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Tag: Dr. Phil Ming Xu

  • WCM777/’Joseph Global Institute’: More Strange Turns Potentially Involving More Colleges And A Push Toward Offshore ‘Cryptocurrency’

    SWIU.edu claims it is showing its main gate, but it's actually a gate at XXX.
    SWIU.edu call itself Southwestern University and claims it is showing its front gate for its “main campus,” but it’s actually a gate at Eastern Connecticut State University.

    UPDATED 4:06 P.M. ET U.S.A. Campus police departments at Southwestern University, Eastern Connecticut State University, the University of Wisconsin-Madison and Texas Tech University had no immediate comment today on a developing story that may be flowing from the bizarre WCM777 Ponzi scheme allegedly operated by SEC defendant Phil Ming Xu, also known as Dr. Phil Ming Xu.

    In addition to pushing WCM777, Xu pushed something called the “Joseph Global Institute” alongside a former reputed member of the Mafia named “Dr. Bruno Caporrimo.” Joseph Global purportedly was a California University in Pasadena that offered a “College of Engineering,” a “College of Health, ” a “College of Media Arts” and a “College of Business.”

    Everything about Joseph Global appears to have been bogus

    On Saturday, the PP Blog reported that an entity that is calling itself “Southwestern University” and purports to have a campus in Georgetown, Texas, claimed it had taken over Joseph Global. This entity, which appears to have no affiliation with the actual Southwestern University in Georgetown, is using SWIU.edu as a URL. The actual Southwestern University uses Southwestern.edu.

    Not only does SWIU appear fraudulently to be trading on the name of Southwestern University, it appears also to have ripped off images from the websites of Eastern Connecticut State University, the University of Wisconsin-Madison and Texas Tech to create a veneer of legitimacy.

    At the SWIU site, for example, what is described as a photo of the “USA Main Campus Front Gate” appears actually be be a photo from the website of Eastern Connecticut showing its entryway.

    Another photo at SWIU purports to be that of the “Main Library,” but it appears to be a photo from Wisconsin-Madison. Still-another SWIU photo depicts a statue of a man with a horse. This appears to be a photo of the statue of Will Rogers and “Soapsuds” at Texas Tech. There may be other misappropriated photos at the SWIU site.

    Though SWIU calls itself “Southwestern University,” it developed today that an entity perhaps based in Singapore that calls itself the “WOW School of Excellence” is pointing visitors toward an entity dubbed SWIU — for “Southwestern International University.”

    The reference at the WOW School site appears to be a reference to the SWIU domain, despite the fact the SWIU domain calls itself “Southwestern University” as opposed to “Southwestern International University.”

    The WOW school website purports to train students in “cryptocurrency.” At the same time, it suggests it operates a “School of Business (School of Excellence in Digital Currencies for Asian Students.”)

    “Our courses are currently affiliated with Southwestern International University (SWIU) and WOW Digital Academy,” the site claims.

    WCM777 was a scam targeted in part at Asian communities. At the moment, any number of purported cryptocurrency schemes are targeting Asians and other population groups.

    The SWIU website purports to be that of a Christian university led by individuals who hold doctorates in various academic disciplines. Videos for the Joseph Global Institute positioned Xu as the “dean” and Caporrimo as the “chancellor.”

  • BULLETIN: Receiver For WCM777 MLM ‘Program’ Says California Lobbying Firm Received $750,000

    Ming Xu is called "DPMX" in this purported contact with a lobbying firm. Source: Federal court files.
    Ming Xu is called “DPMX” in this purported contract with a lobbying firm. Source: Federal court files. Red highlight by PP Blog.

    BULLETIN: (7th update 6:59 p.m. EDT U.S.A.) The court-appointed receiver in the SEC’s WCM777 pyramid- and Ponzi-scheme case says she is seeking court approval to pursue claims against a California lobbying firm that allegedly received $750,000 from accused scammer Ming Xu and performed no work.

    Some WCM777 MLM affiliates claimed $14,000 sent to the “program” returned $500,000 in 52 weeks.

    Ming Xu also is known as Phil Ming Xu and Dr. Phil Ming Xu. The receiver, Krista Freitag, has shown a federal judge a document that purports to be a contract between Governmental Impact Inc. (GII) and Xu, who is described in apparent shorthand as “DPMX” in the contract.

    James Dantona is listed on the contract as the president of GII. Under the contract terms, either party could terminate the agreement with 30 days’ notice and no refunds would be given Xu by GII.

    “DPMX shall not be entitled to any refund for any reason,” the document allegedly specified. Given the nature of the allegations against Xu and WCM777, such an agreement could have deepened the Ponzi.

    It is unclear whether Xu holds a doctorate, and there are claims Xu and enablers tried to plant the seed he was affiliated with Harvard, the famous Ivy League school. The receiver’s claim that Xu negotiated an advocacy contract dated Jan. 30 with GII just weeks after the WCM777 “program” got kicked out of Massachusetts and just days after it was issued a Desist and Refrain order in California adds another bizarre layer to an already-bizarre case.

    Xu was photographed in 2013 with celebrities such as former Vice President Al Gore and Apple co-founder Steve Wozniak. He also purportedly was listed as a member of the Inauguration Committee of Los Angeles Mayor Eric Garcetti, son of the famed prosecutor Gil Garcetti.

    Filings by Freitag suggest Xu, through the 2014 GII contract, was seeking to buy access to American politicians. It is not unusual for Ponzi schemers to seek to surround themselves with politicians and to use politicians and famous companies to create a veneer of legitimacy. WCM777 and its purported parent — World Capital Market Inc. — also claimed ties to scores of famous companies.

    One of them — Siemens — specifically refuted WCM777’s claims in October 2013, during a period in which WCM was being pitched in California churches.

    Some of the money Xu directed toward GII ended up at a company called ZHB International Corp. and was used to pay for the personal mortgage of ZHB’s Zayda Aberin, Freitag contends.

    Through GII, Freitag contends, Xu sought help in “locating and securing legislators, obtaining access to such legislative leaders in California and Washington, D.C., and communicating and recommending advocacy strategies and effective public relations programs with the government.”

    Xu’s plan appears to have backfired. After actions by Massachusetts and California, the SEC sued Xu, alleging he was at the helm of a massive international fraud.

    Visit the receiver’s website. Read the receiver’s declaration.

  • URGENT >> BULLETIN >> MOVING: SEC Takes Down WCM777; Says Purported Opportunity Is ‘Worldwide Pyramid Scheme,’ Ponzi And Offering Fraud; Federal Judge Signs Asset Freeze

    breakingnews72URGENT >> BULLETIN >> MOVING: (16th update 5:42 p.m. EDT U.S.A.) The SEC has gone to federal court in Los Angeles, alleging that the WCM777 “program” is a “worldwide” pyramid scheme, a Ponzi scheme and an offering fraud that targeted Asian and Latino communities and gathered more than $65 million.

    A federal judge has granted an asset freeze, the SEC said. The agency brought the case in an emergency complaint.

    “[Phil Ming] Xu and his entities claimed they were using investor funds to build a strong cloud services company that would then ignite other high-tech companies and ultimately make their investors very wealthy,” said Michele Wein Layne, director of the SEC’s Los Angeles Regional Office.  “In reality, they were operating a pyramid scheme that preyed on investors in particular ethnic communities, leaving them with nothing left to show for their investment.”

    Some MLM promoters have pitched WCM777 alongside the TelexFree “program.” TelexFree is not referenced in the SEC complaint. But the complaint does reference a Massachusetts probe into WCM777 last fall. TelexFree  has been under investigation by the Massachusetts Securities Division since at least February 2014.

    Charged in the SEC’s WCM777 case are WCM777 Inc. of Nevada, World Capital Market Inc. of Delaware, WCM777 Ltd.( dba as WCM777 Enterprises Inc.) of Hong Kong and Ming Xu, also known as Phil Ming Xu, of Temple City, Calif.

    Several firms are listed as relief defendants, amid allegations they received ill-gotten gains. These include Kingdom Capital Market LLC of Delaware, Manna Holding Group LLC of California, Manna Source International Inc. of California, WCM Resources Inc. of Texas, Aeon Operating Inc. of Texas and PMX Jewels Ltd. of Hong Kong.

    Even as WCM777 was under investigation by state regulators in the United States, the SEC said, the “program” raised “more than $37 million from investors which has been deposited into [the defendants’] Hong Kong bank account.”

    During the state-level probes in Massachusetts and elsewhere, “Defendants stopped depositing investor funds into their United States bank accounts, although the WCM777 offering continued,” the SEC alleged.

    Xu, the SEC charged, is “involved in all aspects of the fraud.”

    From the SEC complaint (italics/bolding/carriage returns added):

    The bulk of the investor funds have been used to pay cash for real property purchased in the United States, purchased in many cases with funds transferred through Defendant World Capital Market Inc. (“WCM”), and held in the names of Relief Defendants Manna Holding Group LLC and Kingdom Capital Market LLC, which are affiliated with Defendant Xu.

    The properties include two golf courses, a warehouse, vacant land, and several single family homes. Defendants have also used investor funds to play the stock market and to make investments, through intermediary companies, in an oil and gas offering of Relief Defendant Aeon Operating, Inc.

    Defendants have also sent investor funds to Relief Defendant PMX Jewels, Limited, which is a rough diamond jewel merchant in Hong Kong, and to Relief Defendant Manna Source International, Inc., which is affiliated with Defendant Xu.

    The golf courses were identified as Glen Ivy Golf Club in Corona, Calif., and the Links at Summerly in Lake Elsinore, Calif. To acquire Glen Ivy, WCM777 plunked down $6.5 million in cash, with the money coming from “WCM777 accounts that held investor proceeds,” the SEC charged.

    Meanwhile, the Links at Summerly was acquired for $1.65 million in cash. Again, the SEC charged, the money to acquire the course “originated from WCM777 accounts that held investor proceeds.”

    Along the pyramid and Ponzi path, the SEC charged, WCM777 bought a single-family home in Walnut, Calif., for “$2.4 million in cash,” a single-family home in Monrovia, Calif. for “$980,000 in cash,” a single-family home in Lake Elsinore, Calif., for “$500,000 in cash,” vacant land in New Cuyama, Calif., for “$700,000 in cash,” a warehouse in El Monte, Calif, for “$1,051,750 in cash” and used “$1,456,041.56” to close on the purchase of a single-family home in Monrovia, Calif.

    This Monrovia sale never closed, the SEC said.

    And “Ming Xu opened an account at a major brokerage firm in June 2013 in the name of WCM,” the SEC charged. “Between June 2013 and January 2014, Defendants deposited a total of $2.155 million into this brokerage account. The cash originated from WCM777 accounts that held investor proceeds.”

    Moreover, the SEC charged, WCM777 disbursed $200,000 in investors proceeds to ToPacific Inc., $210,000  to Agape Technology and $230,000 to Media for Christ.

    All of these entities, the SEC charged, were “associated or otherwise affiliated” with Xu.

    Media for Christ — apparently before Xu’s alleged involvement — found itself at the center of an international firestorm in 2012 over a film production known as “Innocence of Muslims.” (See PP Blog report dated Nov. 21, 2013.)

    Among the alarming allegations is that WCM777 falsely planted the seed that it had partnerships “with more than 700 major companies such as Siemens, Denny’s, and Goldman Sachs,” the SEC said.

    WCM777 also asserted a false association with Stouffer Hotels and Resorts, a company that “has not been in business since 1996 when it sold its real estate portfolio to another company, and that was then purchased by Marriott in 1997,” the SEC said. “Marriott does not have any relationship with Defendants.”

    As the PP Blog reported in October 2013, affiliates of WCM777 helped spread the claims about ties with famous businesses across the web.

    Commingling

    The WCM777 enterprises “opened and used numerous accounts located at three different banks in the United States, to move and commingle most of the investor proceeds before they were disbursed to third parties,” the SEC said.

    It is common for HYIP scams to use banks and payment processors to warehouse proceeds from fraud schemes, a practice that brings national-security concerns into play.

    HYIP schemes often also purport to offer interest-earning “packages” while using a “points” system and touting future public offerings, things allegedly in play at WCM777.

    From the SEC complaint (italics added):

    Through publicly available websites and promotional materials, Defendants offer packages or membership units in “WCM777.” Defendants portray WCM777 as a profitable multi-level marketing venture that sells packages of “cloud media” or cloud services. In the WCM777 offering, Defendants promise investors that they will earn 100% or more returns in 100 days. Defendants represent that the “points” investors receive for their investments will be convertible into equity in initial public offerings (“IPOs”) of “high tech” companies Defendants are purportedly incubating. Defendants have facilitated a “secondary market” in the points they award to investors, and Defendants estimate that $890 million of the points have traded on this market.

    But in reality, the SEC said, the WCM777 enterprises “do not realize any appreciable revenue other than from the sale of ‘packages’ of cloud services to investors. WCM777 is not profitable, and is a pyramid scheme. Defendants use some of the investor funds to make Ponzi payments of returns to investors.”

    The SEC, which says WCM777 was selling unregistered securities as investment contracts,  is seeking the appointment of a receiver, a request the judge has approved.

    Like other HYIP schemes, WCM777 preemptively denied it was a “Ponzi scheme.”

    “Is WCM777 a Ponzi Game?” WCM777 wrote on its website, before answering its own question, the SEC said.  “In summary, we are not a Ponzi game company. We are creating a new business model.”

    In reality, the SEC said, “The cash paid to investors were Ponzi payments made with funds received from other investors, and were not paid from net income or profits of the WCM777 enterprise.”

    At a 2013 business event in California, Xu was photographed alongside luminaries such as former U.S. Vice President Al Gore and Apple co-founder Steve Wozniak. It is somewhat common for Ponzi schemers to trade on the names and reputations of prominent individuals.

    Zhi Liu, another WCM777 executive identified in state-level filings, is not directly referenced in the SEC complaint. There may be an oblique reference, however.

    “On January 27, 2014, WCM777 Ltd. filed a lawsuit against a former employee in the Superior Court for the State of California, County of Los Angeles,” the SEC said.

    Liu is known as “Tiger.”

    A Twitter site under the name of “Dr. Phil Ming Xu” has a March 14 entry that claims, “Tiger created the system and took $30M worth of unauthorized ecash from WCM777. WCM777 sued him.”

    As noted above, however, the SEC has alleged that Xu was involved in all aspects of the fraud. And also as noted above, the SEC further alleged that “more than $37 million from investors” had been deposited in a Hong Kong bank account.

    Whether Liu had a role in the Hong Kong deposits is unclear. Also unclear is whether Liu remains in the United States or has relocated elsewhere.

    In its emergency filing, the SEC said the WCM777 enterprise constituted an “ongoing” fraud.

    Read the SEC’s statement and complaint.

     

  • Websites For WCM777 And Kingdom777 ‘Unavailable’

    UPDATED 12:08 P.M. ET (U.S.A.) The WCM777 and Kingdom777 websites appear to be back online. Our earlier story is below . . .

    _______________________________

    Websites linked to WCM777 and Kingdom777 are showing a “Service Unavailable” message this morning. The precise reason why is unclear.

    WCM777 now operates as Kingdom777. California securities regulators have called WCM777 an “investment scam” that gathered at least $20 million. California, Colorado and Massachusetts have banned the “program.” Louisiana and New Hampshire have issued Investor Alerts.

    The province of New Brunswick in Canada also has issued an Investor Alert.

    Ming Xu has been identified in securities actions as the operator of WCM777. Some promoters have called him Dr. Phil Ming Xu and Dr. Philip Ming — or just plain Dr. Phil. At a business event in California last year, Ming Xu was photographed alongside former U.S. Vice President Al Gore and Apple co-founder Steve Wozniak.

    Some MLM scams try to gain a head of steam by associating themselves with famous politicians, famous people and famous businesses. Promos for WCM777 have sought to tie to firm to several famous companies.

    A Twitter account in the name of Dr. Phil Ming Xu says this this morning: “You have not shut me up into the hand of the enemy. You have set my feet in a large place.”

    A Jan. 27 Tweet said this: “Though an army should encamp against me, my heart shall not fear. Though war should rise against me, even then I will be confident.”

    Meanwhile, a Jan. 25 Tweet said this: “Confidence in someone unfaithful in time of trouble is like a bad tooth, or a lame foot.”

    Based on promos that have appeared online, it is possible that individual WCM777 sponsors were accepting wire transfers from their recruits and then somehow forwarding the money to WCM777, which reportedly has a presence in Hong Kong and the British Virgin Islands.

    Circuitous flow of cash is a key marker of scams and may signal money-laundering or other crimes are occurring.

    Please use the PP Blog’s search function near the upper-right corner to find more information on WCM777.

  • UPDATES: (1) Colorado Boots WCM777; (2) California Didn’t Have To Look Far To Find ‘Program’: State Has Office In Same Building From Which Alleged Multimillion-Dollar Securities Scam Operated

    From the Colorado C&D against the WCM777 MLM "program."
    From the Colorado C&D against the WCM777 MLM “program.”

    UPDATED 6:33 P.M. ET (U.S.A.) The state of Colorado has issued a cease-and-desist order against the WCM777 “program,” saying the Ming Xu-led enterprise was selling unregistered securities.

    Ming Xu also is known as Dr. Phil Ming Xu, according to WCM777 promoters.

    In issuing the C&D, Colorado now has joined at least two other U.S. states in banning WCM777. The other states are California and Massachusetts. Louisiana has issued an Investor Alert. (Edit 6:33 p.m. New Hampshire also has issued an Investor Alert on WCM777.)

    California has alleged that WCM777 gathered at least $20 million.

    Gerald Rome, Colorado’s acting securities commissioner, announced his state’s ban on Jan. 21. Paperwork is here. Ming Xu consented to the action without admitting or denying wrongdoing.

    From a statement by Rome’s office (italics added):

    Named in the Order are World Capital Markets, Inc., WCM777, Inc., and their founder and chairman, Ming Xu, all of Pasadena, California.

    The Staff of the Division of Securities (the “Staff”) alleged that World Capital sought Colorado investors through websites, webinars, and live presentations to purchase packages that allow the purchaser to access World Capital’s cloud media services and earn commissions or profits with advertised returns of more than 90%. The program operated much like a multi-level marketing program where purchasers received bonuses for referrals, purchase of stock options, and other bonuses based on how many referrals obtained by a purchaser.

    The Staff alleged that World Capital failed to register either security offering and, by offering the investment opportunity to the public at large by soliciting on the internet, World Capital violated the registration provisions under the Act.

    Meanwhile, it turns out that California didn’t have to venture too far to find WCM777.

    The WCM777 MLM scam was operating from Suite 900 at 150 S. Los Robles Ave., according to a Desist and Refrain Order the state issued last week.

    But the state itself has an office in the same building. The Pasadena branch of the California Department of Rehabilitation occupies suite 300, according to the DOR’s website. The agency says it “administers the largest vocational rehabilitation program in the country.”

  • BULLETIN: California Calls WCM777 A ‘Scam,’ Issues Desist And Refrain Order That Names Executives And YouTube Pitchman

    From the California order announced last week on the state's website.
    From the California order announced last week on the state’s website.
    From a Consumer Alert issued by the California Department of Business Oversight. (Red highlight by PP Blog.)
    From a Consumer Alert issued by the California Department of Business Oversight. (Red highlight by PP Blog.)

    BULLETIN: (Updated 10:36 a.m. ET U.S.A.) The state of California has called the WCM777 MLM “program” a “scam” and issued a Desist and Refrain Order that bans the enterprise in the state. The Department of Business Oversight (DBO) has issued a companion Consumer Alert and is “strongly” encouraging California investors to file a formal complaint.

    Named in the Jan. 8 order announced late last week on the state’s website are WCM777 executives Ming Xu and Zhi Liu. Harold Zapata, an alleged WCM777 YouTube pitchman with an address in Hanford, Calif., also is named in the order. Corporate entities named in the order include World Capital Market Inc., WCM777 Inc. and WCM777 Limited, all of Pasadena.

    Zapata, California alleged, identified himself as “CEO at WCM777 Global Stars,” something that suggests he was the leader of an upline group. On July 15, 2010, the PP Blog reported that FINRA warned the investing public about scams that spread on social-media sites such as YouTube,  Facebook and Twitter.

    WCM777 was targeted at people of faith and members of minority communities. California investors can file a complaint by dialing 866-275-2677, the state said.

    In November, the state of Massachusetts accused WCM777 of selling unregistered securities.

    California now has done the same thing.

    “The WCM777 membership units offered and sold by Respondents constitute securities,” the state charged.

    And, it alleged, “Respondents offered and sold securities by means of written and oral communications which included untrue statements of material fact and which omitted to state material facts necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.”

    WCM777 now is operating as Kingdom777, and has been associated with a series of bizarre events. On Jan. 17 via Twitter, the “program” issued a declaration of love to the people of Peru after a police raid on a WCM777 outlet there. The announcement was attributed to “Dr. Phil Ming Xu” and claimed the enterprise now “has a promotion plan with a payout ratio of 130%.”

    In issuing the announcement, WCM777 appeared to be ignoring the securities issues altogether. California publicly announced the order six days later, on Jan. 23. The California order is dated Jan. 8. A day earlier, on Jan. 7, WCM777 published an announcement of the name change to Kingdom777, claiming “Kingdom777 has acquired the assets of WCM777.”

    As is typical in HYIP scams, the announcement blamed affiliates for WCM777’s woes.

    “Some members failed to represent WCM777 correctly and distorted our vision and mission to be a social capital company whose goal is to build a global community of trust and love,” the new company said.

    But California’s order, which in part echoes suggestions in Massachusetts that WCM777 was steering recruits to avoid lower levels of buy-in in favor of the highest level of $1,999, makes it clear that the state viewed WCM777 itself as a fraud.

    From the California order (italics/bolding added):

    9. The most expensive and, by far, the most popular WCM777 membership unit costs $1,999. The $1,999 membership unit provides the purchaser five years of access to WCM777’s alleged online cloud services. In addition, WCM777 claims that a purchaser of the $1,999 membership unit will receive up to $32 per day over a 100-day period in the form of profit-sharing payments, bonuses and commissions. Thus, over a 100-day period, a purchaser of the $1,999 membership unit would allegedly earn $1,200 more than the original cost of the unit—an alleged 60% return in only 100 days.

    10. The vast majority of purchasers buy the five year unit, rather than the less expensive units that generate lesser returns. In fact, over 95% of purchasers in the United States bought the $1,999 membership unit.

    11. There is no limit to how manyWCM777 membership units an individual may purchase at one time. In fact, a significant number of purchasers buy multiple WCM777 membership units at the same time.

    12. After the purchaser’s 100-day daily returns cycle expires, the purchaser may “re-up” by purchasing another membership unit at a 50% discount, which then restarts the 100-day cycle. A purchaser can “re-up” indefinitely. Therefore, over a 300-day span, a purchaser of a single $1,999 WCM777 membership unit who “re-ups” at the end of each 100-day cycle would allegedly earn up to $5,600 more than the cost of buying the membership units—an alleged 140% return in about 10 months.

    Precisely how California learned that 95 percent of U.S. purchasers allegedly bought in at the maximum level of $1,999 is unclear. What is clear is that the state has accused WCM777 of engaging in a rank deception and gathering at least $20 million between March 2013 and September 2013.

    Among WCM777’s fraudulent claims was that the “Respondents’ activities were not subject to the jurisdiction of the United States Securities & Exchange Commission or the United States Federal Trade Commission,” California alleged.

    Moreover, the state claimed that the respondents failed “to disclose that WCM777 had no other significant sources of income but for its sale of membership units.” Meanwhile, they failed to disclose “that WCM777 did not have an enforceable contract with Siemens under which Siemens would provide the alleged online cloud services that WCM777 advertised.” (See Oct. 30, 2013, PP Blog story, which reports on the issue with Siemens and notes that WCM777 was being targeted at a Latino church in Rialto, Calif.)

    Siemens, the state said in its order, “has publicly disavowed any relationship or contract with WCM777. In a press release, Siemens stated that it disavowed a relationship with WCM777 “[i]n order to help . . . investors avoid making any investments based on false assumptions[.]”

    And despite claims by the respondents that “WCM777’s alleged daily returns are backed by the global banking business of its parent company, WCM,” the state charged, “WCM777 and WCM had no significant income outside of sales of WCM777 membership units.

    “From March 2013 to the end of September 2013, WCM777 and WCM generated over $20 million in sales of WCM777 membership units,” the state alleged. “During the same period, over 99% of the income of WCM777 and WCM came from sales of WCM777 membership units, while less than 1% of their income came from WCM’s alleged global ‘merchant banking’ or any other business.”

    Some WCM777 promoters have claimed that the WCM enterprise had handed out more than $1 billion in loans. In a bizarre example of MLM hucksterism, the promoters identified several companies that allegedly had borrowed great sums from WCM — and even how much the firms purportedly had borrowed.

    News of the California order first was reported today by BehindMLM.com.

    Visit California’s website. Read the Desist and Refrain Order.

  • Email From A Concerned WCM777 Participant Raises Prospect That Worries Are Being Ignored

    EDITOR’S NOTE: UPDATED 6:15 P.M. ET U.S.A. WCM777, now known as Kingdom777, is an outrageous fraud scheme operating over the Internet that has penetrated multiple countries, including the United States. Some affiliates claim a payment of $14,000 returns $500,000 in a year. The purported head is “Dr. Phil Ming Xu.” Please use the Blog’s search function for more info on WCM777.

    For starters, see: SPECIAL REPORT: WCM777 Says Its U.S. Operations ‘Will Be On Hold Until Further Notice’ Because Its Securities Sales ‘Failed To Fully Comply With Laws And Regulations In United States’ — But Will The ‘WCM 777 Boston’ Band Play On In Houston? And What About The Highly Curious ‘Joseph Global Institute?’

    Here is an email received by the PP Blog today from a WCM777 participant who is deeply worried. The email was sent from a U.S. state that has a considerable Latino population. Other than the carriage returns we added and the name we withheld, the email is verbatim.

    __________________________

    As far as I know our Hispanic Team Leader said we have 3 options, 1 is change address to a different country, 2 is transfer to a different name but in a foreign country and 3rd to just wait for the USA to close it down and we can request for reimbursement for every unit we have.

    All what I know is from my team leader. I Log in under affiliate with my password but there is no answers to my questions. All we want is our money back because the money we invested is what we have save all this long past year’s and I have 4 kids, 2 teenagers that are very close to start college. I need help to find out on how we can get our money back. I herd many comments in the meeting but I talk for my myself. Please help!!

    Sincerely

    [Name Withheld by PP Blog]

  • UPDATE: In Aftermath Of Police Raid On WCM777 Venue In Peru, ‘Dr. Phil Ming Xu’ Declares Love For The People — On Letterhead Of Suspended California Company

    wcm777peruletterThings are getting stranger at WCM777: After a police raid this week on the “program” in Peru, the purported head of WCM777 has declared his love for the Peruvian people — on the letterhead of World Capital Market, a California corporation listed as “suspended.”

    The letter, which is dated today and appears on Twitter, did not say whether WCM777 would provide defense lawyers for any arrestees or subjects of investigations in Peru.

    WCM777, an arm of World Capital Market, is under investigation in multiple countries. In November 2013, the firm was accused by the state of Massachusetts of selling unregistered securities. Hotel presentations in Massachusetts allegedly were targeted at Brazilian-Americans.

    In the United States and elsewhere, claims have appeared that $14,000 sent to WCM777 returns $500,000 in a year.

    As part of a Twitter declaration of love to Peruvians, “Dr. Phil Ming Xu” noted that WCM777 “wants to united [sic] people and build a global community of trust and love.”

    And, according to the Tweet, WCM777 “has a promotion plan with a payout ratio of 130% for a limited time to sell our seven cloud products” and has stopped “our promotion plan with a payout ration [sic]  [of] about 50%.”

    The Ming Xu letter to Peruvians claimed the company “is willing to back” the 130 percent scheme, but appears to ignore the issue of offering unregistered securities.

    WCM777, now reportedly known as Kingdom777, has been targeted at people of faith in the United States and other countries.

    In a Jan. 16 Twitter post, Dr. Phil Ming Xu noted, “When 4 blood moons are on the sky in this April, people will understand what we are doing.”

    Some people believe the world will end in April. It’s unclear if Ming Xu is in the end-of-the-world camp.

  • SPECIAL REPORT: WCM777 Says Its U.S. Operations ‘Will Be On Hold Until Further Notice’ Because Its Securities Sales ‘Failed To Fully Comply With Laws And Regulations In United States’ — But Will The ‘WCM 777 Boston’ Band Play On In Houston? And What About The Highly Curious ‘Joseph Global Institute?’

    EDITOR’S NOTE: This story covers highly curious events associated with WCM777 and related entities or people. In this post you’ll find:

    • News on yesterday’s announcement by WCM that it had mothballed its U.S. operation that sells securities.
    • Questions about whether a WCM777 event scheduled over the next two days in Houston would occur or whether TelexFree, a company under investigation in Brazil amid pyramid-scheme allegations, could become the “opportunity” promoted at the Houston event.
    • News about confusion associated with a strange entity known as the Joseph Global Institute, purportedly operated by WCM777 executive Ming Xu. Ming Xu also is known as “Dr. Phil Ming Xu” and “Dr. Philip Ming.”  A website associated with the Joseph Global Institute appears to have preemptively declared the enterprise a university that confers graduate and postgraduate degrees, but is showing videos that appear to be owned by Liberty University in Lynchburg, Va. The Liberty videos have led to questions about whether Joseph Global potentially is duping visitors into believing the Liberty students who appear in the videos are Joseph Global Institute students or whether Joseph Global is a California branch of Liberty.
    • News about strange claims that WCM777 was “launching” an enterprise that actually launched long ago and became the center of an international media and diplomatic firestorm in 2012 over its reported ties to the controversial film, “The Innocence of Muslims.”

    ____________________________________

    UPDATED 6:56 P.M. ET (U.S.A.) WCM777 announced yesterday on its website that it was out of compliance with U.S. regulations and thus had put its U.S. securities operations “on hold.” Whether the purported “opportunity” whose affiliates claim can cause $14,000 to turn into $500,000 in 52 weeks had been notified by WCM777 to stop pitching U.S. prospects is far from clear.

    The news of the U.S. halt first was reported by BehindMLM.com.

    Left unsaid by WCM777 in its announcement was how the purported opportunity intends to address potential claims from untold scores of U.S. residents, including residents who attended pitchfests in hotels and churches and who might have purchased its securities. It is known from public records that Massachusetts purchasers were offered refunds. On Nov. 14, the state alleged WCM777 was selling unregistered securities.

    The WCM777 announcement did not address whether the “opportunity” had reported itself to the SEC. Nor did it say whether it had been contacted by the SEC. Until yesterday, the company never had directly addressed the Massachusetts allegations, hinting only that things had to change at WCM777.

    Another major concern: If WCM777 is selling unregistered securities, so is its stable of thousands of promoters, including those outside the United States who can solicit U.S. residents over the Internet. In theory, any U.S. -based promoter or international WCM777 promoter who continues to pitch the “opportunity” to U.S. residents could be charged under U.S. securities laws or the securities laws of the U.S. states. Whether WCM777 has the ability to block U.S. registrations is unclear.

    Will The WCM777 Band Play On In Houston?

    At the time of this PP Blog post, an apparent WCM777 affiliate site dubbed “Wcm777 Boston” on Facebook appeared not to know that WCM777 is closing shop in the United States. Nothing about WCM777’s announcement about its lack of compliance and the asserted halting of its U.S. securities operations appears on the Boston Facebook site. Indeed, at the time of this post, it was still promoting a WCM777 pitchfest set for tomorrow and Saturday at the  “Crown plaza northwest brookhollow.”

    “i just arrived in houston…. any question about the up coming meeting inbox me… dont lose this opportunity to learn about multi level marketing,” a post dated yesterday at the Boston Facebook site read. Meanwhile, a Nov. 1 post at the Boston Facebook site touting the purported daily payout of WCM777’s $1,999 plan reads, “U$32.00 DOLLARS EVERY DAY. NON STOP Daily Cash Flow NO Selling Required…coming soon, meeting in Houston, 11/22 and 11/23 . . .”

    Whether the WCM777 affiliate who runs the Wcm 777 Boston Facebook site will follow through with the plan to pitch WCM777 at the event — despite WCM777’s own confirmation it was operating illegally and was halting the sale of its own securities — is unclear. Continued sales of WCM777’s offerings could trigger even more scrutiny of the firm and its affiliates. Attendees at the Houston event who plowed any money into the WCM777 scheme all could become potential litigants against the Boston pitchman and WCM777 itself. If the Boston pitchman is aware or becomes aware of WCM777’s announcement before the Houston event and seeks to pitch something else, he may find himself addressing a confused and hostile crowd.

    The Wcm777 Boston Facebook site has associated itself with a street address in Boston, although the asserted phone number for the site uses an area code from a different region of Massachusetts. Whether the operator of the Facebook site had traveled from Boston (or elsewhere in Massachusetts or another state) to host the Houston event is unclear.

    Because the “Wcm777 Boston” Facebook site also references TelexFree in a Nov 10 post, attendees of the Houston event might find themselves getting pitched on that alleged pyramid scheme, too. TelexFree is under investigation in Brazil. The Nov. 10 post reads, “I do have a bunch guys in Houston area, my downlines on wcm777 and Telexfree, they will be more than happy to talk with you… Thank you again.” It is positioned alongside the logo of the National Football League.

    The Nov. 1 post that reproduces the NFL logo contends that two lucky prospects who attend the Nov. 22 and 23 WCM777 event in Houston will receive free tickets to “JACKSONVILLE VS HOUSTON.” The game is set for Sunday in Houston. Whether Ponzi or pyramid proceeds were used to pay for the tickets is unclear.

    wcm777boston

    Also unclear is precisely how the Boston affiliate is conducting business with WCM777 and recruits. Asked to provide payment proof, the Boston affiliate contended this in a Nov. 10 Facebook post: “I work with wcm for 3 Months and I had never need to transfers money my bank account because I use my credit to sign people up, if you not happy with screenshots unfortunately I don’t have deposits transfers to my bank account from wcm777…” (Unedited by PP Blog.)

    The post introduces the possibility that the Boston WCM affiliate somehow is paying recruits’ way into WCM777 and relying on reimbursement later, a common occurrence in HYIP scams. Whether that reimbursement would come from the prospects or the company is unclear. On Oct. 30, the PP Blog reported that a WCM777 affiliate on YouTube claimed, “I just had some[one] wire me from Mexico . . . $6,000 for three units. I’m signing up another person [in] [Florida?] for six units as well — excuse me, three units as well — another $6,000. And this is just going nuts.”

    The YouTube claim raises the specter that individual WCM777 promoters are accepting national and international wires from WCM777 recruits and somehow later transferring the money to WCM777. Such practices have been associated with cross-border securities scams, including the infamous Imperia Invest IBC scam in which the SEC accused a promoter of creating at least two business entities and using them to wire money to the Imperia scammers outside the United States.

    Making matters even stranger is the wording of WCM777’s announcement that it was halting its U.S. operations in the aftermath of a Nov. 14 consent order it entered into with the state of Massachusetts, which accused it of selling unregistered securities and benefiting from an affiliate’s targeting of the state’s Brazilian community. WCM777’s announcement is dated Nov. 20, six days after the order in Massachusetts. The announcement did not explain the delay in addressing the Massachusetts allegations. Nor did it explain why WCM777 hadn’t previously announced it was under investigation, only to claim later that “negotiations” went well — as though it were common knowledge that the firm was the subject of a securities investigation.

    Moreover, the timing suggests that WCM777 continued to benefit from the sale of unregistered securities across the United States even after the Nov. 14 order. Beyond that, it is far from clear whether WCM777 even has control over its U.S. affiliate base or affiliate bases elsewhere in the world. What is clear is that WCM777 is positioned as an opportunity for Christians to prosper.

    Here is WCM777’s Nov. 29 announcement in its entirety (italics added):

    WCM777 Response to Massachusetts Consent Order

    The negotiations between our lawyers and the Massachusetts’ Office of the Secretary went well. We have reached a settlement with Massachusetts.

    However, because the sale of securities failed to fully comply with laws and regulations in United States, our operations in the U.S. will be on hold until further notice; WCM Limited will continue operations. The company will implement new compliance procedures and register with the SEC before selling securities. Our customer service, IT support, and sales training are far from ideal. Especially in sales training, we don’t have a proper system set up. Some of the distributors have exaggerated the sales performance, which has led to complaints. The company system also needs to be further improved to ensure global legitimacy.

    Under the counsel of the lawyer, WCM777 has already registered in the state of California. We will soon re-enter the U.S. market. Also, WCM777 will hold the grand opening for Hong Kong office in Dubai this coming January. We will restore WCM777’s promise and move towards achieving our vision!

    Why WCM777 would hold a “grand opening” for a “Hong Kong” office in Dubai is unclear. Dubai is a city in the United Arab Emirates. Also unclear is how WCM777 intends to comply with securities regulations in all 50 U.S. states, plus federal territories and districts such as the District of Columbia (Washington, D.C.).

    Because virtually all developed nations regulate the sale of securities, WCM777 may face challenges across the globe. The scheme already is under investigation in Colombia, and there are reports that Peru has concerns.

    Affiliates, meanwhile, now have been officially blamed by WCM777 for exaggerating the offering and causing complaints, a classic corporate narrative in the HYIP world. While it is clearly true that affiliates have made outrageous claims that reflect their own lack of due diligence on the purported “opportunity,” it is equally true that WCM777 has advertised that a payment of $1,999 returns $3,200 in 100 days.

    Other Curious Issues

    An entity tied to WCM777’s purported operator Ming Xu — the Joseph Global Institute of Pasadena, Calif. — appears to be implying it operates a university that offers a “College of Engineering,” a “College of Health, ” a “College of Media Arts” and a “College of Business.” A website using the Joseph Global Institute name is accessible through a website that uses the famous name of “Harvard” as part of the URL.

    The site shows images of smiling, college-age students wearing graduation caps and holding what appear to be degrees. Other smiling students are shown studying in front of something that resembles a university hall. Visitors to the site are prompted to watch three videos, but there are no disclaimers or language that the action shown in the videos isn’t taking place at Joseph Global. All three videos appear to be owned by Liberty University, a large Christian university in Lynchburg, Va. Nothing on the Joseph Global Institute site, however, identifies the videos as belonging to Liberty and not to Joseph Global, a potential source of confusion.

    A text line below the videos on the Joseph Global site reads, “Want to see what we offer? Request a brochure here and get a tour of our school.”

    Why Joseph Global appears to be implying that it operates a university is unclear.

    Liberty University did not respond to a PP Blog request for comment about whether it was aware of the Joseph Global site.

    The strangest thing yet: A Nov. 18 Twitter post attributed to “Dr. Phil Ming Xu,” the purported operator of WCM777, says, “Launching The Way TV to transform nations & Joseph Global institute to train a group of Josephs to bless the world.”

    But The Way TV is something that launched years ago, through an entity known as Media for Christ. Media for Christ is based in Duarte, Calif. — and has a history that includes being at the center of an international firestorm.

    That firestorm centered on the inflammatory trailer of a film production known as “Innocence of Muslims,” which has been described as anti-Islamic and denigrating to the prophet Muhammad.

    Here’s how the Los Angeles Times put it on Sept. 13, 2012 (italics added):

    Joseph Nassralla Abdelmasih, the president of the Duarte-based charity Media for Christ, and Nakoula Basseley Nakoula, a convicted felon from Cerritos, emerged Thursday as forces behind “Innocence of Muslims.” An online trailer for the low-budget film incited violence in recent days across the Arab world.

    Nassralla later reportedly told the website AtlasShrugs2000 that he’d been duped by Nakoula into believing Nakoula was making a film about the persecution of Christians and he understood from Nakoula that the film was titled “Desert Warrior.”

    What was supposed to be a film about members of one faith persecuting members of another turned out to be something quite different: a film that portrayed Muhammad, a sacred figure, as a buffoon.

    Quoting Nassralla, AtlasShrugs2000 reported this on Sept. 17, 2012 (italics added):

    Nakoula needed a place to film. So I let him use my facility – that is all I did, and is the full extent of my involvement with this project. Nakoula used my facility for ten days. Media for Christ employees were given a vacation during that time, because Nakoula was using the facility and so there was no work for them. There was only one Media for Christ employee who remained, to answer phones for the ministry.

    I later discovered that Nakoula, using the name Sam Bacile, had gone to LA Films as producer of Desert Warrior, and used the name of my organization, Media for Christ, to obtain the permit he needed. He did so without my knowledge or permission.

    Now, the Twitter site under the name of WCM777 figure Dr. Phil Ming Xu is claiming it is “launching” The Way TV, something Nassralla already has launched. The Twitter site further claims the launch extends to the Joseph Global Institute, apparently the same entity that is advertising its operation of various “colleges” of higher education and showing website visitors videos of Liberty University students.

    A letter attributed to “Dr. Bruno Caporrimo” at the site references the city of Duarte, the home of The Way TV and Media for Christ, the Nassralla enterprises. Caporrimo is referred to elsewhere online as a former Mafia member who found God.

    Here is the opening of the letter, which is dated Nov. 16, 2013: (italics added):

    Dear Potential Student,

    My name is Dr. Bruno Caporrimo, Chancellor of Joseph Global Institute. At J.G.I. we have been training men and women for full time ministry, in a formal classroom experience as well as helping individuals gain a greater knowledge and understanding of the bible in order to fulfill the mandate of God’s calling in their lives. Our curriculum offers important bible doctrines in addition to the School’s emphasis on the practical side of ministry.

    It is our desire to see the world evangelized and we believe that if people are trained and equipped, from the standpoint of their local church and community, that this mandate from the Lord Jesus Christ of Nazareth can be effectively realized and fulfilled in our generation. We currently have students from 50 different churches and from more than 10 nations around the world enrolled in Joseph Global Institute. J.G.I. has equipped and discipled into full and part time church and para-church ministry, over 5,000 students and they have embarked on their personal calling to fulfill the one great Commission of Matthew 28:19.

    Whether you plan to study through our International headquarters & ‘Global Student Network’™ in Duarte, California, or through our Distance Learning and online Correspondence Courses™ we are sure that we have the tools and resources to launch and elevate your personal and ministerial calling SO THAT YOU CAN bear much fruit for the Lord Jesus Christ and to operate in faith, diligence and integrity for God’s Kingdom.

    In a YouTube video dated Sept. 8, 2012, Caporrimo and Ming Xu appear. Ming Xu is described as the “dean” of the school and says, “If you want to get involved with us . . . we have bachelor degree[s], we have master degree[s.]” Caporrimo refers to Ming Xu as “Dr. Phil.”

    The URL cited for the Joseph Global Institute in the video — TheJoseph.org — now rotates to a parked page for Sedo, a domain seller.

    Another website associated with the Joseph Global Institute — JosephGlobalInstitute.com — shows some students holding books and others receiving degrees at a graduation ceremony. The JosephGlobalInstitute.com site uses the same logo as the website that uses Harvard’s name in its URL. The logos are similar in appearance to the logo of the actual Harvard University.

    Also see coverage on the MLM Skeptic Blog about a purported Ming Xu entity known as the Harvard Global Institute.

  • URGENT >> BULLETIN >> MOVING: Massachusetts Halts WCM777, Says It Was Selling Unregistered Securities And Targeting Brazilian Community

    breakingnews72URGENT >> BULLETIN >> MOVING: (10th Update 9:28 p.m. ET U.S.A.) Massachusetts has halted the WCM777 multilevel marketing scheme, saying it was associated with entities in Hong Kong, the British Virgin Islands and the United States and selling unregistered securities. In Massachusetts, the state said, the scheme was targeting the Brazilian community.

    In a filing by the office of Massachusetts Secretary of State William Galvin, the state says it opened a probe into WCM777’s business practices in September.

    Identified entities include World Capital Market Inc. of Pasadena, Calif., an asserted offshoot of a banking enterprise in the British Virgin Islands; WCM777 Inc., a dissolved Nevada business with an office in City of Industry, Calif; and WCM777 Limited of Hong Kong.

    WCM777 purports to sell “cloud” Internet services. The investment scheme spread in part through weekly pitches in August and September by a WCM777 distributor using a “function room” at a Massachusetts hotel, the state said.

    Investors were lured with promises they’d receive “profit sharing” and an ability to “purchase stock options” in the run-up to an asserted IPO in 2014, the state said.

    The Massachusetts filing is a consent order. WCM777, according to the order, has agreed to cease business in the state and to provide refunds to all Massachusetts investors. The scheme netted at least $300,000 in the state from about 160 investors, the vast majority of whom were members of the Brazilian community, according to the order.

    “Nearly all” of the investors bought into the scheme at the $1,999 level — the level that promised the highest daily payout, according to the order.

    Promos advertised returns of “over 90 percent” in 100-day cycles, the state said.

    WCM777 has neither admitted nor denied the allegations, the state said.

    Attorneys for WCM 777 made the refund offer on Nov. 13 after presenting the state a spreadsheet on Oct. 14 showing information on Massachusetts participants, according to the order. The document does not say whether other states also are investigating WCM777. The nation of Colombia is known to be investigating WCM777.

    Ming Xu is identified in the Massachusetts consent order as the founder and president of WCM777 Inc.

    WCM777 promoters refer to Ming Xu as “Dr. Phil.” A Twitter account associated with the name of “Dr. Phil Ming Xu” displays WCM-related content and photos of Ming Xu with luminaries such as former U.S. Vice President Al Gore and Apple co-founder Steve Wozniak.

    The photos appear to have been taken at a California business event earlier this month at which all three men spoke.

    Meanwhile, there’s a photo of Ming Xu surrounded by adoring followers. The photo appears to come from the same meeting from which this video emerged:

    Read the Massachusetts Consent Order.

    Read Oct. 30, 2013, PP Blog story on WCM777, which appears to have promoters interested in pitching the purported opportunity to churches and their entire congregations.