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Tag: Bernard Madoff

EDITORIAL: With Conviction Of Zeek’s Burks, Another Senior MLMer Faces Prospect Of Decades In Prison

UPDATED 4:31 P.M. EDT U.S.A. Zeek Rewards was always inexcusably horrid, fueled by serial willful blindness and the sort of practiced disingenuousness that props up so many MLM “programs.” In dollar volume, Zeek ended up being more than seven times larger than the $119 million AdSurfDaily MLM Ponzi scheme that put ASD operator Andy Bowdoin in federal prison for six and a half years. By this measuring stick, Zeek’s Paul Burks could be staring at 45 or more years.

As things stand, Burks, 69, faces a maximum of 65 years. He was convicted July 21 of mail fraud, wire fraud, conspiracy to commit both and tax-fraud conspiracy. The jury reportedly returned the verdict in less than three hours.

Bowdoin, 77 when he accepted a plea deal before trial in 2012, received the maximum term of 78 months under the deal after earlier facing decades in prison. He pleaded guilty to a single count of wire fraud and acknowledged ASD was a Ponzi scheme and that the “program” never had operated lawfully from its 2006 inception. Other charges that could have led to a longer term were not pursued.

Burks did not have a plea deal. The $939 million dollar volume of the Zeek scam will not be the sole measuring stick considered by U.S. District Judge Max O. Cogburn Jr. when Burks’ sentencing date comes around. Even so, 45 years is not out of the question, given the terms imposed on other Ponzi schemers. Scott Rothstein, for example, received 50 years for a $1.2 billion scam.

Rothstein reportedly cooperated with the government after his convictions with the hope of receiving a sentencing reduction. Whether Burks will have a similar option or be able to argue successfully for mitigation is unknown.

What is known is that even 20 years for Burks, nearing his 70th birthday, is a virtual life sentence. Like Rothstein, he has some serious thinking to do.

Zeek was a tragedy for many, many investors lured in by promises of enormous returns. Can there be any doubt it’s also a personal tragedy for Burks and his family, given what the Zeeker-in-chief now faces?

Why Burks ever would choose to pursue Zeek after what happened at ASD remains an open question. The frauds were remarkably similar. Bowdoin went to jail for an MLM scam when he was 77. The ASD case practically screamed, “Don’t do this!”

“This massive scam is one of the largest in breadth and scope ever prosecuted by this office,” U.S. Attorney Jill Westmoreland Rose of the Western District of North Carolina said about Zeek.

Another problem for Burks is that North Carolina, a U.S. banking center, can be downright unfriendly to Ponzi schemers. Keith Franklin Simmons was sentenced to 50 years for his $40 million “Black Diamond” scheme, a scheme much smaller than Zeek. Although that sentence later was reduced on appeal to 40 years, four decades is hardly a bargain — and Zeek had something else in common with Black Diamond in addition to operating in the same federal district in the same state.

Indeed, with both Zeek and Black Diamond, the Feds pursued actions against banks that allegedly were asleep at the wheel. Ponzi schemes put economic security at risk.

Burks had to know that Zeek was going to cause his world to crumble. He’d been an MLMer for years, he knew about the ASD case, Bernard Madoff, Rothstein, Ponzi pain in general throughout society and bizarre happenings in his own company.

Why he moved forward is a sort of maximum imponderable. Why so many in the trade followed him after ASD is an even more disturbing question.

Zeek’s wing of MLM, which also includes ASD, TelexFree, WCM777 and others, has harmed millions and millions of people. It is a vast wasteland of wink-nod disingenuousness and racketeering. The cross-border nature of these schemes is truly frightening.

Kenneth D. Bell, the court-appointed receiver for Zeek, is pursuing class-action litigation involving more than 9,000 alleged Zeek winners. It is known that some of the winners also participated in ASD. These winners were at the scene of two crimes. Some of them were at the scene of more than two.

This is a major problem for MLM, whether the trade acknowledges it or not. Recruits were told Zeek couldn’t be a Ponzi scheme because MLM lawyers were involved.

And they were told that Zeek was on the up-and-up because it issued 1099 tax forms. These longstanding MLM myths have been shattered in both criminal and civil prosecutions.

With respect to Burks’ sentencing, the government’s recommendation is not yet known. Lengthy sentences for senior-citizen Ponzi schemers, however, are hardly unprecedented. Madoff, in his seventies, received 150 years.

Richard Piccoli, 83, received 20 years for a scheme far smaller than Zeek in dollar volume and number of victims. Piccoli advertised in Catholic publications, and is believed to have caused about $25 million in losses to about 250 people.

Zeek advertised online and in MLM publications, creating hundreds of millions of dollars in losses while creating hundreds of thousands of victims.

NOTE: Our thanks to the ASD Updates Blog.

Jul 24, 2016
An Incredibly Toxic Series Of HYIP Swindles — Everything From Bitcoin-Themed Scams To Purported Real-Estate Ventures That Claim To Aid Victims Of Terrorism
FundComing.com says it is a real-estate venture that pays 5,000 percent after three days and had helped victims of terrorism in Syria, one of the homes of ISIS,

Bitcoinest.net, a site that covers cryptocurrency news, reported today that “DoubleCloud.pw Is Another Bitcoin HYIP Ponzi Scheme.”

The “pw” extension stands for Palau, an island country in the Western Pacific. But the extension has been rebranded as “Professional Web,” according to Wikipedia. The user-created encyclopedia says Symantec, the security company, reported in 2013 a lot of “pw” spam.

The PP Blog today visited the DoubleCloud.pw website and observed an offer that advertises a “350% profit after 48 hours.” The Blog further visited the “Rules” page at the domain, which may be operating from Russia.

While at the domain, we copied this “rules” passage — “is not available to the general public and is opened only to the qualified members” — and pasted it into Google. Turns out the phrase appears on many, many sites, meaning it is part of a script in which the operators simply swap in the name of their particular swindle.

Bernard Madoff became infamous as a Ponzi schemer who tried to instill a sense of exclusivity in his investors. These HYIP scams are doing the same thing.

Perhaps of particular concern is that the phrase is on many sites that do not have a Bitcoin theme, meaning the kit is being used by scammers across the HYIP sphere.

One of them is known as FundComing.com, a purported real-estate venture that promises 5,000 percent after three days.

A note on the site clams as such (italics added):

“Today, we received a letter of thanks from investors [sic]. The investor comes from Syria, a 7 years [sic] old boy whose husband [sic] died from a terrorist attack. After the consent of her consent [sic], we put the letter of gratitude, the mood to share to you.”

Syria, of course, is one of the strongholds of ISIS. Based on the purported testimonial, the FundComing “real estate” website appears to be positioning itself as a safe venture for families shattered by terrorists. Meanwhile, it is using the same “rules” as DoubleCloud.pw, the purported Bitcoin earnings “program.”

Separately, a site styled Bond-dot.com is using the same “rules.” It says it is involved in both cryptocurrency and Forex from a purported base in “London (England).” It appears to be soliciting sums from $10 to $5,000, making it both a micro- and a macroscam.

Other sites with virtually the same “rules” — and this is just the tip of the iceberg:
- RazInvest.com
- NextPayMoney.com
- NanoIncomes.com
- HYIPFirst.com
- NextHourPay.com
From the second page of Google search results for “is not available to the general public and is opened only to the qualified members.”
Dec 21, 2015
Watch The Trailer For ‘Madoff’ And Think About How You Could Have Avoided Schemes Such As Zeek And TelexFree

Bernard Madoff, played by Richard Dreyfuss, tells investors “Look, it’s a closed fund” in the ABC miniseries. Ponzi schemes often trade on suggestions of exclusivity.

ABC has made available the first trailer for “Madoff,” a network miniseries debuting Feb. 3, 2016. Richard Dreyfuss plays the notorious Ponzi schemer, with Blythe Danner starring as Ruth Madoff.

Bernard Madoff’s name first appeared on the PP Blog nearly seven years ago, on Dec. 13, 2008. It has appeared numerous times since then.

Says Dreyfuss, as Madoff, in the trailer: “You want to know how to get people to trust you with their money? I’ll tell you right now: You present it as an exclusive thing.”

Any number of the “programs” we have covered tried to sell Madoff-like exclusivity. One of them was Zeek Rewards, an alleged MLM fraud involving more than $850 million taken down by the SEC in 2012.

Zeek Rewards, according to the SEC, called itself a “private, invitation-only, affiliate advertising division” for Zeekler, a penny-auction “opportunity.”

Of course, the interest rate Zeek promised made Madoff look like an amateur.

As the PP Blog reported on June 10, 2012, a couple of months prior to the SEC’s Zeek action (italics added):

When Zeek’s story is compared to the tale of Madoff’s relatively modest (compared to Zeek) but unusually consistent returns of around 10 percent a year, Zeek is outperforming the notorious Ponzi swindler by a factor on the order of 30 to one. Zeek, though, insists it is not offering an investment. It also preemptively denies it is a “pyramid scheme” and plants the seed it will terminate any affiliate who suggests Zeek is offering an investment program.

Lessons flowing from Madoff continue to go unheeded — things such as suggestions of exclusivity and unusually consistent returns.

But with HYIPs, the danger signs may be even clearer: preposterous interest rates that dwarf Madoff’s “returns,” a presence of a scheme on the Ponzi boards such as TalkGold and MoneyMakerGroup, menacing behavior by a company or its affiliates, cult-like qualities (such as allegedly existed at TelexFree), bizarre antigovernment rhetoric suggesting the presence of “sovereign citizens” or political extremists.

One of the classic refrains is that “it can’t be a scam because the company is registered.”

TelexFree, which allegedly generated $3 billion in economic activity, was “registered.”

So was Bernard L. Madoff Investment Securities LLC.

As was the case at Zeek, the TelexFree interest rate dwarfed that of Madoff. From the SEC’s 2014 TelexFree complaint filed years after Madoff made “Ponzi” household word in 2008 (italics added):

One version of the marketing presentation on the company website contained slides indicating that an AdCentral promoter could clear $2,296 per year on a $289 investment, that an Ad Central Family promoter could clear $11,599 per year on a $1,375 investment, and that a Team Builder promoter could receive as much as $39,600 per year.

The “Madoff” trailer is below. It includes lots of lessons for the mind and soul in just one minute — and it’s not just about making people think they are becoming members of an exclusive club. The con man serving 150 years in federal prison also made appeals to naked greed.

Your Ponzi-board sponsor may be doing the same thing to you right now.

Dec 11, 2015
BULLETIN: $1.5 Billion Ponzi Alleged In Nevada

BULLETIN: (5th Update 12:54 a.m. EDT July 9 U.S.A.) Three individuals have been indicted on multiple criminal charges in Nevada, with a grand jury alleging they were at the helm of a $1.5 billion Ponzi scheme targeted at Japanese victims. The criminal case follows a civil action filed by the SEC in 2013.

Charged with eight counts of mail fraud and nine counts of wire fraud were Edwin Fujinaga, 68, of Las Vegas; Junzo Suzuki, 66, of Tokyo; and Paul Suzuki, 36, of Tokyo, the U.S. Department of Justice said. Fujinaga also is charged with three counts of money laundering.

All of the defendants were associated with a company known as MRI International Inc. (MRI). The FBI led the criminal probe.

The news may create consternation among cross-border scammers who venture into the United States to hatch fraud schemes.

“The defendants allegedly preyed on thousands of unsuspecting Japanese victims to enrich themselves by operating a billion-plus dollar Ponzi scheme,” said Assistant Attorney General Leslie R. Caldwell. “This prosecution shows that the Criminal Division will pursue not only those who victimize American citizens, but also those who use the U.S. as a home base to defraud victims abroad.”

As the PP Blog reported in 2013 (italics added):

Part of the scam featured “tours” of MRI’s offices in Las Vegas. The alleged scam is evoking images of Bernard Madoff’s colossal Ponzi scheme, in the sense it appears to have gone undetected for years.

At the same time, the alleged Fujinaga/MRI fraud is reminiscent of the epic Trevor Cook Ponzi scheme in Minnesota, in the sense that investors appear to have been lulled into a false sense of security because the company had a physical presence. It is somewhat common for fraudsters to tout a brick-and-mortar presence as “proof” no fraud scheme is occurring, even though case after case has demonstrated that the frauds may be buried deep inside an enterprise that at first glance appears to be legitimate.

“These defendants are accused of using a Nevada corporation to conduct their $1.5 billion fraud scheme and falsely telling thousands of overseas victims that their investments would be safely held and managed by an independent, third-party escrow agent in Nevada,” said U.S. Attorney Daniel G. Bogden of the District of Nevada “Fraudulent ruses and schemes perpetrated by Nevadans using Nevada corporations and entities will continue to be addressed by this office.”

From a statement by the Justice Department (italics added):

MRI purportedly specialized in “factoring,” whereby the company purchased accounts receivable from medical providers at a discount, and then attempted to recover the entire amount, or at least more than the discounted amount, from the debtor.

According to allegations in the indictment, from at least 2009 to 2013, Fujinaga and the Suzukis fraudulently solicited investments from thousands of Japanese residents, and MRI currently owes investors over $1.5 billion. Specifically, the indictment alleges that Fujinaga and the Suzukis promised investors a series of interest payments that would accrue over the life of the investment and that would be paid out along with the face value of the investment at the conclusion of the investments’ duration. The defendants allegedly solicited investments by, among other things, promising investors that their investments would be used only for the purchase of medical accounts receivable (MARS) and by representing that investors funds would be managed and safeguarded by an independent third-party escrow company.

The indictment further alleges that MRI operated as a Ponzi scheme, wherein the defendants used new investors’ money to pay prior investors’ maturing investments. According to the indictment, the defendants also allegedly used investors’ funds for purposes other than the purchase of MARS, including paying themselves sales commissions, subsidizing gambling habits, funding personal travel by private jet, and other personal expenses.

In January 2015, the SEC said a final judgment from its 2013 civil case “requires Fujinaga and MRI to pay more than $580 million.”

Jul 8, 2015
RIPPLING NIGHTMARE: Has TelexFree Been Dwarfed By Another MLM Ponzi Scheme? Better Living Global Marketing Reportedly Says It Has Taken In $3.3 BILLION — And Is Experiencing ‘Cash Flow Problem’
EDITOR’S NOTE: In a story dated today, BehindMLM.com has broken down claims made in a recent video in which Better-Living Global Marketing (BLGM) figure Luke Teng appears. The potential criminality at BLGM, purportedly based in Hong Kong, not only is alarming, it is stunning. Even more disconcerting is the level of disconnect surrounding the scheme, which had a Zeek Rewards-like business model and purportedly was in the penny-auction business . . .

Hang on to your hats! There could be an active MLM HYIP Ponzi scheme that is even larger than TelexFree, which allegedly reached across national borders to take in $1.2 billion before collapsing in April 2014. The alleged TelexFree sum would rival the epic Scott Rothstein Ponzi and racketeering scheme in Florida and potentially would make TelexFree the fifth largest Ponzi scheme of all time, regardless of the Ponzi business model used. (Like the shrimp delicacies memorably recounted by “Bubba Blue” in the movie “Forrest Gump,” Ponzi schemes come in many forms.)

In 2012, prior to the actions against TelexFree by various law-enforcement agencies, PonziTracker.com rated Rothstein’s caper as the 4th largest of all time in terms of investor losses, estimated at $1.4 billion. Only the Bernard Madoff (est. $17.3 billion), Allen Stanford (between $4.5 billion and $6 billion) and Tom Petters schemes (est. $3.7 billion) were larger.

BehindMLM.com is reporting today that BLGM’s Luke Teng claims to have set a “world record” for intake in his particular sphere of MLM.

If the claim attributed to Teng is correct — that BLGM has taken in $3.3 billion — it could blow both Rothstein and TelexFree out of the water and put BLGM in the same Ponzi seas as Tom Petters and his $3.7 billion scheme. Put another way, BLGM could be the fourth-largest Ponzi scheme of all time, regardless of form.)

If an online Ponzi scheme operating across national borders (including the borders of the United States) can put $3.3 billion on the table in two or so years of operation and creep up on Petters, are we on the cusp of the once unthinkable? Could MLM HYIP schemes rival or even eclipse Stanford and Madoff?

At $1.2 billion, TelexFree already has created a litigation quagmire that rivals the quagmires surrounding the Madoff, Stanford, Petters and Rothstein schemes. BLGM could go the same way. Both BLGM and TelexFree even could eclipse the Top 4 in terms of litigation and logistical nightmares, because millions of victims from dozens and dozens of nations are apt to exist. That condition was not present in the Madoff, Stanford, Petters and Rothstein schemes.

Zeek Rewards — the sixth-largest Ponzi scheme in history, according to the 2012 PonziTracker list — created a litigation monster that could be surpassed by both BLGM and TelexFree.

And yet willfully blind MLM hucksters and serial scammers still are pushing cross-border fraud schemes. The numbers alone show that the world never has seen such felonious self-indulgence at the street level of dealers:
- Zeek. Collapsed in 2012 after less than two years of operation. Victims: 800,000 to 1 million (est.). Dollar volume: $897 million. Source for dollar volume: U.S. court filings.
- TelexFree. Collapsed in April 2014 after operating for a little better than two years. Victims: 700,000 to 1.5 million (est.). Dollar volume: $1.2 billion. Source: TelexFree figures cited in Massachusetts Securities Division action in April 2014.
- BLGM: Operational, but reportedly experiencing cash-flow problem and not paying out or making selective payouts. Victims: Unknown number, but may rival Zeek and TelexFree. Dollar volume: $3.3 billion. Source: Luke Teng video cited by BehindMLM.com.
A Rippling Nightmare

The numbers are hardly the sole concern. As Behind MLM.com reported today, citing remarks made by Luke Teng in the BLGM video (italics added):

[8:13] Some leaders are still making good money. Because the leaders are taking cash from the new members and they use it to give them ecash.

So, that’s still a way for you to make money.

Our take: If true, this is beyond horrifying. It is alleged TelexFree created conditions that permitted members to transact business outside of the system, and some members even may have created an exceptionally dangerous black market for TelexFree’s earning units, which were known as “AdCentrals.”

As the PP Blog reported on March 24, 2014, an ad offering TelexFree AdCentrals at a firesale price appeared on an auction site. Viewers were encouraged to buy a bundle of 550 AdCentrals for $16,760. The asking price purportedly reflected a discount of $8,190 (33 percent), and the purchaser purportedly would earn $110,000 from TelexFree in the next year.

The situation in both TelexFree and BLGM is reminiscent of the truly disturbing Evolution Market Group/FinanzasForex scheme described in 2010 by federal prosecutors in the Middle District of Florida.

As the PP Blog reported at the time (italics added):

. . . there were schemes within schemes in a tangled web of domestic and international deception that featured dozens of bank accounts, shell companies and various fronts for money-laundering enterprises, including companies purportedly in businesses such as real estate and car washes.

The scheme was so corrupt, according to court filings, that some investors were told that, in order to leave the program whole, they had to recruit new investors, have the new investors pay them directly — and use the proceeds from the new investors to “recover” their initial outlays.

In short, if you wanted to recover your EMG/Finanzas money, you had to steal your way out of the “program” by gathering new cash from incoming recruits and keeping it.

Some of the money in the EMG/FinanzasForex case allegedly was tracked to the narcotics trade.

Based on the BehindMLM.com report, it also appears that BLGM may be trying work a second form of Ponzi fraud into its existing scheme. This would appear to involve an adverting rotator of some sort, something consistent with the AdSurfDaily MLM Ponzi scheme in 2008. In 2012, while sharing promoters in common with Zeek, a “program” known as JSSTripler/JustBeenPaid appeared to be trying to transition from a straight-line HYIP fraud into a fraud named “ProfitClicking” that would introduce an “advertising” function. Part or all of the earlier JSS/JBP fraud appears later to have morphed into something called “ClickPaid.”

So, in some ways, BLGM could be modeling ASD, JSS/JBP and other reload schemes to sustain its Ponzi deception.

Teng also may be channeling a notable delusion of now-jailed ASD Ponzi schemer Andy Bowdoin.

Indeed, according to the BehindMLM.com report, Teng is suggesting he may start his own bank.

Before Bowdoin was arrested in 2010, he claimed ASD was looking at acquiring an interest in a bank in South America and creating its own payment processor.

BLGM appears to have gained a head of steam in part from cash-gifting schemers in a “program” called “BlessingGoldClub” and also from former enthusiasts of the Zeek and Profitable Sunrise fraud schemes.
Nov 4, 2014
SEC Declines To Comment On New Claims Attributed To Zeek Figure Robert Craddock

UPDATED 8:30 P.M. EDT U.S.A. The SEC this afternoon declined to comment on a confounding claim attributed to Zeek Rewards figure Robert Craddock that Zeek took in $1 billion in 12 months and that the U.S. government should have modeled a “stimulus program” after Zeek instead of shutting it down in 2012.

News that Craddock apparently had authored a book on Zeek and was making new claims first appeared on BehindMLM.com early today. In 2012, the SEC described Zeek as a massive Ponzi- and pyramid scheme and described Craddock as an obstructionist who was encouraging victims not to cooperate with Kenneth D. Bell, the court-appointed receiver in the agency’s civil case. Craddock has not been been charged with wrongdoing.

Titled “The Zeek Phenomenon: Zero to $1 Billion in 12 Months,” the book in which Craddock is listed as the author is advertised on Amazon.com as a paperback “Out of Print” and with “Limited Availability.” Sept. 29 of this year is the asserted publication date.

The office of U.S. Attorney Anne M. Tompkins of the Western District of North Carolina did not respond immediately to a request for comment on the claims. Tompkins’ office brought successful criminal prosecutions against Zeek figures Dawn Wright-Olivares (investment-fraud conspiracy and tax-fraud conspiracy) and Daniel Olivares (investment-fraud conspiracy) in late 2013.

Wright-Olivares, 45, and Olivares, 31, her stepson, pleaded guilty to the respective criminal charges against them in February 2014. Earlier, in December 2013, they settled SEC civil charges against them by agreeing to pay millions of dollars each, “the entirety of their ill-gotten gains plus prejudgment interest,” the SEC said at the time.

In July 2014, Bell said in court filings that Wright-Olivares, Olivares and alleged Zeek operator Paul Burks had agreed to a consent judgment of $600 million “to be satisfied with substantially all of their assets.”

Other court filings by Bell say a criminal investigation into Burks remains open. Bell also is special master in the criminal case.

The Confounding Claims

Craddock’s apparent claim that Zeek took in $1 billion in a year appears to be at odds with court filings by federal prosecutors in December 2013 that claim Zeek gathered a maximum sum of $897 million before collapsing in August 2012. If, as the claim suggests, Zeek took in $1 billion, there may exist a discrepancy of at least $103 million between the claim attributed to Craddock and the government’s account.

How Craddock apparently arrived at the $1 billion figure was not immediately clear. Such a discrepancy, though, potentially could cause both the SEC and federal prosecutors to revisit the Zeek numbers. The assertions attributed to Craddock suggest that Zeek’s haul could have been much larger and occurred in the narrower time frame of 12 months, not the nearly 20 months cited by the SEC.

In short, could an undisclosed, unrecovered pile of Zeek cash exist elsewhere?

According to marketing copy on Amazon.com for the book attributed to Craddock, the government messed up big time by taking down Zeek.

Here’s a snippet (italics added):

In 2012, if the present Administration wanted to build a successful stimulus program, it should have used Zeek Rewards as a guide. This pioneering venture went from zero to one billion dollars in just 12 months, paid over 400 million dollars to more than 20,000 people earning an average of $20,000, created 10 people who made over one million dollars, and caused several thousand people to earn incomes in excess of one hundred thousand dollars. This unparalleled example would have been a phenomenal feat for our US Government during a period when our very financial existence was threatened.

The words “Ponzi” and “pyramid” appear nowhere in the marketing copy on Amazon.com. Whether Zeek “paid” is immaterial in the context of Ponzi schemes. So is the issue of how much it paid. Bernard Madoff “paid.” All successful Ponzi schemes “pay.” Zeek launched after the collapse of Madoff’s epic fraud, leading to questions about whether Zeek, its insiders and key promoters simply divorced themselves from reality.

Moreover, Zeek launched after the collapse of AdSurfDaily, a Zeek-like scam that promoted a return of 1 percent a day. Zeek’s purported daily payout averaged 1.5 percent, a percentage grossly superior to Madoff and significantly better than ASD.

In 2012, less than a month prior to the SEC’s Zeek action, Craddock temporarily succeeded in taking down a HubPages site operated by Zeek critic “K. Chang” by accusing him of copyright and trademark infringement.

K. Chang ultimately prevailed, but the site experienced downtime.

As the PP Blog reported at the time, Zeek appeared not to own the trademarks Craddock complained about, purportedly with the authority of North Carolina-based Zeek operator Rex Venture Group. Rather, the trademarks were listed in the name of Ebon Research Systems LLC, a Florida business.

A business known as Ebon Research Systems Publishing LLC is listed as Craddock’s publisher for the new book on Zeek, according to the Amazon.com listing.

Florida records suggest that Ebon Research Systems Publishing is managed by Dr. Florence Alexander, the same person behind Ebon Research Systems LLC when the HubPages flap played out more than two years ago.

The PP Blog spoke with Alexander in 2012. She said she “certainly” knew of Zeek, but said she had “no knowledge” of any trademark or copyright complaint filed at HubPages against K. Chang.

Although Craddock claimed to be a Zeek “consultant” while filing the claim against K. Chang prior to the SEC action in 2012, Zeek itself did not list him as one after the action, according to court records maintained by the ASD Updates Blog. (See Zeek filing from September 2012 here.)

Oct 7, 2014
Launch Of Murky BitClub Network ‘Program’ Appears To Be Under Way

From a BitClub Network promo on a page in Indonesian today. Red blocks by PP Blog.

Much remains murky about BitClub Network, a Bitcoin-themed “program” that in typical HYIP fashion missed at least three advertised launch dates earlier this month.

The launch, however, now appears to have gotten under way shortly after “2 p.m. EST” today, a possible indicator that the “program” is using Panama time.

One promo the PP Blog observed shortly after the launch time was in Indonesian. It appeared to claim that BitClub Network paid between 0.3 percent and 0.8 percent a day. If we are reading this claim correctly, it appears as though the promoter is saying recruits who send in $3,000 will earn somewhere between $9 and $24 a day — or between $270 and $720 a month.

We ran the Indonesian claim through Google Translate. Here is part of what the English translation reads (italics added):

. . . the process is run by experts [mining?] bitcoin Digital Currency you just sit at home and receive a daily income of about 0.3 to 0.8% everyday.

The Indonesian pitch also referred to “compounding.” Many HYIP schemes purport that “earnings” can be compounded and that relatively small sums will be become tremendous fortunes over time. Zeek Rewards, which allegedly collected on the order of $850 million in a combined Ponzi- and pyramid scheme that lasted less than two years, was such a “compounding” program.

If our reading of the early info on BitClub Network is correct, it is an upstart offering fraud with a lower daily payout rate than Zeek, which averaged about 1.5 percent. Promos for Bitclub Network claim recruits will get paid for 1,000 days. Zeek had a much shorter term, absent “rollovers.” BitClub Network also may have a rollover feature.

Alleged Zeek Rewards winner Brian Spatola of Randolph, N.J., appears to be on the front lines of BitClub Network. So does alleged Zeek winner T. LeMont Silver, a named defendant in a clawback action by the court-appointed receiver in the Zeek case.

The BitClubNetwork site itself today was using rolling headlines from other sites. One read, “United Way Becomes Largest Nonprofit to Accept Bitcoin.”

Some scams trade on the names of reputable entities as a means of creating a veneer of legitimacy. The names of other famous companies easily could appear in the rolling headlines on BitClub Network, which is presented as a “mining” venture that offers “shares.”

That famous entities may use Bitcoin does not mean that BitClub Network itself is legitimate. Prior to the emergence of Bitcoin, the scammers who promote HYIPs routinely traded on the names of famous banks and credit-card companies, hoping the legitimacy of those enterprises would rub off on the emerging scams.

Regulators have issued repeated warnings about the volatility of Bitcoin values and about scams that seek to tie themselves to Bitcoin.

Here is part of what BitClub Network says about itself on its website (italics added):

BitClub is not owned by any one person, we are a team of experts, entrepreneurs, professionals, network marketers, and programming geeks who have all come to together to launch a very simple business around a very complex industry. Anyone can join BitClub and begin earning a passive income by taking advantage of our expertise in Bitcoin mining and other Bitcoin related services.

Fuzzy ownership and claims about “passive income” lead to questions about whether a “program” is conducting an offering fraud, selling unregistered securities as investment contracts and permitting recruits who have little or no net worth to direct whatever safety blanket they have to murky enterprises with long reach.

Zeek Rewards preemptively denied it was a “pyramid scheme.” On its website, BitClub Network preemptively denies it is a “ponzi scheme .” The “program” claims to be “based in Europe.”

It further claims to operate “virtually with contributors from all over the world.”

And, it claims, “[o]ur main servers and technology for digital mining is located in a very secure and private location that will only be made available by pictures and a live video feed in the near future.”

An earlier HYIP “program” known as JSS Tripler/JustBeenPaid appeared to use servers in the Netherlands. Frederick Mann, its murky purported operator, once fretted that the JSS/JBP servers could be subjected to a “cruise missile” attack.

This is from the FAQs at the BitClub Network site (italics added):

Q – If BitClub is already successful at mining Bitcoin then why are you sharing profit? Great Question!s [sic]

A: Because of how mining works it is always getting harder and harder for smaller mines to make great profits. This is quickly turning into a game for the big boys. Bigger orders mean bigger discounts on hardware, less electricity and rent per Ghz, more flexibility in what is mined and many other factors. By starting BitClub Network we know that over the next couple of years we could become one of the largest most profitable mines in the world. We will actually make more money sharing the profits with you. That’s why there are so many mining pools, we are just doing things a little differently. We believe in the motto “Making money is a team sport.”

Despite the fact BitClub Network says it does not promote that “a share will have set return and we don’t offer 100% ROI claims,” the site in Indonesian is making a claim that the daily payout will range between 0.3 percent and 0.8 percent. If people send in $3,000 and purportedly make between $9 and $24 a day with it, they’d make between $9,000 and $24,000 in BitClub Network’s purported term of 1,000 days.

Bernard Madoff would not have dared to be so bold.

A graphic of a smiling miner wearing a button-down shirt and swinging a pick appears on the site in Indonesian. Another graphic at the site shows Bitcoin and an Automated Teller Machine — as through BitClubNetwork will be the easiest thing in the world, that laborers worldwide will be smiling.

The site in Indonesian also carries graphics of nice automobiles. A photo displays people standing in front of a “HOLLYWOOD” sign — presumptively in California. The banner in part reads, “MALAYSIA.”

Another “MALAYSIA” banner appears in the foreground of a shot that shows people and pine trees set against a backdrop of snow.

Following a recent pattern in HYIP promos, famous landmarks such as the Eiffel Tower and the Arc de Triomphe also appear on the site in Indonesian.

Sep 16, 2014
FAITH SLOAN: Blame TelexFree, Merrill, Wanzeler, Labriola And Nehra, Not Me

Faith Sloan in a TelexFree promo. Source: YouTube.

UPDATED 8:55 P.M. EDT U.S.A. Veteran HYIP huckster Faith Sloan told a federal judge presiding over the SEC’s TelexFree case that she is a victim of the company and was duped by TelexFree executives James Merrill, Carlos Wanzeler and Steve Labriola.

And, the former Noobing, Zeek Rewards and Profitable Sunrise pitchwoman asserted, she also was duped by MLM attorney Gerald Nehra, a lawyer for TelexFree.

Sloan was among four TelexFree promoters charged with fraud by the SEC. Four executives also were charged.

“Sloan believed what Defendants Carlos Wanzeler, James Merrill, Steve Labriola and their attorney, Gerald Nehra, had told her, until TelexFree continued to miss the deadlines for the launch of its new products, which were to be the foundation of TelexFree’s growing business going forward into 2014,” Sloan said in court filings through her attorney.

Those new products, Sloan said, included “MyFinancialAdvantagePlan,” “Mobile App,” “TelexCommerce” and “TelexMobile.”

Taking a swipe at Nehra, Sloan contended that she and fellow promoters were “excited” about TelexFree after Nehra “had stood on the stage and publicly announced that TelexFree was ‘on a solid legal ground’, because they were selling a real product.”

Nehra made the remark at a TelexFree rah-rah fest in Newport Beach, Calif., in July 2013, according to YouTube videos. The remarks followed a June 2013 action in Brazil in which certain TelexFree assets were frozen and new registrations were suspended, amid pyramid-scheme allegations.

Sloan did not say why she continued to promote TelexFree with serious pyramid allegations on the table, except to suggest that Nehra’s remarks paved the way for her to continue with TelexFree. Nor did Sloan say whether her experience promoting Noobing, Zeek and Profitable Sunrise provided her any clues that something could be amiss at TelexFree.

MLM attorney Gerald Nehra offering remarks about TelexFree; Source: YouTube.

Sloan was not charged in the Noobing, Zeek and Profitable Sunrise cases. Regulators say Noobing, an HYIP that targeted people with hearing impairments, was attached to a government-grants swindle. It effectively was shut down by the FTC.

Zeek, meanwhile, was an $850 million pyramid- and Ponzi scheme, and Profitable Sunrise was a cross-border securities swindle effectively run by a ghost that potentially raked in tens of millions of dollars. Both “programs” collapsed after SEC actions.

In April 2014, the SEC described TelexFree as an epic, billion-dollar cross-border pyramid and Ponzi-swindle that engaged in securities fraud and the sale of unregistered securities. All four of the “programs” offered returns that bested Bernard Madoff on orders of between 20 and 70 to one on an annualized basis.

Regulators have been warning about HYIP schemes for years, saying they offer returns that are too good to be true and make cosmetic tweaks to dupe the masses.

Many such schemes proliferate because serial promoters turn blind eyes to obvious markers of fraud such as preposterous interest rates, a presence of a “program” on Ponzi-scheme forums, the presence of other serial fraud promoters and fractured relationships with payment vendors during the course of the fraud. The schemes pay commissions to unlicensed promoters to sell securities to recruits and typically have an illegal investment arm attached.

When a scheme collapses, serial promoters disingenuously point fingers of blame back at management. Though the blame is deserved, it ignores the promoters’ roles in driving dollars to scams.

Sloan also today accused Merrill and Labriola of threatening to boot her from the “program” after she made unflattering remarks about it — after she’d been in the “program” for a year or so and suddenly realized something was wrong at TelexFree.

“In response to her public complaints, Labriola, with the approval of the Defendant, Merrill, threatened to terminate Sloan’s relationship with TelexFree shortly before they filed for bankruptcy protection on April 13, 2014,” Sloan contended in a “verified” memorandum of law filed by her attorney. The document seeks to have the charges against Sloan dismissed.

From Sloan’s motion (italics added):

Sloan became a “promoter” of TelexFree early in 2013. Sloan attended public webinars (web-based seminars) along with thousands of other TelexFree “promoters”. During those webinars, Sloan was told by TelexFree leaders that they were growing a company based on remarkable new products such as the “MyFinancialAdvantagePlan” (MFA), “Mobile App” “TelexCommerce” and “TelexMobile”, which was built on the backbone of Sprint, Verizon, and T-Mobile. All these products were due to be launched during the last quarter of 2013. The Mobile App was touted as being on a par with “WhatsApp”, which had been purchased by Facebook for 19 billion dollars. Based on what she was told by her fellow Defendants, Sloan and her fellow “promoters” were excited about the future of TelexFree, especially after the companies’ lawyer, Gerald Nehra, had stood on the stage and publicly announced that TelexFree was “on a solid legal ground”, because they were selling a real product.

Sloan’s troubles aren’t limited to the SEC case. She’s also a defendant in at least three prospective class-action lawsuits that allege fraud and racketeering.

Nehra is accused in the class-action complaints of turning a blind eye to TelexFree’s fraud to line his own pockets and dupe the masses.

In the Legisi HYIP Ponzi case, HYIP figure Matthew John Gagnon tried a defense similar to Sloan’s defense in the SEC civil case. It didn’t work.

Gagnon was held civilly liable and eventually was charged criminally for making a secret deal with Legisi to promote its scam, which had payouts similar to TelexFree, Noobing, Zeek and Profitable Sunrise. He was sentenced to five years in federal prison.

Like the criminal side of the TelexFree case, the Legisi case was brought after an undercover investigation.

NOTE: Our thanks to the ASD Updates Blog.

Jun 6, 2014
BULLETIN: Special Master Compares Zeek Case To Madoff, Stanford And Enron

BULLETIN: With the MLM world only now coming to grips with the alleged $1.2 billion TelexFree Ponzi- and pyramid fraud, the special master in the Zeek Rewards criminal action has compared the Zeek case to the Bernard Madoff and Allen Stanford Ponzi schemes and the notorious Enron securities swindle involving former CEO Jeffrey Skilling.

Special Master Kenneth D. Bell made the comparison as a means of bringing some logistical efficiencies to the criminal case in which former Zeek executives Dawn Wright-Olivares and Daniel Olivares were charged in December 2013.

Like TelexFree, Zeek operated as an MLM HYIP “program.”

Bell, who also is the court-appointed receiver in the SEC’s civil case against Zeek, has proposed in his role as special master that the court impose electronic noticing procedures on the criminal side of things to keep victims informed.

The Madoff swindle, Bell noted, included “thousands” of victims. Stanford’s swindle, meanwhile, included “tens of thousands” of victims. So did the Enron case.

In each case, Bell noted, judges approved electronic noticing procedures because of the impracticality or downright impossibility of dealing with so many victims on an individual basis.

“In light of the vast number of potential victims spanning the globe in [the Zeek] case, it is difficult to envision a better candidate” for electronic noticing, Bell advised the court.

And, Bell noted, “[b]y many counts, the ZeekRewards scheme created more victims than any other Ponzi scheme in history. As a consequence of its internet-based focus, the scheme generated more than 700,000 victims in over 150 countries.”

Wright-Olivares and Olivares turned blind eyes to Zeek’s massive fraud, which gathered more than $850 million, according to court filings.

It is possible that the alleged TelexFree Ponzi/pyramid is even larger than Zeek in terms of both victims and dollars consumed, a circumstance apt to trigger alarm in the law-enforcement community because of the relentlessness and brazenness of the cross-border schemes. Until final TelexFree numbers become known, Zeek continues to hold the title of of the largest HYIP swindle in U.S. history.

As special master, Bell is proposing that the court permit noticing on both a U.S. Department of Justice website and the website of the Zeek receivership. Many Zeek victims already are familiar with the receivership website.

TelexFree figures James Merrill and Carlos Wanzeler were charged criminally last week. They’re also defendants in an SEC civil action.

The SEC charged Zeek in August 2012. TelexFree may have surpassed it in raw fraud volume less than two years later.

NOTE: Thanks to the ASD Updates Blog.

May 14, 2014
EDITORIAL: Uproar In TelexFree’s Billion-Dollar Broom Closet

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

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

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

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

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

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

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

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

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

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

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

Next imagine that these payouts were “guaranteed.”

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

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

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

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

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

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

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

Maximum Incongruity

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

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

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

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

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

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

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

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

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

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

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

Photo source: WhiteHouse.gov.

Apr 3, 2014
EDITORIAL: Want To Build Your U.S. TelexFree Downline While An Active Pyramid-Scheme Investigation Is Under Way In Brazil? Ignore Or Downplay The Probe And Tell A ‘Carlos Danger’ Joke

Scott Miller goes for a “Carlos Danger” laugh line at a TelexFree event in California.

EDITOR’S NOTE: TelexFree has two executives named Carlos — Carlos N. Wanzeler, and Carlos Costa. Neither of them is “Carlos Danger.”

TelexFree, an MLM “opportunity,” has been under investigation in multiple states in Brazil since at least late June. There have been reports of death threats against a judge and a prosecutor — and there have been reports of assaults against journalists covering the alleged scam in Brazil.

None of this appears to have motivated TelexFree to cancel/postpone a California MLM rah-rah session in late July.

Scott Miller, according to a video playing on YouTube, was one of the featured TelexFree speakers at the Newport Beach event. Members of his group claim in videos that, if one sends $15,125 to TelexFree to purchase a “contract,” one will emerge with guaranteed earnings of at least $1,100 a week for a year. The math of the claim is basically this: $1,100 a week for 52 weeks equals $57,200. Subtract the original outlay of $15,125, and emerge $42,075 on the plus side.

Put another way, plunk down a little more than $15,000 and watch it virtually triple or quadruple in a year. Would Bernard Madoff have dared to be so bold?

The plain answer is no. Madoff roped in his Ponzi victims with suggestions of vastly lower annual returns.

But all of this TelexFree tripling or quadrupling of money is possible — to hear the firm’s cheerleaders tell it on YouTube — if recruits carry out a simple task: place an ad for the “opportunity” at free classified sites online. And you can make more in pure dollar terms by sending more, the cheerleaders say.

If you find it strange that TelexFree is continuing to conduct business in the United States against the backdrop of alleged threats against judicial officers in Brazil even as some TelexFree promoters try to drive business to the firm by videotaping a statue of Jesus Christ in Rio de Janeiro, you may find it stranger yet that New York City mayoral candidate Anthony Weiner’s name has made its way into a TelexFree sales pitch.

Nothing suggests that confessed sexting aficionado and former Congressman Weiner has anything whatsoever to do with TelexFree. But his in-the-news name apparently was one too rich for Miller to ignore from the stage in Newport Beach.

Miller told the assembled TelexFree masses in California that 75 percent of the people in MLM are women.

“Even Anthony Weiner — ‘Carlos Danger’ — can meet someone in this industy,” Miller cracked. Carlos Danger reportedly was an online name name used by Weiner.

MLM and/or affiliate schemes have been known to trade on the names of famous politicians of both major American political parties, occasionally even planting the seed that the famous politicians even had endorsed the “opportunity.” The $119 million AdSurfDaily MLM Ponzi scam traded on the names of (Republican) President George W. Bush and Vice President Dick Cheney, for example. The Mantria Ponzi scheme ($54.5 million) traded on the name of former President Bill Clinton, with one of the pitchmen encouraging prospects to join the [Donald] Trump network after the 2009 collapse of Mantria. Clinton is a Democrat who continues to be a major figure on the world stage after an affair with an intern nearly toppled his Presidency; Trump is a billionaire, an occasional MLM cheerleader and an often-rumored GOP Presidential candidate who appears to enjoy trying to tweak President Obama, a Democrat, by pandering to the “Birther” conspiracy-theory vote.

In 2010, an affiliate of the MPB Today MLM “program” tried to drive traffic to the now-shuttered “opportunity” whose operator is jailed by positioning Obama and then-U.S. Secretary of State Hillary Rodham Clinton as Nazis, with Obama’s family being positioned as welfare recipients eager to eat dog food.

With each passing day, MLM seems to be creating bigger and bigger PR disasters for itself. We’re left wondering: What is funnier? The joke about Anthony Weiner or the fact it was told by an MLMer whose group apparently believes that sending an entire year’s salary for many Americans to TelexFree during an active investigation will cause the investment to mushroom while Bernard Madoff is knocking another year off his 150-year sentence?

In any event, the apparent message in some U.S. MLM circles today is that you can build a downline in TelexFree even during an offshore pyramid probe by ignoring or downplaying the investigations and deflecting the attention of the audience further by trotting out your best “Carlos Danger” lines.

And you can triple or quadruple your money while doing so, of course.

Aug 4, 2013