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Tag: Andy Bowdoin

  • NEW ADSURFDAILY DISASTER? Andy Bowdoin Says Prosecutors Returned ‘Advertising Expenses’ To Members, Not Proceeds Of A Ponzi Scheme; ‘Government Forced Members To Sign . . . Untrue Statement To Get A Refund,’ ASD Patriarch Claims

    Andy Bowdoin: Is ASD's patriarch now accusing the government of subornation of perjury?

    UPDATED 3:44 P.M. EDT (U.S.A.) Facing felony charges of wire fraud, securities fraud and selling unregistered securities and the potential of 125 years in prison, accused Ponzi schemer Andy Bowdoin has responded by accusing federal prosecutors in the District of Columbia of forcing members to lie to qualify for compensation from a victims’ fund in the AdSurfDaily case, according to an email ASD members have received.

    Last week, the government released $55 million seized in the ASD case and began to distribute it through Rust Consulting Inc., the remissions claims administrator approved by the U.S. Department of Justice and the U.S. Secret Service. Members began to receive payments Friday. About 8,400 ASD members filed approved claims, according to the government.

    In an email to ASD members yesterday in which Bowdoin continued his efforts to solicit $500,000 to pay for his criminal defense, the ASD patriarch suggested  prosecutors had set up the remissions program to dupe them into identifying themselves as crime victims. (Emphasis added.)

    “We need the legal defense funds now more than ever to combat this great injustice where the government forced members to sign the untrue statement to get a refund of their monies,” Bowdoin claimed in the email.

    The remissions money was not the proceeds of a Ponzi scheme, Bowdoin claimed. Rather, the money members received constituted a return of their “advertising expenses.”

    Bowdoin did not explain in the email what he intended to do if the government produced evidence that people were advertising nonexistent businesses on ASD’s closed network. Nor did he explain what he would do if the government produced evidence that the sums sent to ASD for individual advertising purchases bore no connection to the real world: a sole proprietor of an MLM sideline business hawking fruit juice who historically posted $5,000 in gross revenue suddenly spending three times that amount to advertise on ASD, for example.

    Bowdoin himself was accused in 2008 of advertising a failed, dissolved business in his own advertising “rotator” to generate purported “rebates.” In making the assertion, the government effectively was claiming that even a nonexistent business — or perhaps even a blank page or a page that promoted a personal Facebook site — could generate a return on investment if inserted in ASD’s rotator.

    “To secure some of ASD’s rebates himself, Bowdoin promoted a bogus website through ASD,” prosecutors claimed on Aug. 25, 2008. “Bowdoin explained to the Secret Service that he used the ‘advertising’ he secured from ASD to promote GPS Tech, an unsuccessful business endeavor that had already been dissolved.”

    In a footnote within the three-year-old filing, prosecutors claimed “Bowdoin also acknowledged that he modeled ASD after12dailypro, that ASD had no significant income (except maybe a couple thousand dollars) other than what its members paid in (and expected back as rebates). Bowdoin said he was not sure how ASD differed from 12dailypro except, he said, ASD did not guarantee a particular percentage, and its payments were only based on its sales. Bowdoin acknowledged that representations that he had met with the Securities and Exchange Commission (SEC) in Washington, DC, and representations that a team of SEC attorneys that he hired had approved of his operation were made up, as was ASD’s representation that Bowdoin had been awarded a Medal of Distinction by President Bush for business acumen.”

    12DailyPro was an autosurf successfully sued by the SEC in 2006 amid allegations it was operating a massive online Ponzi scheme. Prosecutors said later that Bowdoin had a “silent partner” in ASD — and that the silent partner had been Bowdoin’s 12DailyPro sponsor. The government has said all along that ASD falsely traded on Bush’s name to sanitize a fraud that gathered tens of millions of dollars.

    The U.S. Secret Service and prosecutors said in August 2008 that Bowdoin had disguised his securities venture as an advertising company that paid “rebates” of 125 percent. They later said that ASD’s internal computer systems described payouts to members as “ROI” — for “return on investment.”

    Bowdoin, though, claimed yesterday that ASD, “by definition,” was not a Ponzi scheme. He did not addresses the government’s contention about the “ROI” reference, instead insisting that ASD offered “no guarantees” that members would receive payouts. In August 2008, the government claimed that ASD’s Terms of Service included these words:

    “Advertisers will be paid rebates until they receive 125% of their ad purchases.”

    An expert witness hired by ASD acknowledged in 2008 under cross-examination that the words had appeared in ASD’s TOS. Despite the fact that the TOS document has been a matter of public record for more than three years, some ASD members claimed that the government has produced no evidence and that ASD members who agreed that they are victims of a massive financial crime will be “torn apart” on the witness stand by ASD’s lawyers.

    The “torn apart” claim was made on Jan. 17, 2011, two days before the deadline for ASD members to file a remissions claim with Rust in the case. The claim followed previous claims that a “group” of ASD members might sue persons who identified themselves as victims.

    Bowdoin, 76, further claimed in yesterday’s email that, at his upcoming trial, the government will use claims forms signed by members to prove “they were ‘investors’ and therefore victims” of a Ponzi scheme.

    On Jan. 23, 2009 — just 10 days after Bowdoin withdrew his claims to the seized money “with prejudice” and just one day after a federal judge memorialized Bowdoin’s withdrawal and consent to forfeit the seized money — federal prosecutors explained the law to ASD victims and said the compensation program would be governed by these federal regulations. (Emphasis added in next paragraph.)

    “Under Section 9.8(a)(1) and (2) of Title 28 of the Code of Federal Regulations, in a petition for remission or mitigation of forfeiture a non-owner victim must demonstrate that it suffered a pecuniary loss of a specific amount directly caused by the criminal offense(s) underlying the forfeiture, or a related offense, and that the loss is the direct result of the criminal acts,” the government said in explaining remissions regulations.

    A month later — in February 2009 — Bowdoin reentered the case as a pro se litigant and sought to rescind his decision to submit to the forfeiture. That effort failed after months of legal wrangling, and U.S. District Judge Rosemary Collyer issued a final order of forfeiture for the lion’s share of the seized funds in January 2010.

    Bowdoin appealed that order and a separate forfeiture order issued by Collyer, but lost both cases in the U.S. Court of Appeals.

    In April 2009, in response to Bowdoin’s pro se pleadings, prosecutors revealed that Bowdoin had signed a proffer letter in the case and acknowledged that the government’s material allegations were all true. Bowdoin later revealed in his own court filings that he had met with prosecutors over a period of at least for days in late 2008 and early 2009 and had given information against his interests.

    In yesterday’s email, Bowdoin did not address the proffer issue and his own acknowledgment that he’d provided information against his interest in the hopes of receiving a sentencing reduction. Instead, he asserted that he had “very strong feelings about what the govt. is really doing.

    “[B]ut due to my court case and upcoming trial, I can only pass on a statement made by one of the attorneys on my Legal Defense Team, in response to the govt. media press release issued on Monday, Sept. 26th, with the headline – “$55 MILLION BEING RETURNED TO VICTIMS OF INTERNET FRAUD – Victims Receive Forfeited Ponzi Scheme Proceeds,” Bowdoin continued.

    “I am in full agreement with what my attorney had to say about this govt. press release, which is in ‘quotation marks’ as follows:

    ‘The release is a gross distortion of the facts. There are no ‘victims.’ Not a single person lost a dime until the government shut down the business. These customers bought advertising on the net. They were not investors.’”

    Bowdoin did not say whether the email he sent to members yesterday in which he claimed the government “forced” members “to sign the untrue statement” to qualify for remissions was approved by his attorney.

    Bowdoin fired his original attorneys in 2009, after he had submitted to the forfeiture and agreed to cooperate in the investigation. He later hired replacement attorneys.

    Prior to Bowdoin’s email, an ASD members who identified herself as “Sara” claimed in an email that some ASD members had received amounts like “$50,000 and $60,000” back through the remissions program.

    The email attributed to “Sara” painted a picture of a government conspiracy.

    One apparent ASD member posting on Bowdoin’s Facebook fundraising site claimed last week that he received back $27,690 through the remissions program. The person did not say whether the business he had advertised on ASD had posted revenue that would justify such an advertising purchase, and the government had no comment on the Facebook assertion.

  • URGENT >> BULLETIN >> MOVING: AdSurfDaily Ponzi Scheme Example Of ‘Insidious’ Financial Crime, Head Of Justice Department’s Criminal Division Says; Top Officials, U.S. Secret Service Issue Statement In Support Of Victims; Obama Task Force Monitoring ASD Case

    Assistant Attorney General Lanny Breuer, head of the Justice Department's Criminal Division.

    URGENT >> BULLETIN >> MOVING: The AdSurfDaily Ponzi scheme is an example of an “insidious” financial crime, the head of the U.S. Department of Justice’s Criminal Division said moments ago in a special statement on how forfeiture laws were used to protect ASD victims.

    Meanwhile, a top official of the U.S. Secret Service described Florida-based ASD as a “criminal enterprise.”

    ASD members who filed approved claims through the government’s remissions program will receive back tens of millions of dollars owing to the quick actions of the U.S. Secret Service and federal prosecutors in the District of Columbia in 2008, officials in Washington said.

    Victims who filed remissions claims and demonstrated losses will be compensated at 100 percent, a rare total, a source with knowledge of the process told the PP Blog last week.

    “[F]orfeiture is a powerful tool for ensuring that victims of financial fraud are made whole,” Assistant Attorney General Lanny A. Breuer said today. “Returning funds to victims is a key goal in our mission to combat financial crimes. We will continue to use every tool at our disposal to bring justice to the citizens defrauded by these insidious schemes.”

    Breuer was backed by U.S. Attorney Ronald C. Machen Jr. in the District of Columbia.

    U.S. Attorney Ronald C. Machen Jr.

    “We are putting $55 million back into the pockets of innocent victims of this online Ponzi scheme,” said Machen.  “As we did in this case, we will continue to work with our law enforcement partners to recover every penny we can find for victims of financial fraud.”

    A top Secret Service official said today that ASD was a “criminal enterprise” and that the remissions program represented a positive outcome for victims of an elaborate fraud scheme.

    “With all of our efforts to punish and deter this criminal enterprise, the rights of innocent parties are protected and will subsequently be returned,” said Assistant Director A.T. Smith of the Secret Service’s Office of Investigations. “This substantial remittance not only emphasizes the cooperation between the Secret Service, U.S. Attorney’s Office, and the Department of Justice, but promotes positive community impact by returning these funds to innocent victims.”

    The U.S. Secret Service “safeguards the nation’s financial infrastructure and payment systems to preserve the integrity of the economy,” said Smith.

    Today’s statement by the officials confirmed that President Obama’s Financial Fraud Enforcement Task Force, which was created in November 2009 to root out fraud, has been monitoring ASD developments and assisting in the case.

    Information for ASD victims is accessible by dialing this number:

    1-800-644-1535

    Victims who use the mail and have questions should contact:

    Basizette Stribling
    Victim Witness Assistant
    Re: AdSurf Daily
    United States Attorney’s Office for the District of Columbia
    555 Fourth Street NW
    Washington, D.C. 20530

    ASD President Andy Bowdoin was arrested by the Secret Service in December 2010. He was charged with wire fraud, securities fraud and selling unregistered securities. Bowdoin, 76, is free on bail and awaiting trial.

  • UPDATE: About 8,400 AdSurfDaily Members Will Receive Remissions Payments; Number Of Successful Claimants Exceeds Population Of ASD’s Home Base Of Quincy, Fla.; No Comment From Prosecutors On Curious Facebook Post From Apparent ASD Member

    Federal prosecutors had no comment this morning about a Facebook posting from an apparent ASD member who claims to have received victim's compensation but still purportedly backs accused felon Andy Bowdoin. Bowdoin is facing criminal charges of wire fraud, securities fraud and selling unregistered securities.

    UPDATE: About 8,400 victims of the AdSurfDaily autosurf are receiving remissions payments of 100 percent of their losses, a source familiar with the process said today.

    The PP Blog first reported Thursday that the remissions payments would be 100 percent across the board to ASD victims who demonstrated a loss. On Friday, the Blog received a stream of confirmations from ASD victims that Rust Consulting Inc., the government-approved claims administrator, had deposited the payments into their bank accounts electronically.

    Based on court filings, the PP Blog is estimating that about 80 percent of ASD members who filed for remissions by the January 2011 deadline had their claims approved. The number represents an “overwhelming majority,” the source said last week.

    The number of successful remissions petitioners significantly exceeds the population of Quincy, Fla., ASD’s headquarters. Quincy’s population is about 7,000.

    The U.S. Secret Service said in August 2008 that ASD President Andy Bowdoin was operating a massive, international Ponzi scheme from Quincy in part by claiming ASD was selling “advertising” that paid “rebates” of 125 percent.

    Bowdoin, 76, has been soliciting contributions for his criminal defense for weeks, asking the people he is accused of defrauding to pony up $500,000 to pay for lawyers.

    Federal prosecutors had no comment this morning on a Friday post on Bowdoin’s Facebook fundraising site from an apparent ASD member who claimed he’d received crime-victim’s compensation but still was backing Bowdoin.

    “I don’t know what happened, but I had posted on here yesterday that the government sent me a letter they would be refunding my ASD money,” the apparent ASD member wrote. “To my surprise and shock, the money IS in my account as of today, all $27,690.00 of it!!!!

    “DO NOT THINK THAT I DON’T BACK ANDY, BECAUSE I STILL DO!!!!” the apparent member exclaimed. “I want ASD BACK, I want Andy and ASD EXONERATED, and I want the government to PAY PAY PAY for what they did and for MISUSE of The Patriate Act (sic), which ironically they used in the most UNPATRIOTIC way seemingly possible!”

  • MAJOR DEVELOPMENT: AdSurfDaily Remissions Payments Will Be 100 Cents On The Dollar; ‘Thousands’ Of Payments To Go Out; ‘Overwhelming Majority’ Of Claims Approved; Members React With Joy

    “Thousands” of AdSurfDaily Ponzi victims with approved claims will receive remissions payments of “100 percent” in the coming days, a source familiar with the process tells the PP Blog.

    It is quite rare “to have a remissions program that comes back with 100 percent,” the source said.

    The claims process was administered by Rust Consulting Inc. of Minnesota. The process was coordinated by the U.S. Department of Justice, the U.S. Secret Service and the office of U.S. Attorney Ronald C. Machen Jr. in the District of Columbia.

    After three long years waiting for the process to be finalized after two forfeiture appeals by ASD President Andy Bowdoin and attempted pro se interventions by dozens of members who claimed the government was the bad guy, ASD members who stuck with the process expressed joy.

    “YAYAYAYAY!” exclaimed one. Another characterized the news as “amazing.”

    A small percentage of ASD members who filed claims will not receive compensation because they failed to demonstrate a loss, the source said.

    An “overwhelming majority” of claims were granted, the source said. Court records show that about 11,000 people filed claims.

    Payments are expected to begin within 15 days. The money will be deposited electronically into the accounts of ASD members whose claims were granted.

    In 2008, Bowdoin compared the prosecutors in the case to “Satan.” Other ASD members described the U.S. Secret Service as “Nazis” and “goons.” A poster on the now-defunct Surf’s Up forum said that the lead prosecutor in the case should be placed in a medieval torture rack and that ASD members should draw straws to determine who received the honor of carrying out the torture.

    A federal judge was called “brain dead” if she did not agree with ASD’s side of the case, and a purported “prayer” was circulated among ASD members calling for the prosecutors to be struck dead. One prosecutor was described derisively as “Gomer Pyle,” and rumors were unleashed on the Surf’s Up forum that the government had admitted secretly that ASD was not a Ponzi scheme.

    Some ASD members encouraged others not to file for remissions. Those who ignored the advice and were able to demonstrate a loss now will receive back 100 cents on the dollar.

    Remissions payments will be made from funds seized by the U.S. Secret Service in the earliest days of the ASD probe more than three years ago.

    Bowdoin filed appeals in the forfeiture cases, but lost. He is now soliciting funds to pay for his criminal defense to charges of wire fraud, securities fraud and selling unregistered securities.

    Some ASD members ignored the seizure and a parallel criminal investigation. They immediately joined other autosurfs, HYIPs and cash-gifting programs, claiming they were excellent ways to make up their ASD losses.

    In a March 2009 letter to ASD members on the Surf’s Up forum, Bowdoin chided prosecutors and the Secret Service, claiming his pro se filings in the civil portion of the case “should really get their attention.”

    A month later — in April 2009 — prosecutors revealed in a final response to a series of pro se pleadings by Bowdoin that Bowdoin had signed a proffer letter in the case and acknowledged that the government’s material allegations were all true.

    Bowdoin acknowledged in his own court filings that he had given information against his interests and had met with prosecutors over a period of at least four days in late 2008 and early 2009. In January 2009, he abandoned the forfeiture cases, releasing his claims to the seized money “with prejudice.”

    By the end of February 2009, however, Bowdoin reentered the case as a pro se litigant, claiming later that his decision was driven by a “group” of ASD members. He did not identify members of the group.

    ASD is known to have so-called “sovereign citizens” in its ranks.

    Bowdoin has not referenced the proffer letter in his fundraising bid. Nor has he referenced a racketeering lawsuit filed against him in January 2009 by some members.

    It was not immediately clear how many members destroyed their chances to receive remissions after coming under the influence of various crackpot theories spun by certain ASD members. One of the theories held that all commerce is lawful if a contract exists. Another held that members should include notes on the claims forms that explained Bowdoin was conducting business lawfully.

    Another theory held that the government had invested approximately $80 million seized in the case, had earned a return in excess of  $1 billion — and that prosecutors were partying with the money. Still another held that a federal judge was conspiring with another federal judge to deny ASD justice and that at least one of the judges was guilty of 60 felonies.

    Yet another theory held that ASD members should not cooperate with investigators and should not file remissions forms.

  • URGENT >> BULLETIN >> MOVING: AdSurfDaily Remissions Distributions Are Beginning

    URGENT >> BULLETIN >> MOVING: UPDATED 5:21 P.M. EDT (U.S.A.) Remissions payments to AdSurfDaily members fleeced in an alleged global Ponzi scheme are beginning, a source tells the PP Blog.

    It was not immediately clear how Minnesota-based Rust Consulting Inc. — the government-approved claims administrator — would roll out the compensation plan and how long it would take for all members with approved claims to be notified that their payment will be on the way.

    But the PP Blog has confirmed that an ASD member in Minnesota has received a formal notification that the member’s claim has been approved and that funds will be electronically deposited within the next 15 days. (See screenshot below.) The payments are being funded from money seized by the U.S. Secret Service in the civil portion of the ASD case.

    Separately, AdSurfDaily President Andy Bowdoin — who faces criminal charges of wire fraud, securities fraud and selling unregistered securities — continues to flog away on Facebook and a separate fundraising site to raise $500,000 to pay for his criminal defense. After nearly two months of nonstop fundraising, Bowdoin reportedly has fallen 95 percent short of his goal.

    He’ll now be issuing his appeals even as ASD members he is accused of defrauding are receiving remissions payments from the proceeds of his alleged $110 million Ponzi scheme. In sworn court filings, Bowdoin has claimed the money seized in the case belonged to him.

    At least 11,000 people have identified themselves as victims of Bowdoin’s Ponzi scheme, according to court filings.

    Screenshot: Remissions payments to AdSurfDaily Ponzi scheme victims are beginning, according to this letter the PP Blog obtained today from a source.

  • Accused Ponzi Scheme Felon Andy Bowdoin Launches Facebook Page, Asks Members To ‘Like’ Him And ‘Share’ Link To Defense Fundraising Site ‘Right Away’

    After weeks of delays, a Facebook “Fan” page for accused Ponzi schemer Thomas Anderson “Andy” Bowdoin finally has launched. The site includes a link to “Andy’s Fundraising Army,” the web venue at which Bowdoin’s bid to raise $500,000 to pay for criminal lawyers has fallen 95 percent short of its goal.

    Bowdoin, 76, was arrested in Florida in December 2010 and freed on bail. Federal prosecutors described him as a recidivist securities huckster who’d presided over Quincy-based AdSurfDaily.

    ASD was an “autosurf” Ponzi scheme disguised as an “advertising company,” and Bowdoin used some of the money sent in by members to make campaign donations to the National Republican Congressional Committee, prosecutors said.

    An early version of Bowdoin’s alleged $110 million Ponzi scheme collapsed in 2007, leaving members holding the bag, according to records. After weeks in limbo, ASD switched the URL from which the purported “program” operated and relaunched under the new name of ASD Cash Generator, sucking in a new crop of victims, prosecutors said.

    The accounts and unpaid redemptions of participants active at the time of the 2007 collapse were rolled into the new scheme, and incoming members were not told about the original Ponzi failure and that members were getting paid with recycled cash, prosecutors said.

    ASD eventually gained momentum by creating a video lie about the program’s purported legality and by arranging “rallies” in U.S. cities. In late 2007, Bowdoin added a second autosurf Ponzi known as LaFuenteDinero — Spanish for “the fountain of money” — to his criminal tool kit, and compounded his deception, prosecutors said.

    In 2008, Bowdoin and Clarence Busby Jr. of Acworth, Ga., struck up a partnership that resulted in the creation of an autosurf known as Golden Panda Ad Builder, describing it as ASD’s “Chinese” option, according to records.

    The SEC has described Busby as a prime-bank swindler implicated in three securities schemes in the 1990s. Busby has described himself as a minister and real-estate professional. Records suggest he has lost property in Georgia to foreclosure, was the operator of yet-another surf scheme known as BizAdSplash (BAS) and was on the receiving end of an IRS tax lien.

    BAS went missing in early 2010, after positioning itself as a purported offshore business. Its web servers resolved to Panama.

    Like Busby, Bowdoin also was implicated in securities schemes in the 1990s, according to records. He narrowly avoided prison time in Alabama by agreeing to make restitution to defrauded investors.

    Bowdoin has asked Facebook members to “like” his site. The Facebook site does not mention that three ASD members filed a prospective-class action lawsuit against Bowdoin in 2009, accusing him of racketeering and disguising the nature of ASD’s business.

    Nor does the Facebook site reveal that ASD and related businesses have been on the receiving end of at least three civil-forfeiture judgments totaling about $80 million. In August 2008, the U.S. Secret Service seized about $65.8 million from 10 personal bank accounts of Bowdoin through which he was operating the ASD business, according to records.

    The seizure occurred after ASD members falsely claimed that Bowdoin had received an award for business acumen from then-President George W. Bush, prosecutors said. Bowdoin filed two appeals when forfeiture orders were entered against his assets, but lost both. His new appeals for cash are targeted at the people Bowdoin is accused of defrauding: the ASD membership base.

    In the aftermath of the 2008 seizures, Bowdoin described federal prosecutors in the District of Columbia — the venue in which the forfeiture actions were filed — as “Satan.” Bowdoin’s use of the word “Satan” occurred just weeks after he described himself at a company “rally” in Las Vegas as a Christian “money magnet.”

    Bowdoin also compared the seizures to the 9/11 attacks, saying the actions against ASD by the Secret Service were “30 times worse” in some ways than the terrorist attacks that killed nearly 3,000 people in New York, Pennsylvania and Washington.

    One of the Washington victims of the 9/11 attacks was Barbara Olson, an author, television commentator and former assistant U.S. Attorney (AUSA) in the District of Columbia office. Olson was the wife of former U.S. Solicitor General Theodore Olson.

    In commemoration of the 10-year anniversary of the 9/11 attacks, prosecutors in the District of Columbia dedicated a national-security conference room in Barbara Olson’s memory last week.

    “As an AUSA in [the District of Columbia] office, and throughout her career, Barbara proved that her convictions ran deep, and that her fidelity — to the values she held dear, the principles she fought to defend, and the countless people whose lives she touched — was unshakeable,” U.S. Attorney General Eric Holder said last week.

    ASD is known to have so-called “sovereign citizens” in its ranks. Two ASD figures — Kenneth Wayne Leaming and Christian Oesch — sought unsuccessfully to sue the government for its actions in the ASD case, apparently seeking the staggering sum of more than $29 trillion, more than twice the U.S. Gross Domestic Product in 2009.

    Leaming was accused in Washington state in 2005 of practicing law without a license. Records show he also was involved in a lawsuit that sought more than $9 billion against a local hospital in Washington state. Filings in the case show that Leaming sought liens against the hospital and even sought to attach it water and mineral rights. At least two notaries public in Washington state with ties to Leaming have had their licenses revoked. The names of both notaries appear on the docket of U.S. District Judge Rosemary Collyer in the District of Columbia.

    Collyer is presiding over the ASD-related forfeiture actions and the criminal case against Bowdoin. Bowdoin twice has tried to have Collyer removed from the case. Both efforts failed, and the U.S. Court of Appeals has upheld the forfeiture orders she issued in the case.

    Sixty-two people (as of the time of this post) have “liked” Bowdoin’s Facebook fan page. It is unclear if Bowdoin’s fans have followed the ASD case closely.

  • UPDATE: His Fundraising Goal 95 Percent Short Of The Mark, Accused Felon Andy Bowdoin Asks The People He’s Charged With Defrauding For ‘Positive’ Testimonials; ‘I Warmly Invite You To Write Your Personal Viewpoint’

    Andy Bowdoin

    A Florida man’s weeks-long, nonstop efforts to raise defense funds from the people he is accused of defrauding in a $110 million Ponzi scheme have fallen flat, leaving him 95 percent short of his $500,000 goal.

    But AdSurfDaily President Andy Bowdoin says he still wants members to send him money — and he’s asking for one more thing: “positive testimonials . . . for a new page on the fundraising website.”

    In a strangely worded email filled with bizarre bullet points some ASD members have received, Bowdoin said this:

    Each of you, who have already donated to the Legal Defense Fund, are thanked by me, and I warmly invite you to write your personal viewpoint and testimony in answer to one, or more or all of the following topics:

    • Why you want to help us fight back against the Govt injustices.
    • Why you think this Fundraising Army is an excellent way to join forces and do something about it.
    • Why you donated your small contribution and why you think all ASD members should do the same quickly.
    • Why you feel positive and hopeful that I can win my court case AND be found “Not Guilty” by the Jury.
    • Why proving to the jury that ASD is not a Ponzi Scheme is so important.
    • Why you want us to win the case and what you will do when ASD gets back in business again.
    • Why you are hopeful that ASD members can get their advertising money back from the US govt.

    The accused felon said in the email that he’d gathered only $24,400 of the $500,000 needed. His formal bid to raise funds began on July 26 after weeks of prelaunch hoopla for his website, which is known as Andy’s Fundraising Army.

    In August 2008, the U.S. Secret Service seized tens of millions of dollars from Bowdoin amid allegations he was presiding over a massive international fraud caper. Federal prosecutors say Bowdoin is well aware he was conducting a Ponzi scheme.

    The money was seized in civil-forfeiture actions, and U.S. District Judge Rosemary Collyer issued final orders of forfeiture and judgments in the government’s favor last year. Prosecutors have established a remissions program from which victims of ASD will receive compensation from seized funds.

    More than 11,000 people have filed remissions claims, prosecutors said in court filings.

    Bowdoin claimed in court filings that the seized money belonged to him. In a September 2009 conference call, he told members it belonged to them — despite what he had told Collyer.

    The U.S. Court of Appeals upheld Collyer’s forfeiture orders.

     

  • Attorney General Visits U.S. Attorney’s Office In District Of Columbia To Commemorate 10th Anniversary Of 9/11 Attack; Justice Department Dedicates National Security Conference Room In Memory Of Barbara Olson, Terrorist Victim And Former AUSA

    EDITOR’S NOTE: The U.S. Attorney’s Office for the District of Columbia brought both the civil and criminal prosecutions in the AdSurfDaily Ponzi case. In 2008, ASD President Andy Bowdoin compared prosecutors in the office to “Satan,” saying that what happened to ASD was “30 times worse” in some ways than what happened on Sept. 11, 2001. The 9/11 attacks killed nearly 3,000 people.

    Barbara Olson, a former assistant U.S. Attorney (AUSA) in the District of Columbia office, was killed on 9/11 when American Airlines Flight 77 — the plane she was aboard — slammed into the Pentagon. Today the Justice Department dedicated a national-security conference room in the D.C. office in her memory.

    Olson was 45 at the time of her death. She was the wife of former U.S. Solicitor General Theodore Olson.

    Here are the remarks U.S. Attorney General Eric Holder delivered today in the office of U.S. Attorney Ronald C. Machen Jr. in the District of Columbia. Holder once was U.S. Attorney for the District of Columbia.

    Attorney General Eric Holder

    Thank you, Ron [Machen], for your kind words, and for your outstanding leadership of an office that is very special to me – and an essential part of our nation’s Department of Justice.

    As Ron just mentioned – and as many of you remember firsthand – I once had the privilege of leading this office. I understand the unique jurisdiction, and the vital national security prosecutions, that place you at the center of the Justice Department’s efforts to protect the safety of the American people. In a very real sense, you serve on the front lines of this fight. You’re helping to advance our most critical priorities. And you’re doing extraordinary work.

    Let me assure you – Ron never misses an opportunity to brag about his team, and to tell me just how much you’re accomplishing. Especially as we commemorate the tenth anniversary of the most devastating terrorist attacks ever carried out against the United States, it’s clear that this work – your work – has never been more important, or more urgent.

    That is one of the lessons of September 11th, 2001 – a day that transformed our entire nation and touched each of our lives. And I know that many of you experienced the human cost of 9/11 in a deeply personal – and painful – way.

    The nearly 3,000 innocent victims of 9/11 included a remarkable, and cherished, alumna of this office. Some of us had the chance to work with Barbara Olson – to learn from her example, and to count her as a friend. She reached many others with her professional commentary, her bestselling books, and the enduring impact of her contributions.

    Barbara was a wonderful woman – a dedicated public servant, a brilliant attorney, and a loving wife. As an AUSA in this office, and throughout her career, Barbara proved that her convictions ran deep, and that her fidelity – to the values she held dear, the principles she fought to defend, and the countless people whose lives she touched – was unshakeable.

    On the morning of September 11th, 2001, Barbara boarded American Airlines Flight 77 – which soon was hijacked by five al-Qaeda terrorists, and plunged into the western side of the Pentagon.

    Like so many others on that fateful day – in Arlington, Virginia; in my hometown of New York; and in a field outside of Shanksville, Pennsylvania – Barbara’s life was cut tragically short.  But – one decade later – as we gather to reflect on the events of 9/11, and to remember those who were taken from us so suddenly, I believe that – thanks to the heroic efforts of so many law enforcement officers and military service members; the vigilance of dedicated public servants like you; and the extraordinary resilience that the American people – today, our nation is not only safer, but stronger, than ever before.

    Despite the best efforts of our enemies, our resolve has never wavered or weakened. Our commitment to doing not just what is necessary, but what is right – to protect the safety and the civil liberties of those we serve – remains certain. And, over the last 10 years, we have proven this nation’s ability to respond to terror threats, but never – never – to submit to them.

    That’s why, at its core, the anniversary we observe every September 11th is about far more than the buildings that our enemies brought down, or the damage that they inflicted on our fellow citizens. It’s about honoring the heroism we witnessed. It’s about offering our strongest support to law enforcement officers, military service members, and the families of every victim. And it’s about renewing our commitment to upholding the uniquely American values that have always defined and strengthened this great nation.

    In this spirit – and in honor of our fallen colleague – I am proud to join you in dedicating a national security conference room to Barbara’s memory, here in the critical office where she once served.

    As we carry on her work – and build on the record of achievement that each of you has helped to establish – let us draw inspiration from all those who have dedicated their lives to the service of others, and whose memories remind us of the quiet power of compassion, patriotism, and selflessness that shone through the smoke and the wreckage of 9/11.

    These values have always given our nation strength – even in our darkest moments. Let us continue to honor them. And let us continue our work to ensure that – in our own time and in the work of future generations – the lessons of September 11th, and the rich legacies of those we lost, will never be forgotten.

    Thank you.

  • Image Of Famed Actor And Grammy-Winner Will Smith Appears In Club Asteria House Organ Just Above ‘JOIN NOW’ Button; No Immediate Comment From His Publicist

    "ABOUT US" and "JOIN NOW" buttons — each punctuated with exclamation points — appear below this image of actor Will Smith in Club Asteria's September 2011 house organ. The PP Blog has cropped this screen shot not to show Smith's face, but his face appears in the Club Asteria promo.

    UPDATED 1:47 P.M. EDT (U.S.A. OCT. 29, 2011.)  An image of famed actor and rapper Will Smith appears in Club Asteria’s September house organ, an online glossy used by the firm to recruit affiliates across the world. It was unclear if Smith had knowledge of the promo or had authorized Club Asteria to use his likeness.

    A link to the publication featuring the image of Smith appeared on the TalkGold Ponzi forum yesterday. TalkGold is referenced in federal court filings as a place from which international fraud schemes are promoted.

    Smith’s publicists at the 42West agency in Los Angeles had no immediate comment on the promo when contacted today by the PP Blog, which provided a link to the Club Asteria publication. The entertainer’s image appears on Page 7 of the September gusher.

    Buttons using the words “LEARN MORE!”  “ABOUT US! and “JOIN NOW!” appear a short distance below the image of Smith. But readers who press the buttons do not receive information about Smith. Rather, the buttons forward to Club Asteria’s website. The “JOIN NOW” button, for instance, takes readers to Club Asteria’s registration page.

    The presence of the image of Smith, the wording and design of the page and the positioning of the buttons lead to questions about whether the “Independence Day” and “Men in Black” star had endorsed the purported Club Asteria opportunity or whether Club Asteria was trying to create the impression among readers that he was a spokesman for the company.

    In May, Club Asteria promotions were banned in Italy by the Italian securities regulator CONSOB. The agency has published its orders and findings on Club Asteria affiliate websites in Italy.

    It is common for shady promoters of multilevel-marketing (MLM) “opportunities” to plant the seed in promos that a particular product or service is endorsed by a celebrity when no actual endorsement exists.

    A headline of “Will Smith Inspires the World With Enthusiasm for Life, Work & People!” appears above the image of Smith in the Club Asteria promo.

    A deck below the headline uses these words, “An Interview With Will Smith,” suggesting that Club Asteria itself had a direct connection to him. In a short blurb below the deck, readers are told that the “interview” and “discussion” with Smith will inform them about the wisdom he gained “throughout his journey to success” and that Smith will explain “the importance of extraordinary dreams.”

    A button to a video —  apparently one that appeared on YouTube and is being reframed inside the house organ — appears below the image of Smith. When clicked, the video loads footage of an interview with Smith conducted by 60 Minutes reporter Steve Kroft (NOTE: This paragraph was edited on Oct. 29, 2011, to reflect that Kroft, not Scott Pelley, conducted the 60 Minutes’ interview.) As the video proceeds, it loads footage of Smith being interviewed by broadcaster Charlie Rose. It then works in footage of a Smith interview on NBC’s Today show and a Smith interview on the “Ellen” show. Footage from other shows also are spliced into the video.

    Club Asteria reportedly recruited more than 300,000 members in a worldwide promotional blitz that traded on the name of the World Bank. Hundreds — if not thousands — of promos for the firm claimed Club Asteria was a program that provided a weekly return on investment of between 3 percent and 10 percent. The offers were targeted at the world’s poor, with Club Asteria positioned as a company that could lift them out of poverty.

    Club Asteria was widely promoted on forums associated with Ponzi schemes and the sale of unregistered securities. Members said Club Asteria first slashed weekly payouts to members in the spring and then eliminated them. Club Asteria announced in May that its PayPal account had been frozen, a development it blamed on members.

    In various promos prior to the PayPal freeze, Club Asteria affiliates preemptively denied Club Asteria was operating a Ponzi scheme. Club Asteria managing member Andrea Lucas, whom the World Bank said in March once held a staff position at the bank, last worked for the bank in 1986 — 25 years ago.

    Lucas was described in promos for Club Asteria as a former “Director,” chairman and vice president of the World Bank. Images of Hank Needham, another Club Asteria principal, appeared in 2008 promos for AdSurfDaily.

    In August of that year, the U.S. Secret Service seized tens of millions of dollars from the personal bank accounts of ASD President Andy Bowdoin, alleging that he was presiding over an international Ponzi scheme.

    Bowdoin was arrested on criminal charges of wire fraud, securities fraud and selling unregistered securities in December 2010. His trial is pending. Like Club Asteria, ASD also was promoted on Ponzi boards such as TalkGold and MoneyMakerGroup, which is listed in federal court filings as a place from which the alleged Pathway To Prosperity and Legisi Ponzi schemes were promoted.

    ASD, Pathway To Prosperity and Legisi created tens of thousands of victims globally and fraudulently obtained a combined total of about $250 million, according to court filings.

  • SPECIAL REPORT: PROSECUTION: More Than 11,000 Remissions Claims And 150,000 Pages Of Documentation Received In AdSurfDaily Case; Number Of Claims Greatly Exceeds Population Of ASD’s Home Base Of Quincy, Fla.

    Andy Bowdoin

    UPDATED 12:09 P.M. EDT (U.S.A.) Federal prosecutors effectively advised U.S. District Judge Rosemary Collyer last month that enough people to fill a small city had filed remissions claims in the AdSurfDaily autosurf Ponzi case.

    Although prosecutors did not reveal a precise number, they said in court filings that more than 11,000 people had filed claims and provided more than 150,000 pages of documentation. ASD was based in Quincy, Fla.

    Remissions is a form of restitution. Prosecutors have said for more than two years that the government intends to compensate ASD victims from funds seized by the U.S. Secret Service in civil-forfeiture actions against ASD-related assets in 2008. Collyer issued civil judgments in the government’s favor totaling about $80 million in 2009 and 2010. Bowdoin was charged criminally with wire fraud, securities fraud and selling unregistered securities in December 2010.

    ASD created Ponzi victims all over the world, prosecutors have said. The claims number alone greatly exceeds the Gadsden County community of Quincy’s population of roughly 7,000. It also greatly exceeds the population of Perry, the 7,000-inhabitant Florida town in Taylor County Bowdoin once represented as a council member and mayor.

    The claims number would consume nearly 80 percent of combined populations of Perry and Quincy. Looking at the number a different way, had ASD’s membership consisted only of residents of those two communities in separate counties, only one in five inhabitants — 20 percent — would be left untouched by the scheme.  Had the 80 percent of residents who filed claims lost significant sums in ASD, the economies of both cities could have been brought to their knees.

    Among the core dangers of autosurf schemes is that criminals — domestic and international — establish means by which they can tap into bank accounts, payment processing accounts and credit accounts at the local level. When a scheme collapses, it may affect commerce far and wide while also putting banks in multiple communities in possession of tainted cash. By some accounts, large numbers of members of individual churches became ASD members.

    A collapsed autosurf scheme not only may affect individual churches, it may affect the finances of the church itself and the commerce stream in reach of the church and its members. One 2008 promo for ASD and a purported “millionaire” advertising co-op viewed by the PP Blog as part of its reporting encouraged members (verbatim, text coloring added by PP Blog) to:

    Go to your nearest ATM machine
    Use your Debit card to withdraw the necessary cash for your payment OR
    Use your Credit card to make a “cash advance” of the necessary funds for your payment. Note: there is usually a much higher Annual Percentage Rate for a credit card cash advance. Take the cash to your nearest branch of Bank of America and deposit the cash amount in the AdSurfDaily, Inc. account, using the following information:

    The promo appeared on a website linked to Tari Steward, whom Bowdoin has identified as a potential defense witness and the Internet Marketer behind an effort by Bowdoin to raise funds to pay for his criminal defense.

    Screen shot: From a 2008 promo for an ASD millionaire co-op.

    The U.S. government warned in December 2010 that securities schemes such as AdSurfDaily and Imperia Invest IBC that spread virally on the Internet were creating tens of thousands of victims at a time. Imperia, which was smashed by the SEC in October 2010, was targeted at people with hearing impairments and gathered millions of dollars.

    Noobing, an autosurf that became popular after the ASD-related bank-account seizures in 2008 and collapsed in 2009 after the FTC took action against its parent company, also was targeted at the deaf community. Internet-based crimes and scams are creating victims in numbers America’s largest sports stadiums cannot accommodate, according to records.

    ASD gathered at least $110 million in its scheme and may have created 40,000 or more victims, prosecutors have said, asserting in January 2011 that “as far as the Government is aware, there is no available accurate compilation” of all individuals or entities that lost money in the scheme.

    “It appears from the investigation that there may be members who provided funds to ASD but whose information ASD did not enter into its database,” prosecutors said in January.

    Bowdoin, with Steward’s reported assistance, has busied himself since June to raise funds online for his criminal defense from the members he is accused of defrauding. A web entity known as “Andy’s Fundraising Army” has been sending “blast” emails for weeks to a list of ASD members that purportedly contains 77,000 names.

    Bowdoin also announced plans to complement his “Andy’s Army” fundraising efforts with a Facebook site, but no such site appears to have launched on the popular social network. At least three advertised launch dates for the Facebook site were missed.

    Meanwhile, the  “Andy’s Army” bid appears to have fallen flat, with Bowdoin stuck more than 95 percent short of his $500,000 goal after five continuous weeks of formal fundraising. Some ASD members have said they had received multiple fundraising appeals from Bowdoin in a single week.

    Screen shot: From the 2008 "millionaire" co-op promo.

     

  • BULLETIN: SEC Says Alleged Life-Settlement Scammer Ran $4.5 Million Fraud And Ponzi Scheme — And Spent $5,000 On ‘Cowboy Boots’ And Another $5,000 For ‘Dating Service’ While Directing $55,000 To A ‘Tribute’ For Deceased Entertainer Michael Jackson; Image Of Former President Bill Clinton Appears On Website

    UPDATED 4:32 P.M. EDT (U.S.A.) It’s only getting stranger . . .

    The SEC has gone to federal court in Los Angeles and obtained an emergency asset freeze for what it described as a $4.5 million life-settlement fraud and Ponzi scheme operated by a man who spent more than $5,000 in investor funds on “cowboy boots,” nearly another $5,000 on a “dating service,” $1,300 on designer sunglasses, more than $200,000 on luxury cars — and $55,000 in a tribute to the late pop icon Michael Jackson.

    The alleged scam also directed enormous sums toward other purchases, the SEC charged. A photo on a website linked to the principal defendant in the SEC’s civil case features an image of former President Bill Clinton, with the White House as its backdrop.

    Of the $4.5 million gathered in the fraud, only $90,000 — about 2 percent — was applied to its “avowed” purposes, the SEC charged.

    Even the avowed purposes — purchasing life settlements, developing coal leases in Kentucky purportedly worth $11.8 billion or developing interests in gold reserves in Nevada — were dubious or not carried out, the SEC said.

    Charged in the case were Daniel C.S. Powell, 29, of Los Angeles, and his company Christian Stanley Inc. Two Powell-related entities — Christian Stanley LLC and Daniel Christian Stanley Powell Realty Holdings Inc. — were named relief defendants.

    About 50 investors were fleeced, the SEC said.

    “Powell and Christian Stanley created the façade of an actual business when in reality they have virtually no revenue,” said Rosalind Tyson, director of the SEC’s Los Angeles Office. “Most of the money raised from investors has been used to finance Powell’s extravagant lifestyle and for other purposes that have not been disclosed to investors.”

    “As of August 23, 2011, only $29,396.55 remained in Christian Stanley’s bank accounts,” the SEC charged.

    The “Message From Our Chairman” page of “Christian Stanley’s website features a photo of Powell and former President Bill Clinton with the White House as its backdrop. The photo appears to include a disclaimer of some sort, but the type in the disclaimer is small and washes out, making it difficult or impossible to read.

    A similar photo featuring an image of Powell and Clinton is displayed elsewhere on the site, but appears to be cropped in a different fashion — and also in such a way that any disclaimer language was lost.

    Images of Clinton also were used in promotions for the Mantria “green energy” Ponzi scheme in 2009. It is common for fraud schemes to use images of celebrities to sanitize offers. In 2008, for instance, members of the alleged AdSurfDaily Ponzi scheme painted word pictures that then-President George W. Bush and the White House had given a special award to ASD President Andy Bowdoin.

    This list is not all-inclusive, but here are some of the alleged purchases and sums consumed in the alleged fraud by Powell and Christian Stanley:

    • $212,000 for cars, including a Porsche, a Ferrari, a BMW and a Dodge Ram.
    • More than $290,000 in debit card transactions, mostly consisting of payments of Powell’s daily living expenses, including gas, groceries, pharmaceuticals, dry cleaning and retail goods.
    • Cash withdrawals and checks payable to Powell or to cash totaling almost $240,000.
    • More than $160,000 toward Powell’s exorbitant lifestyle, including almost $90,000 for hotels, more than $49,000 for nightclubs, more than $17,000 for restaurants and more than $4,800 for limousines.
    • More than $100,000 in rent paid on behalf of a woman who Powell has described as “like a mother” to him and another woman with no apparent connection to the company.
    • Donations totaling $91,000, including $55,000 toward a tribute to Michael Jackson and $35,000 to the rapper Usher’s New Look Foundation.
    • Miscellaneous luxury purchases, including $8,700 for jewelry, almost $5,000 to register for a dating service, more than $5,000 for cowboy boots and more than $1,300 for designer sunglasses.

    Investors believed they’d receive returns of between 5 percent and 15.5 percent per year, the SEC said.

    U.S. District Judge George H. King of the Central District of California has ordered an asset freeze and appointed a temporary receiver, the SEC said.

    “A life settlement is a transaction in which an individual with a life insurance policy sells that policy to another person, who then assumes responsibility for paying the premiums,” the SEC said. “Typically, the seller no longer wants the policy or can no longer afford to pay the premiums. In exchange, the insured party typically receives a lump sum payment that exceeds the policy’s cash surrender value, but is less than the expected payout in the event of death.”

    In its complaint, the SEC charged that Powell and Christian Stanley were selling unregistered securities and that Christian Stanley “has not purchased a single life settlement.”

    The scheme has operated for at least seven years, the SEC said.

    Read the SEC complaint.