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Tag: BBB

  • SPECIAL REPORT: OWOW, Phil Piccolo-Associated Firm That Pumped Text Cash Network, Purportedly Cited ‘Financial Trouble’ Last Summer And Sought ‘Brand New People’ To ‘Pay Off All Of The Past Commissions And Money Owed To Suppliers’

    From YouTube: Mr. P. prowls the stage for OWOW in 2010.

    UPDATED 5:05 P.M. ET (U.S.A.) Did One World One Website Inc. (OWOW) — the Phil Piccolo-associated company that appears to have been given some of the top positions in Text Cash Network (TCN) and recruited a huge downline with the knowledge of TCN management — try to fix its own problems last year by hatching a Ponzi plan in which money sent in by new members would be used to pay commissions owed to original members?

    A bizarre OWOW promo dated July 30, 2011, on Dealslinker.com suggests so. The promo, which claimed that “O.W.O.W. Management left town a long time ago” and “gave up for many reasons,”  further claimed OWOW was implementing a restoration plan and suggested that the company was being run by “leaders.” The “leaders” were not identified.

    Incongruously, the promo claimed that “[i]t is actually not the current O.W.O.W. that is in Financial Trouble. It is the baggage from 10/10/2010 to 3/10/2011 that has brought us down. And is a Ball and Chain around the current O.W.O.W. Team.”

    “WE NEED YOUR HELP ‘OR’ THE HELP OF BRAND NEW PEOPLE…” the promo urged. “THE SOLUTION IS ‘FOUNDER OWNERSHIP’ YES… FOUNDERS…”

    With those words in July, OWOW introduced a scheme by which “FOUNDER PACKAGES” would be created in four tiers (Bronze, Silver, Gold and Platinum) and sold online to right the OWOW ship. The purported packages were priced between $500 and $5,000, and purchasers who bought in at the $5,000 level were promised they would get “20 shares in a (sic) 5% of The Sales Profit Pool from 8/8/11 to 12/12/12 of The O.W.O.W. Program…”

    The claim leads to questions about whether OWOW was offering unregistered securities as investment contracts and effectively creating an investment pool while using unregistered broker-dealers to sell the offer.

    Purchasers who bought in at the lower-priced tiers were promised a smaller number of shares, according to the promo. Members at the $500 level would get one share; members at $1,000 and $2,500 levels would get three shares and 10 shares, respectively.

    Despite the claim that OWOW’s profits would be shared among certain members through Dec. 12, 2012, the business registration in Wyoming of One World One Website Inc. is listed as “Inactive – Administratively Dissolved (Tax).”

    OWOW and at least one releated entity also appear to have lost the ability to gather money via PayPal.

    Whether OWOW sold any of the purported packages referenced in the July 2011 promo is unclear. But about three months later — during the opening days of November 2011 and while OWOW apparently was still reeling — OWOW appears to have been given a 10-day head start to sell TCN.

    Some TCN members now say that TCN has delayed commission payments to members for a fourth time and that members have been encouraged to send money via Western Union and money orders to both the company and individuals associated with the firm.

    A pulldown menu on TCN’s website says money can be sent via Western Union to three individuals: Tyler Johnson, Brett Hudson or Jane Johnson. TCN purports to have hundreds of thousands of members globally.

    Brett Hudson is listed on TCN’s website as the firm’s president. TCN purports to operate from Boca Raton, Fla. OWOW and another Piccolo-associated entity know as Data Network Affiliates (DNA) also purported to operate from Boca Raton and environs.  The Better Business Bureau issued an alert about DNA in 2010.

    Why TCN is asking members to send funds to individuals via Western Union is unclear.

    TCN purportedly is owned by “The Johnson Group,” although descriptions about that company have been vague and ambiguous.

    Here is what TCN says about itself:

    “Text Cash Network Inc is a USA Corporation and is own (sic) 100% by a five year old communication company which is another USA Corporation owned by The Johnson Group. We have not disclosed the communication’s company name or contact information in fear that THOUSANDS OF AGENTS may or should we say would call them for information prior to our official launch of 12/12/2011.”

    The date TCN advertised as its launch date — Dec. 12, 2011 — was precisely one year ahead of the date through which OWOW promised to pay tiered members who purchased shares in a pooling arrangement: Dec. 12, 2012.

    Curiously, TCN promoters associated with OWOW added an ampersand and extra proper noun to the name of TCN’s purported ownership group, describing TCN’s owners as the “Johnson & Johnson Group.”

    Whether the addition of the ampersand and extra proper noun was a bid to trade on the name of Johnson & Johnson, the New Jersey-based Dow and S&P 500 component, is unclear. TCN came out of the gate trading on the name of Groupon, but a Groupon logo that once appeared on the site has been removed.

    Returning to the subject of OWOW, money from the purported OWOW “FOUNDER PACKAGES” would be used in part to “pay off all of the past commissions and money owed to suppliers,” according to the bizarre OWOW promo, which was attributed to “Mister P.”

    “Mister P” is an alias used by Phil Piccolo. Strangely, though, the OWOW promo was positioned as a “personal letter from J.P. aka Mister P.” Why the initials “J.P.” were used is unclear.

    Other Oddities

    The July 2011 OWOW promo referenced in this post appears to be a bid to sell both OWOW and a program known as ThatFreeThing. Indeed, the headline on the promo reads, “OWOW Wholesale Direct and MyFreething – ThatFreeThing.”

    Despite the headline reference to That Free Thing, the promo does not contain a link to the That Free Thing program.

    That Free Thing uses an address in Westminster, Colo., and publishes a picture of an office building with the name of the company affixed in large letters to the side of the building.

    TCN promos have featured images of a building in Boca Raton with the company’s name affixed in large letters near the crown of the building. The Boca Raton Police Department said on Dec. 14 that TCN’s name was not affixed to the building — despite what promoters led recruits to believe.

    “Mister P,” meanwhile, also is referenced in a promo for something called “MY FREE EVERYTHING,” which appears to be operating through a domain styled “TheDebtFreeCard.com.”

    Visitors to that site are told about a “100% PASSIVE!” program through which they can earn through the sale of “$50,000 to $250,000 JVP FOUNDER LOAN PACKAGES.” Like the OWOW promo, the My Free Everything promo raises questions about whether the purported firm is selling unregistered securities as investment contracts and whether promoters are serving as unregistered broker-dealers.

    Amid confusing claims on the site, visitors are told this: “If you are within 10 Levels of This Sale you will EARN IMMEDIATE MONEY… $500 to $2500… or If you personally sell one $5000 to $25,000… However THE BIG PICTURE will be THE RESIDUAL INCOME because THE SALE was made in YOUR DOWNLINE… There are many DOCTORS and OTHER PROFESSIONALS looking for PASSIVE INCOMES… All you do is FIND THEM and The Leadership SELL THEM… ”

    Separately, promos for OWOW on LinkedIn are asking viewers to visit a YouTube site to “see [an] Oprah” video on OWOW.

    When a link in the LinkedIn promo for OWOW is clicked, however, visitors are taken to a video that has nothing to do with Oprah Winfrey, the entertainment icon and business titan whose name often is appropriated by MLM hucksters and affiliates unwise to their ways.

    Instead, the video is about a product known as PhoneGuard, an app that purportedly keeps teens and children safe by shutting off a cell phone’s texting capacity while they’re in automobiles.

    See this story about DNA, another Piccolo-associated program that used Winfrey’s name. DNA purported to have ties to Anthony Sasso, who was described as DNA’s data expert and a “special board consultant.”

    Sasso, who reportedly once had a role in PhoneGuard, is a convicted felon who was charged in a South Florida racketeering case. DNA, the Piccolo-associated entity, hyped him as “The King Of Data For Dollars” and Sasso was said to be the “owner of the largest database of text numbers in the world.”

    TCN purports to be a text-advertising company.

     

  • ‘AutoXTen,’ Ponzi Forum Darling And Scheme Linked To Former DNA And Narc That Car Pitchman Jeff Long, Goes Missing After Long Traded On Patriotism And Claimed ‘Opportunity’ Was Appropriate For ‘Churches’

    AutoXten came out of the gate during the summer, amid claims $10 could turn into nearly $200,000. Promos claimed the "opportunity" was using Canada-based AlertPay to avoid PayPal restrictions and that AutoXten was suited for "churches."

    AutoXTen, the absurd matrix cycler that came to life this summer even as the state of Oregon was issuing a public warning against pyramid schemes and ordering a $345,000 penalty against a cycler pitchman, has gone missing.

    The AutoXTen website is registered in the name of Jeff Long, an MLM huckster who sang the praises in 2010 of both the Narc That Car (NTC) and Data Network Affiliates (DNA) license-plate schemes before abandoning both programs and warning his followers to “Stay away from ‘EZ MONEY’ pitches and claims.”

    Long, though, appeared not to have followed his own advice. After the failures of Narc That Car and DNA, AutoXTen came out of the gate with a claim that members could “Turn $10 into $199,240.”

    Prior to the apparent collapse of AutoXTen, remarks attributed to Long on the AutoXTen help desk claimed the program was appropriate for “churches.” DNA made similar claims about one of its “programs” last year.

    In 2010, Jeff Long's YouTube video for Narc That Car was referenced by Fox News 11 in Los Angeles as part of the station's Narc coverage. The original Narc video was repurposed by Long into a YouTube text pitch for DNA, but later edited to insert an announcement Long had left both Narc and DNA.

    DNA’s website also has gone missing. The DNA program was associated with MLM huckster Phil Piccolo, as was a program known as One World One Website (OWOW). OWOW emerged last month as a launch ground for the emerging Text Cash Network (TCN) scheme.

    Despite the appearance online of a photo of a glistening building in Boca Raton, Fla., with the words “TEXT CASH NETWORK” affixed in large letters near the crown of the building, the Boca Raton Police Department said Wednesday that the company’s name does not appear on the building.

    Questions have been raised about whether Long performs any due diligence on the “opportunities” he embraces or blindly defaults to the company line or manufactures a convenient truth while recruiting participants by the hundreds into scheme after scheme.

    Long was among the conference-call cheerleaders for DNA, along with Joe Reid, who went on to become a cheerleader for TCN.

    Reid also was a cheerleader for OWOW, a company Piccolo positioned as the provider of a “magnetic” product that could prevent leg amputations and help tomatoes grow to twice their normal size.

    This video in which Jeff Long was driving an automobile and pitching the MLM license-plate schemes of DNA and Narc That Car was edited to insert the red balloon and annoucement from Long that he had dumped both DNA and Narc — and to warn prospects to stay away from "EZ MONEY'" MLM schemes. Long then turned to AutoXTen amid claims the firm's matrix cycler could turn $10 into nearly $200,000 and was appropriate for "churches."

    Whether Long participated in OWOW and TCN was not immediately clear. What is clear is that the AutoXTen website is not resolving to a server only months after the purported miracle program’s launch.

    When pinged, both the AutoXten and DNA websites are returning this message: “Unknown error: 1214.”

    Both NTC and DNA carded scores of “F” from the Better Business Bureau. Some NTC members then attacked the BBB, and DNA changed the name of one of its purported offerings to “BBB” in an apparent bid to trick search engines.

    AutoXTen was hawked in part through posts on Ponzi forums such as TalkGold and MoneyMakerGroup.

    AutoXTen gained a head of steam in part through promos by well-known Ponzi forum pitchmen “Ken Russo” (as “DRdave”), and “manolo,” both of whom also promoted Club Asteria.

    Club Asteria, which purports to have a philanthropic arm, suspended member payouts months ago and acknowledged its PayPal account had been suspended.

    An AutoXTen email attributed to Long, Scott Chandler and Brent Robinson as the opportunity’s “Founders/Owners” also shows the firm traded on U.S. patriotism.

    “This weekend here in the United States of America, we celebrate our freedom and independence as a nation and a Country,” the email read in part. The email was posted on the TalkGold Ponzi forum by “manolo” on July 1, 2011, during the run-up to the Independence Day holiday in the United States.

    “We want to wish EVERYONE a HAPPY Independence weekend, please be safe, have fun and as you are celebrating, know that you are also celebrating your new life should you choose to step into it here with AutoXTen!” another part of the email exclaimed.

  • BULLETIN: Philadelphia Lawyer Arrested Last Week In Alabama On New Jersey Theft Charges Was Implicated By FTC In Alleged Mortgage-Modification Scam Targeting Vulnerable Borrowers; New Jersey Officials Say Michael Kwasnik Also Was Part Of Ponzi Scheme Targeting Seniors And Stole More Than $1 Million From Elderly Woman

    Attorney Michael Kwasnik's booking photo in Alabama. State and federal authorities now say he was involved in multiple scams: theft from an elderly client, a New Jersey Ponzi scheme and a mortage-reduction caper targeting financially strapped homeowners.

    BULLETIN: The Philadelphia attorney with an office in New Jersey who was arrested in Alabama last week on a fugitive warrant amid allegations he had stolen more than $1 million from an elderly woman in a trust scam was on the Federal Trade Commission’s radar screen for an alleged mortgage-relief scam, the PP Blog has learned.

    The FTC began a civil prosecution of attorney Michael Kwasnik in September 2009. That case, which alleged Kwasnik and others targeted financially strapped homeowners while planting the seed that the purported mortgage-reduction program had been endorsed by the government, culminated today with an announcement by the FTC that it had settled the case with Kwasnik and the others and forced them to “return ill-gotten gains to consumers.”

    New Jersey officials said last week that Kwasnik, in addition to stealing from the elderly woman, also was part of an $8.5 million Ponzi and fraud scheme targeting senior citizens.

    Kwasnik was part of a law firm known as Kwasnik, Rodio, Kanowitz & Buckley, according to the FTC. The firm rated an “F,” the worse possible score, according to the Better Business Bureau.

    Among the allegations in the FTC case was that Kwasnik and the firm were part of a scheme that used the name “Hope Now Modifications” and “falsely claimed to be part of HOPE NOW Alliance, a non-profit, government-endorsed mortgage assistance network.”

    Other records show that Kwasnik has been under scrutiny by the New Jersey State Bar Association.

  • A BRIEF STUDY IN CASH-GIFTING CONTRASTS: The Attorney General, The BBB — And Hank Needham (Before The Club Asteria Brainstorm And CONSOB Probe)

    In this June 2008 video, Hank Needham — later to emerge as a Club Asteria principal — counts out a stack of £20 British notes delivered in a cash-gifting scheme. Using the pronoun "we" without defining who "we" was, Needham told viewers that "we" intended to open a cash-gifting "school." About three years later, Club Asteria positioned itself as an online "education" leader. In a March 2008 cash-gifting video, Needham was featured counting out a small stack of U.S. $100 bills. What was needed, Needham coached, was "training" on how to post cash-gifting videos on the Internet. Prosecutors say cash-gifting is illegal. The BBB calls it a pyramid scheme. In May 2011, CONSOB, the Italian securities regulator, blocked promos for Club Asteria in Italy. Needham has called himself a Club Asteria owner, and Club Asteria had described him as the director of sales and marketing “responsible for establishing Country, Regional and Network Team Leaders."

    In this post, we included a March 2008 Dailymotion video of Hank Needham — later to emerge as one of Club Asteria’s purported owners — hawking a cash gifting scheme in which five $100 bills (U.S.) spilled out of an envelope tucked inside an envelope delivered by overnight courier DHL. (Please note that March 2008 video also appears on a separate site. The date notation on that site is May 2008.)

    Another cash-gifting video from Needham — this one  dated June 2008 — has surfaced. In the June 2008 video, Needham is holding an envelope from FedEx, another overnight courier. “Now, we have another [envelope] — I won’t really go through the courier — I don’t think we’re supposed to use this courier anymore,” Needham tells viewers, after making sure they notice what he describes as a “little pile of cash that’s accumulating” to his left.

    As the June 2008 video proceeds, Needham removes cash that has been packed snugly in the FedEx envelope. It’s British pounds as opposed to U.S. currency this time — and this time the money has come from “Robin” (or Robyn?) in the “British Isles.” Unlike the March (and May) 2008 video in which “George,” presumably an American, is reported by Needham to have sent five large U.S. bills, “Robin,” presumably a Brit, has chosen to send 25 twenty-pound notes. Needham counts out all 25 bills, creating five rows with five bills in each row. Why Needham was reluctant the mention the name of FedEx was not made clear in the video. What was clear was the Needham wanted viewers to know that “we’re opening up a website called CashGiftingSchool.com.”

    He did not define “we.” The “school” website, which appears to have been registered in April 2008 while Needham was pushing the AdSurfDaily scheme in addition to cash-gifting, now resolves to a page that beams ads. (It’s worth noting that Needham, in 2008, was wearing casual attire while hawking the cash-gifting “school,” apparently from his home. Flash forward three years to 2011: Club Asteria is positioning itself as an “education” leader and featuring Needham on video. He is wearing a crisp, black suit in the 2011 video — and the backdrop is a board room. A button promoting the 2011 Club Asteria video in which Needham is showcased in the black suit is labeled “ABOUT COURAGE.” The button appears in Club Asteria’s October 2011 recruitment house organ.)

    Various Club Asteria-related entities have been trading on the names of various charities, including the American Red Cross. The Red Cross sent the purported Asteria Philanthropic Foundation a cease-and-desist letter 11 days ago, and the relief agency said yesterday that the foundation agreed to stop using the Red Cross  logo and other materials. How long it will take the Asteria-themed enterprises to comply is unclear.

    Needham’s image also appeared in 2008 promos for AdSurfDaily, an autosurf the U.S. Secret Service called an international Ponzi scheme.

    The Attorney General

    Before you take a look at the June 2008 Needham video — which appears to have been placed on Dailymotion just two months before the spectacular seizure by the U.S. Secret Service of tens of millions of dollars in the ASD Ponzi case — we’d like you to take a look at what the attorney general of Michigan says about cash gifting. Bill Schuette notes that purveyors can be charged with felonies. Mike Cox, Schuette’s predecessor as attorney general, said the same thing.

    Needham does not mention the law in either of his videos; he’s too busy counting bills. He appears to be less than pleased that “Robin,” unlike “George” in the other video, packed the bills tightly. It is unclear in either video whether DHL or FedEx left the envelopes in a secure place before Needham retrieved them. In other words, had the envelopes been left on Needham’s doorstep, they could have been stolen, an outcome sure to have created an unpleasant situation for both the senders and Needham.

    The BBB

    Now — to accent this brief study in contrast before you view Needham’s June 2008 cash-gifting video — take a look at this brief video on cash-gifting fraud by the Better Business Bureau:

    Hank Needham


    The CASH PROOF by hankneedham

  • Is Ponzi Legend ‘Ken Russo,’ AKA ‘DRdave,’ Now Performing PR Work For Club Asteria In Wake Of Negative Findings By Italian Regulator? Infamous Forum Pitchman Who Claims To Have Received Thousands Of Dollars Via Wire From Firm Posts 854-Word Club Asteria Puff Piece On TalkGold

    Club Asteria promoter "Ken Russo," aka "DRdave," posted this purported $1,311 payment from Club Asteria June 2 on the TalkGold Ponzi forum.

    Club Asteria updated its news website yesterday for the first time since July 21, a period of more than a month. But the Virginia-based company did not address a new order issued Monday by the Italian regulator CONSOB in its three-month-long investigation into how Club Asteria was promoted in Italy.

    And neither did Club Asteria promoter “Ken Russo,” who simply copied the entire 854-word puff piece Club Asteria posted on its news website yesterday and pasted it into the Club Asteria thread at the TalkGold Ponzi scheme and criminals’ forum.

    Whether “Ken Russo” understands that legitimate companies would be aghast if their affiliates trolled for business and performed PR outreach on known Ponzi forums linked to international fraud schemes that have gathered huge sums of money is unclear. What is clear is that “Ken Russo” is using TalkGold as a cheerleading outlet for Club Asteria — even as he uses it to cheer for other schemes.

    Whether Club Asteria will take any sort of action against “Ken Russo” for trolling for business on TalkGold or reproducing 854-word Club Asteria PR pieces verbatim on a known Ponzi forum is not known. “Ken Russo” is hardly the only known Ponzi pimp who has led cheers for Club Asteria on the Ponzi boards, and Club Asteria has benefited from the Ponzi board cheerleading though a series of “I got paid” posts and reports that the firm’s membership roster had swelled into the hundreds of thousands.

    Club Asteria now is conceding that it is having trouble launching a suite of new products — and that the delay in launching the suite could extend for another 60 days. Club Asteria buried the news about the specific length of the delay in the fourth paragraph of the puff piece “Ken Russo” regurgitated on TalkGold, after congratulating itself in the first paragraph for its diligence in implementing a new scheme and assuring members “how anxious and excited we all are to see all these new items being produced, tested and the logistics worked out so they can be introduced to our members.”

    “Ken Russo” posts as “DRdave” at TalkGold, which is referenced in U.S. court filings as a place from which Ponzi schemes are promoted. He is a figure who elicits nearly constant criticism from the antiscam community for turning a blind eye to fraud schemes while seeking to create plausible deniability of any personal responsibility for permitting fraud to mushroom globally by accepting claims made by “opportunity” sponsors at face value and not questioning obvious incongruities.

    If an “opportunity” claims a unique ability to pay spectacular, higher-than-market returns with an accompanying, unverifiable claim that external income streams enable the returns — often in the mind-blowing region of hundreds of percent on an annual basis — “Ken Russo” accepts the claim at face value and parrots it.

    On Talk Gold, “Ken Russo” made a claim about Club Asteria that projects to an annual payout of more than 200 percent. Other promoters have claimed Club Asteria had the capacity to pay out more than 500 percent annually — all while claiming Club Asteria also paid affiliate commissions to recruiters. The confluence of payout schemes — combined with the lack of any verifiable information on Club Asteria’s sales figures and income streams and the highly public presence of known Ponzi scheme promoters — strongly suggest that Club Asteria was conducting a global Ponzi scheme

    “Ken Russo” previously has claimed on TalkGold to have received thousands of dollars in compensation via wire from Club Asteria, including payments received after Club Asteria’s PayPal account was frozen in May and after CONSOB opened its probe during the same month. Some Club Asteria members, including “Ken Russo,” have claimed they were paid through AlertPay, a payment processor based in Canada.

    The full effect of Monday’s order by CONSOB remains unclear because a reliable English translation was not immediately available. The PP Blog has asked both CONSOB and Italy’s Embassy to the United States to provide one, owing to the virality Club Asteria achieved worldwide and the presence of thousands of Club Asteria promos in English. TalkGold features a 137-page thread in English on Club Asteria.

    Neither CONSOB nor the Embassy has declined the Blog’s request, which may signal that an official translation could be released in the coming days. CONSOB raised concerns in May that Club Asteria was being promoted illegally in Italy on websites, forums and social-media outlets such as Facebook.

    Club Asteria said in June that it was experiencing a cash crunch and that its revenue had plunged “dramatically,” blaming members for events and comparing the situation to a  bank run. Club Asteria first slashed members’ weekly cashouts from an apparent norm of between 3 percent and 4 percent a week, and then suspended cashouts altogether.

    Some Club Asteria members claimed that the company paid out up to 10 percent a week, and scores of promoters globally are believed to have offered prospects inducements to join, including the partial reimbursement of sign-up fees. Many — if not most — of those members likely locked in losses for both themselves and their downlines by offering the inducements because their costs could not be retired after Club Asteria itself suspended cashouts.

    It is common on the Ponzi boards for posters to offer inducements as a lure to attract prospects to join schemes of all stripes. When “Ken Russo” was promoting the purported MPB Today “grocery” program on the Ponzi boards last year, he advertised that one of his downline members was offering prospects cash rebates of $50 to join MPB Today.

    An untold number of Club Asteria promoters offered similar inducements to their prospects while encouraging new enrollees to do the same, a situation that could have caused Club Asteria’s coffers to fill with cash. It is not known if Club Asteria affiliates who pledged to partially reimburse their recruits sign-up fees have honored their pledges in the aftermath of the firm’s decision to suspend weekly cashouts.

    What is known is that the Club Asteria offer was targeted at the world’s poor — and that the firm may have gained penetration in 150 or more nations. Italy is believed to be the first nation to publicly ban Club Asteria promoters.

    Club Asteria promoter "Ken Russo," aka "DRdave," posted this purported payment of $5,462.80 from AutoXTen July 13 on TalkGold

    When not regurgitating Club Asteria fluff on TalkGold, “Ken Russo” is helping an “opportunity” known as AutoXTen gain a head of steam on TalkGold. On July 13, “Ken Russo” claimed on TalkGold to have received a payment of “$5462.80” via AlertPay for “AutoXTen.”

    “Thanks AutoXTen!” “Ken Russo wrote, posting as “DRdave.” Join us today! Just $10 to get started!!”

    AutoXTen has been linked to Jeff Long, a pitchman for both the Data Network Affiliates (DNA) and Narc That Car MLM schemes last year. DNA, in turn, was linked to serial MLM pitchman Phil Piccolo, known online as the “one-man Internet crime wave.”

    Both DNA and Narc That Car carded an “F” grade from the Better Business Bureau, the BBB’s lowest score. Some promoters then attacked the BBB.

    Long now says the AutoXTen scheme is appropriate for churches — a claim DNA made about its scheme.

    “Ken Russo” also is promoting Centurion Wealth Circle, an AlertPay-enabled scheme whose earlier cycler scheme collapsed. Centurion, which also was widely promoted on Ponzi boards such as TalkGold, now is attempting to revive itself by incorporating a new cycler known as “The Tornado.”

    On July 13, ClubAsteria promoter "Ken Russo," aka "DRdave," posted these purported payments from Centurion Wealth Circle totaling $276 on TalkGold.

    On July 11, two days before he reported a payment of “$5462.80” from Long’s AutoXTen scheme, “Ken Russo” reported on TalkGold (as “DRdave”) that he had received three Centurion payments totaling $276.

    This claim followed on the heels of claims by “Ken Russo” (as “DRdave”) that he had received $2,032 from Club Asteria between late May and late June.

    The claims raise the prospect that multiple schemes, including Club Asteria, AutoXTen and Centurion, have come into possession and redistributed money from other fraud schemes promoted on the Ponzi boards.

    And because “Ken Russo” is hardly alone in his Ponzi forum efforts to promote Club Asteria and any number of schemes in addition to Club Asteria, it raises the prospect that every single one of the schemes is shuffling fraud proceeds back and forth.

    “Ken Russo,” for example, could have used proceeds from any number of schemes to join Club Asteria and any number of emerging schemes — with his downline members doing the same thing.

  • UPDATE: 8 More Women Charged In Michigan Cash-Gifting Probe, Bringing Total Since December To 15; BBB Releases Video That Adds To Prior Warning About ‘Thousands’ Of Gifting Scams Promoted Online

    Just prior to Christmas last year, seven Michigan women were charged with felonies in an alleged cash-gifting pyramid scheme that targeted women.

    Now, just prior to Memorial Day, eight more women have been charged, bringing the total number of women charged to date to 15. The Michigan State Police said last year that gifting schemes were sweeping across the state.

    The Muskegon Chronicle was among the first newspapers to report on the new defendants.

    Separately, the BBB has added a video on cash-gifting scams and added to its previous warning about “thousands” of such schemes using YouTube and the Internet to proliferate.

    In August 2008, after the U.S. Secret Service seized tens of millions of dollars in the AdSurfDaily autosurf probe, some ASD members immediately turned to cash-gifting, positioning it as a way for ASD members to make up their losses. Gifting scams typically pluck heartstrings, targeting people of faith, people down on their luck and people who can ill afford to lose a single dollar, let alone hundreds or thousands at a time.

    “Cash gifting is a pyramid scheme — pure and simple,” the BBB says. “There are thousands of YouTube videos and websites out there touting cash gifting as an empowerment program or a way to make easy money from the security of your home.”

  • URGENT >> BULLETIN >> MOVING: FTC Goes To Federal Court To Block Alleged $467 Million Scam Operating Globally Online; International Cooperation Cited In Exposing Colossal Fraud Caper, Officials Say

    David Vladeck of the FTC.

    BULLETIN: UPDATED 3:50 P.M. EDT (U.S.A.) The FTC has gone to federal court to halt what it described as a $467 million, online fraud scheme operating across international borders. The scheme was exposed through international cooperation among the FTC, the Canada Competition Bureau, Service Alberta, the Royal Canadian Mounted Police, the Alberta Partnership Against Cross Border Fraud, the Edmonton Better Business Bureau and the BBB of Southern Nevada, officials said.

    Charged in the case were Jesse Willms, Peter Graver, Adam Sechrist, Brett Callister, Carey L. Milne and several companies.

    Willms, a Canadian, released a statement on his website that described the FTC case as a “disagreement.”

    “We believe our business practices are compliant with the law and are working to resolve this disagreement with the appropriate government agencies,” the statement attributed to Willms read in part.

    The FTC had a far different take.

    Part of the scheme falsely traded on the names of Oprah Winfrey and Rachael Ray while also making false claims of cancer cures and weight loss, the FTC charged. In fact, the FTC said, Winfrey has sued Willms.

    Named corporate defendants by the SEC were: 1021018 Alberta Ltd., also doing business as Just Think Media, Credit Report America, eDirect Software, WuLongsource and Wuyi Source; 1016363 Alberta Ltd., also doing business as eDirect Software; 1524948 Alberta Ltd., also doing business as Terra Marketing Group, SwipeBids.com and SwipeAuctions.com; Circle Media Bids Limited, also doing business as SwipeBids.com, SwipeAuctions.com, and Selloffauctions.com; Coastwest Holdings Ltd.; Farend Services Ltd.; JDW Media LLC; Net Soft Media LLC, also doing business as SwipeBids.com; Sphere Media LLC, also doing business as SwipeBids.com and SwipeAuctions.com; and True Net LLC, also doing business as Selloffauctions.com.

    In addition to using the names of Winfrey and Ray, the scheme also traded on the famous names of CNN, USA Today, CBS, the “60 Minutes” television show and other brands, the FTC said.

    “None of these entities have endorsed or positively reported on any of the 10 Willms defendants’ products,” the FTC said. The agency added that financial service-providers were duped and manipulated into processing payments for the alleged scam, in part through the creation of “dummy” websites designed to sanitize the scheme.

    “Shell corporations” also were used to hoodwink service-providers, the FTC alleged. Consumers were fleeced out of at least $412 million in the scam, which netted nearly half a billion dollars, the agency charged.

    The heart of the scheme was a continuity-billing fraud in which consumers who responded to “free” trial offers were billed for products and services they never requested, the agency said.

    “The defendants used the lure of a ‘free’ offer to open an illegal pipeline to consumers’ credit card and bank accounts,” said David C. Vladeck, director of the FTC’s Bureau of Consumer Protection. “‘Free’ must really mean ‘free’ no matter where the offer is made.”

    A Canadian official said cross-border cooperation was vital as agencies combat online fraud schemes.

    “Internet fraud is a global problem that requires an international enforcement response,” said Lisa Campbell, deputy commissioner of competition for the Competition Bureau of Canada. “International cooperation ensures that fraudsters can’t hide behind borders.”

    Auction fraud also was part of the massive scam, the FTC said.

    “Willms and 10 companies he controls used deceptive tactics in offering ‘free trials’ for various products online, including acai berry weight-loss pills, teeth whiteners, and health supplements containing resveratrol (the supposedly healthful ingredient in red wine), as well as for a work-at-home scheme, access to government grants, free credit reports, and penny auctions,” the FTC said.

    Penny auctions, the agency said, are “online auctions in which consumers must purchase bids, usually for $0.50 to $1 each. Regardless of whether a consumer actually wins a penny auction, the consumer has paid for each bid he or she placed during the auction. However, each bid that is placed raises the price of the auctioned item by a penny.”

    “Willms and his companies obtained consumers’ credit or debit card account numbers, by enticing them with bogus ‘free’ or ‘risk-free’ trial offers that supposedly required only small shipping and handling fees, and also promised phony ‘bonus’ offers just for signing up,” the FTC said.

    Consumers, though, often were “charged for the ‘free’ trial plus a monthly recurring fee, typically $79.95,” the agency said.

    Making matters worse, the agency alleged, consumers also were “charged monthly recurring fees for the so-called bonus offers,” the agency said.

    A purported money-back guarantee was no remedy because “consumers were often unsuccessful in canceling the charges or obtaining refunds, and the process involved time-consuming phone calls and other steps that made the deals far from risk-free.”

    Meanwhile, the “penny auctions” were corrupt, the agency charged.

    “The complaint charges that the defendants’ penny auction offers falsely indicated consumers would receive free ‘bonus’ bids, but those who provided credit or debit card numbers to facilitate future auction buying were hit with charges they did not know about, including $150 for introductory ‘bonus’ bids and $11.95 per month for ongoing ‘bonus’ bids,” the FTC charged.

    Winfrey and Ray never endorsed the program, despite the appearance that they had, the FTC said.

    Affiliate marketers in pursuit of commissions helped the massive fraud scheme go viral, affecting consumers in the United States, Canada, the United Kingdom, Australia and New Zealand, the FTC said. Important details were buried in the “fine print,” the agency charged.

    The complaint was filed in federal court in Seattle. Willms resides in Alberta, according to the complaint. Graver, Callister and Milne are from Utah. Sechrist lives in Pennsylvania.

    Some of the corporate defendants are from Canada. Others are from England, Cyprus, Utah, Idaho and Nevada, according to the complaint.

    “Offshore merchant banking services” were used as part of the scam, the FTC said.

    “Because these corporate defendants have operated as a common enterprise, each of them is jointly and severally liable for the acts and practices,” the FTC said.

  • MPB Affiliate Says Members Are ‘Partners’ With Walmart And That Program ‘Guaranteed’ Not To Be Scam; Separate Promo Depicts Michelle Obama As Experiencing Oval Office Gas Attack After Sampling ‘Beans’ At Sam’s Club

    This promo for MPB Today claims affiliates become "partners" with Walmart and that business owners are "Granted FREE Groceries" for referring business to the MLM program. The promo appeared last night on a site that is heavily advertising the program — even after Walmart's name had gone missing from the landing page on MPB Today's website.

    UPDATED 10:42 A.M. EDT (U.S.A.) Using the soundtrack from the legendary rock band Heart’s 1985 hit single “What about love,” an affiliate of MPB Today is claiming on YouTube that the company’s members become “partners” with Walmart and that MPB’s multilevel-marketing (MLM) program is “Guaranteed” not to be a scam.

    Heart could not be contacted immediately to determine if the MPB affiliate was authorized to use the song, which features the voice of Ann Wilson, in a sales promotion for an MLM program tied to a Florida-based grocery company known as Southeastern Delivery.

    Walmart has not responded to a request last week from the PP Blog that asked the company to comment on legal and regulatory issues surrounding the use of its name in promotions for MPB Today. The Blog specifically asked Walmart if it knew that MPB Today was using the company name in sales pitches and that at least one affiliate had claimed that Walmart gift cards distributed by MPB to its purported customers could be converted to Walmart prepaid Visa cards, which can be used the same as cash.

    The Blog also asked Walmart if it was affiliated with MPB Today and whether it approved of the use of its brand in the MPB Today MLM program.

    On Tuesday, the MPB Today website removed images of a Walmart store and business titans Donald Trump and Warren Buffet. It was unclear if Walmart, Trump and Buffet had forced the removal.

    Even after MPB Today removed the images, an affiliate promo appeared online last night that claimed MPB Today members were “partners” with Walmart. Ads for MPB Today have targeted Food Stamp recipients, senior citizens, Ponzi scheme victims, foreclosure subjects, people of faith and members of the public who are unhappy with the administration of President Barack Obama.

    One animated ad for MPB Today depicted First Lady Michelle Obama as having experienced a gas attack after sampling “beans” at Sam’s Club. Sam’s Club operates under the Walmart flag.

    This animated pitch for MPB Today depicts First Lady Michelle Obama as having an embarrassing gas attack in the Oval Office after sampling "beans" at a Sam's Club. In the promo, Michelle Obama later gets knocked out by a drunken Hillary Clinton, who is portrayed as a Nazi. President Obama gives Clinton a left-handed Nazi salute in the promo.

    The ad, which portrayed President Obama and Secretary of State Hillary Clinton as Nazis, potentially could alienate customers regardless of their political views. Why an affiliate would imply in an ad that MPB Today prefers Obama opponents as customers is unclear. Such a caustic ad potentially could injure multiple brands because MPB affiliates have claimed Walmart is affiliated with the firm and the name of Sam’s Club appears in the anti-Obama promo.

    MPB Today operator Gary Calhoun has a poor record with the Better Business Bureau for his operation of a previous company, United Pro Media. The company’s predecessor firm, Trim International, was ordered by the U.S. Food and Drug Administration to stop violating federal law in its marketing of a product positioned as a treatment for Lou Gehrig’s Disease, cancer and other severe medical conditions.

    The U.S. Department of Agriculture said last week that it was conducting a review into claims made about MPB Today. The agency said yesterday that its review was ongoing.

    MPB Today is being marketed on social-media sites. It also is being marketed on at least three forums that are infamous for promoting Ponzi schemes.

  • MPB Today Operator Was Subject Of Inquiry By U.S. Food And Drug Administration For ‘Cell Rejuvenator’ Product That Claimed To Treat Lou Gehrig’s Disease, Alzheimer’s, Down Syndrome

    This MPB Today pitch claims a $200, "ONE-TIME" grocery purchase from Southeastern Delivery can "TOTALLY ELIMINATE" future grocery bills.

    Gary Calhoun, the operator of a multilevel-marketing (MLM) program that is targeting Food Stamp recipients, Ponzi scheme victims, foreclosure subjects and people of faith, received a warning letter in 2006 from the U.S. Food and Drug Administration for his marketing of a product that claimed to treat multiple diseases, according to federal records.

    Calhoun, who now operates an MLM program known as MPB Today and a grocery business tied to the program, was ordered by the FDA to stop violating provisions of the Federal Food, Drug, and Cosmetic Act. The grocery business is known as Southeastern Delivery LLC.

    On Friday, the U.S. Department of Agriculture (USDA) said it was opening a “review” of claims made in the MPB Today program and the associated grocery business.

    The FDA’s letter pertained to a Calhoun-operated business known as Trim International and a now-defunct website known as MyTrim.com. Calhoun also operated a business known as United Pro Media LLC, which became a subject of complaints to the Better Business Bureau and was given an “F” rating, the BBB’s lowest rating on a 14-step scale.

    In 2006, according to the FDA, Calhoun was marketing a product known as “TCR Cell Rejuvenator.” The agency said the product was positioned as a treatment for “Neurodegenerative diseases: Alzheimer’s, Parkinson’s, amyotrophic lateral sclerosis, axonal and other neuropathies, Down’s and other syndromes.”

    Amyotrophic lateral sclerosis (ALS) commonly is referred to as Lou Gehrig’s Disease, in recognition of the famed New York Yankees’ first baseman, the subject of the tear-jerking 1942 movie “The Pride of the Yankees,” which starred Gary Cooper. Gehrig died in 1941.

    TCR Cell Rejuvenator also was positioned as a treatment for “recurrent Herpes, common cold and flu,” amid MyTrim claims it could be used “to treat patients with Alzheimer’s, Parkinson’s, cancer and other infectious diseases and neurological disorders,” according to the FDA.

    Meta tags on the site also referenced “prostate cancer,” the FDA said.

    Calhoun was ordered by the FDA to notify it “in writing within 15 working days of receipt of this letter about the steps that you have taken to correct” violations. The company eventually went out of business.

    “[T] he introduction or delivery of a new drug into interstate commerce without an FDA-approved application is a prohibited act,” the FDA advised Calhoun. “No such applications exist for this product.

    “Furthermore, many of the diseases or conditions for which this product is offered are not amenable to self-diagnosis and treatment by individuals who are not medical practitioners,” the FDA said. “Therefore, adequate directions for use for these conditions cannot be written so that a layman can use this drug safely for its intended purposes.”

    The agency said Calhoun had misbranded the product because the “product’s labeling fails to bear adequate directions for its intended uses for those diseases or conditions which are not amenable to self-diagnosis and treatment.”

    MPB affiliates claim a single grocery purchase of $200 through Southeastern Delivery can result in free groceries for life.

    Read the FDA’s warning letter to Calhoun.

  • BULLETIN: Data Network Affiliates Gets ‘F’ From BBB After Purported Data Firm Did Not Respond To Complaints

    BULLETIN: The Better Business Bureau of Southeast Florida and the Caribbean has given Data Network Affiliates (DNA) an “F” rating after the company failed to respond to complaints.

    DNA, a purported multilevel-marketing (MLM) firm, publishes a street address in Boca Raton, Fla., on its website. The BBB’s file on DNA lists the Boca Raton address.

    DNA now joins Dallas-based Narc That Car, also known as Crowd Sourcing International, in the lineup of purported license plate data gathering firms to have received an “F” from the BBB. The “F” rating is the BBB’s lowest on a 14-step rating scale.

    Separately, bizarre events at DNA continue to occur. Earlier this year, DNA purported to be in the business of gathering license-plate numbers to assist law enforcement in locating abducted children. In a conference call, a DNA pitchman criticized the AMBER Alert program, claiming it had a bloated budget. The same pitchman recommended that members gather license-plate data at “churches” and “doctors’ offices,” triggering concerns that DNA’s business model could lead to untenable invasions of privacy.

    It is far from clear that DNA has any capacity to help law enforcement locate missing kids. The company’s domain name is registered in the Cayman Islands. Earlier this year, DNA claimed the offshore address was arranged through a domain registrar so company executives would not have to put up with “stupid” calls.

    DNA later declared itself the world’s low-price leader in the cell-phone business, before acknowledging that it had not studied pricing before announcing it could offer an “unlimited” plan for $10 a month, including a free phone.

    DNA later said it also had ventured into the businesses of selling a purported spray to be applied to license plates that would prevent motorists from getting tickets if they ran a red light at an intersection equipped with a camera — all while purporting to support law enforcement.

    The company also announced it had ventured into the mortgage-reduction business, claiming churches had the “MORAL OBLIGATION” to support the program.

    In July, DNA asked existing members to pretend the company had not launched in March, asking them to “Make believe that July 26th, 2010 is the LAUNCH DATE for DNA…”

    DNA than rescheduled the make-believe launch to Aug. 9. It is unclear if the imaginary launch occurred as advertised.  A countdown timer set for Aug. 23 now appears on the website.

    Meanwhile, the company appears to have renamed its Business Benefit Package, which once used the acronym BBP, to the BBB. BBB is the acronym used by the Better Business Bureau.

    DNA regularly employs capital letters to stress sales points in pitches to members.

    “Please attend our next WEBINAR it will CHANGE YOUR LIFE,” DNA said in a recent email, which also included a pitch for products described as the “DNA Photo Blocker & The DNA $5.95 TELE-FAX BOX.”

    It was not immediately clear if the product advertised as “DNA Photo Blocker” was the same product previously advertised as “DNA Protective Spray.”

    Visit the BBB site.

  • DNA Now Says It Is Selling ‘Protective Spray’ To Block ‘Wrongful Ticketing’ From Red-Light Cameras; Simultaneously Announces ‘Alert Button’ To Protect Abducted Children

    A Florida multilevel marketing (MLM) company that says its license-plate data system can help law enforcement and the AMBER Alert program locate abducted children now says it is working against cities “worldwide” in their efforts to enforce traffic laws.

    Data Network Affiliates (DNA) announced that it was offering “DNA Protective Spray” by the case to distributors. The spray is applied to license plates to obscure the view of cameras that take photographs of cars that run red lights. DNA said the spray protected against “wrongful ticketing by city cameras worldwide.”

    DNA did not explain the incongruity of saying it supported law enforcement in its efforts to locate abducted children while at once working against law enforcement in its efforts to enforce traffic laws.

    Even as DNA was announcing the availability of its purported “Protective Spray,” the company announced it soon would adopt a browser-based “DNA World Wide Alert Button” to let members know when a “child is reported missing in your immediate area.”

    DNA purports also to be in the mortgage-reduction business, claiming it is the “MORAL OBLIGATION” of churches to spread the word about the money-making program and perhaps use it to raise church funds.

    This morning the Federal Trade Commission announced three settlements in cases that banned “deceptive marketers” from selling mortgage-relief services. In one of the cases, a judgment of $11.5 million was entered against one of the marketers. A judgment of $6.2 million was entered in the second case, and a judgment of nearly $5.3 million was entered in the third case.

    DNA said distributors would be able to order its protective spray “very soon.”

    “This product has sold millions for $29.95 a can which is good for up to 3 or 4 applications when done properly,” DNA said.

    The product falls under the umbrella of a series of products that purportedly can help DNA members “RETIRE BY CHRISTMAS 2010,” the company said.

    DNA also said it soon would offer “The New DNA Phone & Fax Module,” which purportedly “will make MAGIC JACK & SKYPE OBSOLETE.”

    In April, DNA announced that it was offering an “unlimited” cell-phone plan with a free phone for $10 a month. The company later withdrew the offer, acknowledging it had not studied cell-phone pricing before announcing it had become the world’s low-price leader.

    Some DNA members have implied the company was backed by Oprah Winfrey, Donald Trump and Apple Inc. No evidence to support the claims has emerged.

    DNA has compared itself favorably to Walmart, Google, Facebook and Amway. Curiously, the company once claimed it offered a Business Benefit Package, which it dubbed the BBP. The company now appears to be referring to the package as the BBB, using the acronym associated with the Better Business Bureau.