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Tag: Connecticut pyramid schemes

  • NEW HAVEN REGISTER: Witness Says Alcoholics Anonymous Members Were Recruited For Cash-Gifting Scheme And That ‘Largest Conflict I’ve Ever Seen’ In AA Ensued

    EDITOR’S NOTE: In May 2012, the PP Blog reported that three women had been arrested on federal charges in Connecticut that flowed from an alleged cash-gifting pyramid scheme. One of the women has pleaded guilty. Two others now are on trial.

    Cash-gifting often is associated with affinity fraud. The alleged Connecticut scheme centered around women with common interests, for example. Cash-gifting schemes also may be targeted at members of a common faith or belief system, members of a specific racial or ethnic group, members of specific occupations or members of virtually any group with common interests or common problems.

    No individual or member of an organization may be truly safe in the context of affinity fraud, considering that schemes even have been targeted at members of the military and their loved ones. Now, it seems, not even members of Alcoholics Anonymous — an American treasure with international reach that has helped countless participants in their daily struggle against the clutches of alcoholism —  were off limits to a person or persons desiring to recruit members into the cash-gifting scheme.

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    recommendedreading1The New Haven Register is reporting that “Julie,” a witness in the “Women’s Gifting Table” trial in federal court in Connecticut, testified that members of Alcoholics Anonymous were recruited for the scheme, which caused dissension among people battling to stay sober.

    “Julie” was introduced to cash-gifting by her AA sponsor, Julie testified, according to the Register.

    From the Register (italics added):

    Eventually, there were eight AA members involved in tables and Julie attempted to recruit more. What followed was “the largest conflict I’ve ever seen in Alcoholics Anonymous,” she said. “It’s a violation of a trusted relationship. I trusted people to save my life, and people trusted me to save their lives, and to take advantage of that situation was a problem.”

    “Julie” testified that she quit the scheme after news broke that former Connecticut Attorney General Richard Blumenthal had launched an investigation.

    Gifting is the business of parasites, Blumenthal said in November 2009.

    Blumenthal now is a U.S. Senator.

    On Jan. 31, the Register reported that some people believe the unsolved murder of a woman in 2010 may be tied to the cash-gifting scheme.

     

  • NEW HAVEN REGISTER: Feds, State Investigating Cash-Gifting Schemes In Connecticut; Grand Jury Convenes; State AG Called Gifting Programs The Business Of ‘Parasites’ In Statement About ‘The Women’s Gifting Table’ Last Year

    State and federal probes into cash-gifting schemes are under way in Connecticut, the New Haven Register is reporting.

    Investigators are concerned about so-called “Women’s Gifting Tables,” and women soon will be called before a federal grand jury, the newspaper reported.

    Similar probes are under way in Michigan. Seven women were charged with felonies last month, and the Michigan State Police issued a warning that gifting schemes targeting women were sweeping across the state.

    The Connecticut probe began more than a year ago, when then-Attorney General Richard Blumenthal warned that the schemes were illegal and doomed to collapse. Blumenthal is now a member of the U.S. Senate, and the gifting probe now is under the direction of George Jepsen, Connecticut’s new attorney general.

    Gifting is the business of parasites, Blumenthal said in November 2009, noting that “The Women’s Gifting Table” had been positioned as a “sisterhood” in which women provide a $5,000 gift to another woman in the network.

    Participants were encouraged to take cash advances on their credit cards and even to sell their cars and family heirlooms to grease the “pernicious” pyramid-scheme wheel, Blumenthal said.

    “As new women join the group, others move to higher ‘positions’ to eventually receive their own gifts totaling much more than their initial contribution,” Blumental said.

    “Gifting clubs take more than they gift — often ending in economic ruin for participants and their families,” Blumenthal said. “A gifting club is merely a fancy name for an old-fashioned pyramid scheme that bleeds newcomers to feed the parasites above them. Even as I investigate, I urge all Connecticut citizens to immediately reject and report such schemes.

    “Gifting clubs are the gifts that keep on taking,” he continued. “These fraudulent clubs exploit economic catastrophe — urging newcomers to sell their belongings, jeopardize their credit and assume devastating debt with deceptive and dangerous promises. Citizens facing foreclosure and job loss may risk everything for these ominous opportunities.

    “State and federal law prohibit all pyramid schemes because each one is a house of cards doomed to collapse,” Blumenthal said. “Any offer involving upfront money payments with promises of riches, but no product or service, should be considered suspect.”

    In August 2008 — in the days immediately following the seizure of tens of millions of dollars in the AdSurfDaily autosurf Ponzi scheme probe — some ASD members raced to forums in bids to recruit members for emerging cash-gifting schemes.

    Efforts to recruit members for other autosurf and HYIP schemes also continued after the seizure of assets in the ASD case.

    Some gifting schemes are targeted at people of faith and promoted as an opportunity to “pay it forward” to put cash in the hands of participants while positioning yourself also to get a pile of cash. The language of “pay it forward” increasingly has become a marker that a scam is under way.