PatrickPretty.com

Tag: ASD

  • Are ASD Members Waging Ongoing Misinformation Campaign To Suppress Victims’ Count And Obstruct Justice? Note Instructs Members NOT To File For Restitution

    Andy Bowdoin

    The now-defunct Surf’s Up forum was AdSurfDaily’s officially endorsed news venue. It became so on Nov. 27, 2008, a little more than a week after a key court ruling went against ASD, a Florida company implicated by the U.S. Secret Service in an alleged $100 million Ponzi scheme. Surf’s Up routinely deleted posts that challenged ASD President Andy Bowdoin, and routinely suppressed information unfavorable to ASD.

    Surf’s Up was known for conflating fantastic realities to accommodate unpleasant fact sets. Among the unanswered questions as the ASD investigation proceeds is whether the forum and some of its members were/are engaging in efforts to obstruct justice by asking victims to spread misinformation.

    Some ASD and Surf’s Up members recently received the email below, which fractures facts and appears to encourage members to spread misinformation and not to participate in the federal restitution program. (Italics and carriage returns added. PP Blog’s Notes in Bold.)

    “Please pass this on to your group and ask them to pass it on to others who were in ASD. The lawsuit filed against ASD, Andy and his wife Faye was decided in ASD’s, Andy’s & Faye’s favor a few months ago. (PP Blog Notes: The lawsuit was not decided in favor of ASD, Andy Bowdoin or Faye Bowdoin. Florida dropped the lawsuit “without prejudice,” meaning it can be refiled. The state said it had turned over a victim’s list to the federal government for the purposes of securing restitution from funds seized by the U.S. Secret Service.)

    “In October the state of FL dropped all charges against ASD. (PP Blog Notes: See note above.)

    “The Federal charges are all that is left to be addressed and progress will be made on that this month. Unfortunately if members respond to this notice and file a claim, they will be contributing to ASD losing its case because the government will use it as evidence that ASD created these “victims.” (PP Blog Notes: Is this a deliberate attempt to suppress the victims’ count and a bid to obstruct justice? Beyond that, Andy Bowdoin’s appeal of the forfeiture of money he advised a federal judge belonged to him is hardly the sole, unsettled legal issue. It is known, for example, that a criminal grand-jury probe has been under way. Bowdoin references the criminal probe in his own court filings. It is possible that criminal indictments against multiple individuals could be returned.)

    “I have told this man that but he persists because he will make money from ‘helping.’ If ASD loses its case, THEN it would be appropriate to follow up these options, but not until then.

    “My husband was hit by a car while he was bicycling and I have been struggling to care for him at home alone. I am 63, 105 lbs and he is functionally quadriplegic (which means that there is much to be hopeful for but, in the meantime, it is very challenging). For this reason I am unable to keep everyone updated as I had hoped to do and I have been unable to spearhead a member campaign to help the effort as I had also hoped to.

    “God’s Blessings,
    Sara”

    (PP Blog Notes: The section of the note above even could bring things such as practicing law without a license into play because it introduces an “if, THEN” proposition that lays out a legal strategy. For example, “if” ASD loses the forfeiture proceeding in the appeals court, only “THEN” should victims register for the restitution program. One of the core problems is that there may be no way of knowing precisely when the appeals court will issue its ruling (oral arguments scheduled for this month have been canceled, and the appeals court will decide the issues based on briefs from both sides). Meanwhile, the restitution/remission forms victims must file are due by Jan. 19, 2011. Victims who follow the advice in the email could be denied a refund.)

    See related story.

  • BULLETIN: Woman Who Did Not Report Ponzi Schemer Richard Piccoli Sentenced To 18 Months In Federal Prison For ‘Misprision Of Felony’ And Tax Charge; Kathleen Fuoco Turned ‘Blind Eye’ To Fraud, Prosecutors Say

    BULLETIN: In a case that could send shockwaves across the culture of promoting scams and accepting payments from scams, a New York woman who turned a blind eye to Richard Piccoli’s long-running Ponzi scheme in New York state has been sentenced to 18 months in federal prison for misprision of a felony and willful failure to file tax returns.

    Kathleen Fuoco, 60, of West Seneca, N.Y., pleaded guilty to the charges in June. She was sentenced today in Buffalo. Piccoli, 83, was sentenced to 20 years in prison last year. He became infamous in the Buffalo region for targeting people of faith in the scheme.

    Fuoco knew Piccoli was operating a scam, but did not report him, prosecutors said in June. Her failure to report the scheme brought about the misprision charge and also resulted in an agreement with prosecutors in which a financial judgment of $25 million would be placed against Fuoco, the total amount of restitution due victims.

    Piccoli operated a firm known as Gen-See Capital Corp., and directly targeted Christians and senior citizens.

    “Our seniors and clergy are absolutely pleased with Gen-See’s Re-Investment Program,” Piccoli said, according to marketing materials gathered by investigators as evidence in the case.

    The Piccoli prosecution was brought after an undercover sting by the U.S. Postal Inspection Service and the IRS.

    After Fuoco’s guilty plea in June,  U.S. Attorney William J. Hochul said “the public should know that if you attempt to defraud any hard working citizen or turn a blind eye while someone else is committing fraud, you will be caught and prosecuted to the fullest extent of the law.”

    Hochul built on his earlier remarks after Fuoco’s sentencing today.

    “The best defense for investors is to conduct your own due diligence and research,” he said. “When unscrupulous defendants take advantage of others through fraud, however, my office stands ready to bring the full force of law to punish the crime.”

    Misprision of felony is a charge that serial promoters of online scams such as autosurfs, HYIPs and 2×2 matrix cyclers potentially could face. The schemes proliferate in no small measure because promoters who play dumb to the fraud create the conditions that make it possible for the “programs” to go “viral” on the Internet.

    Some promoters help fuel scheme after scheme after scheme, perhaps saying later that they were surprised the programs proved to be fraudulent.

    Such bids to create plausible deniability have been unmasked by the U.S. Secret Service in a number of investigations since 2008. In some cases, the agency has used undercover identities to join the schemes and later advised federal judges that the agents were instructed by members of the schemes to avoid using certain phrases in sales pitches to minimize the chance of getting caught.

    In certain undercover operations, the Secret Service revealed it had agents in rooms or venues from which scammers were delivering sales pitches to an audience. Some schemers have been kept under surveillance for weeks by agents.

    Court documents in the alleged AdSurfDaily (Florida) and INetGlobal (Minnesota) Ponzi schemes — and in the alleged Regenesis 2×2 (Washington state) Ponzi scheme — show that agents moved from location to location and even city to city to build evidence against Ponzi schemers.

    Meanwhile, court documents show that undercover Secret Service operatives and their state law-enforcement colleagues even have posed as interested investors and walked right through the front doors of offices operated by suspected fraudsters.

    Court filings in the alleged Legisi Ponzi scheme brought by the SEC show that the behavior of the alleged schemer changed after he came to understand he was under investigation — a development that allegedly led to even greater chicanery to hide the scheme.

  • UPDATES/NEWS: ASA Ponzi Forum Now Redirects To CashX.com; Arthur Nadel Gets 14 Years In Florida Ponzi Case Brought By Obama Task Force; Former Indiana Pastor Who Bilked Christians Convicted Of Securities Fraud

    President Obama formed the interagency Financial Fraud Enforcement Task Force in November 2009. He later became the subject of an attack ad by an affiliate of the purported MPB Today "grocery" MLM.

    UPDATED 10:56 A.M. EDT (U.S.A.) The ASA Monitor Ponzi and criminals’ forum now is redirecting to a website operated by CashX.com, a Canadian payment processor that hawks MasterCard debit cards and says it permits customers to withdrawn money to Liberty Reserve.

    Liberty Reserve is a Ponzi-friendly payment processor purportedly headquartered in Costa Rica after earlier operating from Panama.

    Meanwhile, confessed Ponzi schemer Arthur Nadel — who briefly went on the lam from Florida in early 2009 as his $390 million scheme was disintegrating and became known as one of the original “mini-Madoffs” — has been sentenced by a federal judge in New York to 14 years in prison.

    It is effectively a life sentence for Nadel, who is 77 and one of several senior citizens implicated in U.S. Ponzi schemes.

    At the same time, a former clergyman from Indiana who told congregants it was their “Christian responsibility” to become pitchmen for his then-undiscovered bond scheme has been convicted of nine counts of securities fraud.

    Vaughn Reeves, 66, is scheduled to be sentenced next month. The jury deliberated only four hours before returning the verdict against Reeves, himself a senior citizen. Congregants believed they were helping raise money for church-building projects, but it was a scam that led to foreclosure proceedings against eight places of worship. (See link to AP report below.)

    Claims made by Reeves are similar to claims made by the Data Network Affiliates (DNA) MLM program, which told members that churches had the “MORAL OBLIGATION” to help bring business to the Florida-based firm and qualify for commissions ten levels deep. DNA purports to be in the license-plate data collection business, claiming it can help law enforcement and the AMBER Alert program recover abducted children.

    Incongruously, DNA also purports to sell a “protective spray” that shields cameras from taking photographs of license plates. Equally incongruously, the company said that it could offer a free cell phone with unlimited talk and text for $10 a month. The company later backtracked on the claim, bizarrely saying it studied pricing structures only after announcing it had become the world’s low-price leader while acknowledging it hadn’t vetted its purported vendor for the service.

    DNA figure Phil Piccolo later threatened to sue critics. Earlier, Dean Blechman, who said he was the company’s CEO before resigning in February, threatened to sue critics. DNA withheld the announcement of Blechman’s departure for nearly a week and then misspelled his name. DNA also described Blechman as the “future” CEO, even though Blechman had described himself as the current CEO.

    Blechman complained to the PP Blog about “bizarre” events at DNA.

    ASA Monitor, which is referenced in court filings as a place from which the alleged Pathway To Prosperity (P2P) Ponzi scheme was pitched and was a site from which the purported “grocery” MLM operated by Florida-based MPB Today was pitched, suddenly announced on Oct. 12 that it was closing.

    Like MPB Today, DNA also was pitched from Ponzi and criminals’ forums.

    The ASA Monitor closure announcement coincided with a flap in which an ASA forum moderator sought to muzzle critics of the MPB Today program, which is being targeted at Christians, foreclosure subjects, Food Stamp recipients, senior citizens, people of color and members of the alleged AdSurfDaily (ASD) Ponzi scheme.

    ASD also operated from Florida before the U.S. Secret Service seized tens of millions of dollars in August 2008, amid allegations of wire fraud and money-laundering. Robert Hodgins, an international fugitive wanted by Interpol in a narcotics-trafficking and money-laundering case filed after an undercover probe by the U.S. Drug Enforcement Administration in Connecticut, provided debit cards to ASD, members said.

    Nadel’s scheme, meanwhile, operated in the Sarasota area.

    “Through his massive Ponzi scheme, Arthur Nadel greased his own pockets and financed his lavish lifestyle, using money his clients relied on him to invest,” said U.S. Attorney Preet Bharara of the Southern District of New York.

    “He cheated his elderly and unwitting victims out of their retirement savings and consigned others to poverty,” Bharara said. “The message of [yesterday’s] sentence should be loud and clear — we will continue to work with our partners at the FBI to find the perpetrators of financial fraud and use every resource we have to bring them to justice.”

    U.S. District Judge John G. Koeltl ordered Nadel to forfeit $162 million, five airplanes, a helicopter and real estate in Florida, North Carolina and Georgia.

    The prosecution of Nadel was brought in coordination with President Obama’s Financial Fraud Enforcement Task Force. U.S. Attorney General Eric Holder traveled to Florida earlier this year to warn fraudsters that the United States was serious about putting scammers in prison.

    By September, an affiliate of MPB Today had created a video in which Obama was depicted as a left-handed saluting Nazi who cowered to U.S. Secretary of State Hillary Clinton, who was depicted as a drunk. First Lady Michelle Obama, the mother of two daughters, was depicted as having experienced an embarrassing gas attack in the Oval Office after sampling beans at a Sam’s Club store.

    Clinton, depicted in the sales promo as “Hitlary,” knocked out Michelle Obama after barging into the Oval Office bawling and carrying a bottle of wine. Clinton, the mother of one, was the first woman ever appointed to the Walmart board of directors.

    Some MPB Today affiliates have claimed Walmart is affiliated with MPB Today and that the government backs the MLM program, which appears to have accounts at at least two banks in the Pensacola area. One of the banks is operating under a consent agreement with the FDIC.

    Read the AP story on the Vaughn Reeves scheme in Indiana.

  • EDITORIAL: Prized Magazine ‘Newsweek’ Acquired For $1; Publishing Continues To Bleed — Even As Autosurf Cheerleaders Say They Have The Answer To Lagging Ad Sales

    The Associated Press reported yesterday that the Washington Post sold Newsweek magazine — an American treasure — for $1. The Post also absorbed $10 million in debt for Newsweek, which lost nearly $30 million last year.

    How much is $30 million? Well, it’s about $1.6 million less than AdSurfDaily President Andy Bowdoin had in a single bank account from his alleged “advertising” Ponzi scheme. It’s also less than one-half the total sum ($65.8 million) the U.S. Secret Service seized from 10 Bowdoin bank accounts.

    This is painful to watch on a couple of levels: First, American publishing companies continue to bleed profusely, leading to a situation in which American treasures are being sold for $1 and skilled administrative, management, editorial, production, sales and advertising professionals are losing their jobs or working for far less money.

    Second, problems in the U.S. economy in general are providing a launching ground for hucksters who would have you believe that Newsweek, the Seattle Post-Intelligencer and many other cherished publications could have saved themselves a lot of heartache by turning to the “autosurf” business model.

    In the autosurf business model as practiced by ASD, a company such as Microsoft that perhaps had relied on Newsweek  to advertise in print could have paid ASD $1 million to advertise online. ASD would have placed Microsoft’s ad in its magical advertising rotator. From that $1 million, Microsoft would have “earned” $10,000 a day more or less for the next 125 days, thus not only “earning” back the full $1 million, but also fetching a “profit” in the neighborhood of $250,000 on top of it.

    And Microsoft also would have sold a bunch of software by advertising on ASD, which purported to have a “captive” audience consisting of advertisers it was paying to view the ads of their fellow ASD advertisers. With Microsoft as a theoretical ASD advertiser, it could have boosted its bottom line by watching ads from a theoretical Apple, for example. The “rebates” Microsoft earned — coupled with the profits from the sale of software products displayed in ASD’s rotator — would have made both Microsoft and America happy, according to ASD’s devoted flock of commission-based, MLM salespeople.

    ASD, its fans said, had the perfect solution: Microsoft would have been paid more money than it spent, meaning it would have emerged in a better cash position within 125 days of doing business with ASD.  The ASD salesperson who recruited Microsoft also would have been paid — $100,000 for the $1 million sale alone. ASD would have made money. The U.S. economy would have continued to gain steam.

    Except it was not perfect, of course. In fact, is was all a colossal lie, according to the U.S. Secret Service, which accused ASD in August 2008 of operating a massive Ponzi scheme. Any money that ASD advertisers received from ASD came from other advertisers.

    So, it is plain to see that ASD was not a good deal for “advertisers” — theoretical or otherwise. ASD could have killed off Microsoft had its management been uninformed enough or desperate enough to trust a single word ASD ever said. Horror of horrors: Why would Microsoft want to limit its ASD ad spend to $1 million? Why not $10 million or $100 million — or more? Why not plow its “profits” right back into ASD, which advertised dramatically higher profits than, say, Bernard Madoff?

    After ASD killed off Microsoft, it would have killed off that MLM salesperson, the one who was paid $100,000 for Microsoft’s $1 million in business while Microsoft itself was paid $1.25 million more or less.

    Indeed, like Microsoft, the ASD MLM salesperson pitching ASD’s cancer would have had to return the “profit” he was paid from the proceeds of a criminal enterprise, even if it meant selling his home to raise the cash.

    But how to sell a home in this economic environment — you know, with all the foreclosures and such, all the bank failures and such — and all of the falling prices of real estate and such because of all the foreclosures and such?

    Want to add an extra layer to the ASD madness? Some ASD promoters who declared themselves committed, free-market Capitalists insisted that companies such as Microsoft would not be interested in profits, that they’d be happy enough just to display their ads and not get paid.

    The corporate benevolence of companies such as Microsoft would have resulted in ASD profits that were redistributed to smaller companies and Mom-and-Pop advertisers, thus creating wealth across the social spectrum. Some of the very same Capitalists who made these claims later complained about what they described as the Socialist redistribution schemes of the U.S. government.

    It also seemed not to occur to the autosurfing Capitalists who were rooting for a Socialist redistribution scheme — a scheme whereby big companies such as Microsoft would finance the profits of smaller players — that companies such as Microsoft could have started an autosurf at any time they wanted and crushed ASD like a bug.

    It’s a pretty safe bet that Microsoft, unlike ASD, could have kept its autosurfing site from going offine and could have produced a site that didn’t look as though it had been assembled by amateurs using a script kit. Meanwhile, it’s also a pretty safe bet that Microsoft wouldn’t have been looking for ways, say, to peel off cash to put Bill Gates in a new Lincoln or a relative of Bill Gates in a sporty, new Honda.

    Along those lines, it’s also a pretty safe bet that Microsoft would not have been seeking ways, say, to route millions of dollars offshore so it could be retrieved later by “management” who suddenly found themselves cash poor and without a country.

    Ay, just another day in Ponzi America, a country that has more than a few people who believe the business cure for what ails America is an ASD-like scheme that runs 24/7/365. You can read all about such schemes on the Ponzi boards — and you can induce people into the schemes and get paid a commission, which you can deposit into your FDIC-insured bank.

    Newsweek, like the Post Intelligencer, didn’t go the autosurf route, despite the fact it could have done exactly what ASD did: Lied to its advertisers by telling them that NewsweekDailyProSurf.com was the cure for all their ills, a cure that would have returned 125 percent more or less in 125 days more or less.

    No, Newsweek sold itself for $1 in a bid to save itself. We wish this American treasure the best as it seeks to retool.

    Finally, did you hear that the affiliate braintrust pitching the purported MPB Today “grocery” program on the ASA Monitor Ponzi and criminals’ forum is promoting an MPB Today “rebate” program?

    Read the AP story on the sale of Newsweek for $1.

  • Florida Drops State-Level Pyramid Case Against AdSurfDaily; Says It Has Supplied Victims’ List To Claims Administrator For Restitution From Assets Seized By Secret Service In Federal Case

    Andy Bowdoin

    UPDATED 7:40 P.M. EDT (U.S.A.) Certain members of Florida-based AdSurfDaily began crowing last week that the office of Florida Attorney General Bill McCollum had dropped the pyramid-scheme case it had filed against ASD in August 2008.

    “The State of Florida has dropped all charges against Ad Surf Daily, Inc. This is wonderful news!” an email received by some ASD members exclaimed.

    Florida prosecutors, however, tell a different story.

    Although McCollum’s office confirmed today that the pyramid case has been dropped “without prejudice” — meaning it can be refiled — it noted that state investigators have forwarded a list of Florida victims of ASD to a federal claims administrator “for processing and reimbursement purposes.”

    Florida initially had sought restitution for victims, along with the dismantling of ASD. ASD essentially dismantled itself in September 2009 by not filing required forms with the state, which revoked its corporate registration. Less than four months later, in January 2010, the federal government was awarded title to more than $65.8 million seized in the case. The government earlier had been awarded title to more than $14 million. In March 2010, the government was awarded title to more than $600,000 that had been seized in a separate forfeiture action filed against ASD connected assets in December 2008.

    All in all, the federal government was awarded title to more than $80 million seized in the ASD case, gaining a clean sweep in the forfeiture proceedings.

    The U.S. Secret Service raided ASD on Aug. 5, 2008.  Florida followed up with a lawsuit of its own a day later, but federal prosecutors later said they intended to form a restitution pool from seized assets. That process now has begun, although ASD President Andy Bowdoin is appealing the January 2010 forfeiture order entered by U.S. District Judge Rosemary Collyer.

    In its paperwork to dismiss the pyramid case, McCollum’s office pointed to Collyer’s forfeiture order, saying ASD victims from Florida and elsewhere had been provided an opportunity for restitution by the federal government.

    On Sept. 28, 2009 — three days after Florida revoked ASD’s corporate registration and dissolved the registration of a shell company known as Bowdoin/Harris Enterprises — federal prosecutors filed a U.S. Secret Service transcript of a conference call ASD had recorded Sept. 21.

    In the call, Bowdoin told members that the government had seized their money. In his court filings, however, Bowdoin claimed the money was his.

    Federal prosecutors said the recording was evidence that Bowdoin could not keep his stories straight, arguing that he had told members one story and a federal judge another. Collyer issued the forfeiture order for more than $65.8 million less than four months later.

    Although an email some ASD members received in recent days claimed that “It looks like things are moving in the right direction” with the Florida dismissal, the email urged members to “only share this with those whom you trust.

    “Do not post on forums or blogs,” the email urged.

    Federal prosecutors noted last month that the U.S. Court of Appeals for the District of Columbia Circuit had dismissed one of two appeals Bowdoin had filed in the forfeiture cases, noting his second appeal was pending before the same court.

    The court should reject that appeal as well, prosecutors argued.

    With the federal procedure for restitution established, ASD victims now have a remedy for reimbursement, McCollum’s office advised a state judge.

    In late 2008, Bowdoin told ASD members that Florida had dropped “Ponzi scheme” allegations against the firm. McCollum’s office immediately countered with a statement that it never even had accused ASD of operating a Ponzi scheme, noting that it had alleged a pyramid scheme only.

    When Bowdoin made the 2008 claim, some ASD members raced to forums and websites to spread the news, which turned out not to be true. He later tried to sell members a VOIP telephone service, explaining the price he offered was a gift to his loyal supporters.

    Even as Bowdoin was telling members in September 2009 that he had big plans for ASD, he did not explain why he had permitted its corporate registration to lapse or explain that the state had revoked the registration.

    Instead, Bowdoin told members that the government had seized their money — a claim in opposition to his own court filings that advised a federal judge the seized money belonged to him.

  • BULLETIN: Florida — Again: SEC Sues Atlantis Technology Group In Alleged Online Television Pump-And-Dump Scheme; CEO Christopher M. Dubeau Threatened ‘Bashers’ For Making ‘Slanderous’ Postings, March News Release Says

    BULLETIN: UPDATED 10:51 A.M. EDT (U.S.A., Oct. 1.) About six months after the chief executive officer of Atlantis Technology Group (Atlantis) was quoted in a Marketwire news release that threatened online commentators for “making slanderous postings” about the company, the SEC has gone to federal court in Florida to accuse Atlantis CEO Christopher Dubeau and the firm of running a penny-stock swindle.

    The SEC’s lawsuit concerns the operations of an Atlantis subsidiary known as Global Online Television (GOTV), which allegedly used a commission-based sales force to promote the purported TV company.

    Dubeau and Atlantis actually were operating a “pump-and dump” stock fraud, the SEC charged in U.S. District Court for the Southern District of Florida.

    “From at least August 7, 2009 through April 5, 2010 . . . Atlantis and Dubeau issued numerous false and misleading press releases that artificially inflated the trading volume and price of Atlantis’s stock,” the SEC charged. “Dubeau benefited financially from Atlantis’s artificially increased trading volume and stock price. In December 2009, he sold more than 60 million shares of Atlantis stock for proceeds of about $240,000, and in August 2009 he received $77,000 of the proceeds from an associate’s sale of more than 16 million shares.”

    A Marketwire news released dated March 26, 2010, and issued under the names of Atlantis and Dubeau accuses “bashers” of making “slanderous” remarks about the company online.

    “I can assure you I will not play the bashers’ games,” Dubeau was quoted as saying. “Atlantis has Launched an Investigation into these Individuals that are attacking the Company and its Associates. Atlantis has Identified at least 3 of these Participants in what we deem to be manipulation of the Company’s Stock price by making slanderous postings. We will seek every avenue available to bring these persons of interest to the forefront of the Judicial System.”

    Now, six months later, the SEC has accused Dubeau of operating a large-scale fraud by fabricating news about the company’s ability to offer online TV and video-phone services.

    “Atlantis’s press releases were false because Atlantis’s subsidiary has never offered
    Internet protocol television service or video phone services,” the SEC charged. “At the time the company and Dubeau issued these press releases, the subsidiary did not offer (and was not able to offer) either service, and it did not have relationships with television networks to offer content to Atlantis’s subscribers. In fact, until March 1, 2010, neither the subsidiary nor Atlantis had any product or service to offer to consumers.”

    Threats against critics who voice concerns about business opportunities online are common, as is the issuance of news releases to spread false information. In the alleged AdSurfDaily Ponzi scheme, for example, ASD President Andy Bowdoin threatened critics with lawsuits. ASD operated from Florida.

    An operation known as AdViewGlobal (AVG) that has close ASD ties and also operated at least in part from Florida also threatened critics. AVG even threatened its own members with lawsuits.

    Critics of Data Network Affiliates (DNA), a Florida company that purports to offer an MLM program that collects license-plate data to aid law enforcement and the AMBER Alert program rescue abducted children, also were threatened.

    DNA figure Phil Piccolo used an online radio program last month to threaten critics.

    Convicted Florida Ponzi schemer Scott Rothstein, who ran one of the largest scams in U.S. history, also threatened critics. Rothstein pleaded guility to racketeering.

    Read the SEC complaint against Atlantis and Dubeau of Fort Lauderdale and Weston, Fla.

  • ASA Monitor Ponzi And Criminals’ Forum Locks MPB Today Thread — Again; Naysayers Scolded By Mod For Challenging ‘Ken Russo’

    EDITOR’S NOTE: The ASA Monitor Ponzi forum now has reopened its thread on the MPB Today MLM program — with a warning in red to “Play nice . . .”

    UPDATED 9:54 A.M. EDT (U.S.A.) A forum infamous for promoting Ponzi schemes and other criminal pursuits has locked the thread from which the MPB Today 2×2 matrix cycler is being pitched.

    The official explanation for locking the thread was that naysayers challenging ASA Monitor member “Ken Russo” needed a “temporary cooling off period.” (See Editor’s Note above: The thread now has been unlocked.)

    “Ken Russo” is a reliable cheerleader for Ponzi schemes and highly questionable business pursuits on ASA Monitor and other forums. ASA Monitor’s name is referenced in a May criminal case filed against the alleged Pathway To Prosperity Ponzi scheme. Prosecutors said the scheme mushroomed globally, gathering about $70 million and defrauding more than 40,000 participants.

    A similar program known as Legisi gathered more than $70 million and also fleeced thousands of participants, according to the SEC. It, too, was promoted on the Ponzi forums. A court filing in the Legisi case specifically references the MoneyMakerGroup forum, another venue from which MPB Today is being promoted.

    This marks the second time the MPB Today thread has been locked at ASA Monitor. It was locked earlier this month and then reopened amid similar circumstances. ASA Monitor initially deleted several references to the PP Blog in the initial closure of the thread, but later restored them.

    One of the principal incongruities of the MPB Today program is that it is being targeted at people of faith from a known Ponzi forum. Because ASA Monitor members routinely promote Ponzi schemes, some of the funds being passed to MPB Today could be criminal proceeds from Ponzi and other fraud schemes.

    “Ken Russo,” for example, promoted the alleged Regenesis 2×2 Ponzi scheme. Like MPB Today, Regenesis used a 2×2 matrix cycler. The U.S. Secret Service executed search warrants in the Regenesis case in July 2009. The agency said in court filings that it had linked the scheme to a convicted felon.

    Spectacular international frauds have been promoted at ASA Monitor. Meanwhile, some of MPB Today’s own members have said there are liars and thieves in the organization, including liars and thieves who are using false information to recruit prospects. The claims have been made in public on YouTube. Incongruously, they have been positioned as reasons to join the program under specific uplines that purport to be honest.

    How MPB Today’s payments to members could be clean if it has come into possession of money tainted by the lies of its own pitchmen and money tainted by Ponzi schemes promoted on forums such as ASA Monitor is left to the imagination.

    Last week the PP Blog reported that a “news release’ that appeared online encouraged MPB Today prospects to sell $200 worth of Food Stamps to raise money to join the program. One of the URLs referenced in the release also was being promoted on ASA Monitor by “Ken Russo.” Other information suggests that promoters of the judicially declared CEP Ponzi scheme are promoting MPB Today.

    Some ASA Monitor members use a strategy of playing dumb to promote Ponzi schemes. One form of the strategy is to repeatedly accept at face value whatever a company says in sales literature — and then blame the company and dishonest affiliates if a scheme collapses or is taken down by law enforcement.

    Another form of the strategy is to include links to the sites of other promoters, apparently on the theory that favorable commentary about an “opportunity” demonstrates that no scam could be occurring. If the opportunity later proves to be a Ponzi or a fraud scheme, promoters who employ the play-dumb method point out that others got taken, perhaps through the actions of a fraudster who was particularly clever.

    Yet another form of the play-dumb method is to position an opportunity as a matter of free choice. Such wink-nod efforts are part of numerous Ponzi schemes.

    In February 2010, the Secret Service said in a search-warrant application in Minnesota that it believed a company known as INetGlobal was operating a Ponzi scheme. In court filings, the agency said an undercover agent was introduced to INetGlobal by a member of the alleged AdSurfDaily (ASD) Ponzi scheme, describing the introduction as a wink-nod deal.

    ASD, which was accused of operating a $100 million Ponzi scheme, also was promoted from websites and forums. Federal agents seized about $26 million in the INetGlobal case, which is still under investigation. Steve Renner, the operator of INetGlobal, is in federal prison for income tax-evasion in a case linked to his money-services business.

    Court records show Renner-related ties to at least four Ponzi schemes.

    Among the targets of promotions for MPB Today were victims of the alleged ASD Ponzi scheme, foreclosure subjects, the unemployed, Food Stamp recipients, senior citizens, college students and other vulnerable populations.

  • A CEP PONZI SCHEME TIE? MPB Today Member Says ‘Trevor Reed’ In His Organization; No Immediate Comment From USDA

    This promo lists the names of 20 purported MPB Today affiliates, including the name of "Trevor Reed." It is unclear if the "Trevor Reed" included on the list is the same Trevor Reed who operated the judicially declared CEP Ponzi scheme.

    UPDATED 1:03 P.M. EDT (U.S.A.) Two days ago the PP Blog reported that a Sept. 20 “news release” for MPB Today’s purported “grocery” program solicited financially strapped Americans to sell $200 worth of Food Stamps to raise cash to join the Florida-based MLM.

    The Blog further reported that a name referenced in the news release (as the author) appears on page 21 of a distribution plan by the court-appointed receiver in the judicially declared CEP Ponzi scheme. The person referenced in the document is scheduled to receive a distribution of $125, which is expected to be issued Sept. 30.

    Today the PP Blog is reporting that a separate MPB Today affiliate who referenced the federal Food Stamp program in a July sales pitch also informed prospects that a person by the name of “Trevor Reed” is in his MPB Today organization.

    It was not immediately clear if the “Trevor Reed” referenced in the MPB Today promo is the same Trevor Reed charged by the Securities and Exchange Commission in a complaint filed July 9, 2007. The complaint alleged that Reed was committing fraud and selling unregistered securities through a company known as CEP.

    A judge later declared CEP a Ponzi scheme. A judgment of more than $1.5 million was placed against Reed and others on Nov. 18, 2008, according to court records. The order was signed by U.S. Bankruptcy Court Judge James E. Massey.

    On Oct. 27, 2007, Trevor Reed invoked his 5th Amendment right against self-incrimination in the CEP case. In September 2008 — less than a year after Reed invoked the 5th Amendment — Andy Bowdoin, the alleged operator of the AdSurfDaily (ASD) Ponzi scheme, also took the 5th.

    Records show that ASD advertised that it accepted payments from a payment processor known as CEP Trust, which was linked to the CEP Ponzi scheme. ASD members are being targeted in sales promos for MPB Today.

    On Nov. 19, 2008, U.S. District Judge Rosemary Collyer ruled that ASD had not demonstrated it was a lawful business and not a Ponzi scheme, a ruling that dealt a crushing blow to ASD. Just one day earlier — on Nov. 18, 2008 — Massey entered the financial judgment against Reed and others in the CEP Ponzi case.

    Massey ruled CEP a Ponzi on May 22, 2008 — less than three months prior to the federal seizure of tens of millions of dollars in the ASD case. Court records show that CEP had invested money in at least 26 online opportunities, primarily autosurfs.

    “The [CEP] Websites were investment programs that promised cash returns exceeding the amounts paid into the programs,” Massey ruled. “Debtors did not, however, operate or own any underlying business or assets whose profits could fund the promised returns. Although Debtors did place a relatively small amount of money in similar ventures operated by others, the evidence shows they made no profit from those investments. Most importantly, Debtors paid investors with cash received from new investors.”

    The U.S. Department of Agriculture (USDA), which is conducting a “review” about claims made in the MPB Today program, had no immediate comment on potential links to the CEP Ponzi scheme.

    “Take a look at my stats just a few days in!” the MPB Today affiliate urged members in a July forum post. The post included names of 20 downline members, including the name “Trevor Reed.”

    “Trevor Reed’s” MPB Today ID was listed as 150532. It was unclear if “Trevor Reed” is actively promoting the MPB Today program.

    What is clear is that the affiliate pitch in which the name “Trevor Reed” was referenced as an MPB Today downline member also referenced the Food Stamp program.

    “Great opp,” the pitch reads in part. “Just opened affiliated with WAL MART and EBT FOOD STAMPS (GOVT. ACKNOWLEDGED!) TAKE THE TIME TO READ THIS EMAIL IT WILL CHANGE YOUR LIFE!”

    Walmart has not responded to a request from comment about the MPB Today program.

  • MPB TODAY SPONSOR ATTACKS FELLOW MEMBERS: Join My Group Because Other Uplines ‘Lying’ To Prospects; ‘People Are Gonna Try To BS You To Try To Get You To Join’

    At the 2:54 mark in this video that includes a guitar as a backdrop, an MPB Today sponsor informs prospects that the company includes uplines that lie to recruits to get them to join.

    An MPB Today sponsor is asserting in a YouTube video that his upline is honest — but that other uplines in the company consist of liars who are “gonna tell you whatever they think you’re gonna want to hear” in a bid to get you to join the Pensacola-based multilevel-marketing (MLM) program that purports to sell groceries.

    How any MPB Today payments to members could be considered untainted if the company collected money based on lies and misrepresentations by sponsors was not explained in the 4:26 video.

    “And you’re going to see so many videos here, telling you, ‘Join us, we have a large upline, large [upline],’” the video’s narrator intoned.

    “They’re lying to you,” he continued. “I know that ours is the second-largest upline in the company. Don’t be . . . People are gonna try to BS you to try to get you to join. They’re gonna tell you whatever they think you’re gonna want to hear.”

    MPB Today is being promoted on YouTube and other social-networking sites. It also is being promoted on known Ponzi scheme forums such as ASAMonitor, TalkGold and MoneyMakerGroup.

    It is believed that some of the promoters have ties to the judicially declared CEP Ponzi scheme, the alleged AdSurfDaily Ponzi scheme, the alleged Pathway To Prosperity Ponzi scheme, the alleged Regenesis2x2 Ponzi scheme and other Ponzi and pyramid schemes.

    Ponzi ties are potentially catastrophic to MPB Today because promoters could be using criminal proceeds from other schemes to join the company. A public claim by a promoter that the company has upline sponsors who lie to members also is potentially catastrophic because it could be construed as an acknowledgment that the company is coming into possession of money based on falsehoods told by its own members.

    Meanwhile, some MPB Today members have posted purported “proof” videos that the company is legitimate. Some of the videos show images of checks drawn on a Florida bank that is operating under an FDIC consent agreement.

    At least one video shows an MPB Today member cashing a check from the MLM at an FDIC-insured bank while audiotaping the bank teller’s voice. Research suggests the affiliate’s account is at a bank in Utah.

    Federal officials have said that Utah is plagued by Ponzi schemes, including schemes targeted at people of faith.

    If MPB Today has come into possession of money from Ponzi schemes and is gathering money based on the lies of its members — and if affiliates are cashing or depositing MPB Today checks at banks across the United States — it means that banks external to MPB Today’s bank may be in possession of tainted money.

    The U.S. Department of Agriculture is conducting a “review” of claims about the MPB Today program. In July 2009, the U.S. Secret Service, which opened a probe into ASD’s business practices a year earlier, said it also was investigating a 2×2 cycler program known as Regenesis2x2.

    MPB Today also operates a 2×2 cycler. It is known that at least one MPBToday affiliate also promoted Regenesis2x2.

  • FBI Says It Has Opened 291 New HYIP Cases And Has 780 Pending Cases Of High-Yield Fraud; Many Have ‘International Nexus,’ Agency Notes

    FILE: Kevin Perkins appears before the Senate Judiciary Committee in 2009. He appeared again today.

    How confident are you that the HYIP you’re flogging on the Ponzi boards isn’t already under investigation by any of a number of state or federal agencies?

    Court records show that the alleged Legisi HYIP Ponzi scheme (about $70 million) was under investigation by state and federal law-enforcement agencies even as promoters were pitching it. The same is true of the alleged AdSurfDaily (ASD) Ponzi scheme (about $100 million).

    In Congressional testimony today, Kevin L. Perkins, assistant director of the FBI’s Criminal Investigative Division, said the agency has opened 291 “new” HYIP case this fiscal year and has 780 pending cases of high-yield fraud.

    “Many of the Ponzi scheme investigations have an international nexus and have affected thousands of victims,” Perkins told the Senate Judiciary Committee.

    In February 2009, members of the alleged ASD scheme bizarrely asked the very same committee to investigate the prosecutors investigating the scheme — not ASD President Andy Bowdoin, the alleged schemer.

    By September 2009, Bowdoin was telling members the $65.8 million the government seized from his 10 personal bank accounts belonged to them — a position that contradicted his own court filings.

    Bowdoin told U.S. District Judge Rosemary Collyer the money belonged to him. The judge later ordered the money forfeited to the government, which is establishing a restitution fund. Bowdoin appealed.

  • Pensacola Fraudsters Sentenced To Federal Prison; Pinnacle Quest International Vendors Sold ‘Tax And Credit Card Debt Elimination Scams,’ Federal Prosecutors, IRS Say

    “They helped form a series of sham business entities and then promoted fraudulent debt elimination tactics intended for the sole purpose of concealing income from the IRS.” — Victor S. O. Song, chief, IRS Criminal Investigation

    As the U.S. Department of Agriculture was conducting a “review” of claims made by affiliates of a purported “grocery” business in Pensacola, Fla., that dispenses “gift cards” to winners in a 2×2 matrix cycler, a federal judge in Pensacola was handing out prison sentences to defendants convicted in a tax-fraud and debt-elimination scheme.

    All in all, nine promoters were implicated in the Pinnacle Quest International (PQI) case. Four were sentenced to prison in July. Two others will be sentenced in October, and three were sentenced yesterday for their roles in an elaborate fraud in which PQI served as an “umbrella organization for numerous vendors of tax and credit card debt elimination scams,” federal prosecutors said.

    Eugene Casternovia received 7 years in prison. Arthur Merino, meanwhile, was sentenced to 40 months. Mark Lyon, the third defendant sentenced yesterday, cooperated with prosecutors and received a sentence of 18 months.

    Among the PQI vendors was the Southern Oregon Resource Center for Education (SORCE), which “sold bogus theories and strategies for tax evasion,” prosecutors said.

    “For fees starting at $10,000, SORCE assisted its customers in the creation of a series of sham business entities in the United States and Panama,” prosecutors said. “Other tax-related PQI vendors denied the legitimacy of the income tax system on various theories and provided customers with a ‘reliance defense’ that consisted of a paper trail of frivolous correspondence which a client could allegedly use as evidence of good faith if the client were prosecuted.”

    Financial Solutions, another PQI vendor, sold “fraudulent schemes for eliminating credit card debt,” prosecutors said.

    “Financial Solutions charged its customers thousands of dollars for a series of letters to send to credit card companies disputing the lawfulness of the underlying debt,” prosecutors said. “The product was wholly ineffective, and customers typically were sued by their creditors and often forced into bankruptcy.”

    At the same time, yet-another PQI vendor known as MYICIS “operated as a sophisticated, computerized ‘warehouse bank,’” prosecutors said.

    “MYICIS was a single bank account in which customers pooled their money,” prosecutors said. “MYICIS was promoted to PQI’s clients as a method to hide their assets from the IRS as a result of the pooled nature of the account. MYICIS had 3,000 clients and approximately $100 million in deposits over a three year period.”

    A veteran IRS agent declared the business entities tied to the PQI case a “sham.”

    “These defendants are now being held accountable for their criminal behavior,” said Victor S. O. Song, chief, IRS Criminal Investigation. “They helped form a series of sham business entities and then promoted fraudulent debt elimination tactics intended for the sole purpose of concealing income from the IRS. Their tactics were fraudulent. There is no secret formula that can eliminate an individual’s tax obligation.”

    In July, Arnold Ray Manansala was sentenced to 12 years in prison; Dover Eugene Perry, meanwhile, was sentenced to 10 years. Michael Guy Leonard was sentenced to nine years and one month, and Mark Daniel Leitner was sentenced to five years.

    The trial in Pensacola took up a full month. Wayne Hicks, the operator of My Icis Inc., already was serving a five-year prison sentence.

    FBI Director Robert Mueller has warned Congress at least twice this year about a “shadow” banking system that is a threat to U.S. national security.

    In November, President Obama formed the Financial Fraud Enforcement Task Force to attack the problem with white-collar and other forms of fraud. It is billed the “broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.”

    MYICIS was a topic of discussion on known Ponzi scheme and fraud forums such as TalkGold. In May, the U.S. Postal Inspection Service referenced the forums in filings in a criminal case against an alleged Ponzi scheme known as Pathway To Prosperity.

    In recent months, a Pensacola business known as MPB Today (My Premier Business Today) has been operating an MLM program that purports to sell “groceries.” The program has been advertised on TalkGold, and other known Ponzi forums.

    One MPB Today affiliate attempted to sell the program by creating a video animation and depicting President Obama and Secretary of State Hillary Clinton as Nazis. Clinton was called “Hitlary” in the promo.

    Others have attempted to sell the MPB Today business “opportunity” by linking it to the federal Food Stamp program administered by the Department of Agriculture. The USDA announced earlier this month that it was conducting a “review” of affiliate claims.

    This video promo for Pensacola-based MPB Today is targeted at Food Stamp recipients.

    Still other MPB Today affiliates have focused on recruiting prospects by telling them they’d receive “gift cards” from Walmart. At least one promo on YouTube shows an envelope inside an envelope that had been mailed through the U.S. Postal Service.

    Such an approach is consistent with the practices of “cash-gifters” — people who use the mails to promote chain-letter pyramid and tax schemes. The inside envelope in the YouTube video showed that at least one MPB Today affiliate had been paid with a prepaid Visa card purchased at Walmart. The envelope also contained a Walmart gift card.

    In the YouTube video, the MPB Today affiliate appeared to be surprised about what he’d just received in the mail.

    One promo after another for MPB Today has emphasized the gift cards. Still other affiliates have produced videos that show checks drawn on an FDIC-insured bank in Pensacola that has been operating since January under a consent agreement with the FDIC.

    Florida has been plagued by mortgage foreclosures. MPB Today is targeting foreclosure subjects in a video pitch, as are many affiliates. Affiliates also have targeted the unemployed, senior citizens, people of faith and members of the alleged AdSurfDaily (ASD) Ponzi scheme.

    ASD also was based in Florida. The company is known to have attracted affiliates who participated in tax, debt-elimination and cash-gifting schemes. At least one ASD affiliate has been linked to a group that sought to imprison federal judges and litigation opponents in debt cases. Another affiliate filed papers in federal court that purported to show that a bank could be defeated in a foreclosure case by filing a bond consisting of $21 in “silver coinage.”

    At least one MPB Today promoter positioned the grocery company as an opportunity for religious members of ASD to make up losses in the failed autosurf. The U.S. Secret Service has seized tens of millions of dollars from bank accounts linked to ASD.

    Florida records show that MPB and its associated grocery company — Southeastern Delivery — have operated by at least five names since 2006. MPB Today operator Gary Calhoun was ordered by the U.S. Food and Drug Administration to stop violating federal law in promotions for a product marketed as a treatment for Lou Gehrig’s disease, among others.

    ASD President Andy Bowdoin also operated numerous companies in Florida. according to records.