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MLM WATCHDOG: Phil Piccolo Is Scamming Again

(2ND UPDATE 3:26 P.M. EDT U.S.A.) Rod Cook, who publishes the “MLM Watchdog” and was threatened with a $40 million lawsuit by the AdSurfDaily Ponzi racketeers in 2008, is reporting that veteran swindler Phil Piccolo is back on the prowl.

This time, Cook reports, it’s with a cobra-venom product sold at MyNyloxin.com. The product is positioned as a pain reliever, and Piccolo is calling himself “Felice Angelo.”

Piccolo is known as “the one-man Internet crime wave.” If there’s a Piccolo signature, it’s his ability largely (though not exclusively) to remain in the shadows while engineering scams within scams or within dubious “opportunities” in which an affiliate’s success chances are exceptionally low going in. Piccolo appears to be particularly keen on “programs” ostensibly in the health-maintenance and electronic-technology fields. The “programs” may remain in “prelaunch” phase virtually indefinitely while gathering cash and gaining a head of steam.

“[P]hil is selling his stock to individuals and giving it away as incentives under the table illegally and running $500 co-ops scamming people out of their money,” Cook reports about Piccolo’s MyNyloxin activities.

Based on the PP Blog’s research, Piccolo also is known to engage in anonymous shilling and to leave thousands of orphaned affiliate links of his onetime recruits all over the web as a means of corralling the earnings of people duped into placing the links before they fled the programs because they weren’t getting paid.

PP Blog reader Tony H. noted on March 4 that a “Piccolo Felix Angelo” was listed as a “winner” in the $850 million Zeek Rewards Ponzi-scheme and was being sued by the court-appointed receiver.

As the PP Blog previously has reported, Piccolo has a history of threatening websites that report on his scams. Part of his MO features appeals to religious faith. These incongruously have been mixed with suggestions he can summon leg-breakers if the need arises.

Piccolo claims to hail from New York. He is known to operate in the region of Boca Raton, Fla., and to participate in scams that try to create the illusion of scale — perhaps by using Photoshop to make the scamming firm’s name appear on a large building, for example.

Another part of Piccolo’s MO includes suggestions that “opportunities” he pitches soon will “go public” or already are part of public companies. In the TextCashNetwork scheme, for instance, the Piccolo group suggested that TCN was part of Johnson & Johnson, the famous pharmaceutical company.

Meanwhile, Piccolo scams may feature claims that people who send in large sums of money will receive a preposterous return, a marker that the “programs” are vulnerable to charges they are selling unregistered securities as investment contracts. If a Piccolo-associated scheme loses its payment conduits, recruits have been encouraged to wire money via Western Union.

Piccolo scams also have featured claims that celebrities such as billionaire Donald Trump and entertainment icon Oprah Winfrey were on the ships he helped steer. Such was the case with a scam known as Data Network Affiliates — DNA, for short.

DNA claimed to be in the business of assisting the Amber Alert system of rescuing abducted children. It later claimed to be in the cellphone, offshore “resorts” and mortgage-assistance businesses. DNA was targeted at churches, with prospects told they had the moral obligation to enroll the faithful.

Piccolo also was associated with a business known as “One World One Website” (OWOW) that suggested a bottled-water product could cure cancer and had been vetted by the National Institutes of Health.

Over the years, Piccolo has pushed products such as a purported license-plate “spray” positioned as a means of helping motorists escape traffic tickets at camera-monitored intersections. Perhaps most notoriously, Piccolo has pitched a purported “magnetic” product that purportedly could help medical patients escape limb-amputation procedures while at once helping gardeners/farmers produce tomatoes at twice their normal size. The scam also included a claim that the “magnetic” product could help dairy herds increase milk production.

Perhaps most infamously, the Piccolo group in the DNA scam traded on the name of Adam Walsh, a child who’d been abducted and murdered. Piccolo employs anything that “works,” even the memory of a slain 6-year-old.

Piccolo scams typically also feature the presence of MLM huckster Joe Reid. The scams also may include suggestions that affiliates should enroll as a means of qualifying for tax write-offs. In a typical Piccolo scam, an increase in Alexa rankings is positioned as asserted proof of an MLM “program’s” legitimacy. The Piccolo scams also typically feature a link to Google’s translation tool, potentially as a means of picking off nonspeakers of English.

Some Piccolo scams have featured the registrations of shell companies in Wyoming.

In 2010, the PP Blog was accused by an apparent Piccolo apologist of being a shill for Israel and spreading “Islamophobia.” This claim was made after the Blog reported that the FBI had stopped a plot to detonate a bomb at a Christmas tree lighting ceremony in Portland, Ore.

Also see: Nov. 13, 2011, PP Blog story: ‘TEXT CASH NETWORK’: RED FLAGS GALORE: New ‘Opportunity’ Linked To Ponzi Boards And To Phil Piccolo-Associated ‘Firms’: Hype, Vapid Claims, Alexa Charts, Launch Countdown Timer, Brand Leeching — And Possible Ties To Long-Running SEC Case

Also see this Jan. 16, 2014, comment by PP Blog reader and RealScam.com moderator Glim Dropper. The comment appears below an Aug. 30, 2013, PP Blog story titled, “Zeekers Targeted In New Scheme With Ties To Piccolo Organization.”

Apr 27, 2014
EDITORIAL: Uproar In TelexFree’s Billion-Dollar Broom Closet

Worried members wedge themselves into TelexFree’s broom closet in Marlborough, Mass, Tuesday. Source: YouTube.

UPDATED 12:15 P.M. EDT (U.S.A.) The Boston Red Sox were at the White House Tuesday to receive recognition for winning the 2013 World Series. There were plenty of smiling faces, perhaps particularly when slugger David Ortiz, the MVP of the series, posed for a selfie with President Obama.

But back home in Massachusetts, particularly in Marlborough, specifically in the stylized broom closet the MLM delusion merchants call TelexFree “corporate” as part of a long-running linguistic conspiracy to sanitize HYIP Ponzi cesspits, smiles were absent. In fact, the police were dispatched to prevent things from getting out of hand.

That’s because too many unhappy and confused TelexFree members who appear to believe they’ve been duped by the firm and its stable of serial delusion merchants wedged themselves into the broom closet to demand answers about why TelexFree either wasn’t paying them or why only certain members were getting paid.

But TelexFree — whom some affiliates say is a $1 billion company with a VOIP product — has only seven employees at its Marlborough office, according to regulatory filings in Tennessee. These employees work in “administration, sales and marketing, accounting, and operations positions.”

Our guess is that they work in staggered shifts, given the size of the office. All seven showing up at one time would appear to create sardine conditions.

According to the Tennessee filings, TelexFree’s two corporate officers are James Merrill and Carlos Wanzeler, who also own something called “Clarity Communications.” It’s unclear whether TelexFree’s seven employees also work for Clarity and several other firms associated with TelexFree.

Merrill is in charge of the money at TelexFree and has the ability to “motivate and instill trust in a company,” according to the Tennessee filings.

So, a company affiliates say has global reach, has gathered $1 billion and has the responsibility to pay hundreds of thousands of affiliates, does it all with just seven workers and owns another company called Clarity and several other firms. And when unhappy affiliates show up in the broom closet to demand answers . . . well, there isn’t a whole lot of wiggle room to begin with.

Filings in Tennessee confirm that TelexFree lacks its own underlying telephony infrastructure. Indeed, according to the filings, TelexFree “will resell or utilize the services of existing facilities-based national interexchange carriers in Tennessee, including the services offered by incumbent local exchange carriers.”

The issue here is almost certainly about margins — not only in Tennessee, but in other states — and whether TelexFree can squeeze any profits after it pays for everything else. This question leads to questions about why so many TelexFree affiliates seem to believe they’ll prosper through TelexFree. To put this in context, imagine that any presumptive TelexFree telephony competitor in a low-margin business had put additional pressures on itself by suggesting that $289 sent to the firm would return $1,040 in a year and that $15,125 would return $57,200.

Next imagine that these payouts were “guaranteed.”

This is an epic problem for TelexFree. For starters, the returns are absurd on their face and bring issues such as Ponzi scheme, pyramid scheme, the sale of unregistered securities and securities fraud into play. Moreover, TelexFree relies on banks to conduct business. And yet no legitimate bank ever would assert that a deposit account would provide such a whopping return. Even so, TelexFree affiliates effectively say the company outperforms its own banking vendors by orders of magnitude.

The same company now mysteriously says it is branching out into credit repair, something that potentially makes it a nemesis of the same banks its uses as vendors — while affiliates claim banks are laggards when it comes to producing income, a proposition that leads to questions about why banks haven’t followed TelexFree’s lead in recruiting affiliates and guaranteeing returns that would make Bernard Madoff blush.

At the same time, filings in Washington state show that TelexFree LLC, a Nevada entity, had made intracompany loans to other TelexFree businesses — and had more than $18 million parked at Fidelity Investment. Why does TelexFree have any money parked at Fidelity when, according to affiliates, it can earn 347 percent in a year “guaranteed” by investing in itself?

Where did affiliates get these ideas? Well, from TelexFree itself. In a “Be our promoter” pitch that once appeared on its own website, TelexFree told the troops to send in $299 (the sum also has been reported as $289) and start receiving $20 a week for a year. Meanwhile, TelexFree had an in-house scheme in which it entitled itself to 20 percent of affiliates’ earnings at the end of a year, something that became the subject of affiliate complaints.

As the PP Blog reported on Nov. 17, 2013, at least some TelexFree affiliates were told at a company event in Orlando that the 20 percent payback requirement had been waived. But the requirement appears not to have been lifted. The logistics of collecting 20 percent from each affiliate on a worldwide basis raises questions about whether some TelexFree rainmakers received secret deals that included no payback requirement (or payback discounts) and whether the company structured transactions or relied on a hidden money-moving system to evade bank-reporting requirements when policing up cash from affiliates, whether they received a waiver/discount or not.

Here we’ll point out that the Zeek Rewards MLM Ponzi scheme ($850 million) and the AdSurfDaily MLM Ponzi scheme ($119 million) both made sweetheart deals with insiders. Like Zeek, TelexFree has a purported “advertising” component in which members purportedly get paid for posting ads online. At 1.5 percent a day, Zeek promised to pay the most. On an annualized basis, TelexFree and ASD are in the same ballpark.

Zeek and TelexFree members purportedly get (or got) paid for posting ads. ASD members purportedly got paid for clicking on ads. The concern with TelexFree — as was the concern with Zeek and ASD before it — is that its “product” is just a front to mask an investment scheme.

Maximum Incongruity

As this Blog has pointed out many times, HYIPs are all about incongruity. Tuesday, however, set a new standard for irreconcilable images: cops and citizens potentially in harm’s way in an MLM HYIP broom closet.

Officers appear not to have known that TelexFree is under investigation by the Massachusetts Securities Division. Nor do they appear to have known that TelexFree is under investigation in Brazil and that a judge and a prosecutor reportedly have been threatened with death. Nor do they appear to have known that TelexFree affiliates in Brazil have staged protests in support of the company, something that was the exact opposite of what occurred in Massachusetts on Tuesday.

Our conclusion from observing videos of the broom-closet debacle is that TelexFree, now fueling tensions in the United States and creating worries about economic security after gorging itself nonstop at the 24/7/365 Portuguese and Spanish buffet it created and potentially hoping to establish an Asian smorgasbord, poses a risk to public safety.

Today we call for the Massachusetts Securities Division to brief police. And we call on TelexFree affiliates in Greater Boston and the whole of the state to remain calm and to steer clear of the broom closet occupied by a company that might have put $1 billion on the table. As righteous as your anger is, your answers are not there.

Rather, they are within the part of you that knows an annual return that beats Madoff on the order of 30 to one is too good to be true, that knows the videos and artwork online that suggest TelexFree is much bigger than a broom closet were deliberately designed to deceive, that the “private jet” and monster SUV and other shiny props were cynically calculated to reinforce your dream before cruelly destroying it.

Police did a good job of easing Tuesday’s tensions. And videos made by TelexFree affiliates suggest that reason was the order, not the exception. So, hats off to both the police and duped affiliates for exercising restraint.

We urge affiliates to see TelexFree “corporate” for what it is: the stylized broom closet used by a company that is not paying you after renting ornate hotel accommodations in Madrid, staging the entrance of limousines, posing with giant SUVs, shuttling top recruiters around on a “private jet,” dangerously pandering to the masses in Brazil and Portugal and even sponsoring a professional soccer team in South America.

President James Merrill did not want to talk about how much money the Botafogo club in Brazil received, but every penny of it almost certainly came from affiliates who suddenly now aren’t getting paid and are being told to go out and rope in five more suckers.

Steve Labriola, another TelexFree executive, now pathetically calls the HYIP firm alleged in Brazil to be using a VOIP product as a front, a “customer-acquisition company.”

Say no. Avoid TelexFree “corporate” and any fellow member who calls it that. If you are concerned, call the FBI. Call the SEC. Call the Massachusetts Securities Division. Republican or Democrat, right, left or in between, write to President Obama and tell him his 2009 message about domestic and offshore frauds and corporate broom closets was slow to sink in — but that now you understand it because you’ve encountered one up close and personally. In fact, some of you were in the TelexFree broom closet — with police.

In closing, find joy in your Red Sox! May you and they always be “Boston strong.”

Photo source: WhiteHouse.gov.

Apr 3, 2014
MORE MLM WHACK-A-MOLE: (1) Quebec Securities Regulator Issues Warning On Karatbars International; (2) Cross-Border Colleagues Follow Suit; (3) Former Zeek Ponzi Scheme Pitchman Defends ‘Program’ As Others Push It Alongside TelexFree

Source: Online pitch for Zeek.

UPDATED 12:21 P.M. EDT (MARCH 28, U.S.A.) Whack-A-Mole. Here’s the latest disturbing incarnation: On March 20, the Autorité des marchés financiers (AMF) published a warning on a gold “program” known as Karatbars International GmbH. BehindMLM.com spotlighted the warning yesterday.

From the AMF warning (bolding added): “With the company’s ‘Affiliates’ program, investors can make Internet-based purchases through Karatbars plans and they are encouraged to recruit two other Affiliates. These Affiliates are in turn encouraged to recruit two other Affiliates each, and so on. Affiliates are lured by the possibility of earning large payouts, in particular through a percentage of amounts collected from the Karatbars plans and gold products purchased by referrals.”

After AMF published its warning, the International Organisation of Securities Commissions (IOSCO) republished it. So did the Financial Markets Authority of New Zealand (FMA).

These things apparently meant little to former Zeek Rewards’ pitchman Lloyd Merrifield, who “defended” Karatbars International on BehindMLM. Zeek was an international Ponzi scheme that gathered at least $850 million, according to court records.

You’ll see a reference to Merrifield in the Comments thread below this Dec. 17, 2010, PP Blog story: “URGENT >> BULLETIN >> MOVING: Secret Service Has Seized More ASD Cash; Forfeiture Complaint Filed Today Against Bank Accounts Controlled By Erma ‘Web Room Lady’ Seabaugh And Robyn Lynn Stevenson.”

ASD (AdSurfDaily) was an international Ponzi scheme that gathered at least $119 million, according to court records. Meanwhile, you’ll also see a reference to Merrifield below this June 25, 2009, PP Blog story about AdViewGlobal, an ASD reload scam: “AdViewGlobal ‘Surf’ Firm Suspends Member Cash-Outs, Threatens Media With Copyright-Infringement Lawsuits.”

AdViewGlobal was an international Ponzi scheme that gathered an unknown sum before vanishing mysteriously in 2009. U.S. federal prosecutors linked it to ASD in April 2012.

Merrifield also was a pitchman for Ad-Ventures4u (ADV4U), an ASD-like HYIP scam tied to shiny-object scam known as “TradingGold4Cash.” And why not Tazoodle, a search-engine “program” whose “board” consisted of former ASD members who had the big idea they were going to unseat Google? Yep. Merrifield was there, too.

Along with ADV4U and Tazoodle, Merrifield pitched something called “20Clicks” as part of an overall package known as “The Golden Eggs.” (In 2009, the 20 Clicks website said it was “Powered by USHBB.com.” USHBB later was associated with the Zeek Rewards Ponzi scheme and is listed as a “winner” in a document assembled by the court-appointed receiver in the Zeek Ponzi/pyramid case.)

At least one HYIP pitchfest site that describes Merrifield as a “featured speaker” for Karatbars International has led cheers for “programs” such as AdHitProfits and MyFunLife and BannersBroker — and an emerging darling known as FlexKom. The site also has pushed “ProfitClicking,” one of the JSSTripler/JustBeenPaid reload scams linked to former ASD pitchman Frederick Mann.

Mann, among other things, may have ties to the “sovereign citizens” movement.

Merrifield, perhaps ignoring this 2010 FINRA warning on HYIP schemes and social media, pitches Karatbars International on YouTube and coaches viewers to line up recruits via craigslist.

Source: YouTube

On BehindMLM, Merrifield says he’s been “in the Investment Banking industry for over 35 years.”

As always, HYIP “programs” and similar ventures that may lack licensing in individual jurisdictions across the world raise the prospect that banks and payment processors are coming into possession of funds tainted by fraud. In some cases, those funds have circulated between and among various schemes.

A quick Google search shows that some pitchmen are promoting Karatbars International alongside TelexFree, a “program” under investigation in North America, South America and Africa. TelexFree also has been promoted in concert with the WCM777 MLM scam.

From a video pitch that simultaneously pushes Karatbars International and TelexFree.

Mar 26, 2014
TelexFree, WCM777 (Etc.) — In Pictures

California-based WCM777, an MLM “program,” got booted out of Massachusetts in November 2013, amid allegations of securities fraud and affinity fraud targeted at the Brazilian community through hotel pitchfests. WCM777, purportedly operated by Ming Xu and recruiting affiliates to conduct business over the Internet, later got booted out of California. In addition to the Brazilian community, WCM777 targeted people who speak Spanish and people who speak Chinese, perhaps Christians in particular.

Massachusetts launched a probe into TelexFree, another MLM “program” associated with hotel pitchfests and affiliate recruitment over the Internet, at least by Feb. 28 of this year — probably sooner, given the nature of WCM777. TelexFree largely is targeting speakers of Portuguese and Spanish, perhaps Christians in particular. It also has an affiliate presence in India and Africa (at least).

Although the schemes do not appear to have common ownership, both WCM777 and TelexFree offered plans that encouraged recruits to buy in at higher levels to get higher “earnings.” Affiliates of each scheme appear to have engineered subschemes in which their recruits could buy in at higher levels than the “programs” themselves advertised, potentially introducing a second layer of fraud.

What this means, in essence, is that neither TelexFree nor WCM777 may know their real bottom lines and that the firms created an environment that encouraged back-alley, illegal sales of securities and secret deal-making among individual promoters. Individuals ostensibly acting as brokers for TelexFree and WCM777 could be cherry-picking cash and not even sending it to the “program” operators. In short, certain people could be creating personal and organizational underground economies and fleecing TelexFree and WCM777 even as they fleece their own marks and recruits.

Hidden members of both “programs” may be getting paid in cash by their upline sponsors or ostensible brokers, with no record of their participation — even if they supplied cash or an equivalent to join the “programs.”

The only safe assumption in HYIP Ponzi Land is that any system that can be abused will be abused. That’s why these “programs” necessarily must be viewed through the lens of national security.

Presented below are some screen shots that demonstrate promotional ties between TelexFree and WCM777. In certain instances, the websites pictured below are promoting not only TelexFree and WCM777, but also other “programs.” One of them, for instance, is promoting the almost indescribably insidious and bizarre Banners Broker “program.”

As always is the case in HYIP investigations, the concern is that banks locally, regionally, nationally and internationally are being used by corporate scammers first as warehouses to store illicit proceeds — and later, by individual promoters at potentially thousands and thousands of locations, as virtual ATMs that provide the service of offloading the “earnings” of the promoters.

The interconnectivity of these schemes endangers local, regional, state, provincial and national economies. In many cases, promoters engage in willful blindness and simply move to another MLM HYIP scam when the current “hot” one encounters regulatory intervention or craters on its own.

It’s often the case that promoters plant the seed that a scheme has been endorsed by a government or that a corporate registration is surefire “proof” that no scam exists. Social media invariably is used to help a scheme proliferate or achieve Internet virality.

One of the shots below is from a YouTube video in which a TelexFree promoter seeks to plant the seed that TelexFree is backed by the Better Business Bureau. The narrator’s words in the video suggest he sought to plant the same seed about WCM777 but had to backtrack when he discovered a BBB listing that referred to WCM777 as a Ponzi scheme.

“Today we’re going to compare two of the most dynamic companies out there taking over right now,” the narrator said.

After recording a search of the BBB site for a TelexFree listing and finding one, the narrator suggested that the listing alone was proof that TelexFree was not a scam. He thereafter performed a search for WCM777 and found a Ponzi reference, thus triggering what appeared to be backtracking from his earlier claims that TelexFree and WCM777 were “dynamic companies.”

It also could be the case, we suppose, that he already knew about the WCM777 Ponzi listing before performing the search and that the design all along was to get people to go with TelexFree because WCM777 was a scam. Even under that interpretation, however, the video still demonstrates the underhandedness within the HYIP sphere.

The HYIP sphere always screams incongruity. Keeping that in mind, we’ll point out that one of the screen shots below shows TelexFree executive James Merrill in the same affiliate-manufactured frame as Massachusetts Commonwealth Secretary William Galvin. It was a clear bid to suggest that because TelexFree was registered as a corporation in Massachusetts, the “program” couldn’t possibly be a scam.

That is hogwash, of course. Galvin did not endorse TelexFree when his office approved a corporate registration. Besides, Galvin — as Commonwealth Secretary — oversees both the Massachusetts Corporations Division and the Securities Division. The Securities Division is probing TelexFree and possibly can rely on various documents in the Corporations Division to help investigators connect dots.

Beyond that, the website from which the screen shot promoting TelexFree by marrying images of Merrill and Galvin was taken also is promoting WCM777. Also shown below is an image from the same site in which Merrill is shown posing beside a giant SUV. Contrast that image against the image of Merrill posing in front of a large Massachusetts building as though TelexFree were its only occupant. TelexFree promoters have used the same approach, planting that seed that TelexFree owns the building and has a large physical presence in the United States.

That’s hogwash, too. TelexFree was an occupant of Suite 200 at a Regus center in Marlborough, along with dozens of other companies.

Finally, before observing the shots below, recognize that MLM itself — never a stranger to scandal — may be on the verge of experiencing a PR and legal crisis of unprecedented proportions.

People have harshly criticized hedge-fund manager Bill Ackman for attacking Herbalife. Among his contentions is that Herbalife is a pyramid scheme that targets vulnerable populations. Say what you will about Ackman’s Herbalife claims, but it is crystal clear that affinity fraud and the viral looting of impoverished/disadvantaged people have existed in the MLM realm for a long time and continues to be seen. One might even be inclined to say a market-making fraud blueprint exists within MLM: mow down one affinity cluster or population group and then move to another.

At a minimum, “programs” such as TelexFree and WCM777, which clearly have positioned themselves as wealth recipes for immigrants and vulnerable populations, can help Ackman shape and inform his Herbalife hypothesis.

James Merrill is TelexFree’s president and thus an MLM executive. TelexFree and Merrill, to date, have played into virtually every MLM stereotype that exists — everything from private jets, monster SUVs and stretch limos to business registrations and mail drops in Nevada.

Most disturbingly, though, Merrill represents an American MLM company that has been banned in Rwanda, an African nation that is trying to reverse poverty and receives aid from the World Bank. It’s hard to conceive that MLM — particularly American MLM — could card a worse PR disaster. Regardless, one could be in the offing.

Picture Story

1.

A TelexFree promoter who also promoted WCM777 extends the myth that TelexFree has a large physical presence in the United States and plants the seed that Massachusetts Commonwealth Secretary William Galvin endorsed TelexFree. Galvin’s office is investigating TelexFree after previously booting WCM777 from the state.

2.

A promoter simultaneously pitches TelexFree and WCM777. This shot is from the same site described in the photo above. The site may be based in Ecuador.

3.

This shot is from the same two sites described in the captions above — and features TelexFree President James Merrill posing with a giant SUV.

4.

This shot was taken on the same site described in the three preceding captions above. In this fourth shot, a person promoting both TelexFree and WCM777 claims that the purported parent company of WCM777 provided a loan of $20 million to a restaurant chain that sells Mexican food. The PP Blog has deleted an image of the chain’s logo that appears in the WCM777 promo. The same site plants the seed that WCM has provided hundreds of millions of dollars in loans to jewels of American business.

5.

This site features promos for various purported “opportunities,” including TelexFree and WCM777. Though not shown in the photo, the site also is promoting the uber-bizarre Banners Broker “program.” The site may be based in Italy.

6.

This site also is simultaneously promoting TelexFree and WCM777.

7.

This YouTube site describes TelexFree and WCM777 as “dynamic companies” and plants the seed that TelexFree is endorsed by the Better Business Bureau.

Mar 22, 2014
CLAIM: TelexFree Reps Took ‘Private Jet’ From Dominican Republic To Haiti And Were Met At Airport By ‘Prime Minister’s’ Motorcade

UPDATED 7:03 P.M. ET (U.S.A.) At a TelexFree pitchfest in a Massachusetts hotel this morning, a man promoting a credit-repair “program” linked to TelexFree claimed that TelexFree reps recently took a “private jet” from the Dominican Republic to Haiti.

“I felt like a rockstar,” the man said from the stage.

Once on the ground in Haiti, the man said, “we got in the Prime Minister of Haiti’s motorcade.”

This triggered “high-fiving,” the man said from the stage.

Things settled down when the TelexFree passengers observed throngs of poor people lining the road from the airport into the city, the man suggested.

Whether TelexFree executives were on the private jet and later purportedly traveled in a government motorcade is unclear. TelexFree executive Steve Labriola said last week that he and TelexFree “leaders” recently ventured to Haiti.

It also was not immediately clear whether the asserted TelexFree “high-fiving” and claims of a state motorcade providing shuttle service to TelexFree would prove embarrassing to Haiti’s government. Nor was it clear that the TelexFree reps were guests of the government. The Washington Embassy of the Republic of Haiti did not immediately respond to a request for comment from the PP Blog.

Laurent Lamothe is Haiti’s Prime Minister. He is a former telecom executive.

Similar seeds about government ties from promoters of other MLM schemes have proved embarrassing to other governments, including the government of the United States. In the 2008 AdSurfDaily MLM/HYIP Ponzi scheme, for example, some members of the scheme planted the false seed that ASD had been endorsed by George W. Bush, then the President of the United States.

The false seeds about Bush were one of the things that prompted the U.S. Secret Service to open the ASD probe. Agents went on to discover a massive Ponzi scheme hidden inside ASD. ASD used “ad packs” from which purported “rebates” flowed to disguise its $119 million investment-fraud scheme.

TelexFree offers something called “AdCentrals.” Some promoters have claimed that sums of money from $289 to $15,125 sent to TelexFree triple or quadruple in a year. The $850 million Zeek Rewards Ponzi scheme had a similar component. Like TelexFree members, Zeek members were told they got paid for posting ads about the company online.

“ZeekRewards told Affiliates that in order to supposedly ‘earn’ their points, they were required to place a short, free digital ad each day on one of the many free classified websites available on the internet,” the court-appointed receiver in the Zeek Ponzi- and pyramid-scheme case asserted in a lawsuit last month against alleged insiders.

“In reality,” Zeek receiver Kenneth D. Bell asserted, “the ads were just an attempt to manufacture a cover for what was nothing more than the investment of money by Affiliates with the expectation of receiving daily ‘profit’ distributions.”

One of Bell’s lawsuit targets is Scott Miller of Greenwood, Ind. Miller, an alleged winnner in Zeek’s massive Ponzi scheme, has spoken at at least one TelexFree event and may be one of TelexFree’s key pitchmen.

TelexFree Affiliates Claim Government Approval

It is somewhat common in the HYIP sphere for promoters to suggest a “program” has the backing of a politician, a government or a government agency.

At least one TelexFree-related Blog claimed in a post dated March 7 that the “program” has gained “SEC Approval from USA.”

The U.S. Securities and Exchange Commission (SEC) does not issue such approvals. In 2013, some TelexFree members worded promos to suggest that the U.S. government itself had authorized TelexFree to operate in the United States. During roughly the same time period in the spring of 2013, affiliates made this assertion (italics added):

Steve Labriola, Director of Marketing for Telex FREE, Boston, announced via email earlier today that they are ‘pulling out of Bank of America.’

Earlier, in roughly January of 2013, TelexFree affiliates were urging recruits to make walk-in deposits at a Bank of America branch in Massachusetts. The instructions strongly resembled instructions AdSurfDaily gave its recruits in 2008. TelexFree also used TD Bank, according to affiliates.

It is possible — though not confirmed — that U.S. investigators began looking into TelexFree around the same period in early 2013 in which affiliates were soliciting deposits through Bank of America and TD — while simultaneously claiming that certain TelexFree members could speed the flow of deposits if recruits emailed copies of their deposit slips to a Gmail address.

TelexFree says on its website that tickets to “new comp plan training & overview” event at the Massachusetts hotel today cost $164 and were “Sold Out.”

TelexFree, a purported VOIP communications firm expanding into cellphones, apps and credit repair, is under investigation by the Massachusetts Securities Division. Investigators in Brazil have called TelexFree a pyramid scheme.

Haiti perhaps is the most economically disadvantaged country in the Western Hemisphere.

Mar 9, 2014
Anti-Defamation League, One Of First Groups To Warn Public About AdSurfDaily Figure Kenneth Wayne Leaming, Now Says ‘Sovereign Citizens’ Are Forming ‘Vigilante Grand Juries’ And Harassing Public Officials In New York, Florida And Elsewhere

Kenneth Wayne Leaming, the AdSurfDaily Ponzi story figure and purported “sovereign citizen” now serving eight years in federal prison in part for filing bogus liens against public officials involved in the 2008 ASD case, once claimed the federal judge in Washington state who presided over his criminal trial owed him 208,000 ounces of “99.9% fine silver.”

Among Leaming’s bizarre claims was that the judge was “operating [a] SLAVERY SYSTEM, etc.” Leaming earlier tried unsuccessfully to sue President Obama and U.S. Attorney General Eric Holder. Among his bizarre claims in that now-dismissed case was that he and a co-plaintiff — a man in prison on federal tax charges — were owed 12,000 ounces of gold.

After Leaming’s conviction in a 2013 trial in which federal prosecutors said he was channeling deceased cop-killer Christopher Dorner in the courtroom, the judge ordered the forfeiture of items seized from Leaming during an FBI probe of his activities in 2011. Those items included six firearms and police equipment, including badges, credentials, law-enforcement identification documents, light bars, crime-scene tape, handcuffs, vests and nightsticks.

Leaming “client” files also were ordered forfeited. (Some ASD members said Leaming was performing legal work for them, even though he is not an attorney.)

The Anti-Defamation League, which warned the public about Leaming before his name even surfaced in the context of ASD in 2010, now says a different group of purported “sovereign citizens” on the other side of the country is harassing a judge and court clerk in rural Greene County, N.Y. Greene County, in the Catskills, has a population of fewer than 50,000, according to its Wikipedia entry.

From the ADL (italics added):

. . . common law grand juries claim to have signed a “true bill” charging the chief clerk in Greene County with numerous “crimes” related to her alleged failure to file paperwork for the “grand jury,” according to ADL. They also “fined” a Greene County judge the amount of “100 ounces of silver,” citing 23 separate “violations” for failing to provide demanded documents and refusing to speak to their “board of review,” and allegedly sent harassing documents to a number of judges.

And there might be trouble elsewhere, ADL says.

“[C]ommon law juries in Marion and St. Johns counties in Florida sent a ‘Writ of Mandamus’ to county officials demanding a budget of $1.5 million, office space and equipment and a meeting room with a conference table and chairs,” ADL reports.

Marion County is in North Central Florida in the Ocala region and has a population of about 335,000. St. John’s County is in Northeast Florida in the Jacksonville region and has a population of about 190,000.

There have been reports of violence and extremely menacing behavior involving “sovereign citizens” in Florida. In March 2013, purported “sovereign” Jeffrey Allen Wright was shot to death after pointing a pistol at a sheriff’s SWAT team in Navarre, situated in the Florida panhandle. Wright was wanted on a warrant for counterfeiting.

In November 2013, Tampa-region “sovereign citizen” Eric Holtgard was arrested twice in less than 24 hours, amid allegations he was menacing people with guns. In May 2013, purported “sovereign citizen” Bruce Chalmers Hicks of the Tampa region was arrested on charges that he was carrying a sidearm on the property of Turkey Creek Middle School in Plant City.

Larry M. Myers, a purported “sovereign citizen” and fugitive, was sentenced in 2012 to 78 months in federal prison. Authorities said he was was member of a bogus entity known as “The Constitutional Court of We The People In and For The United States of America” and the “Constitutional Common Law Court.”

“Myers and his co-conspirators mailed a CLC arrest warrant to a Chief Judge of a Florida State court,” the office of the Treasury Inspector General For Tax Administration (TIGTA) said. “They also issued a CLC contempt of court order and ‘militia’ arrest warrant to a District Judge.”

“Sovereign citizens” have been claiming judicial and jury authority for years. ADL suggests these elements of the purported “movement” might be gaining steam.

“Adherents of the sovereign citizen movement are forming their own vigilante “grand juries” in counties across the United States in an attempt to exact pressure on local government officials to accede to their anti-government demands and whims,” ADL said yesterday.

“The sovereign citizen group behind this attempt to form bogus grand juries is the National Liberty Alliance, formed in 2011 as the New York Liberty Alliance by sovereign citizen guru John Darash of Poughkeepsie, NY,” ADL says. “It recently launched a nationwide effort to recruit new members, and Darash and his followers have spent most of their time establishing ‘common law grand juries’ in counties across the country. The Liberty Alliance boasts of having 852 county organizers in 36 states and nearly 2,000 members from coast to coast.”

Feb 21, 2014
BULLETIN: Tata Group, Famous Business Concern In India, Says Fraudsters Trading On Its Name To Push HYIP Scheme; Purported Agriculture ‘Program’ Has Presence On The Ponzi Boards
The purported TataAgro entity had a presence on the Ponzi boards and appears to have used trading screens to dupe the worldwide investing public. Image source: Google cache.

BULLETIN: (3rd Update 8:32 a.m. ET, Feb. 20 U.S.A.) The Tata Group, a global conglomerate based in India, says its name has been stolen by an HYIP Ponzi scheme. The fraud scheme is associated with a domain styled TataAgro.com and has a presence on the MoneyMakerGroup, TalkGold and DreamTeamMoney Ponzi forums, according to search results.

Like the recently exposed WCM777 fraud scheme, the TataAgro scam claims a business presence in the British Virgin Islands. WCM777 also traded on the names of famous companies, including Siemens, the German conglomerate. Siemens issued statements warning the public about WCM777. Tata now has done the same thing with the purported TataAgro entity.

The TataAgro website “claims that ‘Tata Agro Holding is a subsidiary of the globally known Tata group, [and is] one of the top 10 agro investment players in Asia’s financial market,’” the real Tata says. “It goes on to offer a wide range of investment plans with a monthly profitability of up to 100%.

“Members of the public are hereby cautioned that the information provided on the website is absolutely false, misleading and intended to defraud innocent and unwary members of the public,” the real Tata says. “Neither Tata Sons nor any other Tata company has any connection whatsoever with the aforesaid Tata Agro Holding. Tata Sons is initiating appropriate action in the matter.”

PonziTracker.com was among the first outlets to report the news of the Tata warning.

The TataAgro site appears not to be loading.

It is somewhat common for fraud schemes to try to steal the identities of major figures on the world financial stage. CONSOB, the Italian securities regulator, regularly publishes information on purported “opportunities” that adopt the names of legitimate firms to create confusion and fleece the masses.

A post dated Dec. 3, 2013, at the MoneyMakerGroup Ponzi forum claims the purported TataAgro entity pays “1.9-3.1% daily for 15-90 days” and accepts Perfect Money, BitCoin, EgoPay and Qiwi.

Meanwhile, a post dated Dec. 17 at the DreamTeamMoney Ponzi forum makes this claim (italics added):

Tata Agro is an agricultural investment company founded in 2012 in British Virgin Islands. We are a subsidiary of transcontinental conglomerate Tata Group that has been established in India back in 1868 and now boasts the combined market capitalization of $96 bln.

We have retained only the best things from a rich and long experience of our ancestor: the unique corporate culture, client-oriented and customized approach, and understanding of the market through retrospective analysis. Our fundamental aim is to help you grow your capital.

We work with assets like barley, soya, soya oil and meat, corn, wheat, and livestock and currently operate in CME Group, TOCOM, and MGEX exchange houses.

We are eager to offer you four investment plans with the daily ROI of 1.9% to 3.1% and investment term of 15 to 120 days. You can invest from 5 to 10,000 USD. Apart from that, we offer you a profitable referral program that lets you earn more and work side by side with your family and friends.

A post dated Dec. 17 at the TalkGold Ponzi forum makes these claims (italics added):
- Invest 5 to 100$ for 15 days and earn 1.9% ROI daily;
- Invest 100 to 1000$ for 30 days and earn 2.3% ROI daily;
- Invest 1000 to 5000$ for 60 days and earn 2.5% ROI daily;
- Invest 5000 to 10,000$ for 120 days and earn 3.1% ROI daily.
Collapsed fraud schemes such as Zeek Rewards, AdSurfDaily, Legisi, Pathway to Prosperity, Profitable Sunrise, Imperia Invest IBC and many more also had a presence on the Ponzi boards.

The TelexFree “program” currently has a presence on the Ponzi boards.
Feb 18, 2014
TELEXFREE LA-LA LAND: Promo For Alleged Pyramid Scheme’s International Convention Is Voiced By Former SEC Defendant (In Pyramid-Scheme Case) — And Uses Images Of Pyramids Of Giza And American MLM Lawyer

In a curious promo, Egyptian pyramids are being used as an art element by cheerleaders for TelexFree, an alleged pyramid scheme. Source: ConventionTelexFree.com. Red highlight by PP Blog.

U.S.-based TelexFree, alleged in Brazil to be a massive pyramid scheme, is serving up a heaping helping of strangeness.

For starters, a promo for TelexFree’s International Convention set for Spain next month is being voiced by Sann Rogrigues, whom the SEC successfully sued in 2006 amid allegations he was operating a pyramid scheme and engaging in affinity fraud aimed at the Brazilian community.

The promo curiously is playing against the backdrop of an image of the Pyramids of Giza. For good measure, images of other famous world landmarks are thrown in. These include St. Basil’s Cathedral (near the Kremlin) in Moscow; Big Ben in London; The Eiffel Tower in Paris; the Empire State Building and the Statue of Liberty in New York; the Leaning Tower of Pisa; and the Burj al Arab Hotel in Dubai.

TelexFree operates out of Marlborough, Mass., and Las Vegas in the United States. Its convention is scheduled for March 1 and 2 in Madrid.

The promo in which Rogrigues dispenses the TelexFree convention wisdom appears on a website styled ConventionTelexFree.com. Among the claims on the site is that American MLM lawyer Gerald P. Nehra will be among the “Special Guests” at the rah-rah fest in Spain.

American MLM lawyer Gerald Nehra will be a special guest at TelexFree’s International Convention in Madrid next month, according to ConventionTelexFree.com.

Serving as an expert witness for AdSurfDaily in 2008, Nehra opined that ASD was not a Ponzi scheme. ASD operator Andy Bowdoin, now serving 78 months in federal prison at the age of 79, later disagreed with his own expert. In 2012, Bowdoin admitted that ASD was a Ponzi scheme that had gathered $119 million and said the “program” never operated lawfully from its inception in 2006.

ASD promoted a return of 1 percent a day. Some TelexFree promoters say that “program” triples or quadruples money in a year. Some promos solicit sums of $15,125.

Nehra’s law firm also was touted by Zeek Rewards. In 2012, Zeek was accused by the SEC of operating a massive international Ponzi- and pyramid scheme that gathered hundreds of millions of dollars by planting the seed that returns would average 1.5 percent a day. At least two Zeek figures potentially now face prison sentences after pleading guilty for their roles in the scheme.

The court-appointed receiver in the Zeek case says he’s on the brink of filing lawsuits against thousands of Zeek promoters.

TelexFree appears recently to have begun operating under the name TelexFree International. Precisely where TelexFree International is based is unclear.

In the past, Nehra has described himself an an attorney for “TelexFREE in the USA,” according to BehindMLM.com. Whether he represents the TelexFree International derivative is unclear. Convention promoters, however, appear to believe he does.

Feb 18, 2014
Why California’s WCM777 Action May Spell Trouble For HYIP Promoters On You Tube

As a reporter interviews a Peruvian official at the scene of a police raid against a WCM777 outlet in Lima, an image of American pitchman Harold Zapata (left) flashes on the screen. Source: YouTube.

Still using social-media sites to promote massive fraud schemes — even after the AdSurfDaily, Zeek Rewards and Profitable Sunrise debacles?

Thanks to his presence on social media, Harold Zapata, a WCM777 YouTube pitchman named a respondent in a Desist and Refrain order announced last month by California’s Department of Business Oversight, may be trapped between a rock and a hard place.

Zapata is a California resident. Not only does the state know about his YouTube presence — indeed, his promos are referenced in the D&R — so do authorities in Peru. Whether Zapata ever has ventured to Peru is unclear. What is clear is that Peruvian media have used snippets of his U.S.-based promo as a backdrop to video reports about a police raid against a local WCM777 outlet in Lima.

Whether he likes it or not, Zapata has become one of the American faces for WCM777. In one video, Zapata identified himself as a WCM777 “director . . . working directly with our founder, CEO, chairmans [sic], leaders in our WCM777 organization.”

WCM777 executives include Ming Xu and Zhi Liu, California said. Both men are named in the D&R. Zapata also is named.

California’s action against WCM777, its executives and Zapata may signal trouble for other YouTube pitchmen for highly questionable MLM “programs” or outright scams. For starters, YouTube commercials for HYIPs sometimes are copied and used by promoters of the same purported “opportunity,” thus saving fellow pitchmen the time and trouble of making their own videos. This can happen with or without permission, perhaps with an eager recruit using the video of another sponsor but inserting a URL to the recruit’s page in a companion text pitch below the actual video.

Beyond that, some fraud-scheme pitchmen openly share their YouTube promos with downline recruits as a means of driving more business to a scam. Such approaches typically are portrayed as the acts of a helpful sponsor who wants to see his or her recruits thrive by providing them the “tools” they need to succeed.

At least one YouTube pitchman for WCM777 appears to be using Zapata’s video to drive traffic to WCM777 and possibly other “opportunities.”

Zapata appears to have noticed this at least two months ago and placed warnings in Spanish and English on the YouTube site of the fellow WCM777 pitchman.

Here’s how the warnings read (italics added):

Por favor quite este video inmediatamente o me veo obligado a reportarte por infracción de copyright, de este video.

Please remove this video immediately or I will be forced to report this video for copyright infringement.

The video nevertheless remains. It shows Zapata pitching WCM777 in English, even after the California action and the raid in Peru. The title of the video on the fellow WCM777 pitchman’s site is “WCM777. FULL PRESENTATION IN ENGLISH.”

It is unclear from Zapata’s warnings whether he was upset that the video was being used without his permission or whether he was concerned that the fellow WCM777 pitchman was using the video to cherry-pick Zapata’s earnings.

Regardless of Zapata’s specific concerns, however, the continued appearance of the video shows the vulnerability of MLM pitchmen who promote “programs” on YouTube. Such promoters not only may lose control over their own content, they literally may lose control over their own faces.

Even if Zapata has stopped promoting WCM777, the video published by the fellow WCM777 pitchman makes it appear as though Zapata still is promoting the purported opportunity, which California publicly declared a scam last month. Last week, the state asked residents who invested in WCM777 to contact the DBO immediately.

At least 5,500 Californians plowed money into the WCM777 scam, the state said.

“The California Department of Business Oversight has seen a surge of high-yield investment schemes that take advantage of social networks to market illegal investments,” said Jan Lynn Owen, commissioner of the Department of Business Oversight. (Bolding added by PP Blog.)

In 2010, FINRA called the HYIP sphere a “bizarre substratum of the Internet” and issued a warning that such schemes were spreading on social-media sites such as YouTube, Facebook and Twitter. Zapata’s experience demonstrates that some HYIP pitchmen either missed the warning or chose to ignore it.

BehindMLM.com is reporting that WCM777 — now operating as Kingdom777 — appears now to be engaging in ham-handed wordplay to continue its duping of the masses. The “program,” BehindMLM reports, now is using the word “members” and trying to steer clear of the word “investors.”

Such wordplay bids foreshadowed doom at both AdSurfDaily, a $120 million Ponzi scheme, and Zeek Rewards, which allegedly gathered at least $850 million.

As the PP Blog reported in June 2012, here is part of what the U.S. Secret Service said in a filing in the ASD Ponzi-scheme case in February 2009 (italics’bolding added):

[ASD operator Andy] Bowdoin and his sponsor knew that it was illegal to sell investment opportunities to thousands of individuals; thus, they were careful not to call participants “investors” but rather referred to them as “members.” Moreover, there were careful not to call payments to “members” “return on investments”; rather, they referred to the income program as a “rebate” program . . .

The document cited above is available at the top this PPBlog story about the then-active Zeek Rewards Ponzi scheme: EDITORIAL: A Friday Evening In MLM Radio La-La Land. (Document courtesy of the ASD Updates Blog.)

For whatever reason, HYIPs and their pitchmen apparently continue to believe they can duck or circumvent securities regulations and laws against the sale of unregistered securities by calling an investment something else.

Prosecutors made short work of the Zeek and ASD wordplay, saying both “programs” engaged in linguistic games to describe an investment as something else.

WCM777 even may dialing up the HYIP wordplay madness. From BehindMLM.com (italics added):

A “dividend” [at WCM777/Kingdom777] is now a “bonus”… cuz well, a bonus could be anything… including an investment “return”, which is now also just a “bonus”.

Feb 16, 2014
Banners Broker Cultists Rip Play From Zeek, AdSurfDaily, AdViewGlobal HYIP Scambook

Banners Broker members who log into their accounts are seeing this pop-up message: Source: Graphic published at RealScam.com

Whoever is pulling the linguistic strings at the Banners Broker HYIP cult operating globally online now is channeling Zeek Rewards, AdSurfDaily and AdViewGlobal in their final days.

Zeek, an $850 million Ponzi- and pyramid fraud that once suggested participants should change their toilet-paper dispensing habits if instructed to do so, threatened to ban members who didn’t stick to the company’s insidious, Stepfordian chant. It also planted the seed that it would use the courts to gag doubting voices and sue credit unions that dared to speak ill about its “program” that averaged a payout of 1.5 percent a day. And through proxies, Zeek made sure that other MLM companies and executives who’d dare question its outrageous claims knew that the Zeek eye in the sky was watching them.

AdSurfDaily, a $119 million Ponzi scheme that promised to pay 1 percent a day, announced that it had filled a pot with $750,000 in cash and would sue critics for tens of millions of dollars. (The U.S. Feds were so moved by the claim that they made sure it was included in an evidence exhibit used to seize more than $80 million in ASD cash.) Prior to the seizure, ASD’s Stepfordian wing made sure that doubters knew their doubts would be reported by right-thinking loyalists to “ASD legal.” After the seizure, some of the ASDers planted the seed that any fellow member who filed a remissions claim through the U.S. Department of Justice would get sued by their fellow members.

In 2009, after forming itself from the carcass of ASD’s MLM fraud scheme and on the brink of collapse itself, AdViewGlobal threatened to sue critics for purported copyright infringement. (Zeek, through purported “consultant” Robert Craddock, later would work the “infringement” gambit into its arsenal while planting the seed one or more Zeek lawyers would go after critics.)

To cement its thuggery, AVG, a Zeek- and ASD-like 1-percent-a day “program” that gathered millions of dollars, said it was watching what members said about it online and planted the seed it would seek to have the Internet connections of in-house critics shut down. AVG bizarrely (and incongruously) did these things while purporting to have “protectors” in its ranks and while purporting to enjoy U.S. and Florida Constitutional speech and commerce protections from its purported base of operations in Uruguay.

Now comes word that Banners Broker, an almost indescribably bizarre “program” whose online steroidal puppeteers have been stringing people along and picking pockets since at least 2012, has accidentally announced that it, too, has become a factory from which MLM thuggery is manufactured. Not only is Banners Broker watching members, the “program” says, its members also are watching members. The news first appeared on the RealScam.com antiscam forum.

Banners Broker, of course, wants members of its cyberspace cult to remain in their Stepfordian trances and not to notice they’re being manipulated like robots, so it has given its strong-arm bid an innocuous (if not wholesome-sounding) name: “Community Watch.”

Ready to projectile vomit?

Given the monitoring policy, individual members who’ve posted negative content should remove it, the “program” instructs. And members who observe other members posting negative content should contact the doubters and provide a copy of the “program’s” policy that bans negativity and threatens management-led account seizures.

On Feb. 12, Banners Broker will begin to take “a firmer stance against people that are speaking badly against Banners Broker,” the “program” bizarrely bleats.

“Affiliates found to be contributing to the negativity on the Internet will have their accounts locked,” the “program” threatens. “[T]hey will be banned from participating in the Banners Broker system and they will forfeit all of their inventory and revenue.”

Banners Broker appears also to be trying to chill nonmember critics.

“If you know of a site with content that is negative towards Banners Broker, we ask that you report it to the Community Watch,” the “program” instructs.

In June 2012, the PP Blog reported that a website selling “customers” to Zeek recruiters also was directing traffic to double-your-money Banners Broker and the 2-percent-a-day (precompounding) JSSTripler/JustBeenPaid HYIP scam purportedly operated by Frederick Mann.

On Jan. 17, 2013, the PP Blog reported it was receiving menacing communications about Banners Broker.

For additional background on bids to chill reporters or program members who publish information about scams and highly questionable “opportunities,” see this Dec. 27, 2012, PP Blog post: Our Choice For The Most Important PP Blog Post Of 2012.

Feb 8, 2014
MORE FROM MLM LA-LA LAND: Former SEC Defendant In Pyramid-Scheme And Affinity-Fraud Case To Headline TelexFree Event In Spain

Sann Rodrigues (right) will be a headliner at a TelexFree event scheduled next month in Spain. Source: TelexFree rolling promo on website.

Calling Sann Rodrigues its “TOP PROMOTER IN THE WORLD,” the alleged TelexFree pyramid scheme curiously has announced that Rodrigues will be a headliner at a TelexFree rah-rah session in Spain on March 1 and 2.

An image of Rodrigues now rolls across TelexFree’s website. But the promo does not mention that Rodrigues was successfully sued by the U.S. Securities and Exchange Commission in federal court in Massachusetts in 2006. The agency alleged that he was presiding over a pyramid scheme known as FoneClub and engaging in affinity fraud targeted at the Brazilian and Brazilian-American communities in Massachusetts.

A federal judge held Rodrigues, also known as Sanderley R. De Vasconcelos, “jointly and severally liable” with FoneClub for “$3,269,459 in disgorgement plus $151,928.49 in prejudgment interest,” the SEC said in 2007.

Prosecutors in Brazil have alleged that TelexFree is a massive pyramid scheme. The purported “opportunity” operates from Massachusetts, the same venue from which Rodrigues was sued by the SEC.

Massachusetts also was the venue from which the U.S. government brought a successful criminal prosecution against the infamous World Marketing Direct Selling (WMDS) and OneUniverseOnline (1UOL) pyramid- and affinity-fraud scheme targeted at Cambodian immigrants. The SEC also filed suit.

In the AdSurfDaily Ponzi-scheme case in 2008, the U.S. Secret Service alleged that neither ASD nor a business partner disclosed that the partner had been an SEC defendant in a successful 1997 prosecution that alleged the partner had pitched three prime-bank swindles, including one that advertised a return of 10,000 percent.

ASD was a $119 million Ponzi scheme targeted in part at the Christian community, federal prosecutors alleged.

In the $850 million Zeek Rewards’ Ponzi- and pyramid scheme in 2012, former SEC defendant Keith Laggos emerged as a key cheerleader. Laggos was sued by the SEC in 2004 in a case that alleged he didn’t disclose he was being paid to tout stock.

Feb 6, 2014