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Tag: Professor Patrick Moriarty

  • As Zeek-Related Fundraising Efforts Begin, ‘Andy’s Fundraising Army’ Down For The Final Count: AdSurfDaily Patriarch Andy Bowdoin Awaits Sentencing In Pre-Zeek, 1-Percent-A-Day Ponzi Scheme Case

    UPDATED 11:31 P.M. EDT (AUG. 26, U.S.A.) After the collapse of AdSurfDaily in 2008, there were at least four efforts to raise funds to “defend” the Ponzi enterprise and/or its participants. The PP Blog has received reports that at least one such effort is under way in the aftermath of the collapse last week of Zeek Rewards, which the SEC called a $600 million Ponzi- and pyramid scheme that had affected more than 1 million people. Zeek also is under investigation by the U.S. Secret Service and the office of North Carolina Attorney General Roy Cooper.

    Zeek members who cling to a belief that the government somehow got it wrong perhaps can save themselves both money and heartache by looking at the history of the various ASD-related efforts to “defend” the multilevel marketing “program” after the U.S. Secret Service seized 15 bank accounts (and about $80 million) in ASD-related proceeds in August 2008.

    Here are briefs on the various ASD-related “defense” efforts:

    “Andy’s Fundraising Army”: This bizarre effort was the fourth and final of a series of failed ASD-related efforts. Started by accused ASD Ponzi schemer Thomas A. “Andy” Bowdoin himself last summer (with the purported help of ASD cheerleader Tari Steward), the effort immediately devolved into a symphony of the bizarre.

    With Bowdoin effectively having been out of public view for nearly three years, the purported “army” teased potential contributors for days with a photo that showed Bowdoin smiling broadly and looking confident. Among other things, the teaser asserted there was “MORE GOOD NEWS” and plenty of reasons to help Bowdoin raise $500,000 to pay for his criminal defense.

    It went on to assert that “A Recent Survey of ASD Members Proves that the Vast Majority of You Want to Join Andy’s Fundraising Army” and that “[P]er standard and accepted industry guidelines, public opinion surveying of 140 members of a large group of members that all share a common interest or purpose, of any size, even in the millions, will give an excellent cross section of the opinions and viewpoints of the entire group.”

    But the “army” site did not describe the characteristics of the 140 ASD members purportedly sampled. Nor did it define what specific surveying “standard” it applied or define the source of the purported “industry guidelines.”

    And what would a good, MLM-like approach to raise funds for an accused HYIP scammer (1 percent a day) be without a “prelaunch” phase? With the teaser in place, a placeholder website for “Andy’s Fundraising Army” promised a full launch to come, along with the exciting opportunity for ASD members to send funds to the man accused of defrauding them to the tune of $110 million.

    But like a bad HYIP dream, the “army” website naturally missed its first advertised launch date. This was blamed on the need for more “testing,” reinforcing one of the HYIP world’s longstanding clichés. It then missed its second advertised launch date, explaining that “one last important system is being finalized.” With the first two launch dates missed, the site reported that it had set a “Final Revised Launch Date.”

    During the evening of July 26, 2011, the launch finally occurred. Like many things ASD, it provided minute after minute of MLM infamy. Indeed, Bowdoin appeared in a fundraising video with symbols of American patriotism as the backdrop.

    Among other things, Bowdoin — who in 2008 described himself as a Christian “money magnet” and advised ASD members after the Secret Service raid that “God” was on the company’s side and that “Satan” had infiltrated the government — claimed in the video that he’d been “crucified” by U.S. law enforcement.

    He blamed the ASD-related losses in civil court on a federal judge, the prosecutors and his own former defense counsel. Bowdoin asked members to provide $500,000 to help him pay his new defense team.

    It is believed he raised about $26,000 in the following weeks — but things continued to unfold like a bad HYIP dream. There was a report that a hurricane knocked the fundraising site offline, for instance. By January 2012, the site had lost its ability to collect money via PayPal. Federal prosecutors declined to comment on the development, which occurred after Bowdoin had become a pitchman for “OneX.”

    In April 2012, prosecutors described OneX as a fraudulent scheme and pyramid. Bowdoin pleaded guilty to wire fraud the following month, admitting ASD was a Ponzi scheme. His fundraising website, which published purported “expert” opinions from attorney Gerald Nehra and consultant Keith Laggos that ASD was not a Ponzi scheme, remained online for weeks after the guilty plea.

    The “Andy’s Army” site is now offline and is listed as an expired domain. In recent days, Bowdoin — as part of his plea agreement — has dropped his last remaining claim to cash seized in the ASD case. (A third ASD-related forfeiture complaint was filed by the government in December 2010. Bowdoin entered a claim.) He is scheduled to be sentenced Aug. 29.

    Nehra’s law firm later became counsel for Zeek, according to Zeek. And Laggos became a purported “consultant.”

    Todd Disner and Dwight Owen Schweitzer: Even as Bowdoin was rolling out his “army” website and repeatedly missing launch dates, ASD figures Todd Disner and Dwight Owen Schweitzer were advancing a plan to raise money to sue the government. An email attributed to Disner surfaced in July 2011 that introduced a pronoun mystery: “We plan to go after Akerman Senifit (sic) next,” the email read in part.

    Akerman Senterfitt was the name of Bowdoin’s original defense law firm in the civil portion of the ASD case. In the earliest days of the case, ASD cheerleaders on the now-defunct “Surf’s Up” forum positioned the well-known firm as the “Perry Mason” firm; the government, meanwhile, was said to be represented by “Gomer Pyle.” A federal judge was described as “brain dead” if she ruled against ASD, and a federal prosecutor was described as an individual who deserved to be placed in a medieval torture rack.

    Why Disner chose the pronoun “we” was never explained. The July 2011 email followed an April 2011 email attributed to Disner that included this declaration: “Let the games begin!”

    During this period, Disner and Schweitzer were soliciting funds to sue the government. This effort began at an unclear point of time after November 2008, the month a federal judge issued a key court ruling against ASD while saying Nehra’s opinion could not be relied upon in part because it “relied solely on the written words contained in the Terms of Service without independent investigation or review of ASD’s business records to ascertain how ASD operates in fact before opining.” (Bolding added.)

    If the judge’s ruling could be reduced to two words, it might read, “Gomer won.”

    At an unclear point in time, both Disner and Schweitzer became reps for Zeek. They filed their ASD-related lawsuit in November 2011, claiming, among other things, that the government had presented a “tissue of lies” when bringing the August 2008 forfeiture case. As part of their apparent strategy, Disner and Schweitzer pointed to purported expert opinions of Nehra and Laggos. Disner and Schweitzer produced those opinions months after ASD had lost two civil-forfeiture cases in both U.S. District Court and the U.S. Court of Appeals.

    Months later, Bowdoin himself put both Disner and Schweitzer in a box. In May 2012 — after Nehra and Laggos both had opined ASD was not a Ponzi scheme and after Disner and Schweitzer had sued the government — Bowdoin admitted that ASD was a Ponzi scheme.

    Bob Guenther and ASDMBA: In 2008, ASD member Bob Guenther became the de facto head of an entity known as the ASD Members Business Association. The stated goal of ASDMBA was to raise funds to hire Dallas attorney Larry Friedman to represent ASD members’ interests in the case.

    ASDMBA soon devolved into a circus, with Guenther using its website to promote a company that was developing an online game. Along the way, Friedman sued ASD critic Jack Arons, triggering a side drama that lasted for weeks and burying Arons in an avalanche of paperwork. (As a matter of pure PR, high-powered Friedman came out the loser for bringing out nukes against a web critic armed with a fly-swatter. The avalanche finally ended, with Arons, a Florida retiree who lives in a manufactured home, largely unscathed.) Guenther, meanwhile, refused to provide a reliable accounting of how the tens of thousands of dollars raised by ASDMBA was spent, according to members.

    Guenther bizarrely dismissed his critics as “left wing liberal no balled people,” calling one an “ignorant mouthy broad.” He also claimed ASDMBA was instrumental in returning money to ASD victims, saying the group retrieved funds for retired and active-duty police officers in Texas and California, and for a high profile Dallas Cowboy’s executive.

    Nothing in the public record suggests Guenther had any standing to perform any services on behalf of ASD members. It later emerged that Guenther was a convicted felon. Months after the 2008 formation of ASDMBA, in March 2009, Guenther was charged with two felony counts of aggravated harassment. Mesa, Arizona, police said Guenther repeatedly violated a court injunction for workplace harassment that prohibited him from nuisancing Cheyenne Mountain and Affiliates, the Arizona business that was developing the online game promoted on ASDMBA’s website.

    Guenther later accepted a plea agreement in the harassment case. No jail time was ordered.

    ASD Members International: This one was hatched by members of the pro-ASD “Surf’s Up” forum, which became Bowdoin’s official mouthpiece after the key court ruling went against ASD in November 2008. ASDMI was a purported nonprofit entity formed in Missouri. Its bizarre mission was to raise funds to litigate against the government even if the government was proceeding lawfully. In short, ASDMI planted the seed that prosecutors and investigators would be sued and/or charged with crimes.

    It is believed that at least 168 people contributed money to ASDMI.

    Included in the ASDMI braintrust was former Surf’s Up moderator Barb McIntyre, who enforced a “Poof Penalty” when ASD members left links on Surf’s Up to stories on the PP Blog.

    But if there was an ASDMI “star,” it was “Professor” Patrick Moriarty, one of the most unusual characters in the entire ASD drama. Moriarty was an early advocate for Curtis Richmond, a purported “sovereign” being who advanced a theory that all commerce was lawful as long as the buyer and seller agreed to a contract. Among other things, it was a position that would have legalized slavery and human trafficking. Richmond went on to accuse a federal judge of “TREASON” and to accuse investigators of theft.

    Richmond was hailed a “hero” on Surf’s Up, which never revealed that Richmond had been found in contempt of court for threatening federal judges and was part of a Utah “Indian” tribe a federal judge ruled a “complete sham.” (This is the “tribe” known derisively as the “Arby’s Indians” because it once held a meeting in an Arby’s restaurant in Utah. The purported “tribe” also had a purported “Supreme Court.” The address for the “Supreme Court” was the address of a doughnut shop. Richmond was sued successfully under the federal racketeering statute (RICO) by public officials in Utah targeted in a vexatious legal campaign by Richmond and other “tribe” members.)

    With Surf’s Up fanning the flames that federal prosecutors and a U.S. Secret Service agent needed to be investigated and prosecuted for their roles in the ASD Ponzi case, it emerged that Moriarty — who once sold fake academic degrees on eBay, claiming they were gag gifts — once had started a purported nonprofit in the name of a man accused of killing a woman in cold blood and ambushing two Missouri police officers and another man.

    Moriarty later was indicted on charges of tax evasion. He pleaded guilty, and was sentenced to federal prison.

    NOTE TO ZEEK READERS: This document, which was filed by federal prosecutors in December 2008, is the second of three known forfeiture complaints filed against ASD-related assets. It is highly recommended reading.

    The document was filed about four months after the original — and best-known ASD forfeiture complaint — was filed.

    The ASD case started as a civil case with a parallel criminal investigation. Zeek-related litigation may follow the same track. Ponzi investigations take time. The December 2008 ASD forfeiture complaint shows that investigators continued to “follow the money” and to destroy ASD’s cover story after the original forfeiture complaint was filed.

    It likely is true that the August 2008 complaint has received the most attention — no doubt because it laid out the core elements of the government’s case. But the December 2008 filing was tremendously damaging because it provided the first real inside glimpse into how ASD truly was operating.

     

     

  • In Rejecting Tortured Legal Constructions, Judges Across America Now Point To Utah Case Involving AdSurfDaily Mainstay Curtis Richmond

    UPDATED 11:54 A.M. ET (U.S.A.) Curtis Richmond claimed the federal judge overseeing the AdSurfDaily civil-forfeiture case in the District of Columbia was among a group of “Co-Conspirators” that included two federal prosecutors and a court clerk.

    The judge, Richmond claimed, was violating her oath and conspiring with another judge to deny ASD members justice. Prosecutors, meanwhile, were helping the judge interfere with commerce, according to Richmond. The judge rejected Richmond’s arguments — but it didn’t stop other ASD pro se litigants from advancing similar arguments.

    For his bid to intervene in the ASD Ponzi case, Richmond was labeled a “hero” on both the pro-AdSurfDaily “Surf’s Up” forum (now defunct) and on a forum that championed the AdViewGlobal autosurf (now defunct). Among Richmond’s boosters was “Professor” Patrick Moriarty, a Missouri man who once started a purported nonprofit in the name of a man accused of murdering a woman in cold blood and shooting a police officer.

    Moriarty later was indicted for tax fraud. He pleaded guilty after prosecutors said they had “casino” records and intended to use them in the case against Moriarty, who advertised that he sold fake academic degrees on e-Bay as “gag gifts.”

    Prior to Moriarty’s indictment, members of the Surf’s Up forum joined with him in forming a purported Missouri nonprofit known as ASD Members International (ASDMI). ASDMI’s stated mission was to litigate against the government for its role in the ASD Ponzi case.

    Utah resident and ASD figure Christian Oesch — later to join with Washington state resident and ASD figure Kenneth Wayne Leaming in a failed 2010 bid to sue the United States for more than twice the U.S. Gross Domestic Product in 2009 — filed pro se pleadings in the ASD case that championed Richmond’s take on the law.

    But Curtis Richmond’s court forays now have been cited by various judges in various jurisdictions as reasons to reject tortured legal constructions. A federal judge in North Dakota, for example, cited this Utah case involving Richmond as a reason to reject tortured arguments advanced by Michael Howard Reed, a so-called “sovereign citizen” now serving two prison sentences for federal crimes.

    One of Reed’s crimes was filing false liens and threatening a federal judge; the other was possession of a firearm and ammunition by a fugitive from justice.

    Richmond, a Californian who advanced the notion in the 2006 Utah case that he enjoyed diplomatic immunity that extended to him from an “Indian” tribe, became a figure in the ASD case in 2008. The “tribe,” which a federal judge ruled a “sham,” came to be known derisively as the “Arby’s Indians” because it once conducted a meeting at an Arby’s restaurant.

    Reed, whose name surfaced in the 2008 SEC Ponzi case against Gold Quest International after he claimed to be the “attorney general” of an unrecognized tribe and asserted a claim against the agency for $1.7 trillion, asserted in a separate case that the government could not prosecute him because he was immune to U.S. law and had trademarked his name.

    Here is a verbatim section from one of Reed’s nonsensical pleadings in federal court in North Dakota. (Italics/identation added):

    “boa-kaa-konan-na-ishkawaanden=Michael-Howard-Reed=original-creditor-original-beneficiary: for MICHAEL-HOWARD-REED=original-debtor-trustee agent; Under the Penalties of Perjury Affirm that MICHAEL HOWARD REED©TM is a Fictional Entity . . .”

    Richmond’s Utah case was cited in the North Dakota case as a reason to reject Reed’s bizarre arguments.

    It also was cited in this Colorado case in which a U.S. Magistrate Judge rejected the tortured legal constructions of Christopher Douglas Wise. Among other things, Wise, a prisoner in the Colorado state system,  asserted that he was a “secured party creditor” who’d never lived in the “District of Columbia” — and that somehow this alleged fact set destroyed the jurisdiction of the Adams County District Court in which he was convicted of a crime.

    In a separate case in Florida, a federal magistrate judge pointed to Richmond’s Utah “Indian” pleadings as a reason to reject arguments advanced by Timothy Black, who was serving two life sentences for sex crimes involving children and tried to overturn his conviction in part by claiming he had copyrighted his name and by arguing he was not subject to Florida law.

    “Petitioner was found guilty by a jury and convicted of two counts of sexual battery on a person less than twelve years of age, and one count of lewd or lascivious molestation on a person less than twelve years of age,  and sentenced to two terms of life and one term of thirty years, to be served concurrently,” the judge noted.

    Here is a verbatim section from Black’s court claims. (Italics added):

    “Therefore the Third Party [Intervener] is the party who is injured by the action at large as he is incarcerated as surety for his collateral, Debtor TIMOTHY W BLACK© Ens Legis . . .”

     

  • Document Linked To Company Associated With AdSurfDaily Figure Kenneth Wayne Leaming Is Referenced In Congressional Record As ‘Claim Against The United States Of America’

    Screen shot from the Congessional Record of April 8, 2011. (Also see image and link to full-scale PDF below.)

    UPDATED 6:55 P.M. EDT (U.S.A.) A garden-variety, lawful protest commonly received in mailrooms within the halls of power? A self-serving, reality-inverting tale of the civil-forfeiture case against the proceeds of an alleged $110 million autosurf Ponzi scheme? A backdoor bid to end-run rulings made by the U.S. Judiciary and hand an invoice to the U.S. Congress for purported damages and financial penalties against public officials sprouting from the government’s alleged mishandling of the ASD case?

    The staff of Senate Judiciary Committee Chairman Patrick Leahy, D-Vermont, did not immediately respond to a PP Blog request for comment this afternoon on a document apparently tabled by the panel after it was received in April after having been submitted by American-International Business Law Inc.

    AdSurfDaily figure Kenneth Wayne Leaming, a purported “sovereign citizen,” is listed in Washington state records (as “Kenneth Wayne”) as the chairman and president of American-International Business Law Inc. The firm’s name appears in the Congressional Record of April 8 as the presenter of a “petition . . .  relative to a claim against the United States of America.”

    Among other things, Leaming, who once was convicted of piloting an airplane without a license,  also was accused of practicing law without a license. He has purported to be a specialist in admiralty law — and has advertised the availability of a lower rate for “prepaid” clients.

    Details about the April document were not provided in the Congressional Record entry, and Leahy’s committee staff was unable to provide details immediately. The Blog asked the staff staff to provide a copy of the claim and, if possible, forward it to the Blog. Whether the staff will be able to accommodate the request was not immediately clear.

    Leaming and ASD member Christian Oesch unsuccessfully sought to sue the United States last year in the U.S. Court of Federal Claims, apparently seeking the staggering sum of more than $29 TRILLION — more than twice the U.S. Gross Domestic Product in 2009.

    Their lawsuit targeted federal employees who had a role in the civil-forfeiture case filed against tens of millions of dollars alleged to be the proceeds of a massive Ponzi scheme conducted by Florida-based ASD. About $65.8 million was seized by the U.S. Secret Service from the personal bank accounts of ASD President Andy Bowdoin, and federal prosecutors in the District of Columbia scored a clean sweep in forfeiture-related litigation. The government now holds title to about $80 million seized from ASD-related bank accounts.

    The lawsuit came in the form of purported “Certificates of Default” issued against public officials on Feb. 16, 2010, by Tina M. Hall, a notary public with ties to Leaming.

    Hall’s notary license was revoked by the state of Washington in October 2010, about three months after Leaming and Oesch filed their lawsuit. The PP Blog reported yesterday that the license of Kathryn E. Aschlea, a second notary with a tie to Leaming and American-International Business Law Inc., also had her license revoked by the state of Washington.

    When Judge Christine Odell Cook Miller dismissed the Leaming/Oesch lawsuit in December 2010, she noted that the complaint included a claim by Hall that the officials had failed to respond to “claims in admiralty.”

    “At this point the complaint deteriorates into rambling,” the judge wrote  in her dismissal order.

    Whether the Judiciary Committee received a similar rambling narrative from Leaming and Oesch and one or more notaries public is unclear.

    See February 2009 story about ASD-related letter-writing campaign to Sen. Leahy by ASD figure “Professor” Patrick Moriarty. See follow-up editorial by PP Blog. Read May 2009 “Poof Penalty” story. Click here to read a Congressional Record PDF that includes the American-International Business Law Inc. reference.

  • REPORT: AdSurfDaily Mainstay ‘Professor’ Patrick Moriarty Sentenced To Year In Federal Prison In Tax Case; Claimed To Be Tax ‘Specialist’ Also Skilled In ‘Karma Restoration’

    “Professor” Patrick Moriarty, a mainstay in the AdSurfDaily Ponzi scheme story, has been sentenced to a year in federal prison for filing a false tax return, according to KMOX.com.

    Details about the sentencing were not immediately available.

    Moriarty, 62, pleaded guilty in January to filing a false return for the year 2003. Prosecutors said he caused a tax loss of $135,697.

    He initially was charged with filing false returns for the years 2002, 2003, 2004 and 2005, but pleaded guilty to a single count. Prosecutors alleged that he claimed a false deduction of $30,000 for “legal fees” for the tax year 2003 and claimed a false amount of $23,533 withheld for the tax year 2004 and a false amount of $23,433 withheld for the tax year 2005.

    After the August 2008 federal seizure of tens of millions of dollars from the bank accounts of ASD President Andy Bowdoin amid wire-fraud and money-laundering allegations, Moriarty fashioned a theory that the government was interfering with commerce.

    Moriarty also espoused the legal theories of Curtis Richmond, another mainstay in the ASD story. Richmond, a pro se litigant in the ASD case, was a member of a sham Utah “Indian” tribe known for filing vexatious litigation, including litigation that resulted in a successful counter-suit brought by Utah public officials under federal racketeering statutes.

    The “tribe” derisively became known as the “Arby’s Indians” because it held a meeting in an Arby’s restaurant in Provo, Utah, in 2003. The “tribe” used the address of a Utah doughnut shop as the address of its “Supreme Court,” and once issued “bench warrants” for the arrests of sitting judges and litigation opponents in legitimate courts.

    Although not a lawyer, Richmond holds the unusual distinction of having been banned from the practice of law in Colorado. In the ASD case, he accused a federal judge of “TREASON” and of operating a “Kangaroo Court,” accused another federal judge of operating a “Kangaroo Court” — and accused federal prosecutors of theft.

    Moriarty, along with other ASD members and members of the Pro-ASD Surf’s Up forum, started a nonprofit entity dubbed ASD Members International (ASDMI). One of ASDMI’s claims was that it would litigate against the government in the ASD case — even if the government was acting lawfully.

    ASDMI, which was formed in 2008 and collected contributions from at least 167 ASD members, never brought any litigation and quickly dissolved.

    Moriarty and Surf’s Up later spearheaded an effort to get the U.S. Senate to investigate the ASD prosecutors. Moriarty and Surf’s Up members also participated in a certified-mail campaign in which — as Moriarty described it — more than 50 “individual and notarized DEMAND[S] FOR LEGAL EVIDENCE” were sent to two federal prosecutors and a U.S. Secret Service agent.

    In 2006, Moriarty formed a nonprofit for a Missouri man accused (now convicted) of breaking into a woman’s home and shooting her to death in cold blood. Moments earlier, the man had shot a police officer four times. Moments later, he shot another man eight times.

    The shootings occurred on June 2, 2006. Moriarty started the nonprofit on Oct. 2, four months to the day after the rampage.

    Moriarty also claimed to be a minister and “Tax Return Specialist” who also is skilled in “Karma Restoration.”

    Read the Moriarty story on KMOX.com.

  • GNI BECOMES THIS YEAR’S ASD: Autosurf/HYIP Pimps Continue To Cheerlead Ponzi Schemes As Bank Failures Pile Up In The United States

    A year ago, members of AdViewGlobal and AdSurfDaily asked Sen. Patrick Leahy, chairmain of the Senate Judiciary Committee, to endorse Ponzi schemes and investigate the prosecutors in the ASD case. This year, members of the failed Gold Nugget Invest (GNI) HYIP are doing most of the early season cheerleading for reprehensible "programs," while sabotaging debate in the ranks and continuing to argue there is something noble about fraud schemes. Fifteen U.S. banks failed while GNI members were singing the praises of the HYIP in the opening days of 2010. GNI tanked earlier this month. Thirteen U.S. banks failed while AVG/ASD members were conducting a letter-writing campaign to Leahy in the opening days of 2009.

    The new year is starting out like the year that just passed. Banks are failing, unemployment is high, money is not trickling down to small businesses that need capital to expand and create new jobs — and the Ponzi pimps are still putting lipstick on pigs, pushing autosurfs and HYIPs and cheerleading for them even when they fail.

    Gold Nugget Invest (GNI) quickly has become this year’s equivalent of last year’s early season favorite, AdSurfDaily (ASD), among the apologists. As was the case a year ago with ASD, the GNI faithful and delusional members of the failed HYIP have emerged to lead the cheers, make the excuses, confuse the issues, sabotage legitimate discussions and set the stage for even more people to lose tremendous sums of money to practiced online schemers.

    Web records suggest that at least 57 percent of funds directed at GNI originated in the United States, and there are claims that GNI had 11,000 members. GNI tanked earlier this month, directly on the heels of an HYIP known as “Cash Tanker,” which used images of Jesus Christ in its marketing materials.

    Yes, even an HYIP that called itself Cash Tanker and used a revered figure as though he were just another hamburger salesman on TV was able to collect untold sums from investors by relying on HYIP cheerleaders to spread the gospel of robbing Peter to pay Paul.

    First, a brief look at the banking environment.

    Five U.S. banks failed Friday, bringing the year-to-date total to 15. That’s ahead of last year’s pace. Through Feb. 14, 2009, 13 U.S. banks had failed. Twenty-five failed in all of 2008, and only three failed in 2007.

    By the time the banking bloodletting had ended in 2009, a total of 140 banks had failed. With 15 failures already this year, the United States is on pace to record 180 in 2010. The FDIC insurance fund fell into the red last year under the weight of the failures, and the agency is replenishing the fund by requiring banks to prepay fees for insurance.

    A Year Ago

    Most notable among the Ponzi pimps a year ago at this time were the promoters of ASD and its offshoot, the AdViewGlobal (AVG) autosurf. They hailed AVG as a cure for what ailed the U.S. economy, even though ASD had been implicated in a wire-fraud, money-laundering, securities fraud and Ponzi scheme that resulted in the federal seizure of tens of millions of dollars.

    AdViewGlobal, which tanked in June 2009, formally launched a year ago this week. It was pushed by ASD members who positioned AVG as an “offshore” alternative.

    Almost a year ago, the Pro-ASD Surf’s Up forum led a campaign to Sen. Patrick Leahy that sought the Senate’s endorsement of Ponzi schemes — it seems incredible, but it’s true — and also sought to have the Senate investigate the prosecutors and agents who were investigating the alleged ASD Ponzi scheme.

    Incredibly, last year’s Surf’s Up campaign, which piggybacked off a campaign by ASD mainstay “Professor” Patrick Moriarty, came to the fore during a time in which 13 U.S. banks were failing  in the opening days of the year; the Bernard Madoff Ponzi scheme ($65 billion) was still a fresh news item; the Tom Petters’ Ponzi scheme ($3.65 billion) was in the news; the alleged Allen Stanford Ponzi scheme ($8 billion) was in the news; the alleged Arthur Nadel Ponzi scheme ($350 million/$400 million) was in the news; the alleged Paul Greenwood/Stephen Walsh financial scheme ($553 million) was in the news; and the alleged Nicholas Cosmo Ponzi scheme ($370 million) was in the news. There were others, of course.

    At the same time the events cited in the paragraph above were making fresh news, autosurfs and HYIPs also were falling like dominos and taking investors’ money with them. Notable among them were MegaLido, Noobing, Frogress, Daily Profit Pond, Premium Ads Club and Aggero Investment. All of them were pushed by promoters who also were pushing AVG (and had pushed ASD).

    Some of the promoters simultaneously tried to sanitize the “industry” through the letter-writing campaign to Leahy, asserting, for example, that the schemes actually were legitimate opportunities and that the government did not understand the technology or the math behind the schemes.

    Despite the headlines of spectacular Ponzi fraud in the mainstream press, despite the fact that it was impossible to miss news about Ponzi schemes unless you lived a life of blissful ignorance or had chosen to be willfully blind, despite the fact that sites such as Scam.com and WorldLawDirect and the PP Blog had published tons of information on autosurf and HYIP Ponzi schemes, despite the fact that the U.S. and other governments had published warnings about the frauds and had filed both civil and criminal cases against the fraudsters, despite the fact that no autosurf or HYIP ever has stood the test of time and survived, the schemers closed ranks and continued to shill and shill and shill and shill.

    They’re still shilling a year later.

    GNI Becomes The New ASD In Opening Days Of 2010

    This year’s early season ASD is GNI. Instead of writing letters to Leahy, though, some of the apologists are saying that the HYIP critics and doubters in the GNI ranks should quit complaining and starting donating money to Haiti earthquake relief. As was the case with ASD, all of the cheerleading is occurring blindly. Not a shred of evidence has emerged that anything about GNI was real.

    And instead of Madoff, Nadel, Cosmo, Stanford and the other Ponzi notables cited above being the preeminent contextual backdrop a year after the Surf’s Up campaign, figures such these have replaced them: alleged Ponzi schemers Trevor Cook and Christian radio host Pat Kiley ($190 million); proven Ponzi schemer Scott Rothstein ($1.2 billion); proven Ponzi schemer Milton Retana ($62 million/$3.2 million in cash found in back of religious bookstore);  proven Ponzi schemer Gold Quest International (about $29 million; ruled a Ponzi and a pyramid scheme by Canadian authorities); proven Ponzi schemer and former Christian clergyman Brian David Anderson ($4 million, link to Flat Electronic Data Interchange (FEDI), whose operator, Abdul Tawala Ibn Ali Alishtari, also known as “Michael Mixon,” was convicted in September 2009 of financing terror and fleecing investors in the FEDI scheme); alleged Ponzi schemer Arthur Leroy Heffelfinger ($2.02 million, including alleged theft from woman in 90s with dementia): alleged Ponzi schemer Mariana Montes (at least $682,000 in combo Ponzi and fraud case, including alleged theft from 90-year-old widow); proven schemer John Anthony Miller ($15 million, tried to flee United States by using identity of deceased Catholic school classmate); proven schemer Bradley L. Ruderman ($25 million, mostly from family and friends); alleged schemer Edmundo Rubi (operated $24 million “Knights Express” Ponzi scheme earlier in decade, sentenced to prison, emerged from jail with new scheme targeting original customers); proven Ponzi schemer Marcia Sladich ($15 million, scheme targeted churchgoers); alleged Ponzi schemer Steve Salutric (at least $1.8 million, including more than $400,000 from 96-year-old widow with dementia).

    There are others, of course, and the names constantly change. What hasn’t changed is that the autosurf and HYIP shills continue to shill and shill and shill, even as one bank after another is failing and one Ponzi schemer after another is making one headline after another.

    We can’t think of anything that matches the level of disconnect or demonstrates the same level of greed and wanton criminality — not even Rothstein’s Bugatti and collection of other fine automobiles purchased with Ponzi proceeds.

    And not even Cook’s alleged submarine.

  • PONZI UNIVERSE: Just How Weird Will It Get? Spammer With Possible ASD Ties Tries To Post News Release In 10 Separate PP Threads; Elsewhere, A ‘Comic Book’ Ponzi Scheme

    On a day a federal judge ordered alleged Minnesota Ponzi schemer Trevor Cook jailed — in part for not turning over a two-passenger submarine allegedly purchased on eBay with Ponzi proceeds — the following things happened:

    • A would-be PP Blog poster attempted to post the same news release about AdSurfDaily mainstay “Professor” Patrick Moriarty in 10 separate threads over a span of 26 minutes. The early indications are that the spammer was associated with both the alleged ASD Ponzi scheme and Gold Nugget Invest (GNI), an HYIP that tanked earlier this month after advertising tax-free returns of 7.5 percent a week. (One poster after another on the Ponzi boards has defended GNI, saying the program was “real” and “honest” because it paid. The same defenses have been uttered for ASD.)
    • The FBI announced the Ponzi scheme arrests of two Greater Chicago men, alleging they had met in federal prison while serving time for previous fraud schemes. After they emerged from prison, they started a Ponzi scheme involving comic books and movies that bilked investors out of $4 million.

    Just how crazy are things going to get in the Ponzi universe? It’s a universe that already includes figures associated with bizarre litigation centered on bizarre claims they are immune from U.S. law because they are adopted members of “Indian” tribes purported to be “sovereign” and that their sovereignty not only is absolute, but also is portable; figures who claim Ponzi schemes are legal as long as participants get “paid”; figures who claim the presence of convicted felons in one scheme after another is mere coincidence; figures who claim prosecutors are not permitted Constitutionally to interfere with commerce even if the commerce is illegal; figures who believe the United States passed secret legislation in the 1990s in anticipation of a visit by reptilian aliens; figures who claim the answer to Ponzi schemes that plague America is even more Ponzi schemes.

    First, a few paragraphs about the would-be serial poster on the PP Blog earlier today:

    We were working on a story this afternoon when our Comments Box in the Blog’s administrative panel began to bulge from spam from a would-be poster. We always check the spam box several times a day in case our filter flags a legitimate comment as spam. When we took a peek this afternoon, the filter had collected 10 consecutive posts from the same sender.

    Each of the would-be posts was targeted at separate Comments threads below stories. Each was a duplicate of a Justice Department news release on “Professor” Patrick Moriarty’s guilty plea to tax charges earlier this month, a story we covered 15 days ago. (If you’re new to the PP Blog, Moriarty was a member of the alleged ASD Ponzi scheme. His tax case was separate from the alleged scheme masterminded by ASD President Andy Bowdoin, and Moriarty is not listed as a defendant in the ASD Ponzi case. He became notable, however, for advancing a theory that the ASD prosecutors had interfered with commerce. Moriarty also once established a nonprofit entity in the name of a man accused of murdering a woman in cold blood and shooting a Missouri police officer four times.)

    In any event, none of the threads the would-be poster selected to copy and paste the news release pertained to Moriarty. Near as we can tell, the poster may have a link to both the alleged ASD scheme and the GNI “arbitrage” program, an HYIP that tanked recently. The would-be poster did not include an actual comment with his copy-and-paste news release; he simply copied and attempted to paste it in 10 separate threads over a period of 26 minutes.

    The first attempt occurred at 3:03 p.m. ET; it was followed by attempts at 3:24 in two separate threads; 3:25 in two separate threads; 3:26 in a separate thread; 3:27 in two separate threads; 3:28 in a separate thread; and 3:29 in a separate thread.

    As often is the case with ASD, the question is why. Based on a preliminary analysis of data, we believe the would be-poster was a member of the now-defunct Surf’s Up forum, a Pro-ASD site that railed against the government and advocated on behalf of Ponzi schemes. Surf’s Up went missing earlier this month. A forum with Surf’s Up ties that had advocated for a surf known as AdViewGlobal (AVG) went missing last summer — after AVG, which had close ASD ties, suspended payouts.

    We’ll update readers on the would-be serial poster if we develop more information. At the moment, the data suggest his effort is connected in some form or fashion to this story. His name may or may not be “joe.”

    Turning now to the alleged “comic book” Ponzi scheme, the FBI said it operated in the Chicago area and was known as Sundown Entertainment Inc.

    Charged with wire fraud in the case were Daniel Parrilli, 59, of Carol Stream, and Christopher Andersen, 59, of Westmont.

    Parrilli and Anderson allegedly met while serving time for fraud in federal prison earlier this decade.

    The alleged Parrilli/Andersen Ponzi scheme was the second to touch Carol Stream in recent weeks. On Jan. 8, the SEC charged Steve Salutric, 51, a church treasurer, with operating a Ponzi scheme by raiding the Charles Schwab accounts of clients of Results One Financial LLC.

    Salutric is accused of misappropriating at least $1.8 million in clients’ funds, including more than $400,000 from a 96-year-old woman with dementia. The woman, identified by the SEC as “Client A,”  resided in a nursing home.

    Fearing his fraud was about to be exposed, Salutric began to approach clients with offers to pay them “hush money,” the SEC said.

  • ‘Professor’ Patrick Moriarty, AdSurfDaily Mainstay, Pleads Guilty In Federal Tax Case; April Sentencing Date Set

    AdSurfDaily mainstay “Professor” Patrick Moriarty has pleaded guilty in federal court in Missouri to filing a false tax return, federal prosecutors said.

    “The total tax loss admitted by [Moriarty] is $135,697,” prosecutors said.

    Prosecutors initially brought multiple tax-fraud counts against Moriarty, saying in March 2009 that he had filed false returns for the years 2002, 2003, 2004 and 2005. He pleaded guilty to the 2003 count, and faces a maximum sentence of three years in prison and a fine of up to $250,000.

    Moriarty’s trial had been set to get under way this week, but he entered a plea instead. Prior to trial, prosecutors said they had “voluminous” evidence, including seven 4-inch binders of records and records from an unspecified casino.

    Moriarty entered the plea before U.S. District Judge Jean C. Hamilton of the Eastern District of Missouri, according to Acting U.S. Attorney Michael W. Reap.

    Along with members of the Pro-AdSurfDaily Surf’s Up forum, Moriarty formed a nonprofit organization known as ASD Members International (ASDMI) in October 2008. Among ASDMI’s claims was that it would litigate against the government in the ASD case, even if the government was behaving legally.

    At least 167 ASD members gave money to ASDMI, but no litigation ever was filed. ASDMI disbanded in January 2009, less than three months after organizing.

    Records showed that Moriarty, who professed tax expertise, once started a nonprofit in the name of a Missouri man accused of murdering a woman in cold blood and shooting a police officer four times.

    Moriarty, who once sold fake academic degrees on eBay, explaining they were gag gifts, used the title “Rev” and purported to be the “minister” of the Universal Life Church (ULC) of Troy, Mo. He listed his qualifications as a Ph.D. and a D.D., and noted he also is an accountant and “Tax Return Specialist.”

    The credentials were listed on a church-provided website, which included a link by Moriarty to MLM opportunities.

    ULC has been the subject of controversy. The church ordains up to 10,000 individuals per month, without charging a fee or holding any classes. Advanced degrees can be obtained for as little as $29.95 with little academic effort, according to ULC’s Wikipedia entry.

    Moriarty advanced the legal theories of Curtis Richmond in the ASD case. Among Richmond assertions were that prosecutors were guilty of interference with commerce for disrupting ASD’s operations.

    Dubbed a “hero” on Surf’s Up, Richmond is associated with a Utah “Indian” tribe a federal judge ruled a sham in a separate case. Public officials successfully sued Richmond and other “tribe” members under federal mail fraud and racketeering statutes, saying they had been targeted in a vexatious legal campaign that resulted in a bogus judgments for spectacular sums being placed against the officials.

    A bogus judgment of $250 million was placed against a local prosecutor in the Utah case.

    Richmond signed a bogus “arbitration” award of more than $300,000 against a family-services worker, according to court records.

    Moriarty and Surf’s Up led a letter-writing campaign to Sen. Patrick Leahy, chairman of the Senate Judiciary Committee. The campaign sought Leahy’s support in advocating for ASD, an alleged Ponzi scheme, and sought the Senate’s help in investigating the ASD prosecutors.

    Prior to his Senate career, Leahy had been named one of the top three local prosecutors in the United States. Even as Moriarty and Surf’s Up members were writing letters, Leahy was calling for U.S. fraud laws to be strengthened.

    See this story from February 2009 about the Moriarty/Surf’s Up letter-writing campaign to Leahy. In a letter to Leahy, Moriarty claimed that “[o]ver 50 individual and notarized DEMAND[S] FOR LEGAL EVIDENCE were sent to Jeffrey Taylor, US Attorney; William Cowden, Assistant US Attorney; and Roy Dotson, Special Agent, US Secret Service.”

  • POLL: As 2009 Draws To A Close, Cast Your Vote For The Most Interesting Figure In The AdSurfDaily Story

    EDITOR’S NOTE: Included in this post is a year-end poll to determine “The Most Interesting Figure” in the long-running AdSurfDaily story. Five of the seven choices are individuals who’ve been an intriguing part of the story. The remaining two choices are intriguing entities consisting of individuals.

    The individuals include Andy Bowdoin (the only individual in our ASD poll against whom prosecutors have asserted allegations of wrongdoing — and so far just civil allegations); Curtis Richmond; “Professor” Patrick Moriarty; Bob Guenther; and Poster “joe,” also known as “little joe.” The entities are the Pro-ASD Surf’s Up forum and a less public group we’ve deemed the “Conspiracy Theorists.”

    Brief memory-refreshers appear below the poll. Some readers perhaps will want to read the memory-refreshers before voting. You may make only one selection.

    Here, now, the story and the poll . . .

    From the date upon which federal prosecutors filed the first of two forfeiture complaints against Florida-based AdSurfDaily in August 2008, the ASD story and accompanying black comedy quickly became less about the Ponzi and more about the intriguing personalities.

    ASD President Andy Bowdoin has had two birthdays since then; he’s now 75 — and one of several U.S. senior citizens implicated in Ponzi schemes of national and international significance. On Aug. 1, 2008, the U.S. Secret Service filed a 37-page affidavit under seal in the case. The affidavit was accompanied by 57 pages of evidence — enough to persuade a federal magistrate judge to order more than a dozen bank accounts to be frozen.

    In its affidavit, the Secret Service said it feared Bowdoin had become aware of scrutiny into his business affairs and planned to flee the country.

    “I have not included every detail of every aspect of the investigation for this affidavit,” the agent who prepared the affidavit said. “Rather, it only includes the information necessary to prove that probable cause exists for a seizure warrant to be issued for property constituting proceeds of a wire fraud scheme.”

    U.S. Magistrate Judge Alan Kay agreed the Secret Service had made a compelling argument. Kay issued 13 orders directing the Secretary of the U.S. Department of Homeland Security “and any Authorized Officer of the United States” to seize 10 Bowdoin bank accounts and three accounts tied to Golden Panda Ad Builder, a closely-connected autosurf purportedly born on a Georgia fishing lake in April 2008 after Bowdoin had spent the day casting lines with Rev. Walter “Clarence” Busby Jr., who would later emerge as GP’s president.

    Aug. 1, 2008, was a Friday. Almost instantly ASD members spun the seizure of the bank accounts as a positive development, claiming the government would see the beauty of ASD’s business model after taking time to listen to the company’s story and that ASD would return quickly to the business of paying “advertisers” profits of 30 percent a month.

    Agents were planning a friendly “visit” in the days ahead, members claimed, again positioning the purported “visit” as a net plus because ASD’s business model was legally sound.

    What the vast, vast majority of the members making the initial claims did not know at the time was that the Secret Service had conducted surveillance in the case in multiple locations and gathered damning evidence from records and interviews with members.

    No criminal charges have been filed to date against Bowdoin or ASD, although the prosecution asserts in civil filings that ASD operated as a criminal enterprise.

    What had been positioned as a friendly “visit” in the earliest hours after the seizure proved to be the execution of search warrants at Bowdoin’s home and at ASD’s headquarters in a former floral shop in Quincy, Fla. The warrants were executed on Aug. 5, a Tuesday, four days after the Secret Service stopped the scheme from mushrooming any further by seizing the bank accounts.

    By Aug. 12, according to members, Bowdoin was comparing the actions of the Secret Service to the actions of the 9/11 terrorists who killed nearly 3,000 people, with Bowdoin saying “Satan” was at work. The allegations contained in the August forfeiture complaint, which was a public filing with several evidence exhibits attached, created a significant PR problem for Bowdoin in addition to the legal problem.

    The vast, vast majority of ASD members learned for the first time in the Aug. 5 civil filing by prosecutors that Bowdoin had been arrested in Alabama in the 1990s in a felony securities-fraud case and had entered guilty pleas. As a result of the filing, many members also learned for the first time that Rev. Busby had been implicated by the SEC in a prime-bank scheme in the 1990s and that Busby had declared bankruptcy.

    This information had been shielded from ASD and Golden Panda members as they were throwing money at the surfs, the Secret Service said. Agents went on to seize two more GP accounts. After reconciliations, the 15 accounts linked to ASD and Golden Panda contained just shy of $80 million, according to records.

    As strange as it sounds, a core group of ASD members pooh-poohed the allegations. Instead of considering that perhaps they had been conned by two individuals who previously had been central figures in serious securities litigation, the core group set out to demonize the government.

    In the months after the federal seizure — and in the months after Florida Attorney General Bill McCollum filed a fraud lawsuit against ASD — federal prosecutors released more information drip-by-drip. The information was part of follow-up filings in the August 2008 case. By December 2008, prosecutors had filed a second forfeiture complaint against ASD-connected assets.

    Several intriguing personalities have emerged since the initial filing in August 2008. Bowdoin, for example, initially contested the forfeiture. In January 2009, however, he submitted to it after meeting with prosecutors over a period of at least four days.

    But before February 2009 had come to a close, Bowdoin reentered the case — this time as a pro se litigant who’d purportedly fired his paid attorneys.

    Curtis Richmond, an ASD member, also emerged as a pro se litigant. He accused the prosecutors of crimes, suggesting a federal judge was operating a “Kangaroo Court” and was guilty of treason. For good measure, he accused a second federal judge of operating a “Kangaroo Court.” Dozens of pro se litigants would follow, some using a Richmond litigation blueprint and others using a blueprint that had been provided by an ASD upline.

    “Professor” Patrick Moriarty, who advanced Richmond’s theories of the case, embarked on a certified-mail campaign to discredit the prosecution. He also wrote a letter to Sen. Patrick Leahy, asserting that Leahy, the head of the Senate Judiciary Committee, should set the committee’s investigative sights on the prosecutors who brought the ASD case, not the alleged wrongdoers who operated ASD.

    Bob Guenther, de facto head of the ASD Members Business Association (ASDMBA), also emerged as an intriguing personality. Guenther led a campaign to raise money so ASD members could hire an attorney to protect their legal interests in the case, and was criticized for not providing transparent accounting of how the money was spent and for bullying members verbally.

    Among other things, Guenther also was criticized for not revealing he had pleaded guility to a felony count of bank fraud in the 1990s and for responding to his critics by asserting they were “wusses” or “liberals.” Some ASDMBA members now say they see the organization as an entity that collected money and dissipated it while taking no effective action.

    Poster “joe,” meanwhile, emerged as an intriguing personality when he rationalized the so-called autosurf “industry” as just another business pursuit akin to gambling. He blasted autosurf opponents, saying he did not care if autosurf Ponzi schemes were illegal as long as they paid.

    “joe,” who described himself as a former Vietnam Prisoner of War, apparently decided eventually that the best way to express his point of view was to become chronically disruptive and abusive. He then morphed from Ponzi promoter to cyberstalker, threatening to set “fires” to disrupt the PP Blog’s operations.

    Since the fall of 2008, Surf’s Up has been a constant presence — and an intriguing personality — in the ASD story. Among the forum’s notable contributions was an assertion that Bowdoin, despite his felonious history, was “too honest” to testify at a hearing ASD asked a federal judge to conduct. The “too honest” explanation came in response to Bowdoin’s decision to take the 5th Amendment at a proceeding his company specifically requested.

    Surf’s Up also has urged members to take part in various letter-writing campaigns in support of Bowdoin, including Moriarty’s campaign. Moriarty was indicted on federal tax charges about a month after his February 2009 campaign to Leahy had begun, although the Moriarty prosecution and the ASD prosecution do not appear to be related.

    Research showed, however, that Moriarty, who started a nonprofit company to advocate for ASD, also had started a nonprofit company in the name of a Missouri man who had been accused of murdering a woman in cold blood and shooting a police officer four times.

    Federal prosecutors alleged that Moriarty, who at one time advertised tax expertise, had under-reported his income by an unspecified amount for the tax year 2002; claimed a false deduction of $30,000 for “legal fees” for the tax year 2003; and claimed a false amount of $23,533 withheld for the tax year 2004 and a false amount of $23,433 withheld for the tax year 2005.

    No poll that did not include the ASD conspiracy theorists as a choice for the most interesting figure would be complete. We’re aware, of course, that there may be some crossover, as some of the other poll choices have shared one conspiracy theory after another and conflated one new reality after another in their zeal to lend support to Bowdoin.

    Readers inclined to select the “Conspiracy Theorists” option, however, should make an effort to divorce the other nominees from the theories. For the purpose of this poll, the “Conspiracy Theorists” are those intriguing ASD members who purport to believe that paper currency is a government plot, that President John F. Kennedy was assassinated because he was about to expose the overall government conspiracy pertaining to money and that U.S. lawmakers passed secret legislation in the 1990s in anticipation of a visit by reptilian aliens.

    The ASD Ponzi story is like none other. Will Bowdoin emerge as the most interesting personality? Will Moriarty, “joe,” Richmond, Surf’s Up or Guenther?

    Or will it be the “Conspiracy Theorists?”

  • BREAKING NEWS: FBI Tells Senate Judiciary Committee It Is Probing 314 HYIP Schemes Only Months After ASD Members Asked Panel To Probe Prosecutors

    Kevin L. Perkins of the FBI tells the Senate Judiciary Committee that the agency is investigating 1,500 cases of securities fraud and that 314 of them involve HYIP fraud in various forms.
    Kevin L. Perkins of the FBI tells the Senate Judiciary Committee that the agency is investigating 1,500 cases of securities fraud and that 314 of them involve HYIP fraud in various forms.

    And to think that only months ago — in February 2009 — various members of AdSurfDaily wrote to the Senate Judiciary Committee trying to elicit support for Ponzi schemes. The letter-writing campaign was spearheaded by “Professor” Patrick Moriarty and pushed by the Pro-AdSurfDaily Surf’s Up forum.

    But now the FBI has told the committee, led by Sen. Patrick Leahy, D.-Vermont, that it has registered a 105 percent increase in HYIP fraud and opened 314 investigations in 2009, up from 154 in 2008.

    “[M]any [had] losses exceeding $100 million,” said Kevin L. Perkins, assistant director of the FBI’s Criminal Investigations Division.

    Perkins said the probes cover the gamut — from the massive Ponzi scheme fraud of Bernard Madoff to smaller variations of the Ponzi scheme.

    “These schemes use money collected from new victims, rather than profits from an underlying business venture, to pay the high rates of return promised to earlier investors,” Perkins told the Committee.  “This arrangement gives investors the impression there is a legitimate, money-making enterprise behind the fraudster’s story; but in reality, unwitting investors are the only source of funding.”

    During his testimony, Perkins also referenced “prime-bank schemes” in which victims are told that “certain financial instruments such as notes, letters of credit, debentures, or guarantees have been issued by well-known institutions such as the World Bank, and offer a risk-free opportunity with high rates of return.”

    In August 2008, in a forfeiture complaint against the assets of AdSurfDaily and Golden Panda Ad Builder, federal prosecutors revealed that Golden Panda President Clarence Busby had been sued civilly by the SEC in the 1990s after he was implicated in three prime-bank schemes. At the same time, prosecutors revealed ASD President Andy Bowdoin had been arrested for felony securities fraud in Alabama during the same decade.

    Despite the Ponzi allegations against ASD and the histories of Bowdoin and Busby, Surf’s Up urged the Judiciary Committee to investigate the prosecutors who brought the forfeiture cases against ASD and Golden Panda in August 2008.

    “We each need to explain [to Leahy] how thousands of innocent Americans have suffered and continue to suffer because of these incredible and despicable acts” by prosecutors, Surf’s Up urged members.

    Law enforcement is investigating a stunning number of securities-fraud cases, the FBI revealed.

    “The FBI continues to aggressively investigate this criminal threat, and currently has more than 1,500 related securities fraud investigations,” Perkins said.

    Read about the Moriarty/Surf’s Up letter-writing campaign to the Senate Judiciary Committee.

  • Site That Used ASD’s Name And Made Odd Claims While Bowdoin Was Negotiating With Prosecutors Goes Offline

    A website known as ASD2Day.com that was registered Aug 19 in the name of a Florida woman now is throwing a server error and appears to be offline.

    ASD President Andy Bowdoin was in negotiations with federal prosecutors when the ASD2Day domain name was registered, and some ASD members were participating in a PR campaign that positioned themselves and Bowdoin as victims of a government prosecution run amok.

    Among the claims on the site was a puzzling assertion that U.S. District Judge Rosemary Collyer was on an Aug. 28 deadline “to determine if the US Attorney General’s case against ASD should move forward.”

    Collyer was on no such deadline, and the prosecution’s case was not teetering on the edge of disaster. At the time, Bowdoin was the subject of an order from Collyer to follow-up on pleadings he had made earlier in the case. On July 24, Collyer, noting that neither Bowdoin nor his attorney had followed up on pleadings made in May, ordered them to respond by Aug. 7.  That deadline, which applied to Bowdoin, later was extended to Aug. 28 — and then until Sept. 14 — when Bowdoin’s attorney notified the court that Bowdoin was negotiating with prosecutors.

    The ASD2Day site featured Pro-ASD content by an unnamed writer and a headline titled “Inside Information.” It described ASD’s “business concept” as a “proven reality” and used meta descriptions such as “Picture of a Flight Simulator Plane, to give an emotional feel.”

    ASD2Day.com claimed, among other things, that ASD could not be a Ponzi scheme because the script employed by the autosurfing firm could not be programmed to permit a Ponzi scheme to occur.

    Using overblown, confusing reasoning and language, the site claimed:

    “As we all know, ASD has been ruled for an irrelevant acquisition of `PONZI SCHEME OR PYRAMID` ruling. ASD Utilized a well known Traffic Exchange Script in the Online Marketing industry. The Script was named Pats Pro. I myself am a Programmer as well. I have worked with this script before to develop websites and add-ons. By the pure mechanics or functions in the Pats Pro system, there is no function of, that such can be ruled ponzi or pyramid. The PATS PRO system does not work as Ponzi, the written code in the software has no leads to such acquisition either.”

    Although the language appeared to be an attempt to suggest that ASD President Andy Bowdoin could not be guilty of operating a Ponzi because the script did not support a Ponzi model, federal prosecutors always have argued that the internal actions of ASD and Bowdoin — not the actions of a script — resulted in criminal instances of wire fraud and money-laundering.

    The writer did not say how the script would protect Bowdoin and ASD from another core allegation in the case: that ASD was engaging in the sale of unregistered securities, meaning the company was selling investment contracts and operating as an unregistered issuer and dealer of securities.

    Meanwhile, the site claimed that “The well known Internet Giant `Google` Ad sense service is not all that different from the ASD Advertising System (Pats Pro).”

    Many ASD supporters have argued that Google and ASD employed a similar business model, but have never explained why Google founders Sergey Brin and Larry Page — both of whom have personal fortunes estimated at $15.3 billion by Forbes magazine and are tied for 11th spot on the list of the richest Americans — never plunked down $100 for a script that would permit Google to do things like ASD.

    Why the ASD2Day site now is offline is unclear. The site included at least two calls to action: “Defend Our Business, Defend Our Rights!” and “ASD2DAY · For a Free Country.”

    Among the featured links were:

    • Join our stand
    • Learn about Defending ASD
    • Meet the team

    A subhead prompt instructed members to “Find out the Truth” and to “Read Articles, comment [on] them and learn the truth the US goverment doesn’t want you to hear..” The site also included a link to a Meebo chatroom.

    The chatroom link still is accessible:

    http://widget-cdn.meebo.com/mcr.swf?id=ySKbgEjiEw&eurl=

    Two links are visible in the chatroom. One is a link to a failed organization known as ASD Members International (ASDMI), which was formed in October 2008 by members of the Pro-ASD Surf’s Up forum.

    Another link is to a URL for a business owned by “Professor” Patrick Moriarty, now under indictment for tax fraud. Moriarty was a founder of ASDMI.

  • Government Revokes Plea Offers In Case Against ‘Professor’ Patrick Moriarty; Prosecution Says It Has Seven Binders Of Evidence, Including Evidence From A ‘Casino’

    Federal prosecutors have revoked plea offers made during discussions with a federal public defender representing AdSurfDaily mainstay “Professor” Patrick Moriarty.

    Moriarty has hired a new attorney, and prosecutors have advised the attorney that they have “voluminous” evidence, including seven 4-inch binders of records.

    Part of the evidence came from records at an unspecified casino, according to court records.

    “Please be advised that any plea offers previously made with the defendant’s former counsel are revoked,” said Rosemary Casey Meyers, the prosecutor handing the case, in a letter to Moriarty’s new attorney.

    Meyers is an assistant U.S. Attorney for the Eastern District of Missouri, where a tax indictment against Moriarty was returned in March by a federal grand jury. The letter means that any offer the government might have made earlier in the case is off the table.

    Other evidence, according to court filings, includes IRS records, bank records, Social Security records, business records and verbal statements by Moriarty. Some 4-inch binders hold 780 sheets of paper.

    Citing his client’s poor health, Moriarty’s new attorney, Lenny Kagan, now has asked for a continuance. The government did not object. Moriarty is scheduled to have cancer surgery this month. The trial had been slotted for next month.

    The prosecution agreed to let Moriarty know if it intended to introduce evidence of other crimes prior to trial, without disclosing if Moriarty was being investigated for other matters unrelated to the tax indictment handed down in March.

    Screen shot: Discovery receipt that shows government has casino records in the case against 'Professor' Patrick Moriarty.
    Screen shot: Discovery receipt that shows government has casino records in the case against 'Professor' Patrick Moriarty.

    Moriarty was charged with filing false income-tax returns for the tax years 2002, 2003, 2004 and 2005. Prosecutors said he underreported his income by an unspecified amount for the tax year 2002; claimed a false deduction of $30,000 for “legal fees” for the tax year 2003; and claimed a false amount of $23,533 withheld for the tax year 2004 and a false amount of $23,433 withheld for the tax year 2005.

    In May, the PatrickPretty.com Blog reported that Moriarty, in 2006, started a nonprofit organization for a Missouri man accused of murdering a woman in cold blood after he had shot a police officer four times.

    The officer and his partner had stopped the man, Bryan Tullock, for running a stop sign in Montgomery City, Mo., on June 2, 2006. As officer Brandon LyBarger, 25, approached Tullock’s car shortly after midnight, Tullock shot him four times with a 9-mm handgun and also opened fire on LyBarger’s partner.

    The second officer, Jarrod Brooks, returned fire, striking Tullock’s Cadillac but not Tullock.

    When officer Brooks called for backup and went to the aid of his downed colleague, Tullock fled, police said. Tullock broke into the home of Heidi Casagrand about a block from the scene of the police shooting.

    He shot and killed Casagrand, 32, and also shot at her husband. Tullock fled the second shooting scene and confronted Ricky Fry, 33. Tullock shot Fry eight times outside of his home, leaving him for dead.

    LyBarger and Fry, who had been hit by a combined total of 12 bullets, survived.

    Tullock was sentenced to life in prison without the opportunity for parole earlier this year. He could have been sentenced to death.

    Moriarty registered the nonprofit for Tullock, the shooter, on Oct. 2, 2006, four months to the day after the rampage. Records suggest that the IRS already was interacting with Moriarty at the time be started the nonprofit.

    Two years later, in October 2008, Moriarty was instrumental in registering another nonprofit in Missouri. Along with members of the Pro-AdSurfDaily Surf’s Up forum, Moriarty started an organization known as ASD Members International (ASDMI), which solicited money to do battle with the government in the civil-forfeiture case against ASD, a Florida company implicated in an alleged $100 million wire-fraud, money-laundering and Ponzi scheme.

    ASDMI promised to litigate against the government even if it was behaving legally. Payments were accepted from at least 176 ASD members, but no litigation was filed.