Just hours after news broke of a racketeering indictment by Colorado prosecutors against a Denver-area man in an alleged Ponzi scheme, Michigan prosecutors announced the racketeering indictment of a Greater Detroit woman in what was described as a real-estate Ponzi scheme.
In the past two days, prosecutors from different agencies in different regions of the United States have announced three major Ponzi indictments brought under state or federal racketeering statutes.
On Tuesday,the FBI arrested former Fort Lauderdale attorney Scott Rothstein, 47, on federal racketeering charges in Florida.
Yesterday, Mark J. Jackson, 55, was indicted on state racketeering charges in Colorado by Denver District Attorney Mitchell Morrissey.
Early this morning Rita Gosselin of Grosse Ile, Mich., was arrested by investigators from the Southgate Police Department and the office of Michigan Attorney General Mike Cox.
Gosselin, 58, was charged under Michigan law with one count of continuing criminal enterprise (racketeering), and three counts of false pretenses over $20,000. In unrelated cases, Michigan prosecutors brought racketeering charges against Michael J. Morris and William T. Perkins in October in an alleged fraud scheme that targeted churches.
Bail for Gosselin was set at $300,000 cash. She was unable to post it, and was taken to the Wayne County Jail. A hearing for Gosselin is scheduled Dec. 15.
“Taking advantage of Michigan families, especially in today’s economy, will not be tolerated,” said Cox.
Prosecutors said Gosselin was at the helm of a Ponzi scheme “involving fraudulent real estate investments and stealing hundreds of thousands of dollars from Michigan families.”
To pull off the scheme, prosecutors said, Gosselin “enticed investors with claims she was able to purchase foreclosed and distressed properties in bulk and renovate the homes to sell at a profit.”
Investors were given promissory notes and promised regular returns on the money they entrusted to Gosselin.
“Few investors received any of the payments promised and all lost some, if not all the money they invested,” prosecutors said.
The alleged scheme fleeced at least 20 investors out of at least $500,000, prosecutors said.
It’s called “misprision of felony” under Section 4 of the U.S. Code, and here’s how it reads:
“Whoever, having knowledge of the actual commission of a felony cognizable by a court of the United States, conceals and does not as soon as possible make known the same to some judge or other person in civil or military authority under the United States, shall be fined under this title or imprisoned not more than three years, or both.”
And today “misprision of felony” was used in Georgia against Saundra McKinney Pyles, who was accused of concealing a Ponzi scheme operated by her friend, Gary Sheldon Hutcheson. Hutcheson pleaded guilty to mail fraud and money laundering.
In essence, Pyles was accused of choosing not to report Hutcheson, even though she knew he was operating an investment scheme and committing mail fraud.
Pyles was sentenced to 14 months in prison, and made equally responsible with Hutcheson to pay $1.6 million in restitution to victims. Hutcheson was sentenced to five years in prison.
Do autosurf promoters who turn a blind eye to fraud or choose to become a participant in a wink-nod Ponzi enterprise now have something new to worry about?
UPDATED 3:17 P.M. ET (U.S.A.) The Federal Trade Commission has asked a federal judge to find attorney Jeffrey S. Benice in contempt of court for failing to turn over $238,300 to a victims’ compensation pool as required.
Benice represented Charles Castro in the Network Services Depot Ponzi scheme involving the sale of Internet kiosks. The defendants in the 2005 civil case were ordered to pay a judgment of $18.9 million earlier this year. Castro separately was charged criminally with securities fraud. He pleaded guilty, and is in Chino State Prison in California.
Prosecutors said many of the victims were senior citizens.
Benice received a retainer of $375,000 in the case. The FTC alleged that $238,300 of the sum was attachable as consumer redress under a theory of constructive trust, claiming the payment had come from proceeds of the Ponzi. A federal judge agreed in March, and ordered Benice to turn over the money. Benice was permitted to keep $136,700 of the retainer for legal fees, but ordered to turn over the balance of $238,300.
FTC attorneys now say Benice is “flouting” the court order, while claiming the money has been spent and that he lacked the means to comply. Although Benice has offered to pay $2,500 per month, the FTC said he “appears to have very few assets but is living in extravagant style, paying over $6,000 per month in rent and over $3,100 per month in car payments on a BMW, a Porsche Turbo, a Jeep Wrangler, and a motorcycle.”
During the past few years, according to the FTC, Benice has earned a nice living.
“Benice testified at his deposition that he makes an average of $400,000 per year from his
practice and specifically asserted that he is not insolvent,” the FTC said.
Read the FTC’s motion to find Benice in contempt of court.
Federal prosecutors and agents today began the process of seizing assets from Florida attorney Scott Rothstein, amid allegations he had been operating a Ponzi scheme involving hundreds of millions of dollars since 2005.
The early probe is shaping up in largely the same way as the early probe into AdSurfDaily, a Florida business accused last year of operating a $100 million Ponzi scheme.
Rothstein, for example, has not been arrested. Agents from the FBI and IRS seized real estate, boats, cars and bank accounts today. Meanwhile, prosecutors brought a civil-forfeiture case against property tied to the alleged scheme.
Prosecutors used largely the same approach against ASD. ASD President Andy Bowdoin, for example, was not taken into custody when news of the allegations broke. As is the case with Rothstein, the ASD probe began with forfeiture complaints.
Like the ASD case, the government believes others perhaps were involved in the fraud. Unlike Bowdoin of ASD, however, Rothstein does not appear to be enjoying an early surge of support.
In the context of Ponzi schemes, civil forfeiture helps the government stop potentially massive financial crimes in their tracks, before they can mushroom and consume even more wealth. Investigating Ponzi schemes can be a mammoth undertaking that involves reverse-engineering thousands and thousands of transactions and following global and electronic trails.
There has been nonstop news about Florida Ponzi schemes in the past 48 hours. Several indictments have been announced, the latest involving Sean Healy of Weston.
Healy, 38, was charged in a 55-count indictment unsealed in Pennsylvania with multiple counts of wire fraud, mail fraud, money laundering and obstruction of justice.
Prosecutors said Healy “spent the money to fund a lavish lifestyle.”
Purchases included “numerous exotic vehicles and sport cars, including a Bentley and several Ferraris, Lamborghinis and Porsches worth over $2.3 million,” prosecutors said.
Obstruction of justice was charged because Healy thwarted a grand jury by providing “phony bank statements and phony trading records, indicating that the Pennsylvania investor’s money was used for legitimate trading activity in stocks and commodities,” prosecutors said.
“When the authentic records were obtained, they revealed that Healy had simply spent the money on his extravagant lifestyle and used some of it to pay back earlier investors who he defrauded between 2003 and 2008,” prosecutors said.
The grand-jury probe began in March, after an investor who had been scammed in Pennsylvania sued Healy and his wife, Shalese Rania Healy, in U.S. District Court in the Southern District of Florida, alleging that Pennsylvania investors had lost $14.6 million with Healy between April 2008 and February 2009.
In July, the SEC and CFTC sued Healy in a case that alleged massive fraud. Also named in the complaints was Healy’s company, Sand Dollar Investing Partners LLC. Healy’s wife was named a relief defendant, meaning investigators believed she had received ill-gotten gains from the scheme.
CFTC said investor funds also were used to purchase gold bullion and “to lease a luxury suite at Miami’s BankAtlantic Arena.”
The sky was the limit, said an SEC official.
“Rather than investing the money as he promised, Sean Healy used investor funds to finance an extravagant lifestyle for himself and his family,†said Antonia Chion, associate director of the SEC’s Division of Enforcement.
The July complaint by the SEC also alleged that Healy provided false information to the U.S. Attorney’s Office for the Middle District of Pennsylvania, which brought the obstruction charges and the other charges. The indictment was unsealed yesterday in Harrisburg, Pa.
Dennis Pfannenschmidt, U.S. Attorney for the Middle District of Pennsylvania, cataloged the spectacular purchases Healy allegedly made with investors’ funds.
In addition to the automobles, Healy also bought a $2.4 million waterfront mansion furnished with more than $2 million of home improvements, plus $1.5 million in men’s and women’s jewelry, Pfannenschmidt’s office said.
The U.S. Secret Service is conducting yet-another investigation into the practices of an Internet-based business amid Ponzi allegations. Agents have seized computers and business records from Regenesis Marketing Corp., which operates online as Regenesis 2×2 at this website.
A felon on federal probation was an integral part of the company, according to court records. Meanwhile, federal agents said they found the personal records of customers in a Dumpster.
Regenesis 2×2 sells what it calls “commission centers” for $325 and touts itself as “THE ECONOMIC STIMULUS PLAN FOR YOU.”
Seized were envelopes containing credit cards, debit cards and financial statements; 13 Priority Mail envelopes and 10 First Class Mail envelopes; and various computers, computer equipment and business records.
Screen shot of Regenesis 2×2 video
In court documents, the Secret Service revealed Regenesis 2X2 had been under surveillance for five weeks prior to the government applying for multiple search warrants, which were approved by a federal magistrate judge July 17.
The case has featured surveillance at multiple locations, including a UPS Store in Kirkland, Wash., that the company used as a mailing address. Business actually was conducted elsewhere in Washington state, including the town of Snoqualmie, according to court filings.
No charges have been filed and the website continues to resolve to a server. The Secret Service, however, laid out allegations of an elaborate fraud involving multiple individuals, multiple bank accounts, multiple addresses and multiple company names, including a firm known as Streamline Media of both Reno, Nev. and Kirkland.
Agents observed complaint letters directed at the firm being discarded into a Dumpster that was kept under constant surveillance. Also found in the Dumpster were copies of checks sent in by customers, other documents that included customers’ names and information to identify them personally, complaint faxes sent by customers and a letter from a law firm complaining about false, misleading and deceptive advertising, according to court filings.
In one case in which agents were observing one of the adult principals in the case, they observed a youth described as a teenager exiting a vehicle and “struggling with a large arm full of opened business and UPS Priority Mail envelopes,” the Secret Service said in court filings.
The juvenile entered a building and “then immediately came back outside and discarded the materials into an alley [D]umpster,” agents said.
Agents identified the adult under surveillance as a person “arrested by the Internal Revenue Service out of Las Vegas, Nevada[,] for felony violations related to Illegal Money Laundering from Securities Fraud and Wire Fraud” in a previous case.
The subject under surveillance was on federal probation, agents said.
Assisting the Secret Service in the probe are the Federal Trade Commission, the Seattle Police Department, the Kirkland Police Department, and the Washington state Department of Revenue, Employment Security Department and Department of Licensing.
It was before Bernard Madoff and before Sir Allen Stanford. President Obama was candidate Obama. Sarah Palin, the little-known governor of Alaska, would not become part of the public consciousness for nearly another month. Few people had heard of the so-called “Arby’s Indians.” Fewer yet could instantly place Uruguay or Panama on a map or understand the acronym “RICO” without a quick trip to Wikipedia. No one had heard of AdViewGlobal, BizAdSplash or AdGateWorld. The 31st Annual Pilgrimage to Graceland to commemorate the life and passing of Elvis Presley would not begin officially until Aug. 9, another eight days.
Regardless, the term Ponzi scheme — which goes missing from the public consciousness for years at a time, despite the nonstop play it recently has received — started making a big comeback late in the afternoon of Aug. 1, 2008. For good measure and to sear the memory, nature treated part of the world to a total eclipse of the sun on Aug. 1. The small town of Quincy, Fla., was too far south to witness the spectacle — but Quincy soon would witness a spectacle of its very own.
Friday, August 1st 2008 afternoon update
Upon direction from the U.S. Attorney’s Office in the District of Columbia, ASD will not be able to move funds into company accounts, or out of them. We will work to resolve this problem, and return to normal operation, as soon as we are permitted to do so.
ASD Management.
Yes, ASD signed this life-altering message “ASD Management.” A company that claimed to be a professional advertising and communications firm — one whose promoters claimed had Fortune 500 clients and signed contracts from major advertisers for millions of dollars — lost the PR war with a single, vague posting.
It was only the first of many incongruities. Reporters who called later were told there was nothing to fear because God was on ASD’s side.
Quincy’s spectacle began on Aug. 5, the date agents showed up with search warrants for ASD’s headquarters and the home of ASD President Andy Bowdoin. WCTV was the first media outlet to report the news. Here is how we put it:
WCTV is reporting that agents are executing a search warrant at ASD Cash Generator headquarters in Quincy, Florida.
Details are sketchy. WCTV serves Tallahassee, Thomasville and Valdosta., and is a CBS affiliate.
Our first update came at 3:09 P.M. EDT (U.S.A.):
WCTV is reporting that the U.S. Secret Service and the Gadsden County Sheriff’s Department are conducting the raid at ASD Cash Generator. Agents reportedly are searching for documents and computers.
We obtained a copy of the forfeiture complaint later in the day. Here are the initial quotations and background we published from the complaint.
” . . . there is reasonable cause to believe that ASD, Thomas A. Bowdoin, Jr. and others, devised and intended to devise a scheme or artifice to defraud, or a scheme for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, and that he and they transmitted or cause to be transmitted by means of wire, communications in interstate or foreign commerce (including writings, signs, signals, pictures, or sounds), for the purpose of executing such scheme or artifice, to wit: an Internet-based Ponzi scheme, in violation of Title 18, United States Code, Section 1343 (Wire Fraud); and in violation of Title 18, United States Code, Section 371 (Conspiracy to Commit Wire Fraud),” the complaint read in part.
“Further, based on the information provided herein, there is reasonable cause to believe that the defendant properties constitute proceeds of the above-specified offenses or property involved in financial transactions, with wire fraud proceeds, that are prohibited by the federal anti-money laundering statutes.”
ASD sales materials positioned Bowdoin as an accomplished business person who once received a medal for business achievement from President Bush. Federal prosecutors, however, say Bowdoin received no such medal from Bush and that “successes are remarkably absent from his true work history.”
Bowdoin “was arrested in Alabama for one or more felony violations related to Fraud in Connection with the Offer and Sale of Securities by an Unregistered Agent,” prior to his involvement in ASD, prosecutors said.
In the Alabama case, prosecutors said, Bowdoin and co-defendants in a company known as Mobile International Inc. were charged with selling “unregistered securities to investors and with failing to state material facts to the investors that would have impacted the victims’ decisions to invest.
Alabama officials asserted Bowdoin “instigated a scheme by which he took money from some victims to pay off prior investors,” prosecutors said.
Charges were dismissed after Bowdoin agreed to enter Pre-Trial Diversion with three years’ supervised probation. He was ordered to pay $15,000 in restitution to victims. The case was settled in 1997.
Then, in 1999, Bowdoin plead guilty in Wilcox County to one count of selling unregistered securities. He was sentenced to a year in prison and three years’ supervised probation. The prison sentence was suspended, and Bowdoin was ordered to make restitution in the amount of $75,000.
U.S. Attorney Jeffrey A Taylor of the District of Columbia, the U.S. Secret Service, the Internal Revenue Service and other agencies are involved in the ASD probe, which also involves Golden Panda Ad Builder, another autosurf.
An IRS-Secret Service Task Force agent opened an A[SD] account as part of the investigation, according to the complaint. Agents also interviewed a number of ASD members as part of the investigation.
Here is how we followed up on Aug. 6:
Yesterday U.S. Attorney for the District of Columbia Jeffrey A Taylor filed a forfeiture complaint in a case involving Ad Surf Daily Inc., ASD Cash Generator, Thomas “Andy” Bowdoin, Golden Panda Ad Builder, Clarence Busby Jr. and Dawn Stowers.
Meanwhile, some ASD members appear to be acting in organized fashion to criticize the government. This has led some ASD critics to dismiss Bowdoin’s advocates as “Kool-Aid” drinkers. References to Bowdoin, Christianity and religion are common parts of the discussion across the Web.
Federal prosecutors and the U.S. Secret Service, which raided ASD’s Quincy, Florida, headquarters, are seeking $53 million held in various Bank of America accounts, a condominium in Myrtle Beach, S.C., and Bowdoin’s home in Quincy.
The Justice Department called ASD a “massive Internet-based wire fraud scheme,” alleging that ADSurfDaily Inc. was nothing more than a common Ponzi that used incoming money from new ASD members to sustain payouts to earlier members of the program.
Some ASD members appear to be going on the offense, attacking the government and flooding news sites, Blogs and forums with defenses for ASD and Bowdoin. Some of the messages have a fire-and-brimstone quality. The message in many cases is that ASD members have a Christian duty to back ASD and Bowdoin, who has a criminal record in Alabama for selling unregistered securities and bilking investors.
WCTV-TV, a CBS affiliate in Tallahassee, has been flooded by comments from ASD members. Many of the posts are defenses for Bowdoin. Some posters mentioned a medal Bowdoin allegedly received from the Bush administration for business achievement. Prosecutors said Bowdoin received no such award, even though the alleged award was cited in ASD advertising materials.
Other posters compared the government’s actions yesterday to the actions of Nazi Germany. Others suggested the government was involved in a conspiracy to defame Bowdoin and that overzealous prosecutors were trying to destroy private enterprise.
ASD members have contacted this Blog, saying it has a duty to investigate the Social Security program if it is going to report on ASD Cash Generator. The argument — directed at this Blog and at others — is that Social Security is a government-sanctioned Ponzi. It therefore follows that ASD should be let off the hook.
Elsewhere online there are reports of people who’d directed life savings and large sums of cash at ASD. One Blog poster and ASD member asked if anybody could point him in the direction of a bridge from which he could jump. The post appeared to be in jest, but it’s easy to believe that people who have thousands of dollars tied up in ASD are unnerved.
The Government Makes Its Case Against Bowdoin And Busby
Bowdoin once was sentenced to prison for his role in a securities scheme. The sentence was suspended after he agreed to three years’ supervised probation and to make restitution in the amount of $75,000, according to the Feds’ complaint.
Like Bowdoin, Golden Panda’s Busby also had a previous run-in with the law over securities issues.
In 1997, according to prosecutors, the “SEC successfully charged that Busby had violated anti-fraud provisions of the Securities laws by offering and selling investment contracts in connection with three different ‘prime bank’ schemes. Busby was accused of raising money for purported trading programs in ‘prime bank’ notes by fraudulently representing that investments were risk-free and the ventures would result in returns ranging from 750% to 10,000%. In total, Busby raised nearly $1 million from more than 70 investors.
“None of the investors earned the exorbitant returns promised by Busby,” prosecutors said in the forfeiture complaint. “Busby was ordered to pay $15,000 in disgorgement to victims; however, after Busby filed a financial statement to support a professed inability to pay, the court dismissed the order of payment. Busby filed for bankruptcy in 1997. This information was not disclosed on Golden Panda’s webpage or mentioned by Busby during his recent conference call.”
Although Bowdoin positioned ASD Cash Generator as an advertising program, the government said it was a smokescreen.
In July 2008, according to the forfeiture complaint, the Ad Cash Generator website stated that ([emphasis] added):
All payments made to ASD are considered advertising purchases, not investments or deposits of any kind. All sales are final. ASD does not guarantee any earnings or profits. Any commissions paid to Members are for the service of viewing other Member web sites and for referring Members to AdSurfDaily. All advertising purchases are non-refundable.
Prosecutors dismissed the disclaimer language, calling it “ASD’s effort to avoid being recognized as an unregistered issuer of securities and to avoid liability to participants, for breaking promises it makes elsewhere, when the Ponzi is revealed.”
Government Describes Role Of ASD Attorney Robert Garner
It was widely known online that ASD explained to new members that its program was legal — and used an attorney to help make it’s non-Ponzi case.
The attorney, Robert Garner, appeared in a video alongside Bowdoin and is mentioned prominently in the forfeiture complaint.
Here’s what the government had to say about Garner’s video appearance with Bowdoin:
“Mr. Garner proceeds to explain that Bowdoin hired [Garner] to insure that ASD’s operations are legal in all aspects. Garner assures the viewer that he and ‘other attorneys in our offices . . . are dedicated to this work with Andy and his company.’ He continued by saying his attorneys ‘are available at any time to deal with the issues as they arise.’
“Garner address[ed] the concerns that new ASD members sometimes have in the area of the legality of the Ad Cash Generator opportunity, by saying: ([Emphasis] added):
Andy has directed us to ensure that his company is structurally sound today and tomorrow and far into the future. My staff and I are dedicated to Andy’s vision that his company will continue to rapidly grow bigger and stronger, and will continue to be an industry leader in Internet advertising in the years to come.
“According to Garner,” the forfeiture complaint continued, “ASD . . . complies with all laws and regulations that apply to it. In explaining that ASD is not a Ponzi scheme, Garner notes that a Ponzi scheme is ‘illegal, because [it] use[s] money from new investors to pay the first investors in the scheme their promised returns.’”
“On behalf of ASD, on its website,” prosecutors said in the forfeiture complaint, “Garner advises prospective members that ASD is not a Ponzi scheme because, among other things, ASD is developing other revenue sources and ‘[t]here is no continuing obligation to pay returns to infinity.’ Contrary to Garner’s claim that this is not a Ponzi scheme, however, an infinite payment obligation is irrelevant and the lack of a non-member revenue source is a tell-tale sign of a Ponzi.”
In what prosecutors described as a “further attempt to make Bowdoin’s business model sound more legitimate, Garner describes ASD rebates as ‘function[ing] something like ‘loss leaders’ in that advertisers are presented [with] a way[ ] to earn their money back, plus a little more, in addition to having their ads viewed on the internet.’”
But an IRS-Secret Secret Service Task Force has “not found any other product or service that ASD sells, aside from new memberships, to cover the ‘losses’ it incurs by allowing its so-called ‘advertisers’ to ‘earn their money back, plus a little more,’” the government said in the forfeiture complaint.
Agents discovered that ASD’s “Nevada incorporation documents list Garner as a director. [Garner], however, does not disclose the fact that he is an insider of ASD in his interview, in his typewritten opinion letter that appears on ASD’s webpage, or anywhere else on ASD’s webpage,” the complaint said.
“Furthermore, although Garner is admitted to the North Carolina Bar, it appears that [Garner] works out of his home and that he does not employ the team of lawyers that, he claims, have worked diligently to confirm ASD’s legality,” prosecutors said.
All in all, the government’s forfeiture complaint takes up 101 pages (including exhibits).
A year has passed. The documentation is much thicker now. Andy Bowdoin has fewer people willing to support him publicly. AdViewGlobal is in a state of decay; like AVG, BizAdSplash recently announced the suspension of member cash-outs. AdGateWorld announced it was selling itself to an unnamed party in the Middle East.
The autosurf world continues to alter lives, continues to turn friend against friend and family member against family member. Every day is a total eclipse of the sun.
Convicted Ponzi operator Bernard Madoff was sentenced to 150 years in prison today for destroying lives so he could live in the lap of luxury.
Victims cheered the sentence, which prosecutors had recommended as a maximum. Madoff’s attorney argued for 12 years.
U.S. District Judge Denny Chin said Madoff deserved the maximum, describing Madoff’s Ponzi scheme as “extraordinarily evil” and not just a crime that takes place on paper.
When the Securities and Exchange Commission charged R. Allen Stanford Feb. 17 with operating a multibillion-dollar fraud scheme through his bank in Antigua, the news created banking pandemonium on the tiny Caribbean island and also in Panama.
In the days that followed, a surf known as BizAdSplash referenced the banking situation in Panama without referencing Stanford by name.
BizAdSplash: Trouble in Panama.
BizAdSplash was one of three surfs that came to life in the months following the seizure of funds tied to AdSurfDaily Inc., a surf registered in the United States and accused of running a $100 million Ponzi scheme.
One of the key sales points of BizAdSplash was its purported offshore location. Two other surfs — AdViewGlobal and AdGateWorld — also bragged about being offshore. Promoters for the surfs said the offshore locations provided protection from the SEC, the IRS and state attorneys general. Promotions for the new surfs repeatedly referenced ASD.
“We want to let you know that even though our banks in Panama are closed for the next day and half, the payment processors are NOT CLOSED,” BizAdSplash said on Feb. 24. “You can still buy Ad Packages through your chosen payment processor. You will get your 100% match today and will continue into next week.
“So,” BizAdSplash continued, “if you purchased new Ad Packages yesterday from outside your Cash Balance, you received a 100% matching bonus.
“This 100% matching bonus will continue on today, through the weekend and on through Friday, March 6th!!!” the surf exclaimed.
On Feb. 27 — just three days later — BizAdSplash told customers it was ending its affiliation with StrictPay, a payment processor with Panamanian ties, but again did not mention Stanford or refer to the regional banking crisis.
“We are suspending the use of the Strict Pay Payment processor,” BizAdSplash said. “This is due to Strict Pay having some technical difficulties at this time. If you have requested a cash out using Strict Pay this past week, please change this and any future cash out request to one of the following: Alert Pay, Solid Trust Pay or Bank Wire. Please note that using the bank wire, the minimum to cash out is $1,000. Until Strict Pay has corrected the problems we will not allow this processor to be available.”
Alert Pay and Solid Trust Pay are payment processors headquartered in Canada, and friendly to the autosurf trade.
AdSurfDaily is another surf with Caribbean ties. Federal prosecutors said ASD had more than $1 million on deposit in Antigua. After prosecutors made the claim, ASD President Andy Bowdoin told members that $500,000 of the sum was a deposit that enabled ASD to process credit-card orders.
Bowdoin never referenced Antigua until prosecutors referenced it first.
ASD said it relied on the expert guidance of attorney Robert F. Garner. The Feds now say Garner was a shill for ASD, and Garner has advertised his legal services to help companies establish a presence offshore.
The extent of the problem the alleged Stanford Ponzi has caused surfs is unclear. But several surfs that purport to be operating offshore have collapsed in recent days
He ran a slow-motion Ponzi scheme in Massachusetts that lasted 20 years. Now Bradford Bleidt is in federal prison, doing 11 years for money-laundering and mail fraud.
The scheme fell apart earlier this decade when Bleidt couldn’t pay a $1.5 million redemption requested by a Greek Orthodox church.
His final take was estimated at $32.6 million. People said he had a magnetic personality and charmed people with his southern accent. His voice was one of his tools.
Bleidt confessed to the SEC on tape. His “day of reckoning” came when he couldn’t make the distribution, Bleidt said.
“The money’s gone,” he said. “I stole it.”
Today’s Boston Globe carries a story about Bleidt’s victims. The Bernard Madoff case has caused them to relive memories of being defrauded.
And it was affinity fraud, too: Most of the victims were members of local social clubs and civic, fraternal or benevolent organizations.
