UPDATED 4:40 P.M. EDT (U.S.A.) Before AdViewGlobal (AVG) even shared what it described as a members-only, “Breaking News” announcement that it was suspending cash-outs, the embattled surf firm threatened media outlets with copyright-infringement lawsuits if they published the announcement.
Members almost immediately shared the news outside the confines of the AVG “private association,” despite the firm’s bid to compartmentalize its announcement. Members said they had grown increasingly frustrated by AVG’s ham-handed efforts to operate in an environment of secrecy and the predisposition of some promoters to scold participants for asking questions about the company in public.
AVG informed members that cash-outs would be suspended for at least 30 days. An 80/20 program that further separates members from their money would be made mandatory. At the same time, AVG claimed it had solved payment-processing and banking problems that had dogged it for months.
The firm did not explain how it had solved the problems.
Recently, though, the firm entered into a partnership with a new company based in Canada. Members said AVG now was selling a debit card that could be used for “page impression” purchases through PayPal, whose Acceptable Use Policy expressly forbids the company’s services to be used for pyramid schemes and Ponzi schemes, two things associated with the business model AVG employs.
The debit card is offered through Texas-based Secure Cash Network Inc. (SCN), which says in its Terms of Service that the card cannot be used for the purchase of illegal products and services. Many jurisdictions consider the autosurf business model to be illegal, and the U.S. government has successfully prosecuted a number of surf firms in recent years.
AVG also said it was hiring “new management” within two weeks, but did not say whether it was firing old management — or even identify its current management team. Incongruously, the surf promised to identify its new management team, members of which may be stepping into a hornet’s nest. AVG engages in an industry frequently linked with wire fraud and money-laundering, and is closely associated with a firm under investigation for those crimes.
As is typical of AVG announcements, the company suggested members were responsible for the firm’s problems.
In this post, the PatrickPretty.com Blog listed the Top 5 reasons to avoid AVG, which purports to be a professional “advertising” and communications firm headquartered in Uruguay. There now is a sixth reason: The news AVG hoped to compartmentalize within its organizational walls — news that now is being talked about openly in forums — may be evidence of a crime in progress.
Could the AVG announcement become an important piece of evidence in an ongoing wire-fraud, money-laundering and Ponzi scheme investigation involving Florida-based AdSurfDaily Inc. (ASD) and unnamed others?
There is good reason to believe AVG is part of the ASD probe.
Two of AVG’s trustees — George Harris III and his wife, Judy Harris — are named in a federal forfeiture complaint as beneficiaries of illegal conduct by ASD. George Harris is the stepson of ASD President Andy Bowdoin. The Tallahassee home Harris shared with his wife — and an automobile registered to the couple — were named in the forfeiture complaint as the proceeds of a crime.
Bowdoin is described in court filings as a target of a federal criminal investigation. AVG graphics once appeared on a website controlled by ASD, and AVG listed its street address as 13 S. Calhoun Street, Quincy, Fla., in the graphics. That is the same mailing address ASD listed, and federal prosecutors said it is bogus, which may signal ASD also is part of a mail-fraud investigation.
Moreover, prosecutors said in court filings that Bowdoin signed a proffer letter in the ASD case before firing his paid attorneys and proceeding as a pro se litigant. Bowdoin told ASD members that he decided to represent himself in court after consulting with a “group.”
His first pro se pleading was dated Feb. 25. The following day, AVG introduced members to Pro Advocate Group, which says it helps businesses form “private associations” and individuals practice specialties such as law and medicine without a license.
Pro Advocate Group is associated with Karl Dahlstrom, who was convicted in the 1990s of securities fraud and sentenced to 78 months in federal prison. Prosecutors said Dahlstrom bought automobiles with investors’ money, an assertion also made against Bowdoin and George and Judy Harris, the AVG trustees.
Dahlstrom also pitched his program to church members — yet another assertion made against Bowdoin.
Meanwhile, an AVG forum operated by some of the Mods and members of the Pro-AdSurfDaily Surf’s Up forum appears to have gone dark. It is unclear if content from the forum has been deleted.
** UPDATE 4:40 P.M., June 25: The website of a firm closely associated with AVG — eWalletPlus — also has gone dark. The site has been throwing a server error for at least 24 hours. eWalletPlus provided certain money services for AVG and once operated from the Phoenix area. As is the case with AVG’s servers, the servers for eWalletPlus now resolve to Panama.
EWalletPlus stopped accepting registrations from new members during the same spring time frame in which AVG announced its bank account had been suspended. ** END 4:40 P.M.UPDATE **
AVG launched after federal prosecutors seized tens of millions of dollars from Bowdoin, whom prosecutors said had a history of taking money from customers and moving it from one company to another when his enterprises encountered difficulties and could not pay members.
Like AVG, Bowdoin suspended member cash-outs and announced retrenchment plans, which fundamentally shifted the burden of paying participants from one group to another within the organization.
AVG appears to be doing the same thing, but appears also to still be collecting money from prospects who visit the firm’s main website. AVG’s retrenchment plan is not mentioned on its sales site, even though the site has a “Breaking News” banner. AVGÂ also does not inform prospects about the ties to ASD on its sales site.
New members may not learn about the retrenchment plan until after they join the organization.
Lack of disclosure is one of the allegations against ASD, which prosecutors said also engaged in the sale of unregistered securities.
AVG’s announcement of the retrenchment program raises new questions about whether the company is engaging in the sale of unregistered securities while operating an unregistered money-services business.