Two senior managers at the St. Michael’s Centre nursing home in Burnaby allegedly were running a pyramid scheme targeted at women and have been fired, GlobalNews.ca is reporting.
Workers — rather than residents — were the apparent targets. The Royal Canadian Mounted Police are investigating, the publication reported.
Whether the scheme was operating as a “gifting” program was not immediately clear. In 2013, there were reports in British Columbia about a “women’s circle” gifting scam in the province.
Such schemes may adopt a theme of “women helping women.” There have been criminal prosecutions flowing from such schemes in the United States and the United Kingdom.
In November 2014, Idaho Attorney General Lawrence Wasden issued a warning about a “women’s” program operating in that U.S. state.
Some promoters who push gifting scams also participate in other forms of the pyramid- or Ponzi scheme. Such was the case among certain participants in “Blessing Gold Club.” They simultaneously were pushing a scheme known as Better-Living Global Marketing, a “program” whose business model strongly resembled that of the Zeek Rewards scheme taken down by the SEC in 2012.
A woman has contacted the court presiding over the Achieve case to solicit help in getting back her money. The six-page filing by Arla Mendenhall, who identified herself as an Achieve investor, further questions how Achieve treated her for tax purposes.
A similar situation at Zeek, according to court filings, led to a 2014 criminal charge of tax-fraud conspiracy against Zeek operator Paul R. Burks. Prosecutors alleged that Burks failed to file corporate tax returns and accused him of issuing “fraudulent IRS Forms 1099s, causing victim-investors to file inaccurate tax returns for phantom income they never actually received.”
Mendenhall claimed in a communication to the court presiding over the Achieve case that she received a 1099 that asserted she was paid $6,000 by Achieve, even though “I only withdrew $800.00.”
The remaining $5,200 was “reinvested in the business,” she advised the court.
All in all, Mendenhall contended she plowed $8,450 into Achieve.
Records in the Zeek case list her as a “winner” of a Zeek sum in excess of $1,000, meaning she’s a defendant in a class-action clawback case filed by Zeek receiver Kenneth D. Bell in 2014. Senior U.S. District Judge Graham C. Mullen of the Western District of North Carolina granted class certification earlier this month.
Separately, posters at the RealScam.com antiscam forum have linked Mendenhall to cash-gifting schemes such as The People’s Program and Blessing Gold Club.
In 2013, the PP Blog reported that certain Blessing Gold Club promoters were promoting Better-Living Global Marketing and its Zeek-like Bidders Paradise arm. BLGM purportedly operated offshore, giving rise to questions about whether U.S. members involved in Zeek later had moved to a new venue in an effort to continue to pick fruit from a poisonous tree.
On Feb. 12, U.S. District Judge Robert E. Blackburn of the District of Colorado froze Achieve Community assets after the SEC contended Achieve was a pyramid- and Ponzi scheme that had gathered more than $3.8 million.
“I had no knowledge of anything illegal when I joined this Business,” Mendenhall said in her filing today.
Much of the information submitted by Mendenhall appears to have originated in her Achieve Community back office.
Alleged Achieve operators Troy Barnes and Kristi Johnson have invoked their Fifth Amendment right not to incriminate themselves in the SEC’s civil case. Barnes has claimed he faces a criminal investigation.
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.
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.
In May 2012, three American women and alleged “leaders” of a cash-gifting pyramid scheme were arrested in Connecticut for their roles in the purported “opportunity,” a pyramid that featured so-called “Women’s Gifting Tables” and had a food theme. Two of the woman later were sentenced to prison. The third woman was placed on three years’ probation and put under court supervision.
It now has emerged that 11 women in Britain implicated in a highly similar scheme have been prosecuted. Six have been convicted. The British scheme was known variously as “Give and Take” and “Key to a Fortune” and had a bridal theme.
The apparent message? Get a great start in wedded life by handing over your cash to a gifting scheme and waiting for your £3,000 to magically turn into more than £20,000.
Like the Connecticut cash-gifting scheme, the British scheme allegedly was led by older women, including some in their fifties or sixties. Both schemes featured false claims the “program” was legal.
The British scheme reportedly gathered on the order of £21 million, with about 90 percent of participants losing their money. Some of the participants appear to have purchased multiple positions, hoping to score more than one payout.
Western Morning News, quoting a prosecutor, reported the scheme was ruled with a “rod of iron.” In May 2012, federal prosecutors in the United States said the Connecticut scheme included an element of “intimidation” aimed at silencing people who questioned the scheme.
The scheme in Britain allegedly operated between May 2008 and April 2009. The Connecticut scheme operated roughly between 2008 and 2011.
From the BBC, quoting Judge Mark Horton (italics added):
“These cases and the actions and attitudes of these defendants demonstrate the way in which pyramid promotional schemes and chain gifting schemes can be secretly created and quickly spread amongst a vast number of people and over several counties,” he said.
In February 2014, a prosecutor in Hawaii warned about a “Women’s Circle” gifting scheme operating in that state. The PP Blog reported at the same time that members of a cash-gifting scam known as BlessingGoldClub were trying to offload “units” in the Better-Living Global Marketing HYIP scam for $500. The units purportedly were being discounted from $1,295.
In the U.K. case, Judge Horton said, “The public need to be aware that schemes like this lead to the destruction of lifelong friendships and families and in some cases whole communities as friends and family are lured into such a scheme,” according to Western Morning News.
In its role as a watchdog for consumers, the FTC has sued third-party companies and individuals who have published the logos of prominent news agencies and falsely traded on their trusted identities to sanitize a purported product or opportunity. (See screen shot of Evidence Exhibit from one FTC case below.)
In a new video promo announcing it somehow has gained 550,000 new American customers in less than a month during a probe into its business practices, TelexFree is publishing the logos of 18 prominent media firms, including logos of local-market affiliates of major American TV networks. In certain instances, the logos of the so-called “mother ships” — media parent firms or brand/content licensors of the local affiliates — appear in the TelexFree promo. This could prove to be an epic blunder.
The move by TelexFree occurs on heels of SEC allegations that a Ponzi/pyramid scam known as WCM777 traded on the names of famous brands outside of media.
On Feb. 28, the Massachusetts Securities Division confirmed it was investigating TelexFree. The agency earlier gave WCM777 the boot.
Hong Kong may be emerging as a hotbed of MLM fraud.
TelexFree goes to Hong Kong.
Does anyone in TelexFree’s MLM leadership have a clue — we mean, Freaking Clue One?
More . . .
__________________________________
UPDATED 10:51 A.M. EDT (U.S.A.) Be skeptical of “programs” that imply media ties or suggest media vetting or an endorsement by the media or a famous company in another discipline, including high finance. Brand-leeching “works,” which is why so many fraudulent companies adopt it as a strategy.
On the “we’ve-been-endorsed-by-the-media” fraud front, several instances of this have occurred. In both 2011 and 2012, the blood-sucking, $850 million Zeek Rewards Ponzi scheme pretended that puff pieces about it that appeared in Network Marketing Business Journal constituted real news. Zeek’s court-appointed receiver later auctioned off the puff pieces and the impressive-looking plaques to which they’d been attached.
Zeek and many of its affiliates preferred fantasy constructions. Put another way, they weren’t all that keen on paying attention to actual news occurring in the direct-sales sphere. In April 2011, for example, the Federal Trade Commission brought actions against several alleged scammers pushing acai weight-loss products and making deceptive claims. Among other things, the FTC alleged that the Internet-based hucksters created fake news sites and often used “the names and logos of major media outlets” such as “ABC, Fox News, CBS, CNN, USA Today, and Consumer Reports” to plant the seed the products had the backing of the brands and had been vetted approvingly by reporters.
As the PP Blog wrote in an Editor’s Note at the time (italics added): If this federal and state action doesn’t get the attention of the out-of-control, direct-sales crowd that divines itself the right to plant the seed that an “offer” is endorsed by famous companies and people, well, perhaps nothing will. Even as this story is being written, affiliates of Club Asteria, a purported “passive” investment company, are planting the seed that the firm is endorsed by Google, Yahoo, MSN and America Online. Club Asteria promoters also routinely trade on the name of the World Bank. Club Asteria is being pitched on forums populated by serial Ponzi scheme promoters.
Club Asteria, which had a presence on the Ponzi boards and purportedly had a satellite operation in Hong Kong, had roots in the cash-gifting fraud sphere and planted the seed it provided a return of at least 3 percent a week. It stopped making weekly interest payments to affiliate-investors before 2011 had come to a close.
Flash forward to April 2014, three years to the month after the FTC brought the acai fraud cases against direct-selling companies and individuals using the names and logos of famous media brands. Indeed, on April 5, a new pitch by the TelexFree MLM “program” began appearing in video form online.
And indeed it uses the logos of a whopping 18 media companies famous in local markets. And because some of those locally famous brands also incorporate the logos of their even more famous parent brands or licensors, TelexFree potentially could be risking the wrath of the upstream mother ships, too.
Like Club Asteria, TelexFree has an affiliate presence on the Ponzi boards. Also like Club Asteria, TelexFree has wildly enthusiastic pitchmen who claim the “program” provides preposterous, “passive” returns. (The TelexFree promo referenced in this report by the PP Blog first was noted by a TelexFree skeptic and reader of BehindMLM.com, a site that covers emerging MLM schemes.)
From YouTube. As TelexFree executive Steve Labriola narrates a video, the logos of prominent media companies roll in the background. Red highlight by PP Blog.
At approximately the 4:55 mark in the April 5 TelexFree video, the logos of local television stations — including affiliates of Fox, NBC, ABC and CBS — begin rolling on the screen. (The logo of the Las Vegas Review-Journal, the biggest newspaper in Nevada, also rolls on the screen.)
Says TelexFree executive Steve Labriola, while continuing to narrate the video after complaining about Bloggers who are negative on the company:
“But let me tell you what is out there that you haven’t quite seen yet: media that’s talking positive about us. There are articles. There are things out there that you’re gonna have in your back office that you can print, you can read, you can use as a tool within the next few days. These are all media articles that are talking great things about your company. So, we’re excited about that. We’re excited that you can be excited about that. It’s all good news. It’s all reprinted. And it’s all available for you.”
From an FTC evidence exhibit in a 2011 case that alleged pitchmen used the logos of media companies to sanitize an online fraud scheme. Red highlights by PP Blog.
What are these “media articles” to which Labriola refers while logos of local affiliates of the major broadcast networks and the logo of a major American newspaper roll in the background?
Well, unless the media firms published any other “great things” about TelexFree, they’re puff pieces TelexFree itself submitted via one or more PR wires. In instances we observed, several local broadcast affiliates of the major networks republished TelexFree-authored content — but not before slapping on a disclaimer. To see an example of the disclaimer we observed, visit the website of News9.com (KWTV-DT as a broadcast channel), a CBS affiliate in Oklahoma City. From the station’s website (italics added):
Information contained on this page is provided by an independent third-party content provider. WorldNow and this Station make no warranties or representations in connection therewith. If you have any questions or comments about this page please contact [deleted by PP Blog]
SOURCE TelexFREE
You’ll see the same disclaimer at KTEN.com, the website of an NBC affiliate in Denison, Texas, that covers parts of Oklahoma. (KTEN’s logo, which incorporates NBC’s famous “peacock,” is the first to roll in the TelexFree promo.)
In yet another example, a disclaimer appears at the website of KTRE, an ABC affiliate in Pollok, Texas. Other channels or newspapers that might have published TelexFree’s PR talking points also likely added disclaimers or attributions to TelexFree, so readers would make a distinction between actual news content and verbatim PR puff.
Labriola doesn’t mention the disclaimers as famous logos roll in the background. The audience easily could conclude that each of the news outlets whose logos are reproduced had published objective reports about TelexFree and championed the company.
With all things possible in the HYIP sphere, we’re wondering if TelexFree affiliates soon will start whipping those republished PR releases into endorsements of TelexFree by major media firms locally and nationally. After all, some TelexFree affiliates have planted the seed the “program” is endorsed by the SEC and is backed by President Obama.
Earlier in the video, Labriola claimed, “Since March 9, since our compensation plan has changed, we have 550,000 new customers in [the] U.S.A. alone. And remember, we’re a global business.”
Whether those talking points later will end up in videos or print material that displays the logos of well-known media companies is, for now, unknown. The stage nevertheless has been set for disingenuous MLM constructions of all sorts, including hypothetical (as of now) constructions such as this one: “according to [Famous Media Company A], TelexFree is in a stunning growth phase that has seen more than 550,000 new American small-business customers enlist since March 9 alone. Because TelexFree is a worldwide phenomenon, tens of millions of customers are destined soon to be in the fold.”
And what about proof? Well, just wrap the logo of a famous media brand around the claim.
This won’t go well if this is TelexFree’s new media strategy.
Branding concerns aside, the practical reality remains that how TelexFree is defining “customers,” like Zeek before it, is far from clear. Beyond that, current TelexFree affiliates are complaining publicly about not getting paid after the company changed its compensation system.
Hong Kong
In the video promo with the media logos, Labriola goes on to note that “I just came back from a Hong Kong trip.” Whether that trip had anything to do with an asserted March 26 TelexFree “conference” in Hong Kong wasn’t explained.
Hong Kong may be emerging as a hotbed of MLM HYIP fraud. For instance, it is a venue in which Club Asteria claimed a presence and also a venue in which a “program” known as “Better-Living Global Marketing” purportedly conducts business. (See reference and related links here.)
In addition, Hong Kong is referenced in the SEC’s Ponzi- and pyramid case last month against WCM777, an alleged $65 million fraud scheme. Hong Kong also is referenced in the SEC’s fraud complaint last month against an entity known as “Mutual Wealth.”
In October 2013, the SEC alleged that enterprises known as CKB and CKB168 were “at the center” of a worldwide pyramid scheme that allegedly featured a purported office in Hong Kong and operations in Canada, the British Virgin Islands and the United States.
TelexFree, alleged in Brazil to be a pyramid scheme, is under investigation by the Massachusetts Securities Division. Some affiliates are deeply concerned about changes in the TelexFree compensation scheme that appear to have dried up or negated payments to them. These affiliates packed themselves like sardines into the “program’s” office in Greater Boston last week. Police were called to the scene.
Just four days after TelexFree affiliates jammed the TelexFree office, the Labriola video with rolling media logos, claims of hundreds of thousands of new customers and the reference to Hong Kong appeared on YouTube. Whether TelexFree has opened new can of worms remains to be seen.
What’s been clear for months is that TelexFree has no cohesive message and throws just about anything against the wall, including rants at prosecutors by a Brazil-based executive while investigations in that country are under way.
A maxim sometimes attributed to Mark Twain and often cited by PR companies and politicians goes like this: “Don’t pick fights with people who buy ink by the barrel.”
To that, we’ll add that it’s also not prudent to tempt fate with media companies that buy bandwidth by the terabyte and employ note-taking reporters and editors and videographers who take spectacularly detailed footage.
This Blog has grave doubts that any of the media firms whose logos appear in the TelexFree promo will be pleased. Their own names could be sullied. If those logos start appearing on marketing materials and plaques, well, hang on to them. They could become the same type of souvenirs the Zeek receiver sold to raise money for victims.
One of the issues in the SEC’s case against WCM777, of course, was the alleged republication of famous logos (nonmedia) and the namedropping of famous companies (nonmedia) to sanitize the alleged WCM777 fraud scheme.
Is any famous company, be it nonmedia or media, safe from MLM hucksters on the Internet? The answer is probably no, given that the vultures apparently think nothing of swiping the brands of government agencies and even of the President of the United States to advance their schemes.
Why TelexFree has ventured down the minefield-laden path of publishing logos of locally or nationally famous brands is truly baffling, especially given the nature of the allegations in the WCM777 case and the fact TelexFree itself already is under investigation.
This circumstance reminded us not only of the Zeek debacle and the SEC’s WCM777 case and the FTC’s acai-berry cases, but also of efforts by the AdViewGlobal Ponzi schemers in 2009 to use an in-house puff piece distributed on PR wires to plant the seed the 1-percent-a-day “program” was endorsed by Forbes magazine, the Washington Business Journal and The Business Review.
Prior to the filing of the SEC’s fraud complaint against WCM777, some apparent cheerleaders for the firm tried to plant the seed that the “program” had been vetted favorably by Yahoo Finance and the Wall Street Journal. One individual tried to drop both famous names at BehindMLM.com, a site that covers emerging MLM schemes.
BehindMLM’s negative coverage of WCM777 was “real non-sense,” the critic asserted on Oct. 11, 2013, pointing to a purported favorable story on WCM777 in the Wall Street Journal. That “story” proved to be a PR puff piece republished with a disclaimer at WSJ.com.
“The Wall Street Journal news department was not involved in the creation of this content,” the disclaimer read.
But with the purported Wall Street Journal “story” in his hip pocket, the WCM777 “supporter” and BehindMLM critic asserted, “I will make the most of it to my enemies’ disgust!” (See this story and Comments thread at BehindMLM.com.)
The SEC was in federal court about five months later, alleging that WCM777 had targeted a massive fraud scheme at Asians and Latinos and had caused the logos of famous brands to be republished as part of a bid to sanitize the $65 million scam.
Honestly, does anyone in TelexFree’s MLM leadership these days have a clue — we mean, Freaking Clue One?
“Women’s Gifting Circles” or “Women Empowering Women Circles” pyramid schemes are operating in Hawaii, said Kauai Prosecuting Attorney Justin F. Kollar.
“These schemes are marketed as a way to entice women through a tiered investment model, often using language that speaks in terms of ‘empowering’ women spiritually or financially,” Kollar said. “The people at the top of the pyramid collect money from those at the bottom of the pyramid, plain and simple. The people at the bottom are promised future rewards that are based on recruiting additional followers to start new circles. These schemes are illegal and are designed by predators to extract money from people who trust them.”
In many cases, women who are being recruited are told not to talk about the circle for various reasons, or are told that the practices are legal as long as the dollar amounts are under a certain threshold. However, violators can be subject to criminal and civil penalties under State securities laws.
In other cash-gifting fraud news, a source told the PP Blog today that members of a cash-gifting scam known as BlessingGoldClub are trying to offload “units” in the Better-Living Global Marketing HYIP scam for $500. The units purportedly are being discounted from $1,295.
BLGM members have been fretting about not getting paid. The “program” is similar to the Zeek Rewards’ Ponzi scheme.
TelexFree figure Scott Miller also has been a proponent of cash-gifting. Miller’s Facebook site for TelexFree, alleged in Brazil to be a massive pyramid scheme, appears not to have been updated since Jan. 10.
The series of screen shots (below) show spam waves aimed here today that appear to originate in China. The would-be visitors tried to register to post “comments” in older stories detailing the MPB Today pyramid scheme, the Evolution Market Group and FinanzasForex fraud schemes and the ProfitClicking fraud scheme. Not pictured are URLs from another Oct. 8 wave, which sought to pull stories and/or post “comments” in threads on scams of more recent vintage, including Zeek Rewards and Profitable Sunrise.
1.
2.
3.
This is an expanded view of a wave tonight and the spammers’ bids to register to post “comments” here.
Through 12:49 p.m. EDT today, the PP Blog had received 24,575 spams this month alone. By 9:05 p.m. today, the number had risen to 25,264. The total in the past six months has exceeded 317,000. For a month or so, the Blog has been testing a new means of minimizing the effect of data floods on its core systems. This is a work-in-progress that occasionally has created inconvenience for legitimate readers and posters. We appreciate your thoughtful notes and patience as we continue this battle.
‘BlessingGoldClub’ Brief
Speaking of thoughtful notes, we received one today from a person knowledgeable about a purported “opportunity” known as “BlessingGoldClub,” which appears to be a cash-gifting scheme with some members trying to marry themselves to a purportedly Hong Kong-based, Zeek Rewards-like scheme known as Better-Living Global Marketing and an apparent subsidiary known as Bidders Paradise.
We referenced Better-Living Global Marketing in this May 12 thread involving former Profitable Sunrise pitchman and Zeek Rewards fawner John Schepcoff. It also is referenced in this June 5 story about an SEC subpoena aimed at Schepcoff.
We have briefly reviewed some information about Blessing Gold Club, which purports to be a “private membership association.” In any event, offering materials for Blessing Gold Club show children displaying handfuls of cash. If members now are congregating with Zeek and Profitable Sunrise scammers and pushing Better-Living Global Marketing, it could be yet another MLM disaster in the making.
The person knowledgeable about BlessingGoldClub is raising the prospect that gifters are trying to keep Better-Living Global Marketing/Bidders Paradise under the radar and may be avoiding traditional scam-pushing sites such as the Ponzi boards.
Longtime readers will recall that AdViewGlobal, a knockoff of the AdSurfDaily Ponzi scheme, also purported to be a “private association.” According to an AVG consultant (in 2009) who had a criminal record for securities fraud, such structures permit individuals to practice medicine and law without a license.
And by the various magical constructions that existed within AVG, they apparently also make Ponzi and pyramid schemes “legal.”
Be careful out there, Folks. The bots and spammers are doing all they can do to make sure the scammers can thrive on the Internet.
John Schepcoff says on YouTube that he potentially lost more than $193,000 in Profitable Sunrise but that a new “program” operating from Hong Kong is “1,000 percent” better.
EDITOR’S NOTE: Much remains murky about Profitable Sunrise, the alleged purveyor of five HYIP “plans,” including one bizarrely dubbed the “Long Haul” that purported to pay a preposterous 2.7 percent a day. The “Long Haul” payoff was dubbed the “Easter Gift.” Investors were told it would arrive April 1 — but it never materialized.
One thing that is abundantly clear is that Profitable Sunrise potentially has created legal exposure and inconvenience for individual pitchmen, even though purported operator “Roman Novak” appears to be gone like a thief in the night.
Still pushing HYIP schemes?
_____________________________
At least three Profitable Sunrise pitchmen — including at least two who pushed the “program” on YouTube — have been subpoenaed by the SEC to appear at depositions this month. The agency’s move is occurring in the aftermath of the depositions of at least two other Profitable Sunrise figures in Florida and Utah in April.
In July 2010, the PP Blog reported that the Financial Industry Regulatory Authority (FINRA) warned investors worldwide “to stay away from HYIPs,” saying that they use social-media sites such as YouTube, Twitter, Facebook and online forums and “rating” sites to spread Ponzi misery globally.
At least two of the men named in the new round of subpoenas went on to push other purported “opportunities” after the SEC described Profitable Sunrise in April as a murky HYIP that had used a “mail drop” in England and a series of offshore bank accounts in multiple countries to scam investors potentially of tens of millions of dollars.
A subpoena was docketed yesterday in federal court in Atlanta for John Schepcoff of Carmichael, Calif. Schepcoff also is known as James Schepcoff, according to the SEC. His deposition has been scheduled for June 12 at 10 a.m. in San Francisco.
After pitching Profitable Sunrise on YouTube prior to its March collapse amid especially murky circumstances, Schepcoff returned to YouTube in late April and began pitching yet another murky “program” purportedly operating from Hong Kong. Although the identity of the Hong Kong “program” was unclear, records suggest it was a Zeek Rewards-like “opportunity” known as “Better-Living Global Marketing.”
In August 2012, the SEC described Zeek as a $600 million Ponzi- and pyramid scheme that had pushed unregistered securities on hundreds of thousands of people and duped them into believing they were receiving a legitimate return of about 1.5 percent a day. The U.S. Secret Service also said it was investigating Zeek.
A subpoena also was docketed in Atlanta yesterday for video pitchman Melton McClanahan of Fairfield, Calif. McClanahan was identified in a March order by the Alabama Securities Commission (ASC) as a Profitable Sunrise agent. McClanahan then posted a YouTube video denying he was an agent and yet claiming the information he passed along to lure prospects “was given to me.”
McClanahan’s deposition is scheduled for June 11 at 10 a.m. in San Francisco.
An SEC subpoena also was docketed yesterday in Atlanta for Don Gillette of Miami. Gillette reportedly told members of his Profitable Sunrise downline that he was turning to a new “program” that “must have a realistic earning potential of at least $500 a day or more,” according to a post at the RealScam.com antiscam forum.
Details about the scheduling of Gillette’s deposition are unclear.
As part of its ongoing Profitable Sunrise probe, the SEC also has subpoenaed records at PayPal and at Societe Generale in New York, according to the docket of U.S. District Judge Thomas W. Thrash Jr. in Atlanta. Whether Profitable Sunrise or its members were using the companies to move money is unclear.
One of the problems with HYIP schemes is that they may cause laundered funds or proceeds of criminal enterprises to pass through or be placed on deposit at legitimate financial institutions.
News of the new round of Profitable Sunrise subpoenas follows on the heels of the takedown last month of Liberty Reserve, amid allegations it had orchestrated a $6 billion money-laundering conspiracy. Liberty Reserve was popular with HYIP scammers and other criminals.
Two senior managers at the St. Michael’s Centre nursing home in Burnaby allegedly were running a pyramid scheme targeted at women and have been fired, GlobalNews.ca is reporting.
