An affiliate's "press release" for JSS Tripler/JustBeenPaid is juxtaposed on Google News today against information about CONSOB's ban of promos for the "opportunity" in Italy. The affiliate's release ignores the CONSOB news, positions JSS/JBP as a way to make a "fortune" — and does not explain that JSS/JBP members must affirm they are not with the "government." The release also ignores conflicts between the "opportunity's" written words and the spoken words of purported operator Frederick Mann.
At the moment, Google News is providing an interesting juxtaposition on the subject of JSS Tripler, the purported arm of the “JustBeenPaid” program that does not identify itself with a nation-state, makes members affirm they are not with the “government” and advertises an absurd monthly return of 60 percent.
Frederick Mann, the “opportunity’s” purported operator, was identified in 2008 promos as a pitchman for AdSurfDaily. The U.S. Secret Service called ASD an online Ponzi scheme that had gathered at least $110 million and defrauded thousands of people. JSS Tripler/JustBeenPaid advertises a daily payout rate twice that of ASD.
As the screen shot above shows, Google News today is publishing information on JSS Tripler from three sources. Two of the sources report on the April 23 JSS Tripler promotional ban by CONSOB, the Italian securities regulator.
A third source — dated May 2, nine days after CONSOB announced the JSS Tripler ban — does not reference the ban at all. Instead, it instructs readers via an affiliate’s press release that JSS Tripler is “an income-generating program that lets investors start with just $10 and turn it into a fortune. Essentially an HYIP, the program factors in the daily compounding system to increase earnings or make daily withdrawals as any investor would wish.”
One of the issues in the ASD Ponzi case is lack of disclosure to investors.
JSS Tripler/JustBeenPaid has no known securities registrations. Regardless, the affiliate’s release defines participants as “investors” and positions the program as one that is passive in nature. Claims in the release easily could lead to questions about whether the “opportunity” and its affiliates are benefiting in ASD-like fashion from the sale of unregistered securities by a global network of unregistered brokers.
5. I have NOT been led to believe that this activity is an investment activity, franchise, or employment opportunity.
Although the release prompts readers (in the first paragraph) to “look closely at what they are getting into and ensure that they are joining income opportunities through programs that are proven to truly deliver financial freedom and sustainability,” it does not explain why the Member Agreement says one thing and Mann another.
Nor does it explain why any reasonable person would direct money to an entity whose Member Agreement also says this. (Italics added):
6. I affirm that I am not an employee or official of any government agency, nor am I acting on behalf of or collecting information for or on behalf of any government agency.
7. I affirm that I am not an employee, by contract or otherwise, of any media or research company, and I am not reading any of the JBP pages in order to collect information for someone else.
Bizarre ambiguities, incongruities and internal inconsistencies are common in the HYIP fraud sphere.
News about CONSOB’s JSS Tripler ban was published in English on CONSOB’s own website April 23. It also was published on the PP Blog and other sites, including the sites referenced by Google News.
Even as the affiliate was prompting JSS Tripler/JustBeenPaid prospects to “look closely,” he apparently missed information that was available through simple web searches — and this apparently also occurred after he missed the conflict between Mann’s words and the “opportunity’s” published Member Agreement.
The release concludes with these words:
“People who want real money from a reliable online networking system without the fuss and tricks should visit [URL deleted by PP Blog] to learn more.”
UPDATED 12:06 P.M. EDT (MAY 5, USA): Andy Bowdoin’s bond-review hearing has been rescheduled from May 8 to May 18. Here, below, our earlier story . . .
Only days ago, federal prosecutors described the OneX “program” pitched online by accused Ponzi schemer Andy Bowdoin of AdSurfDaily as a “fraudulent scheme” and “pyramid” that “simply re-distributes funds among participants” in ASD-like fashion.
The PP Blog learned yesterday through a source that Bowdoin was a no-show on last night’s scheduled “team” conference call for OneX. A call Monday apparently was canceled.
According to information provided by the source, Bowdoin was unable to participate in last night’s call — after the cancellation of Monday’s call — because of “personal problems.” The specifics of the personal problems were not disclosed.
Unless U.S. District Judge Rosemary Collyer postpones a May 8 bond-review hearing for Bowdoin, prosecutors are expected to argue on Tuesday that Bowdoin was pushing the OneX pyramid scheme while awaiting his September trial in the ASD Ponzi scheme case.
Although a postponement of the bond-review hearing is possible because one of Bowdoin’s two lawyers is ill and the government has not objected to a delay, the judge has not entered an order delaying the proceeding, according to docket entries as of this morning. (May 5 update: The May 8 hearing has been rescheduled for May 18.)
Last night’s OneX call, according to information provided by the source, was conducted by “Allen” (or Alan).
“First and foremost, Andy has some personal problems that he has to deal with, so he will not be with us for a few days,” Allen said, according to information from the source.
Whether Bowdoin’s OneX “team” is aware that federal prosecutors have described the “program” as a scam is unclear. What is clear, according to filings by the government, is that Bowdoin has a long history of recruiting people into financial debacles and withholding information that would enable them to make informed investment decisions.
Prosecutors also say they’ve tied Bowdoin to the failed AdViewGlobal (AVG) autosurf, which came to life in the weeks and months after the U.S. Secret Service seized tens of millions of dollars from ASD-related bank accounts in August 2008 as part of a Ponzi probe. AVG vanished during the summer of 2009 — about a year after the ASD seizure — amid claims that someone had stolen money from the enterprise.
Even as AVG was tanking, members and critics were threatened with lawsuits for sharing news about the purported Uruguay-based entity.
While at ASD’s helm in 2007, Bowdoin explained that members were not getting paid because of script problems and because “Russian” hackers had stolen $1 million, according to records. Prosecutors said Bowdoin never filed a police report about the purported $1 million theft.
Prosecutors have argued that ASD collapsed before Bowdoin resurrected it and started operating it under a new name (ASDCashGenerator). Incoming members were not told they were funding payouts to members affected by the collapse. Over time, Bowdoin dialed up the criminality to keep ASD afloat in what was at least its second iteration, according to court filings.
In the 1990s — in at least three Alabama counties — Bowdoin was charged with securities-related crimes similar to his later illegal behavior at ASD, prosecutors now say. ASD members, however, were led to believe that the ASD patriarch’s only encounter with law enforcement had been a speeding ticket.
Bowdoin has been participating in OneX conference calls since at least October 2011, explaining in the earliest calls that we was seeking to fund his criminal defense to the ASD-related Ponzi charges through OneX and that OneX was brought to members and prospects by “God.”
The indictment against Bowdoin was made public in December 2010. It charges him with wire fraud, securities fraud and selling unregistered securities.
Details about OneX, including the identities of its operators, are exceptionally murky.
These court records from Jefferson County, Ala., suggest that Andy Bowdoin was jailed at least briefly in the 1990s in an alleged securities swindle involving mobile phones. (Redactions by PP Blog.)
In April 24 court filings, federal prosecutors in the District of Columbia described four instances in which accused Ponzi schemer Andy Bowdoin was charged during the 1990s with state-level, securities-related crimes in Alabama. Those crimes occurred in Montgomery and Wilcox counties, prosecutors said.
But yesterday prosecutors informed Bowdoin’s lawyers and U.S. District Judge Rosemary Collyer that Bowdoin also had been indicted in 1996 in Jefferson County on 12 state-level counts related to securities fraud. The government said it intended to use evidence of Bowdoin’s criminal history in all three Alabama counties in the AdSurfDaily patriarch’s September 2012 trial on ASD-related charges of wire fraud, securities fraud and selling unregistered securities.
Warrants were issued in Jefferson County for Bowdoin’s arrest, according to exhibits federal prosecutors produced yesterday in advance of a May 8 bond-review hearing for Bowdoin in Washington. At least one of the records suggests Bowdoin was “Committed To Jail” after his arrest on the Jefferson County charges.
How long Bowdoin actually spent in jail was not immediately clear. But records in Alabama show that he entered into plea agreements that required him to testify against at least five alleged securities fraudsters. Federal prosecutors now are suggesting that at least some of the Alabama litigation against Bowdoin was unresolved when he launched ASD in 2006 and that Bowdoin made restitution payments in the state with proceeds from the ASD Ponzi scheme.
Bowdoin claims through ASD employees that his only encounter with law enforcement had been a speeding ticket were “false and misleading,” federal prosecutors said yesterday.
ASD’s existing members and prospects were not told information that could have helped them in making an informed decision when joining ASD, prosecutors said.
In August 2008, the U.S. Secret Service seized tens of millions of dollars from Bowdoin’s bank accounts, amid allegations he was presiding over a massive online Ponzi scheme through ASD. Bowdoin was arrested by the Secret Service in December 2010.
Separately, new court filings suggest that Bowdoin’s May 8 bond-review hearing could be delayed, owing to the illness of one of Bowdoin’s lawyers.
Prosecutors have said Bowdoin disguised ASD — an illegal securities business — as an “advertising” company. He also is accused of using ASD Ponzi proceeds to make campaign contributions to the National Republican Congressional Committee.
Frederick Mann, onetime ASD pitchman and the purported operator of JSS Tripler/JustBeenPaid
UPDATED 7:44 A.M. EDT (U.S.A.). A potentially damning audio recording of a March 15 conference call in which Frederick Mann told JSS Tripler/JustBeenPaid members that the “opportunity” was paying them with money from “new members” has gone missing from the JSS/JBP website.
Mann, whose name appeared in 2008 promos as a pitchman for AdSurfDaily, is the purported operator of JSS/JBP. The U.S. Secret Service seized tens of millions of dollars tied to ASD in 2008, amid allegations it was conducting an international Ponzi scheme over the Internet.
Andy Bowdoin now has been accused of serial scamming dating back at least two decades. He faces a May 8 bond-review hearing. Frederick Mann, the purported operator of JSS/JBP, was identified in 2008 promos as an ASD pitchman.
ASD President Andy Bowdoin was charged criminally in 2010. He now faces a May 8 bond-review hearing amid allegations that he continued to scam the public even after the August 2008 seizure of $65.8 million from his 10 personal bank accounts and even after his December 2010 arrest in Florida on ASD-related Ponzi charges of wire fraud, securities fraud and selling unregistered securities.
“I (Frederick Mann) have been with ASD since January 07,” remarks attributed to Mann on a site known as BigBooster read on May 14, 2008. “Past performance indicates a strong probablility (sic) that ASD will continue to perform as advertised. (By early May 2008, I had received 14 payments totalling over $6,000!”)
The U.S. Secret Service conducted a Ponzi raid of ASD less than three months later. Despite the Ponzi allegations against Bowdoin and ASD, Mann purportedly went on to launch JSS/JBP, which purports to pay members a return of 2 percent a day — double the purported return of ASD.
In January 2012, JSS/JBP-related claims came under the lens of CONSOB, the Italian securities regulator. The agency banned promos for the “opportunity” last month after earlier announcing a 90-day suspension.
Just days before CONSOB’s April 23 announcement of the ban — on April 17 — U.S. federal prosecutors sent a letter to Bowdoin’s defense attorney in the ASD Ponzi case. The letter informed the attorney — Charles A. Murray — that the government intended to introduce evidence that Bowdoin continued to commit crimes after the August 2008 ASD seizure and after Bowdoin’s subsequent indictment on charges that could put him behind bars for 125 years if he is convicted on all counts.
Prosecutors said they had tied Bowdoin to AdViewGlobal (AVG), an autosurf that collapsed in 2009. They also said Bowdoin had emerged as a pitchman for a “fraudulent scheme” known as OneX that — in ASD-like fashion — “simply re-distributes funds among participants.”
Online Ponzi schemes are infamous for morphing into new forms. Serial scammers who populate Ponzi boards such as TalkGold and MoneyMakerGroup drive business to the purported “opportunities,” which often advertise MLM-style, tiered recruitment “commissions” on top of preposterous rates of return.
ASD, AVG, OneX and JSS/JBP all have (or had) a presence on the Ponzi boards. Serial apologists for JSS/JBP have pooh-poohed the CONSOB developments.
In the now-missing March 15 recording, a caller purportedly from “San Francisco” asked Mann where “JustBeenPaid get[s] the money to pay that kind of interest.”
The reference was to the advertised return of 2 percent a day, which corresponds to a precompounding, annualized return of 730 percent — a figure that would make Bernard Madoff blush.
“Well, first of all, JBP or JSS Tripler is a revenue-sharing program, so that means some of the money comes from new members buying positions,” Mann responded to the caller. “Then, we are in the process of developing additional income streams, so that’s relevant. And eventually the additional income streams may be sufficient to pay the 2 percent — maybe not.”
With federal prosecutors in the District of Columbia now saying AdSurfDaily President Andy Bowdoin was involved in multiple fraud schemes after the U.S. Secret Service seized $65.8 million from his personal bank accounts in August 2008 in a Ponzi probe, the ASD patriarch now faces a bond-review hearing in Washington.
U.S. District Judge Rosemary Collyer has scheduled the hearing for May 8.
Prosecutors pointedly asserted on April 17 that Bowdoin, 77, was promoting a “fraudulent scheme” known as “OneX,” informing Collyer that Bowdoin’s OneX pitches began in 2011 –after Bowdoin was indicted in 2010 on charges of wire fraud, securities fraud and selling unregistered securities in his operation of ASD.
Collyer now has ordered prosecutors to present “all evidence (written and testimonial) regarding Defendant’s alleged involvement in OneX or any other alleged Internet scheme since the Indictment in this case.”
Bowdoin’s OneX pitches, which mixed in commentary about his criminal case, began in October 2011. The ASD-related indictment against him was unsealed in November 2010 and announced publicly on Dec. 1, 2010.
Prosecutors also say Bowdoin was involved in AdViewGlobal, an autosurf that came to life in late 2008 and early 2009 — after the August 2008 Secret Service seizure. At the same time, prosecutors say Bowdoin, Clarence Busby and “others” were involved in the operation of the Golden Panda Ad Builder autosurf, the so-called “Chinese” version of ASD.
Money from at least five Golden Panda bank accounts was seized as part of the ASD probe in 2008. All in all, the combined sums seized from ASD and Golden Panda totaled about $80 million.
UPDATED 11:40 P.M. EDT (U.S.A.) Federal prosecutors say they’ve tied AdSurfDaily President Andy Bowdoin to the failed AdViewGlobal autosurf and intend to introduce evidence of “uncharged misconduct” at Bowdoin’s trial for the alleged ASD Ponzi scheme.
Meanwhile, prosecutors say “OneX” — a “program” Bowdoin said he was pitching to help pay for his criminal defense in the ASD Ponzi case — is a “fraudulent scheme.”
The OneX organization and its “matrix,” prosecutors said, are more accurately described as a “pyramid” and the purported opportunity “simply re-distributes funds among participants.”
“In this latest venture, Bowdoin has again partnered with Tari Steward and Rayda Roundy, both of whom were involved in the operation of ASD,” prosecutors said.
Prosecutors’ references to AdViewGlobal and OneX are believed to mark the first time the government has acknowledged publicly it was gathering information about the schemes. The government says its probe into Bowdoin continues and that it intends to introduce other evidence of criminal conduct at his September Ponzi trial.
“The government is aware of additional criminal matters lodged against Bowdoin,” prosecutors said.
Precisely what those alleged matters entailed was not immediately clear.
Here (below) are some highlights from an April 17 letter and an April 24 list of exhibits prosecutors filed with the court and sent to Charles A. Murray, Bowdoin’s defense attorney. The letter and exhibits inform Murray about certain matters the government intends to introduce at trial. (Italics and/or bold emphasis added by PP Blog):
Bowdoin’s history involves at least four instances in which he was charged with securities-related crimes during the 1990s in Alabama. Three indictments were returned in Montgomery County, and one was returned in Wilcox County. There were multiple victims. Bowdoin accepted plea agreements, agreed to testify for the state against at least five defendants and agreed to make restitution to his fleeced investors. (Note: These assertions by the government may be aimed at short-circuiting any claim by Bowdoin that he was ignorant of securities laws when he started ASD. At the same time, the assertions are potentially useful in making a case that Bowdoin was committed to making a living from securities fraud even after agreeing to testify against alleged securities fraudsters.)
Bowdoin allegedly paid some of the Alabama restitution with proceeds from the ASD Ponzi scheme.
In one of the Alabama cases, a grand jury accused Bowdoin of not telling investors he was using their money to make “full and/or partial refunds to investors in earlier projects” involving a cell-phone business.
Bowdoin solicited $600,000 from an Alabama investor, but allegedly did not disclose that his company had been sued four times under a previous name. (Note: Lack of disclosure and a name change also are alleged parts of the ASD scheme.) Moreover, Bowdoin allegedly sold the $600,000 contract despite the fact that neither cell-phone entity had the required license to operate from the Federal Communications Commission.
Bowdoin was “permanently barred” from engaging in the securities industry in Alabama. (This point leads to questions about whether Bowdoin potentially could face state-level charges for selling ASD in Alabama after his ban in the 1990s.)
Included in Bowdoin’s history are a bankruptcy filing and string of lawsuits naming him a defendant. (Details of these are unclear, but the government says it expects to produce additional documents in the “near future.”
Although Bowdoin claimed to have run successful mobile-phone, GPS-tracking and dry-cleaning businesses, “those businesses were not successful and on several occasions were the subject of civil and criminal proceedings.”
“After the United States Secret Service seized ASD’s bank accounts in August 2008, Bowdoin, Gary Talbert . . . and others began operating another version of ASD over the Internet at adviewglobal.com (‘AVG’).” (Talbert was a former ASD executive, according to court filings.)
In 2009, AVG “ceased operation when allegations arose that an individual associated with AVG purportedly stole money from AVG.” (Note: A purported theft of $1 million at the purported hands of “Russian” hackers is an alleged element of the ASD case.)
Bowdoin’s claims about OneX are “inherently deceptive.” Like ASD, OneX “does not generate income by selling a product to consumers outside the system. Instead, it simply re-distributes funds among participants.” (Note: The letter strongly suggests that the government is well-versed on the internal operations of OneX.)
Bowdoin is targeting former ASD members in his OneX promos and offered “leads” from the ASD database.
One of the exhibits filed by the government is the AVG Terms of Service.
U.S. District Judge Cecilia M. Altonaga of the Southern District of Florida has dismissed a lawsuit by AdSurfDaily members Dwight Owen Schweitzer and Todd Disner against Rust Consulting Inc., the government-approved claims administrator in the civil portion of the ASD Ponzi case.
The claims by Schweitzer and Disner were hypothetical in nature and “far from the ‘definite and concrete’ dispute required for the maintenance of a declaratory judgment action,” Altonaga ruled.
And Schweitzer and Disner did “not explain how their allegations relate to their declaratory action against Rust,” Altonaga ruled.
“Indeed,” she continued, “the declaration Plaintiffs seek in this action relates to the government’s verified complaint for forfeiture . . . the Court cannot find — nor do Plaintiffs identify — anything in the Complaint indicating what declaration Plaintiffs seek with regard to Rust.”
Schweitzer and Disner sued Rust and the United States in November. A response by the U.S. Department of Justice is expected soon.
Rust moved for dismissal last month, arguing that Schweitzer and Disner were impermissibly seeking to relitigate the forfeiture action against tens of millions of dollars in the personal bank accounts of ASD President Andy Bowdoin.
Those issues already had been decided in the District of Columbia, where the forfeiture case was filed in August 2008, Rust argued.
In dismissing the claims by Schweitzer and Disner against Rust, Altonaga ruled that the Schweitzer/Disner complaint had presented a “conjectural, hypothetical, or contingent” controversy as it pertained to Rust.
Compound150 says it is a spinoff of T2MoneyKlub, while targeting "compounding lovers" like a sandwich joint targets lovers of cheeseburgers.
The ink was barely dry on the most recent civil judgments for millions of dollars against serial HYIP pitchman Matthew J. Gagnon when Compound150 launched yesterday. On Tuesday, the SEC announced $4.2 million in new court-ordered assessments against Gagnon, who’d earlier been hit with more than $2.5 million in assessments in a related case and became the subject of a criminal complaint filed by the U.S. Secret Service.
Gagnon was a web-based pitchman for the Legisi HYIP Ponzi scheme and other high-yield “opportunities,” including a “program” in which his alleged partner was a twice-convicted felon. The SEC essentially charged Gagnon with turning a blind eye to obvious fraud schemes — repeatedly.
Apparently not taking the clue that HYIP promoters are at risk of both civil and criminal prosecution, the operators of JSS Tripler 2 have launched the Compound150 feeder scam, a companion to the original JSS Tripler 2 scam. After suspending member payouts in December 2011 amid reports of an AlertPay freeze, JSS Tripler 2 — also known as T2 — gave itself a new name: T2MoneyKlub.
The addition of the Compound150 scam means that the entity — purportedly operated by “Dave” from locales ranging from Britain to Cambodia to Thailand — means that the original JSS Tripler 2 entity now has a third entry in its scam lineup.
But the strangeness does not end there: Indeed, JSS Tripler 2 reportedly based its original name on JSS Tripler, a purportedly unrelated “program” whose affiliates became the subjects in January of a probe by CONSOB, the Italian securities regulator. Compound 150 reportedly launched during a period in which “Dave” was building prelaunch buzz while simultaneously battling (or recovering from) a bout with Dengue fever.
In the fraud sphere, it is common for “opportunities” to refer to illnesses, server problems or catastrophes such as typhoons. In upholding the 20-year prison sentence of pyramid schemer Seng Tan, the U.S. Court of Appeals last month pointed out that Tan — who targeted the scam she ran with her husband at Cambodian émigrés in the United States — blamed the scam’s inability to make payouts on Hurricane Katrina.
Tan’s husband — James Bunchan — ultimately received sentences totaling 60 years because he discussed murdering witnesses and the federal prosecutor who brought the case.
How strange could the JSS Tripler2/T2MoneyKlub/Compound150 “opportunity” get? The answer, perhaps, is that the sky is the limit. Perhaps positioning itself as a category creator, Compound150 says “compounding lovers” are among its target audience.
Compound150 apparently believes it is to multilevel marketing (MLM) what a fast-food chain is to lovers of cheeseburgers
Compound150 opened its doors amid a weekend flap at the MoneyMakerGroup Ponzi forum in which “Dave” — posting as Peakr8 — protested the forum’s description that the emerging opportunity was an HYIP, not an MLM opportunity.
“So are we a HYIP?” Dave asked.
“Hell no!” he answered himself, even as Compound150 was claiming on its website that it pays participants “1% daily for 150 days up to 150%.”
In effect, Compound 150 is advertising a (precompounding) annualized return of 365 percent, about the same purported ROI that led to the 2010 indictment of AdSurfDaily President Andy Bowdoin amid allegations he was operating an international Ponzi scheme.
If convicted on all counts in his September 2012 Ponzi trial, Bowdoin, 77, faces up to 125 years in federal prison and fines in the millions of dollars. As part of the ASD Ponzi investigation, the U.S. Secret Service seized the bank accounts of some individual ASD promoters.
Ten of Bowdoin’s personal bank accounts were seized — and five bank accounts allegedly involved in the operation of Golden Panda Ad Builder, a companion autosurf, were seized.
“Dave” was joined in his protest by JSS Tripler2/T2MoneyKlub/Compound150 shill “lolalola,” who insisted that Compound150 was an MLM.
In the civil portion of the ASD case, ASD also insisted it was an MLM. A federal judge was unmoved, ordering the forfeiture of more than $80 million, including more than $65.8 million from Bowdoin’s personal bank accounts.
An “opportunity” can at once be both an HYIP and an illegitimate MLM “program.” (Simply calling a program an ‘MLM” does not cure a program of legal defects, and some scams mix-and-math elements of both pyramid schemes and Ponzi schemes. Such programs may be described by investigators as pyramid-style Ponzi schemes.)
Compound150 appears to have a confluence of payout schemes very similar to the schemes that led to at least FOUR ASD-related forfeiture actions, the filing of a racketeering (RICO) lawsuit against Bowdoin, the seizure of tens of millions of dollars, millions of dollars in ASD-related civil judgments — and the ultimate filing of wire fraud and securities- fraud charges against Bowdoin.
Bowdoin also was charged with selling unregistered securities.
Like Bowdoin, Seng Tan also insisted her “opportunity” was an MLM.
Purported JSS Tripler/JustBeenPaid COO Carl Pearson. From: YouTube.
It sometimes is the case in the corrupt universes of HYIPs that a change in the status quo signals panic or devastating news. It’s also sometimes the case that significant developments get explained away as meaningless or part of a plan that had been in place all along in response to explosive growth.
It is almost always the case that HYIPs such as JSS Tripler/JustBeenPaid and their various purveyors reveal incongruities and internal inconsistencies — and a few big ones now are in play at JSS/JBP.
Within the past several days, audio recordings of JSS Tripler/JustBeenPaid “conference calls” featuring pitchman and purported COO “Carl Pearson” have gone missing from the JSS/JBP website. The recordings previously had been embedded on the site below the embedded recordings of Frederick Mann, the purported operator of JSS/JBP. Although Mann’s recordings remain, the recordings of Pearson have vanished.
No recording from Mann was added to the site last week, meaning the last embedded Mann recording carries a date of March 15. No recording was posted for March 22, meaning that the streak of posting a recording of every Mann Thursday conference call dating back to Feb. 16 had been broken.
In the March 15 call, Mann told members that JSS/JBP was paying them with money from “new members” and that it was OK to call JSS/JBP an investment program. Using money from new members to pay old members is the central element of a Ponzi scheme. And because Mann himself described JSS/JBP as an investment program, promoters could find themselves confronting assertions they are selling unregistered securities as investment contracts.
JSS/JBP members who identified themselves of residents of the United States or Canada were on the March 15 call (and also on previous calls). Their nationalities and citizenship are potentially important because JSS/JBP has no known securities registrations, meaning that regulators from either the United States or Canada could move against the enterprise and perhaps even some of its promoters.
Mann has declined on multiple occasions to identify JSS/JBP with a nation-state — and promoters still are pushing the scheme, despite the fact they appear to have no clue about the internal workings of JSS/JBP and how they (and their recruits) ever could recover their investments in the event of a collapse or a government intervention.
In January, the Italian securities regulator CONSOB announced a JSS/JBP-related action — and affiliates still promoted the program, with JSS/JBP itself claiming it was posting record numbers of new members daily.
At least a few JSS/JBP members have noted the removal of the Pearson calls. Earlier today, the PP Blog viewed an affiliate’s Blog for JSS/JBP in which an assertion was made that Pearson had become too busy with other duties to host calls.
“Due to the unprecedented growth of JBP, Carl Pearson will no longer be doing the weekly conferences,” a comment from a reader asserted. “He is prioritising now full time in the back office operations of JBP.”
The comment was dated March 21. A follow-up comment dated March 22 suggested the recordings had been removed for security reasons and that other information also might be removed.
“From the conference room yesterday at around 8pm Dominick got on the mic and announced it,” the post claimed. “He also said that staff members could have their pictures and information removed from the site if they wanted to and Carl as well as other staff members decided it would be best to have that information removed. He said that they are growing so fast that they could be targeted by crooks and hackers.”
But what the explanation did not reveal is why Mann’s recordings remained on the site if concern about crooks and hackers was great enough to trigger the removal of the Pearson recordings.
As often is the case in the HYIP sphere, the information was posted anonymously, meaning it could not be verified. Even so, the information is potentially disturbing in the sense that it defaults to well-known HYIP clichés such as introducing the prospect of hackers — while ignoring the potentially damning information contained in the jettisoned material as a factor in the removal decision and the obvious fact that information that remains on the site may be equally damning.
With a straight face, for example, JSS/JBP purports to pay a daily return of 2 percent and a monthly return of 60 percent.
JSS/JBP openly advertises that it pays a return of 60 percent a month on TOP of affiliate commissions totaling 15 percent over two tiers.
In 2007, when the alleged AdSurfDaily Ponzi scheme stopped making payments to members (even as its operator allegedly was making political donations with Ponzi money), ASD President Andy Bowdoin allegedly blamed the halted member payouts on script problems and “Russian” hackers who’d allegedly taken $1 million.
Bowdoin never filed a police report about the purported theft of $1 million, federal prosecutors said.
In 2008 promotional materials attributed to Mann, Mann was identified as an ASD pitchman. As the ASD prosecution moved forward, it became apparent that certain ASD members either were “sovereign citizens” or sympathizers. Some “sovereign citizens” hold extreme antigovernment views and have an irrational belief that laws do not apply to them.
In November 2011, ASD figure and purported “sovereign citizen” Kenneth Wayne Leaming was arrested by an FBI Terrorism Task Force in Washington state on charges he had filed false liens against at least five public officials involved in the ASD case, including a federal judge, three federal prosecutors and a special agent of the U.S. Secret Service.
On Feb. 27, the PP Blog reported that a website linked to Mann included links to 11 videos concerning Francis Schaeffer Cox, a purported “sovereign citizen” under indictment in an alleged murder plot against public officials in Alaska.
One poster on the JSS/JBP-related Blog from which the “hackers” explanation was advanced had a different take on conference-call-related developments.
“Heat is also the REAL reason why Carl Pearson has moved off the conference calls,” the poster speculated.
BULLETIN:Ronald James Davenport, the Washington state “sovereign citizen” convicted in November 2011 of filing false liens for billions of dollars against four public officials, has been sentenced to 41 months in federal prison, the Justice Department said today.
Davenport was convicted of the false-liens charges during the same month AdSurfDaily figure and purported Washington state “sovereign citizen” Kenneth Wayne Leaming was accused in a separate case of filing bogus liens against five public officials involved in the ASD Ponzi case brought by the U.S. Secret Service in August 2008.
Leaming’s targets included a federal judge and three federal prosecutors in the District of Columbia and a special agent of the U.S. Secret Service, according to court filings.
Davenport, described by prosecutors as a tax defier, targeted the U.S. Attorney for the Eastern District of Washington, an assistant U.S. Attorney, an IRS agent and a court clerk with false liens, prosecutors said.
“The liens were filed in the county auditor records of Spokane and Whatcom Counties, Wash,” prosecutors said. “Each lien claimed that the victim owed Davenport $5,184,000,000. It also purported to attach all of the victim’s real and personal property as security for this debt. As proved at trial, the defendant chose these four victims because of their involvement in an effort to collect from Davenport more than $250,000 in back taxes.”
U.S. District Judge Garr M. King of Oregon sat in special designation in the Davenport case because the Washington state federal judiciary recused itself, prosecutors said.
The Justice Department’s Tax Division and the Treasury Inspector General for Tax Administration (TIGTA) prosecuted the case because the U.S. Attorney’s Office in Eastern Washington also recused itself, the Justice Department said.
“Where does JustBeenPaid get the money to pay that kind of interest?” — Caller “Michael” from “San Francisco” in March 15 JSS Tripler/JustBeenPaid conference call
“Well, first of all, JBP or JSS Tripler is a revenue-sharing program, so that means some of the money comes from new members buying positions. Then, we are in the process of developing additional income streams, so that’s relevant. And eventually the additional income streams may be sufficient to pay the 2 percent — maybe not.” — Response by Frederick Mann, purported JBP/JSS operator, to “Michael’s” question, March 15, 2012
Frederick Mann
UPDATED 7:26 P.M. EDT (U.S.A.) In yet-another bizarre conference call for JSS Tripler/JustBeenPaid, the “program’s” purported operator told listeners from the United States and Canada (and possibly from Jamaica) that JSS/JBP is paying them with money sent in by “new members.”
Using “new” money to pay “old” members is the central element of a Ponzi scheme — although Frederick Mann did not use the phrase. Still, it was the white elephant in the conference room, and Mann’s explanations during the March 15 call became increasingly complex, vague and incongruous.
Mann, for instance, declined to say where the program was operating from, repeating his practice of nondisclosure from previous calls.
What’s important, he explained, “is that our programs are not U.S.-based. We don’t have any offices in the U.S. Our servers are not in the U.S.”
The explanation caused a chuckling U.S. caller to quip, “Yeah. I agree. Somewhere out in the galaxy.”
“Yes,” Mann replied to the caller’s “galaxy” remark. The caller earlier had described himself during the March 15 call as a “financial planner” for 22 years. In a previous call, the caller said he was in “California” and had family in Iowa.
And Mann advised listeners that it was OK to call JSS/JBP an investment program when they were recruiting new members — guidance that seemed to catch even the conference-call host off-guard.
“And I know that, in the [separate conference] room, we do try to say ‘purchase’ and ‘repurchase’ as opposed to ‘invest’ and ‘reinvest,’” the female host said.
It is common for HYIP scams and their purveyors to seek to avoid the language of investments when promoting “programs” — on the errant belief that avoiding such language insulates them from prosecution.
The female host did not say why the other room was giving one set of instructions and Mann another. Regardless, internal inconsistencies are one of the hallmarks of HYIP scams, and it is well-known that wordplay designed to disguise securities fraud cannot insulate purveyors from prosecution — rather like a robber who uses a gun to snatch the purse of an 80-year-old woman cannot avoid prosecution by calling the robbery an innocent exercise in arranging a loan and insisting that the gun was a harmless piece of metal that just happened to be at the scene.
Mann, whose name appears in 2008 materials identifying him as a promoter of the alleged AdSurfDaily Ponzi scheme, said nothing about whether JSS/JBP had any securities registrations or whether promoters of the “program” were risking a legal calamity by recruiting downlines into a scheme that does not identify itself with a nation-state and whose payout corresponds to a preposterous annualized return of 730 percent .
The bank accounts of some individual ASD promoters were seized by the U.S. Secret Service in the ASD Ponzi case, according to court filings. JSS/JBP purports to pay a daily return double that of ASD.
Income Streams Are Theoretical; ‘Free’ Members Dominate JSS/JBP
The most troubling explanation — among any number of troubling explanations during the 1:11 call — was Mann’s assertion in response to a question from “Michael” of “San Francisco” about where JSS/JBP gets the money to pay a return of 2 percent a day. (The exchange is noted in the breakout quotes at the top of this story.)
Conceding that the company uses money from “new members” who buy “positions” to make the payouts, Mann simultaneously acknowledged that the “program” was “in the process” of developing new income streams and that those still-theoretical streams may be insufficient to sustain the scheme.
But the company’s “restart” feature, Mann suggested, was enough to defeat any concerns that the firm’s liabilities exceeded its assets.
“The 2 percent that the company pays is effectively a liability to the company,” Mann said. “But what the ‘restart’ makes possible is to convert some or even all of these liabilities into assets in the form of JSS positions.”
Even so, members needed “to bring in new members with new money,” Mann said. He later asserted that only “about 25 percent” of new registrants “put in money.”
“Maybe 75 percent of people do nothing,” Mann said, a problematic response because the program advertises that it provides registrants a $10 credit (described during the March 15 call as a loan) for joining and pays them interest of 20 cents a day until they realize a profit of $5 after 75 days.
When JSS/JBP debits a member’s account to recapture the purported loan, which apparently is made at an interest rate of zero percent, the company still is on the hook for the $5 due the new subscriber.
Speaking with a South African accent but using an American baseball metaphor, Mann said the lion’s share of JSS/JBP new members (about 75 percent) do nothing after enrolling
If the JSS/JBP program were baseball, Mann suggested, “The pitcher would pitch the ball, and they would watch it go by, they would just stand there.”
If Mann’s assertions are true, it means that only 25 percent of JSS/JBP’s members are propping up 100 percent of the enterprise, including the purported $5 profit due new registrants in 75 days and much larger payments due other members. Even if JSS/JBP enforces a cash-out minimum higher than $5 to prevent a flood a small redemptions, such a device leads to questions about whether the purported $10 credit is just a smaller scam within a larger scam that permits accrued liabilities to be ignored.
Much remains mysterious about JSS/JBP’s purported restarts and its in-house accounting methods. Other HYIPs have used similar devices to duck the Ponzi issue. But with its “restart” explanation, JSS/JBP may be inviting questions about whether is has introduced Enron-like accounting tricks into the morass.
Enron’s 2001 collapse revealed one of the greatest financial scandals in U.S. history. It destroyed not only the company, but also the Arthur Andersen accounting firm. (See “Enron scandal” Wikipedia entry.)
Is JSS/JBP a miniature Enron-in-waiting?
Among the callers who asked questions during the call was a JSS/JBP member who described himself as “Earl,” a 79-year-old man interested in leaving money for his daughter.
Also on the line was a man who suggested he hailed from Jamaica and wanted to start a JSS/JBP account for a “nonprofit, for a school that I have, that I attended in Jamaica.”
Other callers identified themselves as residents of the Canadian provinces of British Columbia and Alberta and the U.S. states of California, South Dakota, Texas, Georgia, Missouri and Louisiana.
One caller asked Mann why electronic payments from JSS/JBP came from “Michael” at a BigBooster.com email address, not an email address associated with the JSS/JBP domains.
“Michael is a business partner, and he handles some of the finances,” Mann said. He did not identify “Michael” by a last name.
Mann also advised callers that JSS/JBP had two representatives in Italy, but did not speak to the JSS/JBP-related probe involving the program’s affiliates announced by the Italian securities regular CONSOB in January.
One caller informed Mann that his downline recruits has put in “substantial” sums. Another complained that his account had been debited weeks in advance of the anticipated debit. Another complained that the website was unattractive to potential recruits and looked like a scam. Yet another fretted that the site appeared to lack a secure connection (https). Still another complained that his “matrices” did not appear to be cycling properly.
HYIPs are infamous for creating one set of expectations and then changing the rules at midstream. They’re also infamous for their convoluted explanations and fuzzy — if not downright impossible — math.
Like ASD’s Andy Bowdoin — now under indictment amid charges that he orchestrated an international Ponzi scheme that had gathered at least $110 million — Mann has been accorded the description of “genius” in promotions for the program.
