EDITOR’S NOTE: Untargeted, unfocused traffic and participants who did not have websites to advertise are two of the issues in the AdSurfDaily autosurf Ponzi scheme case. They also are issues in the INetGlobal case.
UPDATED 8:20 A.M. ET (March 10, U.S.A.) Public records and other information suggest INetGlobal was becoming largely dependent on cash from Mainland China and was routing unwanted traffic that did not convert into sales to the sites of Clickbank vendors — while passing along the bandwidth costs to the vendors and grossly distorting their conversion statistics.
In an affidavit for a search warrant, the U.S. Secret Service, citing an analysis of INetGlobal’s money stream by an unnamed employee, said “at least 87% of the company’s revenue was generated from sale of memberships to members residing in China.”
The affidavit also describes an INetGlobal function in Flushing, N.Y., on Jan. 23 that was attended by at least two undercover agents.
About 400 people attended the function, the Secret Service said. The “majority” were Chinese. Attendees to whom an undercover agent spoke “had either little or no facility in English.” The agent noted that that “conference registration took a long time because nobody at the registration desk spoke Chinese, and many of the conference attendees could not make themselves understood in English.”
Moreover, the agent said, when INetGlobal owner Steve Renner “asked, through an interpreter, how many people in attendance had their own business . . . only two raised their hands.”
One attendee — an existing INetGlobal member — was asked by the second undercover agent if she had a website to advertise in INetGlobal’s rotator.
The INetGlobal member — a woman Renner had identified as a “New Jersey resident making $6,000 per day, or $180,000 per month” — said she had no site to advertise in the rotator because having a website “was not required,” the Secret Service said.
A second INetGlobal member approached by the same undercover agent was asked if he had a website to advertise in the rotator. This member — a man described as telling the agent he made $3,000 a month in INetGlobal — explained that he had a website, but did not post it because “it was ten years old,” the Secret Service said.
Renner was observed telling different stories, the Secret Service said. One version had INetGlobal posting $25 million in revenue in December; another version “a short time later” pegged the figure at $20 million. Renner also said “iNetGlobal’s search engine, Access, would soon rival Google’s.
“Renner did not explain to the crowd that Access was simply a link to another search engine, and that an Access web search was just the same as a web search on this other search engine,” the Secret Service said.
Despite the claim that INetGlobal’s search engine would rival Google’s, the Secret Service said, internal company emails discussed “the possibility of the other search engine cutting the link and thus taking down Access.”
A Public Tip-Off From Renner Himself That INetGlobal Was Up To No Good?
Meanwhile, web records suggest that INetGlobal — at least for a time — either took it upon itself to add the sites of Clickbank vendors to its advertising rotator or instructed members who did not own businesses to add Clickbank links, an act that resulted in a surge of traffic from China that led to few if any sales. The apparent lack of sales suggests that Chinese members viewing the ads either did not understand what they were viewing or were viewing the ads simply to get paid.
At the same time, web records suggest that INetGlobal was relying on the websites of individuals and companies that had no tie to the firm to provide surfers something to see in the firm’s advertising rotator — at the bandwidth expense of the unaffiliated companies and individuals, at least some of whom were Clickbank vendors.
One of the Clickbank vendors — writing on the Digital Point Forum Sept. 26 — reported that he was studying his Clickbank affiliate stats and discovered something “REALLY messed up.”
The vendor reported on Digital Point that the ID “inetgbal’ suddenly was sending junk traffic that “appears to be coming from China.”
The vendor published screen shots to support his claim and noted, “If you do a ‘surfin demo’ on the iNetGlobal website, you’ll see it takes you to random CPA offers and Clickbank products.”
On Sept. 27, the vendor reported on Digital Point that he considered the traffic problematic and was considering a means of blocking it at the server level with the use of an .htaccess file.
Working with .htaccess files, which can be used to block traffic from an IP or IP range, is not for the faint of heart. It is not uncommon for inexperienced webmasters to bring down their own servers or create an endless loop of error messages when attempting to tweak server behavior with an .htaccess file.
Recognizing the dilemma, the Clickbank vendor put out a call for “good coders” to walk him through a fix for a problem he believed INetGlobal was causing for him. Other posters inquired about the possibility of asking Clickbank to block the unwanted affiliate link.
The discussion on the forum suggests INetGlobal was creating a situation in which Clickbank affiliates might have to incur an expense simply to block unwanted traffic — while creating the additional burden of polluting conversion statistics, potentially making the products less attractive to affiliates.
If, say, a product ordinarily made one sale per each 100 views of an affiliate link — and if INetGlobal suddenly sent through 1,000 page views from China (er elsewhere) that did not convert because the traffic was untargeted or people simply were surfing to get paid — a vendor’s conversion rate could drop from one in 100 to one in 1,100.
On Nov. 6, 2009, a person posting as Steve Renner — the “Director” of INetGlobal — appeared at Digital Point. A little more than a month later, Renner was convicted of income-tax evasion in a case brought in September 2008.
Less than three months after Renner’s tax conviction, the Secret Service asserted that INetGlobal was part of an international Ponzi scheme that had engaged in wire fraud and money-laundering.
“The problem was we had no Daily Budget in place and so traffic was running rampant,” the Digital Point poster purporting to be Renner explained on Nov. 6.
The Clickbank vendor did not mince words in his response to the Nov. 6 post. Others were equally unhappy.
Visit the intriguing thread on Digital Point.