From an Oct. 23 TINA Tweet warning about Jeunesse-related health claims.
Truth In Advertising (TINA.org) reported yesterday that a website styled JeunesseReserve at a WordPress site had positioned the MLM juice offering Jeunesse Reserve as a product that will reverse the course of gangrene in patients with diabetes who are facing amputations.
According to the product claim, a woman with diabetes had developed gangrene of the finger and no longer could bear the pain. Apparently requesting an amputation ASAP and waiting for a surgeon to schedule one, the woman started “taking 2-3 packs of RESERVE” daily.
In the claim, the trademark symbol appeared alongside the word “RESERVE.”
At a point uncertain after the “taking” of RESERVE had begun, the patient was told by the doctor that her blood flow had returned and an amputation no longer was necessary.
Plenty of other health claims surrounded the gangrene claim, TINA reported.
Over-the-top and potentially illegal health claims in the MLM realm are hardly new.
“Achieve Community” Ponzi scheme figure Rodney Blackburn — who’d been pushing multiple cross-border HYIP scams simultaneously and even used video footage from the SEC’s website in one of his promos — ended up pushing a tea product amid claims it was “good for reducing diabetes” and mitigated the virus that causes AIDS.
Piccolo’s target audience additionally was told that the magnetic product could be used to help tomatoes, vegetables and fruits grow to “twice the size” while helping dairy farmers “produce more milk per cow.”
Beloved family pets hearing a call from the grim reaper could extend their lives if their owners used the products, Piccolo ventured.
“Your pets? If you have a pet and your pet’s on its last leg[s], bring them a Magnetic Shower,” Piccolo coached. “You won’t believe what it will do for your pet.”
BULLETIN: (Updated 11:11 p.m. ET U.S.A.) Senior U.S. District Judge Graham C. Mullen has certified a class of more than 9,000 alleged “winners” of more than $1,000 in the Zeek Rewards scheme.
Receiver Kenneth D. Bell sued more than 10 named “winners” in February 2014 in a case styled “Kenneth D. Bell v. Todd Disner, et al.” The suit included class claims against about 9,400 winners of smaller sums.
The ruling by Mullen effectively means the winners of the smaller sums are now defendants who will be represented by the same lawyers representing the larger winners. Bell “proposed that one or more of the following named Defendants serve as Class Representatives: Trudy Gilmond and Trudy Gilmond, LLC; Jerry Napier; Darren Miller; Rhonda Gates; Innovation Marketing, LLC; Aaron Andrews; Shara Andrews; Global Internet Formula, Inc.; T. LeMont Silver; Karen Silver; and Durant Brockett,” Mullen wrote.
Disner is facing a default judgment of more than $2 million, but is trying to get it reversed.
Bell asked for the class certification in July 2014, explaining that he “asked that the Court appoint one or more of the largest net winners sued by name as class representatives because they will, by virtue of their own defense to the same claims, be adequate and appropriate representatives for the rest of the Net Winner Class.”
Mullen agreed today with that logic.
“If the Receiver herein was forced to file separate actions against the 9,400 Defendants, he would certainly be risking inconsistent and varying adjudications,” Mullen wrote. “If one court found that a fraudulent transfer occurred, but another court did not, then those inconsistent decisions would place the Receiver in a stalemated or conflicted position. If the Receiver attempted to enforce a valid judgment against a particular Defendant, that Defendant might refuse to pay because other Defendants similarly situated were not held to be liable for the same underlying conduct related to ZeekRewards. An additional layer of inconsistency would arise if the Receiver attempts to settle a lawsuit, but the Net Winner Defendant is not willing to compromise since that Defendant is already aware of the inconsistent adjudication based on the same set of facts. These anomalous results would leave the Receiver in an untenable position and circumstances such as these are precisely why class actions exist.”
Mullen specifically found that, with 9,400 defendants, Bell had satisfied the “numerosity requirement” to make a class-action reasonable and efficient. He also found that Bell had established a “commonality factor” in that the smaller winners had things in common with the larger ones.
These included questions about “whether ZeeksRewards’ operation was a Ponzi and/or pyramid scheme,” Mullen wrote.
And, he noted, “[a]ll class members had or controlled usernames and accounts with ZeekRewards through which they received funds from [Zeek operator Rex Venture Group]. Further, each class member received more money from RVG than they paid into RVG (their ‘net winnings’) during the course of their participation as affiliates in the ZeekRewards program. There is also a common question of law, that is: whether the payments from ZeekRewards to class members are fraudulent transfers that must be disgorged and repaid.”
Bell also satisfied a “typicality” requirement that examines whether “the claims or defenses of the representative parties are typical of the claims or defenses of the class,” Mullen ruled.
At the same time, the judge ruled, Bell had shown that the class of 9,400 would receive “fair and adequate representation.”
“Here, the proposed Class Representatives’ interests are not antagonistic to, but rather aligned with, the interests of the unnamed class members because they share the common objective to defend against having to return funds received from ZeekRewards as demanded by the Receiver. Thus, there is no conflict which would defeat adequacy of representation.”
Mullen rejected contentions that the defendants did not have enough in common for the matter to proceed as a class action.
He also rejected contentions that the largest winners “simply cannot afford to represent the Net Winner Class, noting that “their protestations of poverty ring hollow in light of the fact that together they won over $11 million in profits from ZeekRewards.”
Regardless, Mullen observed, the “Court has repeatedly made it clear that the Receiver will be required to help fund the defense of the class.”
A footnote in the ruling reads (italics added):
That Court is mindful that despite the large winnings of the Named Defendants, it is possible that much of the net winnings has been dissipated. As stated at the last status conference in this matter, the Court fully expects that the Named Defendants will provide the Receiver with any and all evidence of their financial status and the location of all net winnings received from ZeekRewards, including deposition testimony as to the same. Such financial transparency will not only aid the Court in its determination as to what extent the Receiver shall be required to fund the defense of the class, but will also undoubtedly aid in any settlement discussions.
Disner, who pitched both the AdSurfDaily Ponzi scheme and Zeek, is now listed as a “Black Diamond” member on the website of an MLM program known as Lumaxa.
Lumaxa sells Nyloxin, a pain-relief product made from cobra-venom. Longtime MLM huckster Phil Piccolo has been linked to the Nyloxin program once sold through MyNyloxin.com and may be a Zeek winner. Another business with a Piccolo tie was known as Text Cash Network or TCN. It operated from the area of Boca Raton, Fla.
An entity known as “TCN CUSTOMER SERVICE INC” of Boca Raton is listed as a Zeek winner.
Lumaxa, the company to which the MyNyloxin domain now rotates, may be facing some challenges, a source with knowledge of the “program” told the PP Blog.
“The company is sounding desperate to have people keep their money invested, and in fact giving more, higher rates of interest to cancel their withdrawals and earn more,” the source said.
Regardless, Silver might have to dial up his efforts if he hopes to become be the new standard-bearer in the category of name-dropping to sell a purported MLM/direct-sales “opportunity.” That record is held unofficially by the WCM777 “program,” which the SEC described in March as an international pyramid scheme.
But even longtime MLM huckster Phil Piccolo — known as the “one-man Internet crime wave” in part for the ceaseless dropping of names such as Oprah Winfrey, Donald Trump, Groupon, Walmart and Apple — must be shaking his head in begrudging awe at Silver’s recent efforts to foist the emerging BitClub Network brand on the consuming public.
With BitClub Network, Silver has put his name-dropping into overdrive, joining the likes of the scamming chieftains of WCM777, the collapsed pyramid scheme that traded on the names of Siemens, Goldman Sachs, the Denny’s restaurant chain and a series of hospitality companies with famous flags.
Distressingly, Silver assures his audience in a recent promo that “people from all across the globe” were listening to his webinar and to promos of other affiliates. The named countries included the Philippines, Russia “and all over Europe, Australia, Canada.”
The Silver promo session was titled, “Make Money With No List Featuring BitClub Network Webinar.”
Silver hasn’t topped 700 yet in the unofficial name-dropping calculus, but he’s off to a good start, essentially positioning BitClub Network as a company that will create profit opportunities for the same sort of visionaries who spotted the genius behind one-time emerging brands such as Google, AOL, Microsoft (Internet Explorer), Amazon.com, Apple’s iPhone, Apple’s iPod, Facebook, Twitter, YouTube, Blogger and more.
It’s all about “being at the right place at the right time,” Silver bleats. He even suggests in text that BitClub Network could be the next “email.”
As the video proceeds, Silver talks about Bitcoin, using slides to drop the names of Tiger Direct, the Sacramento Kings NBA franchise, Lord & Taylor, Dish Network, Expedia, Newegg and Gyft. He also works in the names of CVS Pharmacy, Sears, Target, Home Depot, Whole Foods Market and more.
Along the way, Silver also drops the names of California Gov. Jerry Brown, “China’s Central Bank Governor” and Gerogy Luntovsky, “deputy chairman of the bank of Russia,” according to text Silver displays.
From a promo for BitClub Network featuring T. LeMont Silver.
(2ND UPDATE 3:26 P.M. EDT U.S.A.) Rod Cook, who publishes the “MLM Watchdog” and was threatened with a $40 million lawsuit by the AdSurfDaily Ponzi racketeers in 2008, is reporting that veteran swindler Phil Piccolo is back on the prowl.
This time, Cook reports, it’s with a cobra-venom product sold at MyNyloxin.com. The product is positioned as a pain reliever, and Piccolo is calling himself “Felice Angelo.”
Piccolo is known as “the one-man Internet crime wave.” If there’s a Piccolo signature, it’s his ability largely (though not exclusively) to remain in the shadows while engineering scams within scams or within dubious “opportunities” in which an affiliate’s success chances are exceptionally low going in. Piccolo appears to be particularly keen on “programs” ostensibly in the health-maintenance and electronic-technology fields. The “programs” may remain in “prelaunch” phase virtually indefinitely while gathering cash and gaining a head of steam.
“[P]hil is selling his stock to individuals and giving it away as incentives under the table illegally and running $500 co-ops scamming people out of their money,” Cook reports about Piccolo’s MyNyloxin activities.
Based on the PP Blog’s research, Piccolo also is known to engage in anonymous shilling and to leave thousands of orphaned affiliate links of his onetime recruits all over the web as a means of corralling the earnings of people duped into placing the links before they fled the programs because they weren’t getting paid.
PP Blog reader Tony H. noted on March 4 that a “Piccolo Felix Angelo” was listed as a “winner” in the $850 million Zeek Rewards Ponzi-scheme and was being sued by the court-appointed receiver.
As the PP Blog previously has reported, Piccolo has a history of threatening websites that report on his scams. Part of his MO features appeals to religious faith. These incongruously have been mixed with suggestions he can summon leg-breakers if the need arises.
Piccolo claims to hail from New York. He is known to operate in the region of Boca Raton, Fla., and to participate in scams that try to create the illusion of scale — perhaps by using Photoshop to make the scamming firm’s name appear on a large building, for example.
Another part of Piccolo’s MO includes suggestions that “opportunities” he pitches soon will “go public” or already are part of public companies. In the TextCashNetwork scheme, for instance, the Piccolo group suggested that TCN was part of Johnson & Johnson, the famous pharmaceutical company.
Meanwhile, Piccolo scams may feature claims that people who send in large sums of money will receive a preposterous return, a marker that the “programs” are vulnerable to charges they are selling unregistered securities as investment contracts. If a Piccolo-associated scheme loses its payment conduits, recruits have been encouraged to wire money via Western Union.
Piccolo scams also have featured claims that celebrities such as billionaire Donald Trump and entertainment icon Oprah Winfrey were on the ships he helped steer. Such was the case with a scam known as Data Network Affiliates — DNA, for short.
DNA claimed to be in the business of assisting the Amber Alert system of rescuing abducted children. It later claimed to be in the cellphone, offshore “resorts” and mortgage-assistance businesses. DNA was targeted at churches, with prospects told they had the moral obligation to enroll the faithful.
Piccolo also was associated with a business known as “One World One Website” (OWOW) that suggested a bottled-water product could cure cancer and had been vetted by the National Institutes of Health.
Over the years, Piccolo has pushed products such as a purported license-plate “spray” positioned as a means of helping motorists escape traffic tickets at camera-monitored intersections. Perhaps most notoriously, Piccolo has pitched a purported “magnetic” product that purportedly could help medical patients escape limb-amputation procedures while at once helping gardeners/farmers produce tomatoes at twice their normal size. The scam also included a claim that the “magnetic” product could help dairy herds increase milk production.
Perhaps most infamously, the Piccolo group in the DNA scam traded on the name of Adam Walsh, a child who’d been abducted and murdered. Piccolo employs anything that “works,” even the memory of a slain 6-year-old.
Piccolo scams typically also feature the presence of MLM huckster Joe Reid. The scams also may include suggestions that affiliates should enroll as a means of qualifying for tax write-offs. In a typical Piccolo scam, an increase in Alexa rankings is positioned as asserted proof of an MLM “program’s” legitimacy. The Piccolo scams also typically feature a link to Google’s translation tool, potentially as a means of picking off nonspeakers of English.
In 2010, the PP Blog was accused by an apparent Piccolo apologist of being a shill for Israel and spreading “Islamophobia.” This claim was made after the Blog reported that the FBI had stopped a plot to detonate a bomb at a Christmas tree lighting ceremony in Portland, Ore.
Also see this Jan. 16, 2014, comment by PP Blog reader and RealScam.com moderator Glim Dropper. The comment appears below an Aug. 30, 2013, PP Blog story titled, “Zeekers Targeted In New Scheme With Ties To Piccolo Organization.”
“While reviewing the ASD website in the District of Columbia, [an undercover agent] found a posting within ASD’s News section, apparently posted by ASD on July 2, 2008. The title of the posting was, “Alert Pay & Direct Deposit are being phased out July 31, 2008.” According to ASD’s posting, “We have notified BOA not to accept cash or personal checks for deposit account – English or Spanish.” ASD further stated, “Please remember that the preferred method of purchasing Ad Packages is by mailing a Check or by Solid Trust Pay . . . Solid Trust Pay is a Canada based money transmitting and payment company that, like the e-Gold system, operates over the Internet. It appears that beginning August 1, 2008, Solid Trust Pay will be ASD’s preferred method for receiving funds from members, and for paying rebates and commissions to members . . . Within the past two weeks, ASD has wired several million dollars to Solid Trust Pay from its BOA Accounts. A TFA also learned that earlier in July 2008, a bank other than BOA closed the last account that was controlled by Bowdoin or family members after that bank determined, and explained to them, that an investigation by the bank determined that Bowdoin appeared to be operating a Ponzi scheme.” — AdSurfDaily Ponzi scheme forfeiture complaint, August 2008
TelexFree affiliate promos encouraging participants to register for International Payout Systems (I-Payout) began to appear online in recent hours. Just last month, TelexFree affiliates were encouraged to register for Global Payroll Gateway, another e-Wallet vendor that supposedly would solve TelexFree’s payment problems as a pyramid-scheme probe moved forward in Brazil. There now are reports online that GPG has dumped TelexFree, leading to questions about whether TelexFree is trying to port its alleged fraud scheme to yet another vendor — I-Payout. Source: Google search results.
In 2008, the U.S. Secret Service effectively accused the AdSurfDaily MLM “program” of playing a game of payment-processor roulette as U.S. law enforcement put the squeeze on certain money-movers, the willfully blind enablers of online fraud schemes.
ASD, a $119 million HYIP Ponzi scheme that led to a 78-month prison sentence for operator Andy Bowdoin, started out by accepting “e-Gold and Virtual Money,” according to a Ponzi-scheme forfeiture complaint filed in federal court in August 2008.
But ASD, according to the complaint, realized e-Gold had come under investigation for enabling the laundering of money, something that could put the heat on ASD.
“Shortly after publicity surrounding the government’s investigation into e-Gold appeared, ASD discontinued using the e-Gold system as a means for receiving member funds,” the complaint alleged.
And even as these events were occurring, according to court filings in the ASD case and in other cases, Robert Hodgins, a supplier of debit cards and the operator of Virtual Money Inc. — now listed by INTERPOL as an international fugitive — came under investigation in Connecticut amid allegations he was assisting in the laundering of narcotics proceeds in Medellin, Colombia, and prepping himself to assist in the laundering of funds in the Dominican Republic.
Virtual Money, whom some ASD members said was supplying debit cards to ASD, also was linked to the PhoenixSurf Ponzi scheme, according to court filings.
In December 2010, federal prosecutors alleged that ASD also had accepted money from e-Bullion, a California firm that processed payments for Ponzi schemes, including the $72 million Legisi HYIP scheme in Michigan that led to prison sentences for operator Gregory McKnight and pitchman Matthew John Gagnon. E-Bullion operator James Fayed has been sentenced to death for ordering the brutal contract slaying of his wife, a potential witness against him. Pamela Fayed’s throat was slashed repeatedly in the shadows of a Greater Los Angeles parking garage, her husband seated on a nearby park bench “like he doesn’t have a care in the world.”
ASD, according to court filings, also used AlertPay and SolidTrustPay, money-movers based in Canada that have been linked to multiple Ponzi schemes, including the alleged $600 million Zeek Rewards Ponzi scheme broken up by the SEC last year.
Not even Bowdoin’s arrest in 2010 stopped him from pitching fraud schemes, according to court filings. Facing serious criminal charges for his actions in ASD, Bowdoin (in 2011) became a pitchmen for the OneX “program,” which federal prosecutors later alleged to be a pyramid scheme recycling money in ASD-like fashion. Among Bowdoin’s fellow OneX pitchmen was T. LeMont Silver, later of Zeek and later of JubiMax and GoFunPlaces, two MLM “programs” that are suing each other amid allegations of financial fraud.
At one time, OneX claimed to have a relationship with SolidTrustPay. It then claimed to have ended that relationship and to have started a relationship with I-Payout. Earlier, I-Payout had listed the uber-bizarre TextCashNetwork MLM “program” with ties to the Phil Piccolo organization as a “selected client.” TextCashNetwork now appears to have disappeared, but still is operating with the acronym “TCN” — this time as TrueCashNetwork. How the “new” TCN is processing payments is unknown. What is known is that someone associated with the “new” TCN has sent emails to “winners” in the Zeek scheme in an apparent bid to get them to flog for the new iteration, an apparent investment arm of which is being promoted as an opportunity to earn an interest rate of 50 percent.
Now — as incredible as it seems — promoters of the alleged TelexFree pyramid scheme operating in Brazil and the United States now are claiming that TelexFree is using I-Payout, known formally as International Payout Systems Inc. Equally incredibly, this is happening less than a month after TelexFree promoters advised TelexFree participants to register with Global Payroll Gateway (GPG), another eWallet company and supplier of debit cards, as a means of getting paid after payouts to Brazilian members of TelexFree were blocked in Brazil.
Just last month, TelexFree affiliates were encouraging prospects to register with Global Payroll Gateway (GPG). In recent hours — and amid reports GPG has given TelexFree the boot — TelexFree affiliates have been urged to register with I-Payout. Source: Google search results.
There are reports online, including on Facebook from self-identified members of TelexFree, that GPG gave TelexFree the boot in recent days. No sooner did those reports surface than videos went up on YouTube encouraging TelexFree members to register for I-Payout.
One of the reports that TelexFree suddenly had shifted from GPG to I-Payout is published on the MoneyMakerGroup forum. MoneyMakerGroup’s name appears in U.S. court files as a place from which Ponzi and fraud schemes are promoted. Both FINRA and the SEC have warned that HYIP schemes spread in part through social-media sites such as forums, YouTube and Facebook.
Because international MLM HYIP fraud schemes often have promoters in common — and because the schemes are promoted on Ponzi cesspits such as MoneyMakerGroup and TalkGold — proceeds from the schemes can flow into banks at the local level, putting them in the position of becoming warehouses for the ill-gotten gains of participants, including winners and insiders. The use of stored-value debit cards such as those in play in HYIP schemes can lead to the quick dissipation of assets, meaning that victims of an HYIP scheme may have limited hope (or even no hope) that a recovery can be made for their benefit.
The most recent incongruous events involving TelexFree are occurring even as at least one judge and one prosecutor involved in the TelexFree pyramid probe in Brazil reportedly have been threatened with death. And, as was the case with ASD, some promoters of TelexFree have claimed an ability to expedite the flow of money to the scheme — perhaps through back-office transactions within the TelexFree system.
BULLETIN: Zeek Rewards members are being targeted in a new scheme with ties to the Phil Piccolo organization and are being solicited for sums ranging from $600 to $60,000 “in return for ” . . . “guaranteed 50 percent interest” from a purported “unique and legal loan system” over an unspecified time period, the PP Blog has learned.
The offering, which hints of some sort of falling out with Zeek’s management, has been styled on YouTube as “The Diamond Club by TRUE CASH.” The emerging “program” was the subject of an email pitch yesterday that appears to have been targeted by an unknown party at former Zeek “Diamond” affiliates, potentially including some of Zeek’s largest “winners” who have exposure to clawback lawsuits filed by the court-appointed receiver and who previously have been solicited to make contributions to a purported defense fund for Zeek affiliates. Zeek “losers” also could be targets.
Previous schemes linked to Piccolo include the uber-bizarre Data Network Affiliates (DNA) “program” and One World One Website (OWOW), an equally bizarre money grab. (Use the PP Blog’s search function for information on those “programs.”)
In August 2012, the SEC described Zeek as a $600 million Ponzi- and pyramid scheme. In April 2013, the SEC took down a purported “loan” program known as Profitable Sunrise that may have gathered tens of millions of dollars through an alleged offering fraud. How the “The Diamond Club by TRUE CASH” offering intends to collect money is unclear, although a website to which pitchmen are directing traffic includes the logo of SolidTrustPay, one of the offshore processors used by Zeek.
Certain members of a Zeek-related email chain received the purported “Diamond Club” pitch yesterday. Hinting of bad blood, the pitch appeared below this headline, “Zeek Management Belongs in Prison – On 8/27/2013 I earned over $500,000 – I will pay your way in from $600 to $3000.”
How the $500,000 purportedly was earned was not explained. Also unclear was the identity of the sender. Among the claims in the pitch is this one (italics added):
IF YOU LOST $10,000 IN ZEEK OR RECRUITED 10 PEOPLE IN ZEEK I WILL PUT UP $3,000.00 FOR YOU
The principal part of the pitch claims this: “I just made $500,000.00[.] I will put up the $600 minimum for you – You pay me back ‘ONLY OUT OF COMMISSIONS’. If you are already in one of TCN 12 opportunities and want to be on my “DIAMOND CLUB” Team then you need to re-sign up. If you are resigning up you will need a new e-mail address. Get a free g-mail account from Google.”
From the lower-right corner of the True Cash Network website. Source: Aug. 30 screen shot.
In the same email, the pitch points recipients to a YouTube video and a website URL of ThePowerTeam.TrueCashNetwork.Com. “TrueCashNetwork” is using the same acronym used by TextCashNetwork (TCN), an earlier scheme linked to Piccolo and Joe Reid, a longtime huckster associated with Piccolo. On the TrueCashNetwork website, an emblem labeled SiteLock SECURE appears, along with the word “Passed.” The emblem incongruously includes the name of “TEXTCASHNETWORK.COM,” even though it appears on the TrueCashNetwork domain. The TrueCashNetwork domain appears to have been registered behind a proxy on June 28, 2013.
Reid, according to the TrueCashNetwork website, is the new TCN’s “Master Referral Agent” or “MRA.”
Precisely what happened with the original TCN, a purported daily deals site that purportedly used text-messaging, never has been clear. The emerging TCN, however, appears to have access to the original’s database and appears already to have used it to create affiliate links for “old” TCN members — this despite the fact TextCashNetwork is listed in Wyoming as a “dissolved” entity and its members may not have given permission to be ported to the “new” TCN.
These links shown in Google search results are showing the name of “textcashnetwork” in the URL. But all of them rotate to True Cash Network.
The “new” TCN purports to be operating as “True Cash Network, Inc.” Disputes, according to its website, will be handled under Wyoming law, but there appears to be no corresponding registration for True Cash Network in the state. Meanwhile, the “new” TCN is using the same Boca Raton (Fla.) business address as the “old” TCN. The old TCN once curiously purported that a member’s agreement with it “may not be transferred or assigned without prior written consent of REX Venture Group.”
Rex was the operator of Zeek Rewards and one of the defendants in the SEC’s Ponzi case.
True Cash Network — like TextCashNetwork before it — appears to be positioning itself as an MLM company that pushes affiliate products, including a “Medical Savings Plan,” X8 Energy Gum, Parcman Male Enhancer and more.
While TCN was operating as TextCashNetwork, the Piccolo organization appears to have tried to dupe people into believing the company was owned by Johnson & Johnson, a component of both Dow Jones and the S&P 500 and an internationally famous maker of pharmaceuticals and consumer products that are household names.
This affiliate page for the purported Banners Broker “advertising” program claims members can double their money.
UPDATED 8:54 P.M. ET (U.S.A.) Rumors abound online that authorities in India have carried out some sort of action against the Banners Broker “advertising” program. As of the time of this post, the PP Blog has been unable to confirm the rumored action with a law-enforcement source.
“Advertising” scams long have been associated with the HYIP sphere. The $119 million AdSurfDaily Ponzi scheme, for instance, was such a “program.” Such scams are associated with the unlawful sale of unregistered securities and claims by law enforcement of members’ money being siphoned by operators. “Winners” in such schemes can be sued for their ill-gotten gains. There also have been instances in which key pitchmen have been sued by regulatory agencies and even charged with crimes.
Several things the PP Blog has noticed:
A “welcome page” Banners Broker URL exists for the United States but is throwing this error message: “Unable to locate template file welcome_us.tpl.”
The nonworking US URL is http://www.bannersbroker.com/main/welcome_us. It is listed on an apparent Banners Broker affiliate’s website with a headline of “BANNERS BROKER INDIA.” The site also lists a U.S. address for the company in Ocala, Fla. Other addresses and welcome URLs for other countries appear on the same page. Welcome URLs for India, Canada, Ireland and the United Kingdom appear to be working. Only the URL for the United States appears not to work.
Whether Banners Broker removed the U.S. “welcome” URL in a bid to distance itself from U.S. regulatory scrutiny is unclear.
Regardless, the Banners Brokers site is viewable in the United States from the URLs for other countries and by connecting directly to the Banners Broker dotcom address. Although Banners Broker lists the flags of several countries on its homepage, the American flag is not listed. (Or at least wasn’t viewable by the PP Blog from the United States.)
At least one Banner’s Broker affiliate site is calling itself “Banners Broker Brief” and using the BBB acronym long associated with the Better Business Bureau. (A 2010 Phil Piccolo scam known as Data Network Affiliates arranged for one of its products to be called BBB. Such approaches sometimes are used to leech off of the Better Business Bureau’s famous acronym and to distort search-engine results and make “negative” information harder to find. It also is common in certain MLM schemes for affiliates to use the word “scam” when presenting the “opportunity” — and they then explain why it’s purportedly not a scam. This approach also may make it difficult to find “negative” information about a “program” because information can become buried in page after page of claims that the “program” is not a scam.)
Any number of affiliate YouTube videos exist for Banners Broker. Some are of the check-waving variety. Instead of featuring checks, however, they appear to feature screen shots of payments that purportedly originated at SolidTrustPay. SolidTrustPay has a reputation for doing business with scam after scam. Zeek Rewards, which the SEC described in August as a $600 million Ponzi- and pyramid scheme, used SolidTrustPay.
Banners Broker appears to have been popular among Zeek promoters. One video exists in which a Banners Broker affiliate tells the audience about the SEC’s Zeek case, but the affiliate claims he believes Banners Broker is not a fraud scheme. Even so, he allows that it could be.
Banners Broker has a major presence on the Ponzi boards — again like Zeek. Some promoters race from scam to scam to scam.
There are claims about Banners Broker “doubling” money.
EDITOR’S NOTE: Longtime huckster Phil Piccolo learned long ago that God and starving children “work” in MLM. We can’t help but wonder how many shills would flop over backward at his events if he ever finds out that fainting also “works.”
** _______________________________ **
A reader tells BehindMLM that attendees of a “World Consumer Alliance” (WCA) event in Sarasota, Fla., were fainting from apparent excitement.
WCA, with Paul Skulitz as the advertised admin, came out of the gate as “Wealth Creation Alliance,” saying it was selling “ad units” and declaring it was operated by an “Executive Dream Team.” (See Sept. 5, 2012, PP Blog story.)
Here’s a snippet from a September 2012 WCA sales pitch (italics added):
“We are fully operational right now and in our company pre-launch, this simply means that you are able to sign up for free and receive your business website and purchase advertising units as well. You can also refer and sign others in as well. We are also currently receiving payments and more importantly we are paying referral bonuses and daily profit sharing. Our pre-launch will continue through October 2012. We will hold our first major event the first weekend of November. (Details will be forthcoming)
On Sept. 7, the PP Blog reported that WCA was publishing promos for various HYIP schemes, including one that called itself A2P. A2P purported to be in “Pre-launch” and advertised these purported features.
7% daily payout for 30 days
10% income on 2 levels
Join Free!
WCA appears now to be stuck in “prelaunch” mode through March 8 after missing a November launch date. Read the comment by “Disgusted WCA Affiliate” at BehindMLM. (Make sure you page up to read the Sept. 13, 2012, WCA story from Oz at BehindMLM.)
Our assertion: Were he alive today and desperately needed cash, famed daredevil Karl Wallenda would find Zeek’s tightropes too dangerous to walk.
Purported MLM “expert” sent to woodshed: Zeek “consultant” and former SEC defendant Keith Laggos reportedly gets the Zeek boot after using phrases associated with the investment trade and after suggesting that gambling regulations could be used to derail the Zeek train in the near future.
Train wrecks and pom-poms: To his credit, MLMHelpDesk Blogger Troy Dooly reports the Laggos news and dubs an incendiary audio recording featuring Laggos into a Dooly-produced video. But known for his ability to find something “positive” in an MLM train wreck, Dooly goes on to suggest Laggos used Zeek-banned words because he was distracted and wasn’t concentrating. Dooly later declares that an examination into Zeek’s business practices by North Carolina Attorney General Roy Cooper is “exciting” news.
Only in Stepfordian MLM: Zeek cheerleading video with Dooly presented as centerpiece and Laggos presented as key answer man remains online, even after Zeek cans Laggos and Dooly questions the ethics of Laggos while at once making excuses for him.
Cluelessness: No guidance from Zeek on whether affiliates should avoid using the video when introducing Zeek.
More cluelessness: No guidance from Zeek on whether affiliates should continue to use marketing props published by Laggos’ Network Marketing Business Journal, a previous subject of gushing from Dooly.
Plan B: Laggos heralds Lyoness.
Stepfordian MLM vomit: Lyoness trades on name of former South Africa President Nelson Mandela, a recipient of the Nobel Peace Prize.
Why lots of people are fed up with Stepfordian MLM: As Lyoness uses an image of Mandela in a marketing campaign, AdSurfDaily’s Andy Bowdoin awaits sentencing in case in which ASD was accused of trading on the name of then-U.S. President George W. Bush to sanitize $110 million Ponzi scheme.
Whatever “works” is OK in Stepfordian MLM: As nascent penny-auction site and upstart Zeek competitor known as Bids That Give prepped for launch and positioned itself as a company that would aid charities for children, early promos traded on the name of the White House and Chelsea Clinton, the daughter of former President Bill Clinton and U.S. Secretary of State Hillary Clinton.
Oddities: Narc That Car/Data Network Affiliates/Phil Piccolo/Text Cash Network.
More . . .
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EDITOR’S NOTE: While performing a high-wire stunt in Puerto Rico in 1978, legendary daredevil Karl Wallenda fell to his death. He was 73, a risk-taker to the end.
UPDATED 11:39 P.M. EDT (AUG. 14, U.S.A.)
This is one of those “only in Stepfordian MLM” stories, a story that features not one, but two tightropes over a treacherously windy gorge Karl Wallenda would judge too dangerous to walk even if the daredevil business were in a sustained slump and he desperately needed cash. These are the tightropes over the Zeekler/Zeek Rewards Gorge, a man-made gulch in Lexington, N.C., potentially MLM’s next Quincy, Fla.
Quincy was the home of AdSurfDaily, a company that did an almost inconceivable amount of damage to MLM’s already-suffering reputation — first by creating an obvious, five-alarm Ponzi scheme and trying to disguise it as a “revenue-sharing” program and, later, by trying to “save” itself by comparing the U.S. Secret Service to “Satan” and the 9/11 terrorists.
Like the ASD story (and far too many MLM tales), the Zeek story is one that mixes the incongruous with the bizarre and only reinforces negative stereotypes about multilevel marketing.
Keith Laggos, a figurative tightrope-walker and purported MLM expert who once opined that AdSurfDaily’s 1-percent-a-day “program” was not a Ponzi scheme and later became a consultant whose image appeared repeatedly in a cheerleading video for the Zeek Rewards 1-percent-a-day-plus “program” after ASD was raided by the U.S. Secret Service in a Ponzi scheme case, is out, the company reportedly told Blogger Troy Dooly. (Link below.)
Laggos, though, appears not to have been fired for his ASD opinion. Indeed, Zeek may find comfort in that musing, which has been used by at least two ASD members (Todd Disner and Dwight Owen Schweitzer) who accused the U.S. government of presenting a “tissue of lies” to a federal judge when bringing the ASD Ponzi forfeiture case. Both of those ASD members also emerged as Zeek promoters. Curiously, the claim that the government had presented a “tissue of lies” was made longafter ASD had lost the case in both U.S. District Court and the U.S. Court of Appeals.
ASD and its apologists never were known for their impeccable timing. Neither was a 1-percent-a-day ASD knockoff known as AdViewGlobal (AVG), which incongruously announced a month after its February 2009 launch that its bank account had been “suspended” and that its CEO had resigned but would remain in the “accounting” department.
Two months later, AVG, which purported to operate from Uruguay while using U.S.-based Gmail to perform customer service, announced its banking problem had been solved by an offshore facilitator. AVG made this announcement on the same day the President of the United States announced a crackdown on offshore fraud. AVG was done weeks later. Before it exited the stage, it apparently thought it prudent to threaten to sue members who shared negative information and perhaps even have their Internet connections shut down.
Zeek is playing in this same bizarre field. Over the past couple of weeks, Dooly has ventured that Zeek might sue Randy Schroeder, an executive with the Mona Vie MLM company, for using words Zeek might find objectionable — “Ponzi” and “pyramid,” for example. And Dooly has suggested that a North Carolina credit union was risking a lawsuit from Zeek. Meanwhile, a Zeek critic known as “K. Chang” was informed by a purported Zeek “consultant” that Zeek might sue if its efforts to bring down “K. Chang’s’ site on HubPages.com failed.
Zeek now bizarrely claims that “all” criticism of Zeek has been unfair.
This claim was made just days after Zeek appears to have fired Laggos for casting his MLM line elsewhere while a Zeek “consultant” and while not sticking to the company line that Zeek does not constitute an investment opportunity. The other “program” is known as Lyoness, which Laggos has described as his “Plan B” and a “Plan B” for current Zeek members.
MLM ‘Mo’
To hear Laggos tell it on tape, the MLM business is the “momentum” business. One of the ways to maintain the momentum is to move certain banking operations offshore, say, to places such as Hong Kong. Laggos helped Zeek do that, according to Laggos. But Zeek might lose the mo and might not be far enough away to neutralize the regulators, he speculated.
No matter, Laggos ventured. There’s always another company with mo.
“Since last November, Zeekler has had the momentum,’ Laggos intoned in a recording now playing on Dooly’s Blog as part of a YouTube video and report on the sudden sacking of Laggos. “I believe they are going to lose the momentum shortly . . . The company now that’s gaining momentum — and I think it will be the momentum company over the next six months or a year — is Lyoness. And I’m suggesting that a lot of you guys consider Lyoness as your Plan B company now. Stay working with Zeekler. Keep promoting it. Don’t cross-sponsor it, but build a second income. Now, what’s nice about an ideal Plan B company is you would be able to work passively. Lyoness is that kind of company.”
In HYIP-speak, the word “passively” is code that tells participants that they won’t have to do much or anything at all to pile up cash (a/k/a “passive earnings”) by the boatload if they send in enough cash at the beginning of a scheme. Zeek is afraid of that word because it’s the type of word that can cause the SEC to come knocking. Lots of MLM scams that rely on willfully blind promoters to gain a head of steam use it in the early stages. When things get too hot, they try to take it off the table. The reason they try to take it off the table — sometimes by threatening affiliates — is it can lead to civil and criminal charges, seizures of bank accounts and investigations by multiple agencies.
Mixing the language of investments with references to Plan B didn’t do Zeek any favors, to be sure. Another thing that didn’t do Zeek any favors was Laggos’ reference to Zeek becoming the “momentum” company “last November.” In late September of 2011, the U.S. government released about $55 million in remissions payments to victims of the ASD Ponzi scheme.
This leads to questions such as these: How much of Zeek’s “momentum” was fueled by funds originally seized in the ASD Ponzi case and returned to victims in the form of remissions payments? How many ASD members turned around and plowed what effectively was their crime-victim compensation into Zeek, another 1-percent-a-day scheme? Why did Zeek promoters and former ASD members Disner and Schweitzer wait until November 2011 — the same month Laggos now says Zeek became the “momentum” company — to file their ASD-related lawsuit against the government and to present a federal judge an opinion from Laggos that ASD was not a Ponzi scheme?
“Plan B,” also known as “Don’t put all your eggs in one basket,” has a long and sordid history in HYIP Ponzi Land. AVG, for instance, was a de facto Plan B company set up after ASD, the Plan A company, got raided by the U.S. Secret Service on the Tuesday after the previous Friday’s seizure (Aug. 1, 2008) of ASD bank accounts. Lots of ASD members deluded themselves into believing that official company line that God was on ASD’s side. Some of ASD’s earliest post-seizure apologists told the troops that the seizure was a good thing because it would provide the government an opportunity to see how lawful and wholesome ASD truly was, that the government did not understand the business model and had made a monumental mistake.
The MLM vultures, though, had a slightly different take. In case the government didn’t see the ASD light, they speculated, ASD members could join other autosurfs, HYIPs and cash-gifting schemes. These Plan B schemes would enable ASD losses to be made up elsewhere. “Offshore” programs were positioned as the best.
Among the tips Laggos provided to listeners of the Lyoness conference call was this: “Don’t put no more than 70 percent back in [Zeek]. Take out 20 or 30 percent [on] a daily basis. [Unintelligible.] This would be a good place. But, by the same token, if you put $10,000 in Zeekler, if nothing happens over the next year, you’ll probably make $30,000 or $40,000, if that’s all you do without building the front end, the matrix . . . The same amount of money in Lyoness, you’re looking . . . and not doing anything else, without single sponsoring . . . you can probably make a quarter-million dollars.”
The threat to Zeek, according to Laggos, is the FTC and how U.S. gambling regulations could be applied to penny-auctions such as its Zeekler arm. His words on the tape suggest he is confident that Zeek has sufficient cover to ward off a Ponzi/securities investigation. But even as he’s suggesting Zeek has the securities angle covered, he’s using the language of investments.
We wonder: Can MLM really have sunk to these deplorable depths?
But it gets even worse.
Laggos then suggested Lyoness could be used as a hedge in case the FTC acted against Zeek.
“If I’m wrong about what’s gonna happen with the penny auctions — and if you look at my career, I haven’t been wrong often — then the worst-case scenario is we screwed up and we made two incomes . . . We’re making two great incomes with two great companies.”
Dooly, whom to date hasn’t found Zeek’s various claims altogether too much, now has decided that Laggos crossed the altogether-too-much line when he harrumphed for Lyoness and used certain words Zeek finds offensive.
While the featured speaker on the Lyoness call last month with Zeek members listening in, Laggos spoke about Zeek in “several” ways that were “way out of compliance,” Dooly ventured in his video report running on YouTube.
Laggos “talks about putting money into the game,” Dooly reports. “I mean, this is bad right here. You can’t put money in. OK? You either join the company and you’re buying memberships, you’re buying bids. But for Keith to be talking like this was an investment-type deal. This is just . . . and we all fall prey to this. But this is why you shouldn’t be doing public calls when you’re under fire and you’re not paying attention to what you say. And you can hear in Keith’s case — the phone [is] ringing, his assistant [is] coming in to talk to him, his mind is not in the game the way it should be. And that is just . . . it’s sad right now ’cause he’s no longer with [Zeek] . . .”
In short, according to Dooly, Laggos’ big sin was painting Zeek as an investment program in contravention of the Rules Of Zeek.
Not sticking to the script, however, is hardly an original sin within the Zeek sphere. In 2011, while speaking during a conference call to raise money for the Disner/Schweitzer ASD-related lawsuit against the government, Schweitzer, a one-time lawyer whose license was suspended in Connecticut, said he’d invested in ASD. Nevertheless, Disner and Schweitzer later presented a federal judge Laggos’ opinion that ASD was not a Ponzi scheme and that providing money to ASD did not constitute making an investment.
Nobel Peace Prize Used As MLM Stage Prop
Lyoness is an MLM company eager to let its participants and prospects know that it is building a school in the hometown of Nelson Mandela and that a Lyoness team recently was invited to the 1993 Nobel Peace Prize-winner’s home. It even publishes a picture to prove it and notes that a Mandela grandson is a Lyoness rep.
Back in the United States, meanwhile, former ASD President Andy Bowdoin will find out Aug. 29 how long he’ll spend in federal prison. Zeek’s business model and disclaimer language strongly resemble that of ASD, which the U.S. Secret Service described as a “criminal enterprise” that relied on linguistic sleight-of-hand to draft tens of thousands of people into an electronic Ponzi scheme. ASD traded on the name of then-U.S. President George W. Bush, in effect using the White House to sanitize a massive international fraud caper.
Welcome to the Highwire Wing of MLM.
While all of this is going on, a nascent penny-auction “program” and upstart Zeek competitor that claims it exists to elevate children out of poverty is getting ready to unleash itself on the consuming public.
That “program” is known as Bids That Give. One prelaunch promo claimed that a founding affiliate was an SEO expert once hired by a candidate for the U.S. Presidency. The first three minutes of the promo did not even reference Bids That Give. Instead, it dropped names linked to the White House, including the name of former First Daughter Chelsea Clinton and Doug Read, an adviser to two U.S. Presidents. For good measure, the promo dropped the name of NBC News anchor Lester Holt.
The most vomitous MLM “programs” are infamous for dropping names. It is typically the case that the individuals whose names are dropped have no affiliation whatsoever with the “program.” But name-dropping and brand leeching have proven to work time after time in MLM scheme after MLM scheme. (See screenshot.)
Did Mark Zuckerberg REALLY endorse JSS Tripler/JustBeenPaid. According to this Blog, the answer is yes. Facebook did not respond to a request for comment from the PP Blog last year on claims that Zuckerberg had endorsed JSS/JPB, which purports to provide a return of 60 percent a month.
MLM And Wordplay
In 2009, ASD’s Bowdoin was sued by some members of his own company under the federal racketeteering (RICO) statute. Looking at it another way, the ASD members came to believe that ASD was a criminal enterprise with a plan to expand while coming up with new and better ways to steal.
Because veteran MLM huckster Bowdoin also was a veteran securities swindler who’d been charged at the state level with fraud in at least three Alabama counties before launching Florida-based ASD in 2006, federal prosecutors said, Bowdoin tried to avoid the use of the language of investments as a means of keeping the 1-percent-a-day ASD scheme under the radar.
The linguistic cover Bowdoin chose — a cover the Feds stripped bare — was that ASD was an “advertising” company with a “revenue sharing” program, not an investment company selling “securities.”
Bowdoin tried to create additional cover by saying payouts were not guaranteed, according to federal court filings.
Now, four years after the ASD raid, Zeek is using the same type of disclaimer language and members are getting the same sort of instructions on what words to avoid.
Federal investigators became wise to this type of linguistic charade long ago. The charade was outlined in the 2010 criminal indictment against Bowdoin. The indictment quoted Bowdoin himself laying out the linguistic plot to hide the true nature of the 1-percent-a-day ASD program and keep the government at bay (italics added):
“[L]et’s don’t (sic) use the words investment and returns. Instead, lets (sic) use ad sales and surfing commissions. The Attorney Generals in the U.S. don’t like for us to use these words in our program.”
Wordplay to mask an investment scheme also was referenced repeatedly in the forfeiture complaints against more than $80 million in ASD-related bank accounts (italics added):
“The [undercover agent] asked her about investing with ASD. She immediately said, ‘Don’t call it investing, you know what I mean, we can get in trouble if we say that, we have to be careful.” — Source: Federal forfeiture complaint, Aug. 5, 2008.
Only In MLM La-La Land
To be sure, the departure from Zeek of Laggos is a big story. But it’s not the biggest story. The biggest story is that the Paul Burks-led company already was walking a tightrope when it hired the tightrope-walking Laggos and now has cut his rope, casting him into the gorge without informing the membership at large and without pulling the tightrope-walking promotional material that references Laggos or was produced by his publishing company.
Some of that promo material features tightrope-walking Dooly, who’s now questioning the ethics of tightrope-walking Laggos.
How strange is the latest PR disaster to rock Zeekland? So strange it almost defies description.
As noted above, news of the Laggos departure was delivered by Zeek-friendly Blogger Dooly. And the news was delivered even as images of Dooly appeared online as a centerpiece in the same cheerleading video that features images of Laggos as centerpieces. The video largely consists of still photos taken at a Zeek “Red Carpet Day” event in Clemmons, N.C., on June 13. Incredibly, the video continues to appear online, despite the sudden and unexpected departure of Laggos last month.
On Aug. 4, Zeek used its Blog to accuse unspecified “North Carolina Credit Unions” of slander for expressing concerns to customers about Zeek. The post implied Zeek members who didn’t toe the company line would be penalized. Such members were “violators” of company policy, the firm said.
But Zeek has not addresed the Laggos issue on its Blog. Nor has it provided any guidance on whether members should stop using the Zeek cheerleading video that features both Laggos and Dooly, along with Zeek staffers, executives and members who showed up at the June 13 event in Clemmons. The Laggos-produced written materials also are out there, with no guidance from Zeek about whether members should continue to use them or to rely on them in any way.
Like ASD, Zeek plants the seed that participants will earn a return that corresponds to an annual return in the hundreds of percent but insists it is not offering an investment. The office of North Carolina Attorney General Roy Cooper said last week that it had asked Zeek to produce “documents” as part of an “examination” of its business practices. Dooly described that development as “exciting.”
Zeek is making MLM look ridiculous. Troy Dooly is making it look sillier yet. He should not be “covering” a company that is trading off his credibility as an MLM advocate to sell itself. Dooly now is questioning the ethics of Laggos even as Dooly permits Zeek to use his image in marketing promos that also feature images of Laggos.
Prior to opining that ASD was not a Ponzi scheme — only to be one-upped later by Bowdoin, who said that it was when entering a guilty plea to wire fraud in May 2012 — Laggos agreed to settle a 2004 case with the SEC that alleged he issued laudatory press releases and a laudatory article for a company that later become the subject of a securities investigation without disclosing he was being compensated for touting the purported opportunity.
Laggos neither admitted nor denied the SEC’s allegations, which involved a company known as Converge Global Inc. and a subsidiary known as TeleWrx Inc. The future Zeek consultant settled the SEC case by disgorging nearly $12,000, paying interest of nearly $2,000, paying a civil fine of $19,500 and agreeing to a five-year penny-stock ban.
In April, Network Marketing Business Journal, which lists Laggos as its president, published a laudatory article on Zeek. Dooly memorialized the article’s publication by publishing a special Sunday story about it on Dooly’s MLMHelpDesk. He memorialized it further by producing a gushing video in which he described Laggos as “my good friend and mentor.”
“He is breaking a story here that I thought was amazing,” Dooly said of the NMBJ Zeek article, which gushed that Zeek has a 25 to 1 customer to rep ratio. The claim is important because, if true, it could take Ponzi and pyramid concerns out of play. Some Zeek critics doubt that it’s true.
In April, Dooly noted that NMBJ was one of his favorite publications and that he picked it up on that particular Sunday while relaxing near his pool over a cup of tea.
But now — less than four months after Dooly’s April 15 gushing story and video on NMBJ’s gushing story about Zeek and less than two months after images of both Dooly and Laggos appeared in the Zeek video in which Zeek gushed about itself — Laggos is out at Zeek.
“Breaking MLM News: Zeek Rewards Officially Parts Ways With Dr Keith Laggos After Recorded Call Goes Public,” Dooly advised readers in a headline.
The precise reasons for the departure of Laggos remain unclear. Also unclear is whether Laggos will retain a reported Zeek downline of about 4,500 members that he apparently was managing while at once being a paid Zeek consultant.
Produced by USHBB Inc., which once produced videos for the bizarre (and failed) Narc That Car license-plate recording scheme that claimed some affiliates were out-earning the President of the United States, the Zeek video heralding Laggos, Dooly and others shows Dooly mugging with Zeek executive Dawn Wright-Olivares and Laggos posing with Peter Mingils. The last names of both Laggos and Mingils are misspelled in the USHBB video.
Like Dooly, Mingils is a board member of the Association of Network Marketing Professionals. He’s also Zeek’s Training & Incentives Coordinator and is “rockin’ the Certified Trainers course curriculum,” according to Zeek.
Zeek, which at one time listed USHBB executive OH Brown as a Zeek employee, now says Brown is “banging out video after video.”
Some of the backstory surrounding the failed Narc That Car scheme is remarkably similar to the Zeek scheme. In addition to the presence of USHBB, Narc and Rex Venture LLC, Zeek’s purported parent company, both have scored the Better Business Bureau’s lowest rating: “F.”
Affiliates of both Narc and Zeek, meanwhile, have sought to turn attention away from the core issues surrounding both Narc and Zeek by suggesting that the BBB is a fraud.
But perhaps most compellingly, the now-failed Narc scheme once did at least part of its banking at NewBridge Bank, one of the banks that Zeek used before mysteriously announcing on Memorial Day that it was ending its relationship with NewBridge. Narc was based in Texas. How it ended up banking at NewBridge is unclear.
What is clear is that Narc was a pyramid scheme that planted the seed it existed to help the U.S. AMBER Alert system for locating abducted children and traded on imagery of the White House. Both the U.S. Department of Justice and the National Center For Missing and Exploited Children, which administers part of the AMBER Alert program, confirmed to the PP Blog more than two years ago that they had no affiliation with Narc.
A Narc Knockoff With Phil Piccolo As Background Player
Narc appears to have inspired a knockoff MLM scheme known as Data Network Affiliates, which was linked to longtime MLM huckster Phil Piccolo. In late 2011, DNA’s website — and the website of another a Piccolo-linked “program” known as OWOW — were used to drive traffic to an emerging MLM scheme known as TextCashNetwork (TCN).
In December 2011, the PP Blog reported that TCN had used the name of Rex Venture Group on its website in the context of a purported “ASSIGNMENT” clause. The Rex Venture reference later mysteriously went missing from the TCN site, a circumstance that could cause investigators to question Rex Venture about whether it was aware that its name appeared on the TCN site and whether it had any business relationship with TCN.
If this is modern MLM, MLM is in a lot of trouble. Karl Wallenda, who built a magical name in the daredevil business and made a career out of taking risks, wouldn’t do Zeek.
From YouTube sales pitch for BidsThatGive by Randy Jeffers. (Children's faces masked by PP Blog.)
EDITOR’S NOTE: It is true that far too many of the world’s children live in poverty. It also is true that children may become the objects of criminals who engage in human trafficking and that children are exploited in the sex trades. It is equally true that legitimate charities exist to combat these horrific situations and that one MLM “program” after another has tried in recent times to tug at the human heart and “marry” their “programs” to a purported cause. If you desire to improve the human condition for the masses of children, it likely is best to donate directly to a legitimate charitable organization, rather than joining a get-rich-quick scheme that says it is doing good work behind the scenes.
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UPDATED 6:57 P.M. EDT (U.S.A.) WARNING: The following development in MLM La-La Land may be harmful to your gag reflex.
Zeek Rewards, the U.S.-based MLM “program” that wraps itself in the American flag, collects sums of up to $10,000 from participants, plants the seed affiliates can earn a return of between 1 percent and 2 percent a day while insisting it is offering neither securities nor an investment program, has a payout scheme similar to the AdSurfDaily Ponzi scheme and securities swindle, is married to a penny-auction site known as Zeekler that has told successful bidders for sums of U.S. cash that they can receive their money via offshore payment processors and preemptively denies it is a pyramid scheme, has some emerging, U.S.-based competition.
The name of the “program” is “BidsThatGive” — and it unabashedly tugs at heartstrings while at once asking prospects to imagine themselves behind the wheel of a grand automobile and feeling good because they also could become a “Contributor” for $10 a month, a “Guardian” for $50 a month, a “Benefactor” for $100 a month” or a Global Ambassador” for $250 a month and pile up mountains of cash while they’re displaying a social conscience.
Two of the core aims of the “program,” according to a nine-minute video promo running on YouTube, are to help impoverished children and children who’d been exploited and became “sex slave[s].” The prelaunch of BidsThatGive appears to have been timed to coincide with the Independence Day holiday period in the United States.
One of the assertions in a the YouTube video is that the “rewards” the company provides include “an orphanage and a school, church or hospital built in your name.” All of this apparently is possible because BidsThatGive has a “global business model” and employes a “concept” known as “PPSC,” which stands for Private Profit Sharing Company.
But before we get to the uber bizarre, let’s address the run-of-the-mill bizarre in this latest entry in MLM La-La Land.
BidsThatGive is a little bit Andy Bowdoin. Indeed, the emerging penny-auction company with an MLM-style compensation plan, claims it’s not an MLM program and tells prospects they’re “probably not going to sleep at night” once they understand the profit potential. Bowdoin, the infamous AdSurfDaily Ponzi schemer, told prospects that ASD was not a “network marketing company” and used largely the same line about all the sleepless nights excited prospects would experience.
Meanwhile, BidsThatGive is a little bit like AdViewGlobal (AVG), a collapsed 1-percent-a-day Ponzi autosurf federal prosecutors said in April 2012 had ASD ties. AVG once claimed that one of its desires was to save the rainforest through charitable contributions. BidsThatGive also resembles ClubAsteria, which offered outsize weekly returns ranging from 3 percent to 8 percent and told prospects that its charitable arm would provide relief to victims of the devastating earthquake in Japan last year. ClubAsteria also purported to provide aid to children and claimed its mission was to elevate the word’s poor out of poverty.
And BidsThatGive also resembles DataNetworkAffiliates (DNA), which tied itself to the U.S. AMBER Alert system for rescuing abducted children and said its “token system” could help prevent child poverty.
“Help DNA Feed A Million. OVER 1000 AN HOUR DIE. The DNA Token System Can Prevent This!” the company exclaimed.
Among other things, DNA used a YouTube video to trade on the name of Adam Walsh, the 6-year-old who was abducted and murdered in Florida in 1981. Adam’s father, John Walsh, became a prolific advocate for children and later became the host of the “America’s Most Wanted” television series.
DNA, which was associated with longtime MLM huckster Phil Piccolo, appears not to have helped a single abducted child or a single child living in poverty. Affiliates, though, tried to plant the seed that the DNA “program” was backed by Oprah Winfrey and Donald Trump. When DNA’s CEO resigned suddenly in 2010, the company waited nearly a week to announce the departure — and then misspelled the former CEO’s name.
BidsThatGive Operator
Randy Jeffers, an MLM aficionado, is the purported operator of BidsThatGive, according to promo videos on YouTube. Jeffers also presides over a nonprofit entity known as “Liberty Kidz,” which says its “[v]ision is to empower a child to be all that he or she is created to be, by providing homes, help and hope for discouraged, displaced and distressed children of the world.”
A similarly named Jeffers’ entity known as Liberty International LLC filed for bankruptcy in August 2010, listing about $1.94 million in debt and $641 in assets, according to federal records. The assets consisted of the balance of a business checking account.
What follows are comments from Jeffers in the nine-minute sales pitch for BidsThatGive on YouTube (italics added):
You know, there are so many terrible things that happen to children all over the world. Right now a little boy is dying of hunger, a little girl just got sold by her mother and is being forced into life as a sex slave.
Right now, children are being physically abused, and then there’s so many children that are just left by themselves and there’s no one there to love or care for them. I don’t know why bad things happen to innocent little children, but they do. But here’s what I do know: All of us can do something about it.
You see, that’s our No. 1 purpose. This company was founded to be a true partnership between those children, the children’s charities that it supports and its affiliates who make it all happen.
A ‘Founding Member’
One of the founding members of BidsThatGive is Glen Woodfin, according to 6:56 promo video dated July 2 and running on YouTube.
Woodfin describes himself in the video as an American who once moved to Brazil to be with his “multimillionaire” fiance who had 90 employees. Enjoying the “good life” on the beach while sitting around drinking “coconut milk” was fun for a while, but ultimately led to a desire to become more productive and to develop an online skill set. Woodfin ultimately discovered he had a talent for search engine optimization and that clients were interested in those services.
Glen Woodfin, who says he's done SEO for a Presidential candidate, does a little dance in his Bids That Give sales pitch on YouTube.
His SEO skills ultimately became so good that “I was hired by somebody running for President . . .,” according to Woodfin, who narrates the video. He did not identify the candidate.
Woodfin, however, goes to to explain that he was fortunate to know author and White House adviser Doug Wead, who wrote “All The President’s Children,” a New York Times Bestseller. (Wead’s Wikipedia entry says he advised GOP Presidents George H.W. Bush and George W. Bush.)
Apparently in the market for SEO advice, Wead turned to Woodfin, according to the video.
“He said, ‘Glen, we’ve got one of the Presidential children about to get married in three weeks, and we don’t have a website up. Can we get in there and get to the top of the search engines with it?’” Woodfin recalled.
That Presidential child, according to Woodfin, was Chelsea Clinton, daughter of former President Bill Clinton and U.S. Secretary of State Hillary Clinton.
Over the weekend Chelsea Clinton got married, Woodfin said, his SEO techniques on Wead’s behalf put a site known as ChelseaClintonWeddingWatch.com at the top of the rankings. (Chelsea Clinton was married on July 31, 2010.)
When NBC News anchor Lester Holt was interviewing Wead, Woodfin said, Holt mentioned the website Woodfin had put at the top of the rankings, apparently attributing the feat to Wead.
Neither BidsThatGive nor Jeffers is mentioned in the first three minutes of the Woodfin video. But at roughly the 3:03 mark, Woodfin announces, “I’m going in business with a gentleman named Randy Jeffers. Randy Jeffers started the No. 1, fastest-growing MLM of all time, called Destiny. They put in 1 million distributors in 18 months.”
Woodfin goes on to say that Jeffers recently called him and offered him a “founder’s membership” in BidsThatGive.
“While he’s talking, the hair start[s] standing up on my arm, and I got thrilled,” Woodfin recalled. “As a matter of fact, every time I get off the phone with him now, I’m just, ‘Thank you for putting this together.’ It’s based on penny auctions . . .”
It’s not known whether Woodfin contacted the White House, Wead, Clinton and Holt as a courtesy to let them know he’d be using their names in a YouTube pitch for Jeffers’ BidsThatGive. What is known is that namedropping is common in the MLM sphere — often without the knowledge of those whose names are dropped.
Although the Woodfin pitch did not imply that any of the celebrities or institutions mentioned in the pitch endorsed BidsThatGive, the implication was clear that BidsThatGive prospects who joined under Woodfin would gain access to an SEO expert who’d worked for a Presidential candidate and knew a Presidential adviser.
Neither the Jeffers’ video nor the Woodfin video referenced the Liberty International LLC 23-month-old bankruptcy filing. Nor did either video address any of the potential problems BidsThatGive could encounter from regulators.
Like the Zeek Rewards’ business model, the BidsThatGive model resembles that of ASD. In 2008, the U.S. Secret Service seized more than $80 million from ASD-related bank accounts, including $65.8 million in the personal accounts of Andy Bowdoin.
Court records showed that ASD was trading on the name of then-President George W. Bush. Analysts saw it as a transparent bid to sanitize the “opportunity” by trying to link it to the White House.
Major politicians from both sides of the aisle have seen their names used in promos for “opportunities” that proved to be Ponzi schemes.
Former President Clinton’s name and image were used by the Mantria Corp. Ponzi scheme. Clinton is a Democrat.
Here is an imponderable: Is there any ceiling to the absurdities in the HYIP sphere and the destructive force it exercises around the web?
On Wednesday, the PP Blog received repeated spams from U.S.-based IPs. The spammer used the handle “invest liberty reserve” and targeted two threads, including this one about JSS Tripler 2, a purported “program” that purportedly based its name on JSS Tripler. JSS Tripler is a purported element of JustBeenPaid, an “opportunity” purportedly operated by Frederick Mann that claims it pays a return of 60 percent a month.
Liberty Reserve is an “offshore” payment processor favored by HYIP schemes, including JSS Tripler/JustBeenPaid. Wednesday’s spam bids used purported email addresses at AOL and Hotmail.
One of the Wednesday spams featured a graphic swiped from PonziNews, once a sister site to the PP Blog. The spammer attempted to use the stolen graphic in his posting bid on the PP Blog.
It was not the first time the Blog’s graphics had been used in a nefarious way online. On Dec. 12, 2010 — in commemoration of its 1,000th post — the PP Blog recounted a July 2010 story that its Breaking News graphic had been swiped and placed inside a promotion for Data Network Affiliates.
DNA was a scam associated with huckster Phil Piccolo. The “opportunity” traded on the names of Oprah Winfrey and Donald Trump and advertised a nonexistent cell-phone plan of unlimited talk and text for $10 a month, an offshore “resorts” scheme and a “mortgage-reduction” scheme — all while tying itself to Christianity, the U.S. AMBER Alert system of locating abducted children and a purported bid to end world poverty.
It’s worth noting that some JSS Tripler/JustBeenPaid promoters also traded on Winfrey’s name.
In the same December 2010 commemoration post, the Blog reported that Janet Napolitano, the secretary of the U.S. Department of Homeland Security, had been called names that would peel paint when DHS announced that Walmart had joined the “If you see something, say something” terrorism-awareness campaign. Meanwhile, the Blog reported that some online-fraud schemes had evolved to victimize participants by the tens of thousands — numbers America’s largest sports stadiums could not accommodate.
The PP Blog no longer owns the PonziNews domain. The Blog suspended publication of the site in 2010, after thieves who used international IPs stole the domain’s content verbatim and posted it on other sites they controlled that had a higher Page Rank than Ponzi News.
In short, the net effect of the theft was that the PP Blog was being used to create “free” content for thieves who intercepted the traffic of PonziNews. Such piracy schemes are hurting the publishing industry.
In a separate spam bid on Wednesday, a would-be poster suggesting he represented an HYIP ranking site targeted this PP Blog thread on strange claims associated with “MoneyMakingBrain” in the context of JSS Tripler/JustBeenPaid.
The would-be poster purporting to represent the HYIP ranking site complained that the Blog had used the term “HYIP” in the linked story above “21 times” without explaining the meaning of the term.
“Nice writing job!” the would-be poster jabbed. He provided no comment on the substance of the story.
On RealScam.com yesterday, “MoneyMakingBrain” — who’d emailed threats repeatedly to the PP Blog on Feb. 29 — described the Blog as a “BIG idiot,” a “chicken,” a “deceptive unethical lowlife,” the user of “NONFACTUAL” sources and other names.
Because of the emailed threats and “MoneyMakingBrain’s” subsequent ban from the PP Blog, the Blog will not engage with MoneyMakingBrain on RealScam.com, an antiscam forum that concerns itself with mass-marketing fraud and occasionally has been subjected itself to threats and menacing communications.
“MoneyMakingBrain” has advanced various conspiracy theories about RealScam.com, the PP Blog and and some of their common posters.
What he has not done is explain what his purported “due diligence” into the JSS Tripler/JustBeenPaid “program” entailed or how purported operator Frederick Mann could pay an annualized return between 48 and 73 times higher than the purported “returns” of Bernard Madoff.
Yesterday on RealScam, “MoneyMakingBrain” asserted that he has “recently read [about the PP Blog] on some scams forum, that he is a very deceptive reporter, well, that doesn’t surprise the MMB at all.”
It is possible that “MoneyMakingBrain” is referring to this September 2009 thread on Scam.com. The thread was started by a PP Blog poster known as “little joe” who’d been banned for harassment. The poster, who later was banned from Scam.com, claimed the PP Blog would be “scrambling to put out fires” from multiple IPs.
The threats and intimidation campaign from “little joe” began after the summer 2009 collapses of AdViewGlobal (AVG) and Ad-Ventures4U (ADV4U), both of which claimed an ability to provide preposterous returns in the wake of the government seizure of tens of millions of dollars in the AdSurfDaily Ponzi case.
Frederick Mann, the purported operator of JSS Tripler/JustBeenPaid, has described himself as a promoter for both ASD and ADV4U.
On Aug. 18, 2009, antiscam commentators on the PP Blog were called “idiots” and the PP Blog itself was asked by an ADV4U promoter whether the author was a “fag.” After launching his ad hominem attacks against the PP Blog and its posters, the ADv4U pitchman asserted he was a longtime businessman and that criticism about ADV4U on the PP Blog was about “as unprofessional as it gets people.”
“I’m out of here.You bunch of idiots make me sick!!!” the poster railed.
Less than a year later — in May 2010 — Professor James Byrne, an expert hired by the U.S. government to assess the alleged HYIP Ponzi scheme of Nicholas Smirnow of Pathway To Prosperity — observed that HYIPs were not “noted for their internal consistency.”
One of the inconsistencies that became part of the ADV4U story was the assertion by the “defender” that he was a longtime, professional businessman — while the same “defender” asked the PP Blog if he was a “fag” and declared ADV4U critics who questioned a purported payout rate of 1 percent a day “idiots.”
Both assertions occurred a year after the U.S. Secret Service brought Ponzi allegations against ASD, whose payout scheme was similar to ADV4U’s.
