PatrickPretty.com

Tag: chilling the 1st Amendment

  • Joyous Dog’s Death ‘A Sign Of GOD Telling You To Stop Publishing Fear And Meaningless Accusations Once And For All,’ HYIP Apologist Claims

    They’ll tell you that 2 percent a day (730 percent a year) is not too good to be true and that experts had performed “due diligence.” They’ll say their “program” is different from other schemes that either collapsed under their own weight or were brought down by the government. They’ll position themselves as free-market entrepreneurs, perhaps even the guardians and gatekeepers of freedom itself.

    They’ll draft grandparents into their cross-border HYIP fraud schemes, tell them to set up accounts for their grandchildren and then proceed to defraud entire families — oldest to youngest.

    Grandma might not even know that the payment-processing account her unlicensed, unregistered sponsor helped her set up for 15 percent of her personal and family outlay is based offshore.

    By design.

    It makes the money harder to trace. It creates jurisdictional hurdles for law enforcement. It gives the collective of international criminals more time to pick more pockets — and pick them they will. It’s what they do. Often repeatedly in scam after scam. Sometimes for years.

    If you’re an American interested in politics — perhaps especially if you have Republican, conservative, rightist or libertarian leanings and hold the principled view that less government is best — they’ll shape a message just for you. Because the sales pitch is designed to confirm your biases while at once loosening your purse strings, you’ll be less apt to be discerning. They might tell you what you should be angry about — the economy, the Fed, Wall Street, the banks, the bailout, the regulators, the politicians who start wars.

    This does not mean, however, that they won’t be glad to separate you from your money if you’re a centrist of any political persuasion or a Democrat, liberal or leftist in your leanings. They’ll tell you anything to get access to your money.

    The schemes work best during lean times. If no bogeyman exists in your life, they’ll create one for you to loathe: an individual, an authority figure, an agency, a bureaucracy, a member of the media. Their frauds are designed to separate you from your rational self; that’s how they suck you in.

    There may be a public face of the enterprise, perhaps a man who projects impeccable manners. He’ll be described as a genius, perhaps by a conference-call or webinar host who has a soothing voice made for radio. If you haven’t been able to access your account for weeks and aren’t really sure where your money is, someone will suggest it is your fault. Stepfordian shills will reinforce that notion. They’ll try to make you believe that questioning the enterprise is a sign of weakness, a sign that — unlike the rest — you lack faith.

    True believers will emerge. So will enforcers who will “defend” the enterprise at any cost. There may be no ceiling to their wretched excess, their intellectual dishonesty, their disconnect from the world of rational thought. Some of them even will send notes to reporters that read like the one the PP Blog received yesterday at 3:41 p.m. EDT.

    The would-be poster tried to put this in the thread below my tribute post to Maddy, my beloved terrier who died last week.

    Here is is:

    Congratulations! At last a real report based on credible sources and on a fact- not on fabricated false statements or regurgitated information from somewhere else.

    A dog’s life is worthless if his owner is engaged in spreading lies and speculation to harm others.

    It’s a sign of GOD telling you to stop publishing fear and meaningless accusations once and for all. If you don’t believe in him (GOD) but Karma, then this is it coming at ya.

    The next time it will be someone who you love not an animal.

    You’ve been warned by the universe.

    [Name Deleted By PP Blog]

    We’d like to say that the suggestion that God favored HYIP Ponzi schemes and caused Maddy’s death because of what the PP Blog has written represents a new low.

    But it doesn’t.

    In 2008 — on the seventh anniversary of the 9/11 terrorist attacks — an apologist for the AdSurfDaily Ponzi scheme that had sucked in at least $110 million by promising to provide a daily return of 1 percent released a “prayer” that asked God to cause U.S. federal prosecutors to be made to suffer.

    And to be struck dead.

    It therefore comes as no surprise that an HYIP apologist could not resist the urge to subject Maddy — a tiny dog who provided nothing but joy, never saw a person she did not love and put smiles on countless faces — to such a monstrous indignity.

    In the HYIP sphere, according to the apologist, God protects the innocent operators of schemes advertising 2 percent a day and kills dogs to send a message to their owners not to try to warn the public about transnational crime made possible over the Internet.

    And if the death of a dog doesn’t provide enough of a chill for a reporter to abandon a story, then maybe God or at least the forces of karma then will cause family members to die.

    It is thuggery and racketeering, the voluntary abandonment of the greater angels of the soul, and it is utterly bereft of decency.

     

  • EDITORIAL: Top Justice Department Official Speaks On Transnational Organized Crime, References Bogus ‘Libel’ Actions Brought Against ‘Individuals Who Expose . . . Criminal Activities’

    EDITOR’S NOTE: A top U.S. official — speaking today in Mexico City at the High-Level Hemispheric Meeting Against Transnational Organized Crime hosted by the Mexican government under the framework of the Organization of American States (OAS) — addressed the challenges the world law-enforcement community is confronting in the Internet Age.

    In remarks apt to cause unease within the HYIP and organized-crime spheres, Deputy U.S. Attorney General James Cole noted that the government was wise to efforts by criminals to chill efforts to expose crimes by filing libel lawsuits. (A link to Cole’s full prepared remarks appears at the bottom of this story.)

    Some recent Ponzi cases in the United States involving incredible sums of money — and the corresponding behavior of some of the participants — help prove the point . . .

    Now-convicted racketeer Scott Rothstein threatened libel lawsuits when his $1.2 billion Ponzi scheme was on the verge of imploding.

    AdSurfDaily President Andy Bowdoin, named a defendant in a 2009 civil case that alleged racketeering,  issued “slander” lawsuit threats prior to the August 2008 intervention by the U.S. Secret Service in the ASD scheme. The threats were issued not long after Bowdoin had returned from a trip arranged by a lawyer in which the ASD patriarch had ventured to Panama and Costa Rica, according to court filings.

    Bowdoin later was indicted, amid allegations he was presiding over an international  Ponzi scheme that had gathered at least $110 million. Robert Hodgins, who was referenced in 2007 ads for ASD, is an international fugitive wanted by INTERPOL. The United States accused Hodgins of laundering proceeds for narcotics traffickers in Colombia.

    In advance of today’s High-Level Hemispheric Meeting Against Transnational Organized Crime, OAS Secretary General José Miguel Insulza noted that such crime “is the principal continental source of activities such as drug trafficking, the illicit trafficking of firearms and immigrants, human trafficking, money laundering, corruption, kidnapping, and cybercrimes.”

    Befitting its importance, the hemispheric meeting was hosted by Felipe Calderón, the president of Mexico.

    Among others things, Deputy U.S. Attorney General James Cole said this at the meeting:

    “The advance of globalization and the internet, while hugely beneficial to people everywhere, has also created unparalleled opportunities for criminals to expand their operations and use the facilities of global communication and commerce to carry out their criminal activities across national borders.”

    Although Cole did not use the term “HYIP” in his remarks, it is clear that the U.S. government is well aware of the dangers online fraud schemes pose as they reach across borders to accumulate tens and even hundreds of millions of dollars — sometimes through a single fraud scheme.

    As the PP Blog read the text of Cole’s remarks, another thing leaped off the page. Indeed, Cole said this (emphasis added):

    “Because of the sophistication of the world economy, organized crime groups have developed an ability to exploit legitimate actors and their skills in order to further the criminal enterprises. For example, transnational organized criminal groups often rely on lawyers to facilitate illicit transactions. These lawyers create shell companies, open offshore bank accounts in the names of those shell companies, and launder criminal proceeds through trust accounts. Other lawyers working for organized crime figures bring frivolous libel cases against individuals who expose their criminal activities.“

    Cole, of course, wasn’t talking specifically about the AdSurfDaily Ponzi case and ASD’s preposterous claims that Bowdoin had found a legitimate way to pay interest of 1 percent a day on the tens of millions of dollars sent in by participants and that ASD would create 100,000 millionaires in three years.

    Even so, the words Cole uttered in Mexico City today have deep relevance to the HYIP sphere. Indeed, ASD reached across international borders and relied on an international sales force.

    Here is how ASD worked: It relied on “legitimate actors” of the sort Cole described — in ASD’s case, a lawyer who allegedly scrubbed the “opportunity” to ensure compliance, and Moms and Pops and entrepreneurs (and people down on their luck) who signed up and became the friendly faces to their prospect bases. The salespeople were paid 10 percent for recruiting a friend with money and 5 percent more if the friend could recruit a friend with money — on top of “surfing” earnings of 1 percent a day and even more through the purported miracle of “compounding.”

    The current HYIP scheme of JSS Tripler/JustBeenPaid has the same type of payout schemes that ASD foisted on the marketplace. One big difference is the JSS/JBP says it can provide twice the daily payout of ASD.

    JSS/JBP’s purported operator is Frederick Mann, a former ASD pitchman.

    In September 2011, the U.S. Secret Service described ASD as a “criminal enterprise.”

    You’ll note above that Cole today used the same phrase to describe one of the inherent threats of transnational organized crime. And, as noted above, he also spoke about bids to chill critics through the filing of libel lawsuits.

    Those same types of threats were made in the ASD case, beginning in the summer of 2008. In fact, federal prosecutors even included an evidence exhibit in case filings that alluded to one such alleged threat. Unmentioned in the initial ASD case filings were the bids to chill reporters in at least two states and a newspaper in Georgia.

    If you’ve been following the HYIP sphere for any length of time, you know that threats to sue members of the antiscam community are part of the landscape — so much so, that it has become an HYIP cliche. The bids to chill are not limited to threats to sue for libel and “slander,” however.

    It also is becoming an HYIP cliche that the operators and apologists for brazen HYIPs threaten to file complaints with the ISPs of members of the antiscam community — i.e., if you report about us we’ll take down your Internet connection and/or sue you for copyright/trademark infringement.

    These things are transparent bids to chill speech. They also are designed to have a secondary “benefit”: to make the marks — who may consist in part of people who are otherwise “legitimate actors” — believe that harm will come to them if they ever complain, that there are severe consequences to those who complain.

    These nefarious methods have surfaced in scheme after scheme after scheme, as have various assertions about “offshore” venues and the purported “safety” the “offshore” venues provide. Longtime observers know the claims are part and parcel to the HYIP sphere — and that claims that someone is a successful businessman who has presided over multiple companies almost certainly will be incorporated into the sales pitch for an “opportunity.”

    The FBI, for just one example, has been warning for years about securities fraud, the “shadow banking system” and the use of shell companies to disguise fraud proceeds. The director has testified repeatedly on Capitol Hill  about the subject, while simultaneously warning about debit cards that are being used in nefarious ways and the dangers posed by lone wolves and “home-grown, violent extremists.”

    All of these things are or may be in play in the HYIP sphere. Here are some things you should know:

    • It is likely that the scheme’s operator is trading on the credibility you have with loved ones and friends within your immediate sphere of influence to drive dollars to the scam. It is equally likely that you are being denied the sort of information that would empower you to make an informed purchasing decision and highly likely you are being asked to participate in a venture that could result in prosecutions under both civil and criminal law, possibly even the RICO statute.
    • The rate of return will be preposterous in any real-world context and the math will be fuzzy and confusing, if not downright impossible.
    • Your sponsor will lie to you or pass on GIGO that is part of the company line because the company line is more convenient than the uncomfortable truth. It will be garbage coming in, and garbage going out.
    • You will be subjected to a direct or indirect threat or a bid to chill, especially if you ask uncomfortable questions or raise any doubts.
    • There  is a chance you’ll be working for a racketeer or an international criminal, perhaps even a “sovereign citizen” who has hatched a construction by which nothing is a crime, that all conduct is lawful in the name of freedom and free markets. If your sentiment is against the government or “big business” because of your personal financial situation or your political or philosophical views, an extremist may try to exploit your sentiment for personal profit.

    Just some things to think about in the age of the HYIP, the age of terrorism and the age of transnational organized crime as practiced on the Internet . . .

    Read the full remarks of Deputy U.S. Attorney General James Cole here.