 years in prison. Ripley was ordered to pay more than $5.3 million in restitution. VanLiere was ordered to pay more than $3 million.
The API Worldwide scam has resulted in at least two other convictions, bringing the total conviction count to five.
On Dec. 13, Schuette said Douglas Kacos, 58, of Grand Rapids, and Thomas Doctor, 53, of Grand Rapids, pleaded no contest to misdemeanor Money Laundering, which is punishable by up to two years in prison and/or a $10,000 fine or twice the value of the proceeds, whichever amount is greater.
Kent County Circuit Court Judge James R. Redford is scheduled to sentence Kacos and Doctor on Jan. 27.
Bizarre levels of detachment and reservoirs of denial may accompany fraud schemes. In the $82 “Three Hebrew Boys” scam in South Carolina in which victims’ funds were used to acquire a party bus, a jet aircraft and expensive sports tickets, for example, some victims asserted that the scammers should not be prosecuted. Meanwhile, in the $21.5 million Dennis Bolze Ponzi scheme in Tennessee, Bolze told a federal judge that he could make up the losses if permitted access to the Internet and a computerized program — and a little time.
In the $119 million AdSurfDaily Ponzi case in Florida in 2008, thousands of victims initially expressed support for now-convicted Ponzi schemer Andy Bowdoin — even after prosecutors pointed out that he’d previously been convicted of crimes tied to securities swindles with a Ponzi element in Alabama and had a business partner implicated by the SEC in three prime-bank swindles. At least one purported “opportunity” (PaperlessAccess) appears to have hired Bowdoin in 2009 to be a commercial pitchman during an active criminal investigation into ASD and while the ASD Ponzi indictment against him was pending. While awaiting his ASD-related criminal trial in 2011, Bowdoin became a pitchman for OneX, a “program” federal prosecutors later called a scam.
In June 2013, a company known as iWowWe brought in Zeek Rewards figure Dawn Wright-Olivares as its chief marketing officer after the SEC alleged in August 2012 that Zeek was a Ponzi- and pyramid scheme that had gathered hundreds of millions of dollars and after the U.S. Secret Service announced it also was investigating Zeek. Wright-Olivares was charged criminally last week for her role in Zeek, creating a PR problem for iWowWe.
UPDATED 4:07 P.M. ET (JAN. 17, USA) Globo.com is reporting that the hunger strike has ended — after nearly 42 hours. See note/links in Comments thread. Our original brief is below . . .
