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Tag: AVG

  • REVISITING ADVIEWGLOBAL AND ‘ONEX’: Why Promoters Of Better-Living Global Marketing, Zeek Rewards, TelexFree And Profitable Sunrise Should Care About Scam History

    EDITOR’S NOTE: The PP Blog is back — after its most recent brush with death led to a suspension of publishing that lasted through all or parts of six days. You’ll read more in the days ahead about certain changes the Blog plans to implement to safeguard its right to publish, to improve revenue, to make it less reliant on a small group of dedicated readers to put out fires and to keep its archives open to the people who can benefit most.

    As for the editorial below: Some of it is based on “Government Exhibit G” and other government exhibits in the criminal prosecution of AdSurfDaily Ponzi schemer Andy Bowdoin. Exhibit G was filed on Aug. 13, 2012, four days before the SEC went to federal court in Charlotte, N.C., and alleged that the Zeek Rewards MLM “program” was a $600 million Ponzi- and pyramid fraud that had victimized hundreds of thousands of participants. Among other things, Exhibit G addressed Bowdoin’s participation as a silent partner in the AdViewGlobal reload scam. Another court document filed by prosecutors on the same day addressed Bowdoin’s participation in OneX, which prosecutors described as yet-another MLM-style scam in which Bowdoin had participated after the U.S. Secret Service moved against ASD in August 2008 and eventually seized more than $80 million.

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    The evidence sticker from "Government Exhibit G" in the criminal prosecution of AdSurfDaily Ponzi schemer Andy Bowdoin. (Red bar added by PP Blog.)
    The evidence sticker from “Government Exhibit G” in the criminal prosecution of AdSurfDaily Ponzi schemer Andy Bowdoin. (Red bar added by PP Blog.)

    Let’s talk about pollution and how it may be flowing to a bank near you:

    AdSurfDaily Ponzi schemer Andy Bowdoin used a secret hushmail address in 2009 to discuss a bank wire for $38,750 that was to be sent to an account at Regions Bank in Fort Lauderdale, Fla., to pay for servers and programming required by AdViewGlobal.

    AVG, as it was known, was an ASD reload scam that began to unfold in October 2008, just two months after the U.S. Secret Service began the process of seizing more than $65.8 million from at least 10 Bank of America accounts linked to ASD, according to government records.

    The Secret Service, according to court filings, also had its eyes on separate Bank of America accounts linked to an ASD-connected enterprise known as Golden Panda Ad Builder. Golden Panda was operated by Rev. Walter Clarence Busby Jr., a Bowdoin business partner and Georgia grifter implicated by the SEC 11 years earlier in three prime-bank swindles, including one that promised to pay interest of 10,000 percent. Some of the Golden Panda money also made its way into Bartow County Bank, a small Georgia bank that later failed, costing the Federal Deposit Insurance Corp. an estimated $70 million, according to government records.

    From this fact set, one can plainly see that ASD and related scams had caused polluted money to flow to Bank of America and Bartow — and that the noxious and ever-evolving ASD enterprise now had its sights on causing polluted money to flow to Regions. That’s three banks put in harm’s way by what effectively was an evolving ASD criminal enterprise.

    There were more.

    At least $413,018 in ASD-infected funds also had made their way into accounts at First National Bank in Ames, Iowa. Another $96,525 in polluted proceeds flowed to two accounts at Wachovia Bank. (The U.S. state in which Wachovia was used to stockpile $96,525 in fraudulent proceeds directed at an ASD member is unclear. What is clear, according to federal court filings, is that the ASD member allegedly was using ASD to promote a “multi-level marketing site that listed classified job postings” and that 17 checks from ASD were deposited into the Wachovia account on a single, fateful day.)

    That day was July 31, 2008.

    History shows that the Secret Service moved against ASD the very next day, Aug. 1, 2008, as a means of stopping the ASD Ponzi monster from sucking in any more cash and from polluting any more banks. The ASD member with the Wachovia accounts had “sponsored 6-8 people to get into the ASD system,” and somehow had managed to receive nearly $100,000 in tainted proceeds after paying ASD only $500 and working as a “consultant” to ASD “for a brief period,” according to court records.

    Because ASD used infected proceeds to pay members with accounts at banks across the U.S. spectrum of hundreds of institutions, each of those institutions became places at which wire-fraud proceeds were deposited. The total flow of fraudulent proceeds linked to Bowdoin and follow-up scams exceeded $120 million, according to federal court files.

    But it gets worse . . .

    At Least 2 Swiss Accounts Discussed In Exchanges Over Hushmail And Gmail

    Why not infect Europe with American Ponzi proceeds?

    This is the clincher, the one event that — in the context of other ASD-related events — shows the rampant criminality within the ASD enterprise and this particular wing of MLM. This criminality caused federal prosecutors to describe Bowdoin as a man who roped in at least 96,000 people in part by asserting that his “programs” reflected “God’s will.”

    Bowdoin, prosecutors said, indeed was the personification of a con man and affinity fraudster who “boldly continued or expanded his criminal conduct” even after the Secret Service raid in August 2008.

    Just two months later, in October 2008, Bowdoin and a former ASD insider held discussions aimed at launching AVG, the ASD reload scam that allegedly sucked in millions of dollars — in part by targeting ASD members all over again. The sources for this information are a government sentencing memo and  “Government Exhibit F,” filed on Aug. 13, 2012, four days before the SEC’s Zeek action and confirmation by the Secret Service that it also was investigating Zeek.

    Exhibit F is styled “Summary of AdView Global by T. Andy Bowdoin, Jr.” Precisely when and how the government obtained the document is unclear, but prosecutors say Bowdoin drafted it in “memo” form. Agents are known to have seized ASD-related computers. It also is believed that the government seized at least one AVG-related computer.

    The undated document features a narrative in which Bowdoin, despite the Secret Service raid of ASD and ongoing civil and criminal investigations, suggests he was still sticking to a cover story that ASD was an “advertising” company, not an investment company offering securities that paid a preposterous interest rate of 1 percent a day while magically constituting neither a Ponzi scheme nor an investment firm. In fact, according to the document, AVG hoped to ward off the U.S. government by establishing some sort of presence in Uruguay.

    Another part of the AVG launch plan was to attract “30 founders” in December 2008. In the Exhibit F document, Bowdoin also planted the seed that the nascent AVG MLM program had been vetted by “attorneys.”

    These unidentified “attorneys” purportedly had advised Bowdoin that prosecutors would not be interested in establishing whether the AVG upstart “was OK,” even if Bowdoin submitted an AVG business plan, according to Exhibit F. Bowdoin then moved forward with AVG, despite all that had happened at ASD. Both before and after the ASD debacle, according to assertions by prosecutors, Bowdoin claimed he had acted “on the advice of counsel” and therefore had done nothing wrong.

    “Bowdoin’s reliance on the ‘advice of counsel’ defense became a theme in both the civil and criminal litigation,” prosecutors advised a federal judge.

    It was a defense that failed miserably, as various entries on the public record show. And when Bowdoin got in trouble again — this time for promoting an alleged pyramid scheme known as “OneX” while out on signature bond in the ASD criminal case even as he asserted the OneX “program” had been vetted by attorneys and passed muster and that recruits could earn to the limits of their imaginations — Bowdoin again defaulted to an advice-of-counsel defense.

    This time, however, Bowdoin appears to have merely repeated false assertions that he’d heard from OneX or someone within OneX. The government responded by producing an affidavit from an attorney who’d performed work for OneX but never had drawn a conclusion the “program” was lawful and had never examined the actual business practices of OneX. The attorney swore in an affidavit filed under pain of perjury that the law firm through which he represented MLM clients “has never represented” Bowdoin. (The PP Blog is declining to identify the attorney, a partner in a Southern California law firm.)

    Back to AVG, the scheme Bowdoin helped launch before later trying to sanitize the alleged OneX pyramid scheme by claiming it had been scrubbed clean by attorneys: Bowdoin was to own two-thirds of AVG; the former ASD insider would own the remaining third, according to Exhibit F.

    Among other things, the document shows some of the fractured thinking and incongruities so often associated with HYIP scams. Despite the purported need for an offshore presence to ward off U.S. investigators, for instance, the document asserts that Gary D. Talbert, identified elsewhere as an ASD insider and one-time executive, had hired AVG “customer service people in the U.S.” (Bolding added by PP Blog.)

    Web records show that AVG had come out of the gate with two impossible (if not insane) propositions: The first was that AVG was just like the NBC television network, an absurdity on its face in that NBC doesn’t pay its advertisers to watch ads. Moreover, NBC, unlike the collapsed AVG, doesn’t operate a closed network in which only NBC’s advertisers and not the public at large can view ads. Nor does NBC try to recruit advertisers by telling them they’ll receive a dividend of 125 percent (or more) on their ad spend within a few months and that its advertisers can earn downline commissions two levels deep by recruiting competitors to advertise on NBC’s closed network.

    The second proposition was even more absurd: that AVG had nothing to do with ASD. The absurdity of this obvious lie was exposed before January 2009 even had ticked off the calendar. Indeed, after earlier asserting that AVG had no ties to ASD, the company — using a U.S.-based AVG customer-service rep who’d actually testified on ASD’s behalf in federal court —  announced that ASD’s Talbert was its CEO. If this weren’t absurd enough, AVG insisted through the former ASD member now working as a AVG spokesman that the appearance of AVG graphics in an ASD-controlled webroom was an “operational coincidence.”

    AVG went on to pile on the absurdities, according to court filings. In Exhibit F, the document prosecutors say was Bowdoin’s draft memo of his AVG reflections, members of Bowdoin’s family who allegedly benefited from ASD Ponzi proceeds are described as heroes who tried to save AVG from the thieves.

    With ASD’s Bowdoin’s knowledge, Talbert, according to Exhibit F, also purchased an Arizona “company named TMS” that owned a payment processor named “eWallet.” (Other records strongly suggest that the payment processor actually was named “eWalletPlus” and was operating from servers AVG was using in Panama.)

    “TMS used a bank in the Caribbean,” according to the document. The signatory on the Caribbean account somehow never was changed after the asserted change in ownership at TMS, and two former TMS associates allegedly stole nearly $2.7 million from AVG. The theft of nearly $3 million led to the collapse of AVG, according to the telling attributed to Bowdoin in the document.

    To date, the PP Blog has been unable to ascertain the truthfulness of the assertions about the thefts allegedly committed by the alleged former TMS insiders.

    What is clear, however, is that as much ASD money that could be found in August 2008 was seized. AVG then launched with cash that hadn’t been seized, and in part was targeted at ASD members.  AVG members then were left holding the bag, with the blame placed on former TMS associates.

    And something else is clear, which brings us to “Government Exhibit G”: AVG, the follow-up scam to ASD that involved Bowdoin and ASD insiders and alleged thefts of millions of dollars by outsiders, had at least two Swiss bank accounts.

    bowdoinhmail
    One of AVG’s Swiss bank accounts allegedly was discussed in this email between Andy Bowdoin and Gary Talbert. Bowdoin was ASD’s operator; Talbert was an ASD insider who allegedly became Bowdoin’s business partner in the AVG Ponzi scheme that sucked away millions of dollars. (Red lines inserted by PP Blog.)

    On Jan. 28, 2009, just days before AVG’s scheduled launch date in early February and less than six months after the Secret Service raid on ASD’s headquarters and Bowdoin’s home in Quincy, Fla., Gary Talbert used a Gmail address to email Andy Bowdoin at a hushmail address, according to Exhibit G.

    Talbert advised Bowdoin that an individual — presumptively one of the 30 AVG founders — had conducted a “Wire Transfer to AVG Swiss Bank Account” and needed assurances that it had posted. The inquiry about the asserted wire transfer appears to have been initiated by another AVG insider who’d emailed Talbert from his Gmail address to Talbert’s Gmail address. Through Gmail, Talbert then checked with Bowdoin at Bowdoin’s hushmail address, instructing the ASD patriarch that someone wanted to “verify that a bank wire hit the Swiss bank account.”

    Upon verification, the customer would make “another large wire,” Exhibit G suggests.

    Another email within the January 2009 chain says that AVG had at least two Swiss accounts.

    What It Means

    Walking this back and assuming the Exhibit G communications were truthful, what it means is that the ASD enterprise — this time in the form of AVG — had set up a banking operation in Switzerland, a secrecy haven. At the same time, it means that the ASD enterprise did this after it earlier had polluted U.S. banks in multiple states with fraudulent proceeds and now was taking its act not only to Switzerland, but also to South America, Central America and the Caribbean.

    Less clear is whether ASD had a preexisting banking network in Switzerland before effectively morphing into AVG. Regardless of when the Swiss accounts were opened, however, the mere presence of them suggests that ASD and AVG insiders had the means to move fraudulent proceeds from U.S.-based crimes offshore and perhaps tap into them later.

    And this brings us to Zeek Rewards, which also used domestic and offshore facilitators and the same fundamental business model of ASD and AVG. It also brings us to Profitable Sunrise and other MLM “programs” such as Better-Living Global Marketing. The now-disappeared Profitable Sunrise scheme allegedly used U.S. bank wires and offshore facilitators to drive tens of millions of dollars to the scheme. BLGM, still active, clearly has U.S. promoters and facilitators while purportedly operating from Hong Kong.

    Meanwhile, BLGM, like ASD, AVG, Profitable Sunrise and Zeek Rewards, has Stepfordian “defenders” running interference online.

    One of those “defenders” is over at the BehindMLM.com antiscam Blog asserting that he “met a guy online. I know him well now. I deposited $6500 into his Bank Of America account at my local branch.”

    Another BLGM defender is at BehindMLM.com asserting that (italics added):

    Got my Hongkong wire/remittance of 6,000 USD at Bank of America, have all my questions and concerns answered by Luke Teng, the teleconference helped a lot, disregard all the unnecessary comments of non-members.

    Get all your transparent answers from Luke Teng, or else you will die of stress reading all the negative comments of people who are not engaging, and guys remember this is our freewill and our own money, our decision, our own risk.

    TelexFree, a scheme more or less operating globally that has U.S. footprints in Massachusetts and Nevada and is under investigation in Brazil, also used Bank of America, according to members. Some TelexFree promoters instructed recruits to walk deposits meant for TelexFree into a Bank of American branch in Massachusetts or TD Bank locations elsewhere. TD Bank, of course, was the bank of Florida Ponzi schemer and racketeer Scott Rothstein. Four years after Rothstein’s $1 billion-plus scam brought great shame to the banking community, it’s still causing ripples.

    The PP Blog previously reported that a former Zeeker who also was associated with Profitable Sunrise — an alleged international pyramid scheme that funneled tens of millions of dollars to Europe, China and Panama amid the murkiest of circumstances — also was pushing BLGM.

    All of these “programs” are operating or have operated within the MLM sphere, the same sphere that produced the incredibly toxic ASD/AVG Ponzi schemes. All of the “programs” either have or had access to the wire facilities of various nations around the globe while using Ponzi- and pyramid schemes as their business model.

    The Piggybackers

    Various destructive forces are piggybacking on the scams, including attack bots and spambots that are keying on the names of HYIP enterprises and HYIP story figures to promote other scams or to drive traffic to other highly questionable “opportunities.”

    Even after the PP Blog announced the temporary suspension of the publication of new stories last week, it continued to be targeted by resources-draining bots. One wave knocked the Blog offline for about an hour two days ago. During the involuntary outage, legitimate readers and researchers  could not access the Blog.

    One of the spammers left the signature of an IP associated with the country of Indonesia. A spam bid from the specific IP keyed on a PP Blog story about ASD figure and purported “sovereign citizen” Kenneth Wayne Leaming, now in federal prison for targeting U.S. federal officials and a Secret Service agent in an abuse campaign, harboring fugitives and possessing firearms as a convicted felon. Records in Washington state show that a Leaming-connected enterprise once traded on the name of JPMorgan, a famous banking concern. (“Sovereign citizens” are becoming increasingly infamous for harassing banks.)

    Another spammer — one that left an IP signature from Belarus — also targeted a Leaming story thread at the PP Blog.

    In recent weeks, the Blog has recorded data that plainly show that  botnets, spambots or human spammers are circling antiscam sites and attempting to execute command strings that — if enough volume is applied — can cause databases to malfunction or even cause the sites to go offline.

    This creates an atmosphere that affects the publishing of information not only on current scams, but also on emerging scams and scams of the past. The downstream effects are potentially ruinous — and yet it continues.

    ASD and AVG were discredited long ago. But scams that use their core business model not only are launching, but in some cases thriving. Serial promoters are racing from one fraud scheme to the next. This sets the stage for schemes to fill up the world’s largest sports stadiums eight or 10 times over with victims. In 2008, ASD could have filled the Rose Bowl to capacity with victims one time. By 2012, Zeek could have filled the Rose Bowl with victims 10 times.

    The “defenses” for these various schemes range from the bizarre to the utterly mindless — and they absolutely must be decimated with the full, combined weight of the various world governments.

    It is in the interest of the worldwide public to connect the dots of these schemes and to eradicate them through the maximum application of the force of law. Left unchecked, they will erode the very foundations of freedom and permit the criminal underworld of MLM to thrive.

    NOTE: Our thanks to the ASDUpdates Blog.

     

  • TelexFree, MLM Firm That Is Subject Of Pyramid Probe, Says It Will Offer ‘At Sea’ Event

    Source: TelexFree website, Aug. 16. 2013.
    Source: TelexFree website, Aug. 16, 2013.

    TelexFree, an MLM “opportunity” under investigation in Brazil amid allegations it is orchestrating a massive pyramid scheme, says on its website that it is conducting an “at sea” event Dec. 15-18.

    Perhaps accidentally providing an awkward hint of dire portent, the promo shows the TelexFree logo superimposed on the side of a luxury ocean liner that is nearly beached in the tropics. Even more incongruously, it is being published not only against the backdrop of the pyramid probe, but also against reports that a judge and prosecutor in Brazil have received death threats related to the investigation.

    Promoters of MLM HYIP scams such as JSSTripler/JustBeenPaid (2 percent a day) and AdViewGlobal (1 percent a day) previously have advertised sea cruises. It is unclear if the JSS/JBP cruise ever came off.

    AVG’s 2009 cruise coincided with a bid (apparently unsuccessful) by the “program” to line up another bank and wire facilitator to assist in the swindling of investors who’d previously been swindled in AdSurfDaily’s $119 million Ponzi scheme that advertised a 1-percent-a-day payout.

    AdViewGlobal, which purported to operate from Uruguay, bizarrely announced its new scam on the same day the President of the United States announced a crackdown on offshore fraud. Federal prosecutors later said they’d tied AVG to ASD President Andy Bowdoin.

    Some TelexFree promoters say a payment of $15,125 to the program results in a profit of at least $1,100 a week for a year. Other promoters claim they’re “100% telexfree,” which apparently means they’ll stand by their “program” no matter what.

     

  • REPORT: TelexFree Has No License To Offer VOIP Services In Brazil; Claim Reminiscent Of U.S. Government Assertion Against AdSurfDaily Ponzi Schemer Last Year

    telexfreelogoUPDATED 12:29 P.M. EDT (U.S.A.) TelexFree, which operates through Ympactus Comercial Ltd. and is under investigation amid allegations in Brazil it is running a massive pyramid scheme, has no license with Brazil’s telecommunications regulator to offer VOIP services, according to this report in Brazilian media. The regulatory agency is known as Anatel.

    Here is a translation from Portuguese to English by Google Translate.

    Although the degree to which Anatel regulates VOIP providers in Brazil was not immediately clear, the assertion was reminiscent of one the U.S. government made against AdSurfDaily Ponzi schemer Andy Bowdoin last year: that Bowdoin, now in federal prison for ASD’s $119 million fraud,  earlier had sold contracts for a telecommunications company that wasn’t licensed by the U.S. Federal Communications Commission.

    TelexFree denies it falls under Anatel’s regulatory framework.

    Bowdoin, 78, pleaded guilty to wire fraud in the ASD case in May 2012, less than a month after the U.S. government made the assertions that he’d ignored FCC regulations in a pre-ASD securities scam in Alabama in the 1990s. Prosecutors also linked Bowdoin to the AdViewGlobal HYIP scam and a purported venture known as OneX that allegedly recycled money in ASD-like fashion.

    ASD, an MLM company, promised to pay members 1 percent a day. A grand jury charged Bowdoin with selling unregistered securities as investment contracts, securities fraud and wire fraud. He was arrested in December 2010.

    Like ASD, TelexFree is an MLM company. Some TelexFree promoters claim a payment of $15,125 to the firm for the purchase of a “contract” fetches a profit of more than $42,000 in a year.

    There have been reports of death threats against a judge and prosecutor involved in the TelexFree case in Brazil.

    AdViewGlobal and OneX also were MLM companies. In 2011, Bowdoin claimed he was pushing OneX to pay for his criminal defense in the ASD Ponzi case. Prosecutors described OneX as a pyramid scheme.

    A judge banned Bowdoin from MLM in 2012. The same judge earlier had been targeted with false liens by Kenneth Wayne Leaming, a purported “sovereign citizen” who allegedly was performing legal work for certain ASD members while harboring two federal fugitives from Arkansas wanted in a separate home-business caper.

    Leaming, 57, was arrested by an FBI terrorism Task Force in 2011. He was convicted of the charges in March 2013 and was sentenced to eight years in federal prison.

     

  • Notes/Analysis On TelexFree: A Little Like AdSurfDaily/AdViewGlobal, TextCashNetwork, Zeek Rewards, Profitable Sunrise And World Marketing Direct Selling

    TelexFree affiliates have shared a photo of James M. Merrill posing in front of an office building in Massachusetts. The photo, however, is not proof of TelexFree's legitimacy and raises questions about whether the company was trying to plant the seed it had a massive physical presence in the United States.
    TelexFree affiliates have shared a photo of President James M. Merrill posing in front of an office building in Massachusetts. The photo, however, is not proof of TelexFree’s legitimacy and raises questions about whether the company was trying to plant the seed it had a massive physical presence in the United States.

    UPDATED 10:22 P.M. EDT (U.S.A.) The purported TelexFree “opportunity” is under investigation by multiple agencies in Brazil, its purported base of operations despite competing claims the company is headquartered in the United States.  The notes below concern TelexFree’s U.S. presence and positioning. They are presented in no particular order of importance. TelexFree says it is in the communications business.

    TelexFree has a footprint in Massachusetts at 225 Cedar Hill Street, Suite 200, Marlborough. It is a shared office facility. Ads for the building suggest a conference room with video capabilities can be rented by the hour. One suggested use of the room is for attorneys to rent it to conduct depositions. Some attorneys practicing in the state and federal courts use the building as a business address.

    Other lessees include the Massachusetts Library System (MLS), which describes itself as “state-supported collaborative” to foster “cooperation, communication, innovation, and sharing among member libraries of all types.” MLS uses Suite 229, according to its website.

    TelexFree operates as an MLM. One of the problems in the MLM sphere is that purported “opportunities” and their promoters have been known to dupe participants by leasing virtual office space to create the illusion of scale or of a massive physical presence.  Such was the case with a Florida entity associated with AdViewGlobal, an AdSurfDaily knockoff scam that purported to pay 1 percent a day. As the PP Blog reported on May 31, 2009 (italics added):

    Research suggests a company with which AVG has a close association is headquartered in a modern office building in the United States. The building was constructed in 2003. Office functions and conferencing can be rented by the hour. Two large airports are nearby, and a major Interstate highway is situated one mile from the building.

    It is a virtual certainty that AVG, which purported to operate from Uruguay, actually was operating from the U.S. states of Florida and Arizona and using a series of business entities to launder the proceeds of its fraud scheme. AVG disappeared mysteriously in June 2009.

    On Dec. 14, 2011, the PP Blog reported that Text Cash Network (TCN) — another purported MLM “opportunity” — was using a virtual office in Boca Raton, Fla., in a bid to create the illusion of scale. TCN promoters published photos of a glistening building with TCN’s name affixed near the crown of the building. The Boca Raton Police Department, however, said the firm’s name did not appear on the building.

    Although the PP Blog is unaware of any bids to Photoshop TelexFree’s name on a large office building, affiliates have shared photos of TelexFree President James M. Merrill posing in front of the large Massachusetts building. So there can be no confusion, TelexFree does not own the building. TelexFree affiliates/prospects should not rely on the photo of the building as proof of the legitimacy of the company. The photo itself raises questions about whether Merrill and TelexFree were trying to create the illusion of scale. Even though the answer could be no, the negative inferences that can be drawn from the photo contribute to MLM’s reputation for serial disingenuousness.

    TelexFree also has a presence in the state of Nevada. Records show that an entity known as TelexFree LLC is listed as “Domestic Limited-Liability Company” situated in Las Vegas. Listed managers include Carlos N. Wanzeler, Carlos Costa and James M. Merrill. TelexFree operates in Massachusetts with an “Inc.” version of the name — i.e., TelexFree Inc., having undergone a name change in February 2012 from Common Cents Communications Inc. In Massachusetts, James Merrill is listed as the registered agent, president, secretary and director of the firm, with Carlos Wanzeler listed as treasuer and director. Unlike the Nevada “LLC” version of TelexFree, Carlos Costa appears not to hold a title in the Massachusetts “Inc.” entity.

    The footprints in the United States are important in the sense that they establish a business presence in the country should TelexFree become the subject of U.S. investigations akin to what is happening now in Brazil, where pyramid-scheme and securities concerns have been raised. Along those lines, records of the Financial Industry Regulatory Authority (FINRA) appear not to list TelexFree — despite the fact affiliates in the United States have claimed members acquire “stock” from TelexFree that can be sold through TelexFree and that affiliates purchase “contracts” from TelexFree.

    One YouTube video viewed by the PP Blog shows a TelexFree affiliate purportedly cashing out his stock through his TelexFree back office. The affiliate appears to be speaking in U.S. English, citing the date as March 19, 2013. In the video, the affiliate describes his pitch as a “quick withdrawal video” — i.e., proof that TelexFree is legitimate because it pays.

    “OK,” the narrator intones. “I’m going to sell all my stock.” The video shows a tab labeled “Stock” and a subtab styled “Repurchase” in the back office.

    The narrator then clicks on a series of graphics styled “REPURCHASE” and tells the audience that he wants to show it all the “stock that I have that converts to actual money.” He then proceeds to a “Withdraw” subtab under a “Statement” tab. These actions eventually expose a screen that shows an “AVAILABLE BALANCE” of $927.61 for withdrawal.

    For a brief moment, the acronym “BT&T” flashes on the screen, suggesting the TelexFree affiliate is seeking to have his earnings from stock sales relayed through North Carolina-based Branch Banking & Trust. The interesting thing about that is that the alleged $600 million Zeek Rewards Ponzi- and pyramid scheme claimed it had a banking relationship with BB&T.

    In May 2012 — on Memorial Day — Zeek mysteriously announced it was ending its relationship with BB&T. It was unclear from the TelexFree affiliate’s video whether he was a BB&T customer or whether TelexFree was. What is clear is that the SEC moved against Zeek in August 2012, accusing the company of securities fraud and selling unregistered securities as investment contracts. The U.S. Secret Service said it also was investigating Zeek.

    In this TelexFree promo running on YouTube, the acronym BB&T flashes on the screen in a TelexFree affiliate's back office.
    In this TelexFree promo running on YouTube, the acronym BB&T flashes on the screen in a TelexFree affiliate’s back office.

    Among the problems with HYIP schemes is that banks can become conduits through which illicit proceeds are routed or stockpiled. Zeek used at least 15 domestic and foreign financial institutions to pull off its fraud, according to court filings.

    Because HYIPs offer commissions to members who recruit other members along with “investment returns,” legitimate financial institutions can come into possession of money tainted by fraud.

    Like Zeek (and AdViewGlobal and AdSurfDaily), TelexFree has a presence on well-known forums listed in U.S. court records as places from which Ponzi schemes are promoted.

    TelexFree shares some of the characteristics of fraud schemes such as Zeek, AdViewGlobal, AdSurfDaily, Profitable Sunrise and others. ASD, AVG and Zeek, for instance, had a purported “advertising” element. So does TelexFree.

    TelexFree affiliates claim they get paid for posting ads online for the purported “opportunity.” Zeek affiliates made the same claim.

    It is highly likely that Zeek and TelexFree have promoters in common, a situation that potentially is problematic, given that some affiliates may have used money from Zeek to join TelexFree — and the court-appointed receiver in the Zeek case is pursuing clawbacks against “winners.” In short, some of the winnings could have been spent in TelexFree.

    An online promo for Zeek in July 2012 claimed North Carolina-based Zeek had 100,000 affiliates in Brazil alone. TelexFree affiliates are claiming that their “opportunity” now has hundreds of thousands of affiliates, which suggests TelexFree has achieved Zeek-like scale. Whether it enjoys Zeek-like, money-pulling power on the order of $600 million is unclear.

    What is clear is that TelexFree, like Zeek before it, is spreading in part through the posting of promos on classified-ad or similar sites across the United States. Profitable Sunrise, another HYIP, spread in similar fashion. Dozens of U.S. states issued Investor Alerts or cease-and-desist orders against Profitable Sunrise, which the SEC accused of fraud in April 2013.

    To gain an early sense of the scale TelexFree may be achieving in the United States, the PP Blog typed into Google the term “TelexFree” and the names of several U.S. states known to have taken actions against Profitable Sunrise. This revealed URLs such as “TelexFreeOhio” and “telexfreetexas.blogspot.com,” for two examples. It also showcased classified-ad (or similar) sites on which TelexFree promos are running or have run.

    Finally, the state of Massachussets was the venue from which the prosecutions of the infamous World Marketing Direct Selling (WMDS) and OneUniverseOnline (1UOL) pyramid-schemes were brought in federal court. Those fraud schemes were targeted at Cambodian-Americans. The state does not take kindly to affinity fraud. In March, Massachusetts securities regulators charged a man in an alleged fraud bid against the Kenyan community.

    Among the claims of the MLM hucksters pitching WMDS and 1UOL was that members could purchase an income. Some TelexFree affiliates are making similar claims.

    The WMDS and 1UOL frauds became infamous as the source of death threats, including one against a federal prosecutor.

    Media outlets in Brazil have reported that death threats have surfaced over the TelexFree scheme.

    For the reasons cited above and more, it would be surprising if things end well in the United States for TelexFree, which has Zeek and ASD-like signatures of MLM disasters waiting to happen.

     

     

  • UPDATE: MPB Today Operator Ordered To Stay Away From MLM As He Awaits Sentencing In Racketeering Case; Separately, MLM ‘Programs’ Get Pounded In The Press

    Gary Calhoun
    Gary Calhoun

    Gary Calhoun, the operator of the MPB Today MLM “program,” has joined AdSurfDaily Ponzi schemer Andy Bowdoin as a member of a dubious club: A Florida judge has ordered Calhoun not to get arrested on new charges and to stay away from MLM while he awaits sentencing in a racketeering case brought by Florida authorities last year.

    Here is a note on the docket of Circuit Judge Jan Shackelford reflecting the ban: “DEFENDANT TO HAVE NO CONTACT OR RECEIVE ANY INCOME FROM ANY MLM.” Calhoun, according to the docket, will be permitted to pursue any “legal means” to support his family.

    Bowdoin was banned from MLM last year while he awaited sentencing in the $119 million ASD Ponzi scheme broken up by the U.S. Secret Service in August 2008. Prosecutors said Bowdoin pushed a scam known as AdViewGlobal (AVG) even after the government seized more than $80 million in ASD-related bank accounts. After the collapse of AVG in 2009, Bowdoin, 78, pushed a pyramid scheme known as OneX, according to court filings. He later was sentenced to 78 months in federal prison.

    Calhoun, 56, will be sentenced July 30, according to the case docket, which notes a plea agreement. He was arrested on the racketeering charge in December 2012 and has been free on bond since then. In July 2012, federal prosecutors in the Northern District of Florida filed a forfeiture complaint for MPB Today’s headquarters building in Pensacola. The affidavit in the forfeiture case was filed under seal. But the forfeiture case, according to prosecution filings, was brought to enforce 18 USC § 1028 and 18 USC § 1029, statutes dealing with access-device fraud and fraud in connection with identification documents.

    MPB Today operated an MLM married to a grocery-delivery business known as Southeastern Delivery. Among the claims was that a one-time purchase of $200 in groceries could lead to free groceries and gasoline for life. Some promoters claimed the U.S. government and Walmart had endorsed MPB Today. Others encouraged prospects to sell $200 worth of Food Stamps to raise the money needed to join the “program.”

    Supporters of the “program” defended it on the PP Blog by calling critics  “roaches,” “IDIOTS,” “clowns,” “terrible” people, “misleading” people, people who have led a “sheltered life,” people who have been “chained up in a basement,” people who have “chips” on their shoulders, spewers of “hot air,” “naysayers,” “complainers,” “trouble maker[s]” and “crybabies.”

    MPB Today later vanished — but not before a promoter described President Obama as a Nazi and and his family as aspiring to eat dog food. Former Secretary of State Hillary Clinton was depicted as a bawling drunk. First Lady Michelle Obama was depicted as having experienced an embarrassing gas attack in the Oval Office after having sampled “beans” at a Sam’s Club Store.

    From an ad designed to attract prospects for the MPB Today "program."
    From an ad designed to attract prospects for the MPB Today “program.”

    All of it — and more — was designed to attract business to the MLM firm, which apparently has followed ASD into the darkness.

    News of Calhoun’s sentencing date was received during a week in which MLM was experiencing one PR disaster after another. WTOL, a TV station in Toledo, Ohio, carried a report on the alleged Profitable Sunrise HYIP scheme. The SEC said earlier this month that the purported “opportunity” may have gathered tens of millions of dollars and that promoters may not have known for whom they were working.

    Profitable Sunrise was targeted at Christians, according to regulatory actions. Among its absurd offerings was the purported “Long Haul” plan that promised to pay 2.7 percent a day with the payout due April 1 — April Fool’s Day. Promoters called it the “Easter Gift” because Easter occurred on March 31. The payouts, however, never materialized.

    Separately, WFMY of Greensboro, N.C., said it had uncovered evidence that members of the Zeek Rewards “program” were being targeted in a reload scam. In August 2012, the SEC described Zeek as a $600 million Ponzi- and pyramid scheme.

    Meanwhile, the politics and satire site Wonkette ran a piece yesterday titled, “The End Is Near: Time Running Out To Join Amazing Jesus Pyramid Scheme.”

    The story details spam received by Wonkette, apparently from a promoter of a scheme known as “Rocket Ca$h Cycler.”

    The subject line of the pitch, according to Wonkette, was this: “The Wealth Transfer is here!! Florida Pastor & Church break through financially!”

    When MPB Today was operational, it ran a matrix cycler. One particularly bizzare pitch for the “program” in 2010 claimed this: If you “hate Walmart and have written a 603 page manifesto on how Walmart is trying to take over the world and steal your soul,” you should “stop making that pipe bomb and read how you can avoid Walmart and still make bank.”

    Read review of the Rocket Cash Cycler “program” at BehindMLM.

  • Some ‘ProfitClicking’ Members Who Scheduled Sea Cruise May Have Gotten Lucky Break — Sort Of

    ProfitClicking has had trouble since it evolved from the carcass of JSSTripler/JustBeeenPaid last year.
    ProfitClicking has had trouble since it evolved from the carcass of JSSTripler/JustBeeenPaid last year.

    Back in June 2012 — when the “program” later to become “ProfitClicking” still was known as JSS Tripler/JustBeenPaid — a member told JSS/JBP operator Frederick Mann that she was arranging a sea cruise on Carnival Cruise Lines “out of Galveston, Texas” during the last week of January and the first week of February of this year.

    It would not have been the first time members of a Ponzi scheme got together on a ship at sea to talk up a “program.” Members of the AdViewGlobal autosurf, which federal prosecutors later linked to the AdSurfDaily Ponzi scheme, reportedly advanced the AVG scam on the high seas in 2009.

    Whether the JSS/JBP sea cruise ever came off is unknown. What is known is that the Carnival Triumph, whose home port is Galveston, has caused an epic PR disaster for the famous cruise line. The ship experienced an engine-room fire on Sunday, after departing Galveston Feb. 7, the company said.

    A passenger on a recent cruise aboard the Triumph told CBS News that the ship had trouble on Jan. 28 as it was preparing to leave Galveston.

    If JSS/JBP-related trip announced last year went ahead as planned, some JSS/JBP (now ProfitClicking) members could have been on the ship during the trip immediately prior to the disastrous cruise. Or if the trip was delayed by a week, they could have been aboard when the engine room caught fire.

    Just how disastrous was the trip?

    Well, no one was killed. Even so, passengers described the excursion as a venture into hell on the high seas. The fire crippled the ship at sea. A CBS reporter described the vessel as “the makings of a floating biohazard” because the Triumph’s toilets and waste systems were not working.

    Fox News, meanwhile, cited reports of “vile conditions onboard” and used the phrase “shanty town.” Passengers were forced to live on the deck because of filthy conditions inside the ship.

    With the aid of tug boats, the crippled Triumph arrived in Mobile, Ala., late last night.

    The U.S. Coast Guard and the National Transportation Safety Board have launched probes.

    Even if JSS/JBP/ProfitClicking members weren’t on board, there are reports of ongoing, major problems with their “opportunity,” which purported to pay 2 percent a day.

    If they were on board, they got the double-whammy.

     

  • 4 Charged Amid Allegations ‘Industrial Bleach’ Was Sold On Internet As ‘Miracle Cure’ For Flu, Arthritis And Cancer; Web Chatter References Pro Advocate Group, Same Enterprise Linked To Bizarre Claims In AdSurfDaily Saga

    A YouTube video apparently in support of “Project GreenLife” superimposes an image of FDA Commissioner Dr. Margaret Hamburg against the backdrop of a height chart -- an apparent bid to suggest that Hamburg should be booked at a police station.
    A YouTube video apparently in support of “Project GreenLife” superimposes an image of FDA Commissioner Dr. Margaret Hamburg against the backdrop of a height chart — an apparent bid to suggest that Hamburg should be booked at a police station.

    The PP Blog first told you about “Miracle Mineral Supplement,” also known as “Miracle Mineral Solution” or MMS, in August 2010. The FDA warned that serious harm could come to human beings who consumed it, saying MMS produced industrial bleach when used as directed.

    “Multiple independent distributors” sold the product online, the FDA said.

    Now, the U.S. Department of Justice has announced that four people — two from Oregon and two from Washington state — have been charged criminally.

    Named defendants were Louis Daniel Smith, 42, and Karis Delong, 38, both of Ashland, Ore. Also charged were Chris Olson, 49, and Tammy Olson, 50, of Nine Mile Falls, Wash.

    “Our most vulnerable citizens need real medicine — not dangerous chemicals peddled by modern-day snake oil salesmen,” said Stuart F. Delery, principal deputy assistant Attorney General for the Justice Department’s Civil Division.

    Smith and Delong operated a business known as “Project GreenLife” or PGL, the Justice Department said.

    A dissolved Nevada corporation known as PGL International LLC lists “Daniel Smith” as its managing member. A website styled ProjectGreenLife.com now appears to be parked at GoDaddy. Meanwhile, there are references online to ProjectGreenLife purportedly having been a “1st and 14th Amendment Private Membership Association.”

    At least one website that makes the claim makes a companion claim that Daniel Smith used “the help and counsel of the ProAdvocate Group” when contacting the FDA about MMS-related matters. “Daniel based his inquiry on a good-faith understanding of U.S. Supreme Court case law as it pertained to the activities of a private association,” the site claims. “Daniel told the FDA unless they objected within ten days he would assume they had no objection.”

    Pro Advocate Group reportedly was the Texas-based entity that assisted the AdViewGlobal HYIP scam form a “private association” in 2009 in which AVG appears to have tried to insulate itself from examination by the U.S. government by purporting to operate from Uruguay. In April 2012, federal prosecutors in the District of Columbia linked AVG to the $119 million Ponzi scheme operated by Andy Bowdoin of AdSurfDaily.

    Along with hawking purported private associations, Pro Advocate Group claims on its website that it offers “Pro Se Litigation with Super Appeal” and other services.

    A Justice Department news release yesterday on the charges flowing from Project GreenLife and the sale of MMS did not reference Pro Advocate Group.

    Smith, Delong and Tammy Olson were charged with one count of conspiracy, four counts of interstate sales of misbranded drugs and one count of smuggling. Chris Olson was charged with one count of conspiracy, one count of the interstate sale of a misbranded drug and one count of smuggling.

    The Justice Department said that “PGL provided consumers directions to combine MMS with citric acid to create Chlorine Dioxide, and the instructions told consumers to drink this mixture to cure numerous illnesses. Chlorine Dioxide is a potent agent used to bleach textiles, among other industrial applications. In humans, Chlorine Dioxide is a severe respiratory and eye irritant that can cause nausea, diarrhea and dehydration.”

    Research by the PP Blog shows that Daniel Smith apparently has supporters who’ve issued an appeal to “Please take a stand to help save MMS and Daniel Smith from the FDA.” A headline for video on the site describes the FDA as a “Cult of Tryanny.” A narrator describes the FDA as a “rogue agency” and superimposes the images of FDA Commissioner Margaret A. Hamburg and others against the backdrop of a height chart. It appears to be a ham-handed way to suggest that Hamburg and the other purported “rogues” should be booked at a police station.

    From the Justice Department statement (italics added):

    As part of the scheme to manufacture MMS, the indictment alleges that Smith, Delong, and others smuggled sodium chlorite into the United States from Canada using fraudulent invoices to hide the true end use of the product.   In these invoices, according to the indictment, they falsely claimed that the ingredients they were purchasing for MMS were to be used in wastewater treatment facilities.

    According to the charging documents, Smith and Delong were the managing members of PGL Smith co-founded the company, and Delong frequently handled financial transactions for the company and recruited friends and family to participate in the business. The indictment alleges that Smith and Delong paid Tammy Olson to handle all customer inquiries regarding the product.   It is alleged that Tammy Olson continued selling MMS on her own website after federal agents shut down the Project GreenLife website and production facilities.  

     The indictment also alleges that Smith and Delong paid Chris Olson to clandestinely manufacture MMS in a building on his property after regulators from the Food and Drug Administration (FDA) inspected PGL’s original manufacture and shipping locations.

  • ‘American Greed’ Producing Episode On Trevor Cook Ponzi Fraud; Seniors, People Of Faith Fleeced By Cook And His Pitchmen

    Trevor Cook
    Trevor Cook

    CNBC’s “American Greed” will be in Minneapolis today to begin filming an episode on the massive Trevor Cook Ponzi scheme that was targeted at senior citizens and conservative Christians and rendered some victims penniless, a source told the PP Blog.

    Cook’s scheme gathered about $194 million. It collapsed in 2009. Money that potentially could go to victims is still missing. The scheme was reminiscent of the AdSurfDaily Ponzi case in that it took various bizarre and disturbing turns.

    Earlier this month, Cook pitchman Jason Bo-Alan Beckman was sentenced to 30 years in federal prison. Gerald Durand received 20 years. Christopher Pettengill, who cooperated with prosecutors, received a 90-month sentence. Sentencing for Pat Kiley, a conspiracy theorist and former radio host in his seventies, was put on hold, pending the results of medical and psychological exams.

    Cook, the ringleader, received a 25-year sentence in 2010.

    For what the Cook fraud lacked in dollar volume — indeed, it was significantly smaller than Tom Petters’ epic Ponzi fraud in Minnesota — it more than made up for in pure brazenness. Beckman essentially was accused of taunting victims in his court filings after stealing millions from a senior-citizen couple in their late eighties. Durand told a tale about a submersible submarine Cook allegedly bought on eBay for the waters of Canada before moving it to Panama, where Cook purportedly found the conditions to be more sub-friendly.

    Kiley once tried to have a CFTC lawyer fined $1,000 for filing court papers Kiley deemed “offensive.”

    The Cook scheme also had something in common with AdViewGlobal, the collapsed 1-percent-a-day autosurf linked to the AdSurfDaily Ponzi scheme: a tie to offshore facilitator KINGZ Capital Management Corp.

    AdViewGlobal announced its purported tie to KINGZ on May 4, 2009, the same day the Obama administration announced a crackdown on offshore fraud. KINGZ denied any tie to AVG. But the National Futures Association (NFA) established a tie between KINGZ and Cook.

    AdViewGlobal collapsed during the summer of 2009, amid reports that millions of dollars had been stolen. The purported “opportunity” bizarrely declared itself a “private association” operating in Uruguay, apparently in a bid to evade U.S. regulatory scrutiny even though it was conducting business in the United States. Federal prosecutors tied ASD President Andy Bowdoin to AdViewGlobal in 2012. Bowdoin, now serving a 78-month prison sentence, once claimed that prosecutors were “Satan” and compared the U.S. Secret Service to the 9/11 terrorists. His scheme gathered at least $119 million.

    Prosecutors have evidence that suggests at least some of the AdViewGlobal money was deposited in Switzerland. The Cook Ponzi also did business in Switzerland.

    There also is a tie between Trevor Cook and Peregrine Financial Group Inc., the collapsed fraud scheme of Russell R. Wasendorf Sr., now facing up to 50 years in federal prison. Wasendorf once was a member of NFA’s Futures Commission Merchant Advisory Committee

    Peregrine consumed at least $215 million and conducted a scam for two decades, prosecutors said. “[I]n order for the fraud to be effective and sustainable for years, defendant routinely created and used false certifications and forged documents to deceive his customers, his accounting department, his fellow corporate officers, an outside auditor, and multiple regulatory agencies whose core function was to detect and prevent exactly the type of criminal activity defendant perpetrated,” prosecutors said of Wasendorf.

  • UPDATE: ASD’s Andy Bowdoin Incarcerated At Oklahoma City Federal Transfer Center

    Thomas Anderson "Andy" Bowdoin
    Thomas Anderson “Andy” Bowdoin

    Convicted 1-percent-a-day Ponzi schemer Andy Bowdoin is listed as an inmate at the Federal Transfer Center in Oklahoma City, a development that likely means the 78-year-old  AdSurfDaily patriarch is on his way to a federal prison. Bowdoin, a Floridian, last year requested to be incarcerated in Florida. The PP Blog was unable to determine immediately if that request was granted.

    Bowdoin pleaded guilty to wire fraud in the ASD Ponzi case in May 2012. He admitted ASD was a Ponzi scheme that had gathered about $119 million and had never operated lawfully from its inception in 2006 through its collapse in 2008. Bowdoin initially was imprisoned in June 2012, after federal prosecutors proffered evidence that he continued to promote scams even after the seizure of more than $80 million in the ASD Ponzi case and even after he was charged criminally in December 2010.

    In August, Bowdoin was sentenced to 78 months in federal prison for his role in the ASD Ponzi.

    Federal prosecutors identified AdViewGlobal and “OneX” as two other scams in which Bowdoin participated after the collapse of ASD amid Ponzi allegations by the U.S. Secret Service in 2008. Like ASD, AdViewGlobal was a purported “program” that planted the seed its paid a daily return of 1 percent. OneX was a “program” Bowdoin said could fetch participants a quick return of $99,000, apparently after an initial outlay of $5.

    Bowdoin targeted former ASD members and “college students” in his OneX promos.

    In August, the SEC accused Zeek Rewards of operating a massive online Ponzi scheme that had gathered about $600 million. Similar to ASD, Zeek Rewards was a “program” that planted the seed it paid a return of 1.5 percent a day.

    The SEC has described its Zeek probe as ongoing. The Secret Service said in August that it also was investigating Zeek.

    Despite the fact Bowdoin was sued civilly, accused of racketeering and charged criminally with wire fraud, securities fraud and selling unregistered securities for the ASD scam, any number of ASD members turned to promoting Zeek, which planted the seed it paid out even more than ASD.

    In August, the SEC accused Zeek of selling unregistered securities. Zeek operator Paul R. Burks, who is in his mid-60s, consented to a judgment in the civil case without admitting or denying the SEC allegations. Two prospective class-action lawsuits also were filed against Burks.

    Despite the legal entanglements of both Burks and Bowdoin and Bowdoin’s prison sentence, some MLMers immediately began promoting similar “programs.”

  • CURIOUS: 3 Of 5 ‘Most Popular’ Stories On PP Blog Last Week Were ‘Old’ Articles On The AdSurfDaily And AdView Global Scams

    UPDATED 8:55 A.M. ET (U.S.A., DEC. 11) Are Zeekers doing research in advance of clawback actions in the Ponzi scheme case or otherwise trying to get a sense of history? Are they (or other readers) trying to gain a better understanding of ties that may exist among Zeek, AdSurfDaily and AdViewGlobal?

    Three of the PP Blog’s five “Most Popular” stories last week were “old” articles about ASD and AVG, according to a tracking service used by the Blog. AVG had not dominated reader interest on the PP Blog for nearly three years.

    Here are links to (and briefs about) those stories:

    From July 16, 2009: (No. 2 in ‘Most Popular’ rankings last week.) BREAKING NEWS: Federal Judge Says Curtis Richmond, Six Other Parties Who Used Pro Se Litigation Blueprint, Cannot Intervene In AdSurfDaily Forfeiture Case

    The July 16, 2009, story reported that seven would-be, pro se intervenors in the ASD Ponzi case were denied standing by a federal judge. In her ruling, the judge pointed out that the first filing occurred in February 2009. It is “representative and seems to be a ‘form’ complaint inasmuch as the others are duplicates,” the judge said.

    A key part of the ruling (italics added): “Fraud victims who voluntarily transfer their property to their wrongdoers do not retain a legal interest in their property; instead, such victims acquire a debt against their wrongdoers.”

    Waves of other pro se filiers later were denied standing in the case. (On at least two occasions, the judge denied the would-be intervenors en masse.)

    It perhaps is worth pointing out that standing also could become an issue in the Zeek case. Given ASD’s history, it also seems possible that “defenders” of the Zeek scheme will ponder the use of shared litigation templates. (The ASD templates, which advanced conspiracy theories and accused public officials of crimes,  didn’t “work.” To date, one Zeeker has accused the court-appointed Zeek receiver of a crime.)

    From Dec. 7, 2009: (No. 4 in “Most Popular” rankings last week.) AdViewGlobal Recording Suggests Member Cashed Out $10,000 Only Days After Formal Launch And That Insiders Were Awarded Bonuses; Less Than Two Weeks Later, Surf Switched To ‘Private Association’ Structure

    The Dec. 7, 2009, story reported that AVG, a  purported offshore entity, had conducted conference calls earlier in the year and lured prospects with “bonuses.” It also reported that some AdSurfDaily figures were among the first to receive the “bonuses.”

    It perhaps is worth pointing out that an effort by some Zeek insiders now appears to be under way to lure their downlines into nascent “programs,” at least one of which is being positioned as a way to maintain a Zeek downline in a new “program” and receive a bonus. The name of the new “program” that purportedly will provide bonuses to Zeek members and its base of operations are unclear.

    Zeek and ASD figure Todd Disner, however, recently was reported to be in Hong Kong with a “lost” passport.

    “Todd Disner,” said Zeek figure Robert Craddock on a call last week. “Bless his heart. I don’t know if he’s found his passport yet, but he’s . . .  in Hong Kong right now assisting us with this new program. And he’s lost his passport. So, I don’t know if he’s made it back to the states yet or not. And, so, we’re all working very, very hard to pull this together for you.”

    Some Zeekers have ported themselves to schemes such as “BannersBroker” and “GoFunPlaces.” It is possible that any number of Zeek members took soiled proceeds from previous scams to their new “opportunities.” What’s not known at this time is what will happen if Zeek “winners” who are the prospective targets of clawback litigation will do if they moved illicit Zeek proceeds into another scheme or dissipated the money in other ways.

    From the Dec. 7, 2009, story (italics added):

    The conference call, hosted by Terralynn Hoy, a Moderator at both the Pro-AdSurfDaily Surf’s Up forum and a ning.com forum set up to promote AVG, did not disclose how the member amassed a large sum in only days and qualified for a cashout. But another participant in the call announced that the man excitedly expected to receive a check for $10,000.

    Terralynn Hoy, a figure in both the ASD and AVG stories, hosted at least one call for Zeek in 2011. ASD was a $119 million Ponzi scheme that collapsed in August 2008. AVG collapsed in a sea of mystery in June 2009. Before it collapsed, it sought to make an 80/20 “program” mandatory and exercised its version of a “rebates aren’t guaranteed” clause.

    Lots of Zeek members tried to encourage fellow members and prospects to keep 80 percent in the “program” and remove only 20 percent. Like ASD and AVG, Zeek also had a version of a “rebates aren’t guaranteed” clause. Some Zeek “defenders” now claim that Zeek should be left alone because it never promised anybody anything. ASD and AVG members said the same thing about those “programs.”

    From July 24, 2009: (No. 5 in “Most Popular” rankings last week.) UNCONFIRMED: Harris Family In Uruguay, AVG Staff Fired

    This story reported that certain members of the Bowdoin-Harris family involved in both ASD and AdViewGlobal purportedly had moved to Uruguay. News about the purported move broke after AVG was mentioned in a racketeering lawsuit against ASD in June 2009.

    From the July 24, 2009, story (italics added):

    AVG has a history of blaming members for its problems and deflecting accountability from management to the rank-and-file. In the past, it has blamed members for the suspension of a bank account and threatened to sue members who shared information outside association walls — and even to contact their ISPs to suspend service of people who asked pointed questions about the company in forums.

    Yesterday’s announcement by AVG also blamed the delay in audit findings on unspecified “complications created by changes in payment processors.”

    Prior to its August 2012 collapse, Zeek appears to have experienced problems with banks and payment processors. Some Zeek promoters cautioned fellow members not to talk too much about Zeek in public. On Aug. 4, Zeek complained on its Blog about unspecified “North Carolina Credit Unions” saying unfair or untrue things about Zeek.

    Zeek members were warned there would be consequences to members who did not toe the company line.

    Just 13 days later, on Aug. 17, the SEC filed an emergency action in federal court that alleged Zeek was a $600 million Ponzi and pyramid scheme

     

  • URGENT >> BULLETIN >> MOVING: Prosecutors Ask Judge To Sentence AdSurfDaily’s Andy Bowdoin To Maximum Prison Term

    “Fortunately for the investing public, ASD’s popularity in the spring and summer of 2008 also drew the attention of the United States Secret Service, which investigated Bowdoin and ASD and discovered the true nature of the business model.” — Federal prosecutors, in Aug. 13 sentencing memo that asked a federal judge to impose the maximum prison sentence on 1-percent-a-day Ponzi schemer Andy Bowdoin.

    Thomas A. "Andy" Bowdoin

    URGENT >> BULLETIN >> MOVING: Federal prosecutors in the District of Columbia have asked U.S. District Judge Rosemary Collyer to sentence acknowledged Ponzi schemer Andy Bowdoin of AdSurfDaily to the maximum term outlined in Bowdoin’s May 2012 plea agreement: 78 months.

    News of the sentencing memo and detailed new allegations against Bowdoin, 77, broke one day after some ASD members were circulating an email that asked their fellow members to “flood” a federal judge with letters of support for the recidivist con man.

    In a sentencing memo and accompanying exhibits, prosecutors advised Collyer that they had linked Bowdoin to AdViewGlobal (AVG), a collapsed 1-percent-a-day Ponzi scheme “that was simply a repackaged version of ASD.”

    The criminal preparations to launch AVG began in October 2008, just two months after the seizure of tens of millions of dollars in ASD-related bank accounts by the U.S. Secret Service in August 2008, according to an evidence exhibit filed by prosecutors.

    Bowdoin was a two-thirds owner of AVG, which did some of its banking in Switzerland, according to an exhibit.

    And prosecutors linked Bowdoin to OneX, another alleged fraud scheme.

    In what is believed to be the first public filing that includes specific details about OneX, prosecutors produced an exhibit that identified one of the principals of OneX as James C. Hill, who allegedly also is known by the initials J.C.

    The introduction of the document ends one of the long-standing OneX mysteries: the identity of “J.C.,” who once assured conference-call listeners that “God” was aboard the OneX train.

    When confronted about OneX, prosecutors said, Bowdoin claimed he’d done nothing wrong and was acting on “advice of counsel.”

    ” . . . it became clear that Bowdoin did not speak to a lawyer about OneX, but merely relied on another OneX promoter who had supposedly spoken to a lawyer,” prosecutors said.

    But the most explosive revelations by the government concerned AVG. The exhibits show that investigators obtained emails going back and forth among AVG participants described as Bowdoin “co-conspirators.”

    In one document obtained by investigators,  Bowdoin describes two separate alleged thefts from AVG totaling $2.65 million, according to an evidence exhibit.

    Bowdoin’s partner in AVG was former ASD executive Gary Talbert, according to an evidence exhibit. Bowdoin blamed the alleged theft on Arizona business associates of Talbert.

    The Bowdoin story is one “that reads like a handbook on fraud and deception,” prosecutors said.

    ASD’s patriarch and the co-profiteer of AVG cheated investors out of tens of millions of dollars, prosecutors argued, saying that Bowdoin’s career as a crook dated back “several decades” and caused victims to turn over more than $120 million to the huckster.

    “He had no concerns for the lives he affected or destroyed, and he boldly continued or expanded his criminal conduct even while under the supervision of this Court,” prosecutors argued.