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Tag: Michigan Attorney General Bill Schuette

‘Pay It Forward’ Gifting Scheme Leads To Felony Racketeering Charge, Sparks Child-Porn Probe In Michigan

As the PP Blog reported more than six years ago, Pay It Forward (PIF) “programs” have a noxious history in HYIP and cash-gifting Scamland.

A new case in Michigan, however, may be off-the-charts in terms of noxiousness. That’s because investigators looking into a PIF scheme there found child pornography on the alleged PIF operator’s computer, the office of Michigan Attorney General Bill Schuette said in February.

Michael Skupin, 54, of Oakland County, was charged with six counts of possession of child sexually abusive materials five counts of larceny by conversion,and one count of Racketeering- Conducting a Criminal Enterprise.

The PIF “program” was a Ponzi scheme that gobbled up $10,000 at a time from participants, Schuette’s office said.

Records show that it’s not unusual for Ponzi schemers in Michigan to be charged with racketeering, a 20-year felony.

“Victims allegedly made $10,000 cash investments in the [Skupin] scheme,” Schuette’s office said. “Their money would then cycle through a chart in which participants were eventually paid out of other new investors’ money. The scheme was discovered when eventually there were no new investors signing and most people in the scheme lost all of their money.”

The Oakland Press reported yesterday that Skupin was a former contestant on the “Survivor” television show.

And, the publication reported, Skupin was accused of violating his release conditions while waiting trial on the charges against him.

From the Oakland Press (italics added):

Following his arraignment, the former reality TV contestant posted bond and was under house arrest with conditions that barred him from using the Internet except for work.

But during a probable cause hearing Friday, April 8, in Clarkston’s 52-2 District Court, Judge Kelley Kostin ordered Skupin jailed because he violated the Internet bond conditions by posting on Facebook.

Skupin now has made bail for a second time.

PIF schemes have many price points — from low-dollar sums to high. In some PIF schemes, a recruiter may offer you the money to join a “program” — with the understanding you’ll do the same for your recruits. Some participants will purchase multiple “positions” for friends and family members, only to lose it all.

Other such schemes may encourage you to purchase second and subsequent “positions” if you get paid — in effect, paying it forward to yourself, so you can get paid again.

The money-cycling schemes ultimately collapse.

Apr 12, 2016
Will Joel Wilson’s Racketeering Conviction In Michigan Ponzi-Scheme Case Send A Message To Apologists For Achieve Community? Saleswoman Also Convicted

There is no good state in which to run a Ponzi scheme, but Michigan and Colorado — the states in which “Achieve Community” operated — are two of the worst.

This is because both states have racketeering statutes that have been used in Ponzi-scheme cases. The case of Joel Wilson, convicted yesterday in Michigan on criminal charges of racketeering, selling unregistered securities, securities fraud and larceny, is one Achieve Community members can use to inform themselves.

Achieve reportedly is under investigation by the state of Michigan. It’s also under investigation by the state of Colorado, and the U.S. Securities and Exchange Commission has filed civil charges that Achieve was a combined Ponzi- and pyramid scheme that gathered more than $3.8 million.

Alleged Achieve operators Troy Barnes of Michigan and Kristi Johnson of Colorado have asserted their Fifth Amendment right not to incriminate themselves. Criminal probes may be occurring on more than one front.

The office of Michigan Attorney General Bill Schuette has declined to talk about Achieve. But Schuette had plenty to say about Wilson and his investment company known as “The Diversified Group Advisory Fund LLC.”

“I am pleased we have secured justice for the victims who lost their life savings,” said Schuette. “Financial exploitation is a growing crime in Michigan, and we are cracking down on these con artists. Be skeptical of anyone who promises huge returns for a small investment.”

Wilson potentially faces decades in prison.

Fallout from the case was not limited simply to Wilson. A saleswoman also was charged criminally. She, too, was convicted of racketeering, plus embezzlement from a vulnerable adult, and seven counts of false pretenses.

The saleswoman, Shawn Dicken, 40, of Bay City, was sentenced last year to “to 11 years, eight months to 20 years” in prison, Schuette’s office said.

Achieve Community allegedly offered a return of 700 percent in as little as a few months. Promoters of the scheme parroted information put out by the “program” to draw recruits who’d help drive the “cycler.”

With Diversified Group, Dicken “failed to disclose the risks associated with the actual investment in question,” prosecutors said.

She also touted “guaranteed” returns, they noted.

That senior citizens were targeted led to the charge of embezzlement from a vulnerable adult which, like racketeering and false pretenses, is a felony.

Achieve Community largely operated over the Internet and is known to have recruited senior citizens. Internet-based schemes typically increase the odds that vulnerable people will be plundered.

Mar 6, 2015
Post Attributed To Troy Barnes In ‘Achieve Community’ Private Forum Claims ‘Achieve Assets Have Been Frozen’

This 2014 promo for “Achieve Community” asked members to purchase “one EXTRA position” on Christmas Day.

UPDATED 4:36 A.M. ET FEB. 16 U.S.A. “Achieve Community” members this evening are circulating on Facebook a screen shot from a forum post attributed to Michigan-based co-founder Troy Barnes that claims “Achieve’s assets have been frozen.”

Members say the post appeared earlier today in Achieve’s recently installed private forum.

“I am facing criminal charges,” the post reads in part. It is dated today (Feb. 14), includes the Achieve logo and is headlined, “Weekend Update.”

The post did not identify the agency that purportedly launched a criminal investigation into Barnes. Nor did it say how long Barnes had been under investigation, when he found out about it and what person or agency informed him he was facing criminal charges.

Nor did the post identify the agency that requested the freeze and the judge who imposed it.

Whether an action by a specific law-enforcement agency led to the asserted freeze also was not addressed in the post. The post claims “Kristi has fled from USA” after she “had been talking to the Attorney general in Colorado for many weeks.”

The post did not substantiate the claim “Kristi” had fled. Nor did it substantiate the claim “Kristi” had been talking to Colorado’s Attorney General for weeks or say why they’d been talking. It is unclear if Achieve still was gathering money while these purported talks occurred. Achieve appears to have been trying to create and implement a new payment conduit as recently as Friday.

Kristi Johnson of the Denver region is Achieve’s other co-founder, according to Achieve’s websites at ReadyToAchieve.com and TheAchieveCommunity.com. The sites remains online. For at least two days, this message has appeared when the “Join Now!” button is accessed through the “Sign Up” page: “We are temporarily under maintenance – sorry for the inconvenience.”

The office of Colorado Attorney General Cynthia Coffman did not immediately return a call from the PP Blog Saturday night requesting comment. The Blog confirmed in January that Achieve was under investigation by the Colorado Division of Securities, which is not part of the Attorney General’s office.

The two Colorado agencies, however, have a history of working together on cases involving allegations of securities fraud. From time to time, such cases have led to criminal charges of theft and racketeering.

County-level prosecutors in Colorado also have worked with state and federal investigators to bring racketeering charges in securities-fraud cases.

Andrea Bitely, the communications director and press secretary for Michigan Attorney General Bill Schuette, said yesterday that the Attorney General’s office does not comment on investigations. BehindMLM.com reported yesterday that Achieve was under investigation by Schuette’s Consumer Protection Division.

Like Colorado, Michigan has a racketeering statute that has been used in investment-fraud cases. (See one example. See another. See a third.)

In 2013, a now-former Michigan state Legislator pleaded no contest to criminal charge of Neglect of Duty by a Public Official. Schuette’s office said the onetime lawmaker carried a cell phone provided by a scammer running a $9 million Ponzi scheme and “answered calls from potential investors even while on the House floor.”

At least one Achieve member has claimed on Facebook that Johnson has not fled and that Barnes is telling vicious lies, according to a post on the RealScam.com antiscam forum.

A Twitter account linked to Johnson disappeared today. So did at least one Facebook site.

Feb 14, 2015
BULLETIN: Michigan Woman Charged With Hindering Ponzi Probe; Husband Charged With Racketeering
M. Viktoria Wilson: Source: Michigan Attorney General’s Office.

BULLETIN: A Michigan woman who allegedly hindered an investigation into her on-the-lam husband’s Ponzi scheme has been charged with lying to a police officer during the investigation of a crime, a felony under state law.

M. Viktoria Wilson, 24, of Saginaw, was arrested yesterday by Saginaw Valley State University Police, the office of Michigan Attorney General Bill Schuette said.

Wilson’s husband — Joel Wilson, 30, of Saginaw — fled the United States after his Ponzi scheme was exposed in January.

“Scam artists who defraud Michigan citizens, particularly senior citizens, think they can run but they cannot hide from the law,” said Schuette. “We are working to secure justice for the Michigan victims and families affected by this scam.”

When authorities interviewed M. Viktoria Wilson in January, she lied to them, Schuett’s office said.

From a statement by investigators (italics added):

Beginning in 2009, it is alleged that Mr. Wilson scammed investors through his operation of The Diversified Group Advisory Fund LLC, an investment company. Mr. Wilson allegedly told investors that he would use their funds to purchase distressed properties in the Saginaw area and Bay City areas. The properties would later be refurbished and sold for profit, which would go to investors.

When funds Mr. Wilson collected from the sales of the unregistered securities failed to turn a profit, he allegedly used new investor funds to pay returns to previous investors – the trademark of a Ponzi scheme. In addition, Mr. Wilson allegedly pocketed approximately $47,000 of the investment funds to pay his personal expenses and acquire personal assets.

The following nine charges were filed against Mr. Wilson in Bay City District Court on January 8, 2013:
- One count of Continuing Criminal Enterprise (Racketeering), a felony punishable by up to twenty years in prison;
- Three counts of Sale of Unregistered Securities, a felony punishable by up to ten years in prison;
- One count of Larceny by Conversion ($20,000 or more), a felony punishable by up to ten years in prison;
- One count of Larceny by Conversion ($1,000-$20,000), a felony punishable by up to five years in prison; and,
- Three counts of Fraudulent Sale of Securities, a felony punishable by up to ten years in prison.
Joel Wilson is expected to surrender, Schuett’s office said.
Mar 14, 2013
BULLETIN: 2 Michigan Men Arrested In Alleged Ponzi Scheme Targeting Senior Citizens; Jeffrey Ripley, Danny Lee VanLiere Charged With Racketeering, Jailed; 96 Felony Counts Filed Against Men And Their Company

Jeffrey Ripley: Source: Ottawa County Sheriff's Office.

BULLETIN: A joint investigation by offices of Michigan Attorney General Bill Schuette and Commissioner Kevin Clinton of the Office of Financial and Insurance Regulation has led to criminal charges of racketeering against two men accused of targeting the elderly in a $9 million Ponzi scheme.

Charged in the alleged caper were Jeffrey Ripley, 59, of Sparta, and Danny Lee VanLiere, 60, of Grand Rapids, authorities said. The alleged scheme operated through an entity known as API Worldwide Holdings LLC.

At least 140 victims were fleeced out of about $9 million in the scam, which operated between July 2006 and January 2012, authorities said.

Ripley and VanLiere tracked the maturation dates of Certificates of Deposit held by victims “so they could make contact and persuade the victims to transfer the funds to API Worldwide immediately after the CD matured,” authorities said.

Danny Lee VanLiere: Source: Ottawa County Sheriff's Office.

Some of the elderly victims lost their life savings to the scheme, authorities said, characterizing the product offered to them as “fake securities” that promised “high returns.”

“Financial scams devastate the lives of citizens who worked so hard to provide for their families,” said Schuette. “Crimes against the elderly are on the rise, and those who target Michigan seniors will face the toughest penalties under the law.”

Ripley and VanLiere are charged with one felony count each of racketeering, six counts felony counts each of false pretenses and 25 felony counts each of violating the state’s Securities Act. The company is charged with the same crimes.

Ripley was arrested by the Michigan State Police Fugitive Team. VanLiere surrendered to authorities after Ripley’s arrest. Both men are listed a prisoners at the Ottawa County Jail.

Losses among victims ranged between $3,000 and $600,000, authorities said.

“Michigan consumers should give us a call before entering into an investment and we will run a check on any broker, advisor or product,” said OFIR’s Clinton.

All in all, the alleged caper led to the filing of 96 felony counts.

Mar 14, 2012