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Tag: proffer letter

  • UPDATE: Government Has Produced At Least 2,742 Pages Of Discovery In Kenneth Wayne Leaming Case; Trial For AdSurfDaily Figure And Purported ‘Sovereign Citizen’ Scheduled To Begin Sept. 17, One Week Before ASD President Andy Bowdoin Goes On Trial

    “The Government has provided over 2742 pages of discovery consisting of: liens, police reports, [Bureau of Prisons] records, pictures, surveillance photos, internet search records, audio subpoenas and over 1000 pages of documents seized.” — From March 5 court order in false-liens case involving accused AdSurfDaily figure and purported “sovereign citizen” Kenneth Wayne Leaming and former Leaming business associate David Carroll Stephenson

    Kenneth Wayne Leaming

    If the scheduling holds, accused AdSurfDaily figure and purported “sovereign citizen” Kenneth Wayne Leaming will go on trial in the Western District of Washington on Sept. 17 with his former business colleague David Carroll Stephenson, one week before ASD President Andy Bowdoin is set to go on trial in the District of Columbia in a Ponzi scheme case involving at least $110 million.

    Leaming, 56, of Spanaway, Wash., is accused of filing false liens against at least five public officials involved in the ASD case, including a federal judge, three federal prosecutors and a special agent of the U.S. Secret Service. In addition, he is charged with being a participant with 56-year-old Stephenson, a federal inmate in a fraud case, in a scheme to file false liens against at least two federal prison officials.

    At the same time, Leaming is charged with concealing two federal fugitives involved in an Arkansas-based, home-business fraud scheme involving millions of dollars, being a felon in possession of firearms and uttering a false “Bonded Promissory Note” with a purported face value of $1 million.

    The docket of U.S. District Judge Ronald B. Leighton of the Western District of Washington now shows a trial date of Sept. 17 for both Leaming and Stephenson.

    Leaming, who has a 2005 felony conviction for piloting an aircraft without a valid pilot’s certificate, originally was scheduled to go on trial March 20. That trial date was rescheduled for April 2 after a superseding indictment was returned against Leaming after his initial arrest on a criminal complaint in November 2011 — and now has been moved to September to give Leaming and Stephenson more time to prepare, according to court filings.

    Bowdoin, 77, was indicted in 2010 on charges of wire fraud, securities fraud and selling unregistered securities. In August 2008, the U.S. Secret Service seized tens of millions of dollars from 10 of his personal bank accounts, amid allegations that Bowdoin was presiding over an international Ponzi scheme operating over the Internet.

    Both of the Arkansas fugitives allegedly found with Leaming in Washingston state also are purported “sovereign citizens.” They were identified as Timothy Shawn Donavan, 64, and Sharon Jeannette Henningsen, 67. Donavan currently is detained in Oklahoma, and Henningsen is detained in Texas, according to records.

    Leaming and Stephenson both are detained near Seattle.

    As was the case with the original court filings in the 2008 civil action that led to the criminal prosecution of Bowdoin, investigators have produced surveillance photos pertaining to the Leaming and Stephenson prosecutions.

    Records suggest that Leaming came under surveillance in Washington state by an FBI Terrorism Task Force by at least August 2011.

    In addition to the surveillance photos, the government also has produced, liens, police records, unspecified “pictures,” prison records, Internet search records, “audio subpoenas”  and “over 1000 pages of documents seized,” according to court filings.

    All in all, according to the filings, the government has produced at least 2,742 pages of discovery in the Leaming and Stephenson cases.

    It is unclear from court filings whether the government seized any evidence of correspondence Leaming may have conducted with ASD members. Some ASD members are known to have have quoted Leaming in individual emails dating back at least to November 2010.

    Leaming has asserted he is proceeding to trial under “duress.”

    In March 2009  — while the ASD Ponzi case was still a civil matter — Bowdoin claimed a January 2009 decision he made to submit to the forfeiture and stop pressing claims for the money seized from his bank accounts was made under “severe duress.”

    He made the claim while acting as his own attorney, and further claimed that his decision to relitigate the case after earlier abandoning his claims was “legally accomplished as a matter of law” simply because he had filed papers saying so.

    A month later — in April 2009 — federal prosecutors made a bombshell announcement in court that, prior to submitting to the forfeiture and dropping his claims to the seized cash, Bowdoin had signed a proffer letter and acknowledged the government’s material allegations were all true.

    In September 2009, prosecutors said Bowdoin was telling ASD members one story — while telling a federal judge another.

    Final orders of forfeiture were entered in the ASD civil case in January 2010. Bowdoin appealed, but lost in March 2011.

    In the earliest days and weeks after the August 2008 seizure, some ASD members — ignoring the lessons of history — began to promote other schemes that advertised preposterous payouts, claiming they were safe because they were “offshore.”

    One current HYIP scheme is JSS Tripler/JustBeenPaid, whose advertised daily payout rate is 2 percent — twice that of ASD. Frederick Mann, the purported operator of JSS Tripler/JustBeenPaid, identified himself as an ASD pitchman in 2008 web promos three months before the Secret Service raid on ASD headquarters in Quincy, Fla.

    In a Feb. 23, 2012, conference call, Mann declined to say precisely where JSS Tripler/JustBeenPaid was operating from. On Feb. 27, the PP Blog reported that a site linked to Mann featured videos of Francis Schaeffer Cox, a purported “sovereign citizen” implicated in an alleged murder plot against public officials in Alaska.

    On Feb. 29, the PP Blog received threatening communications from an individual describing himself as “MoneyMakingBrain.” Among other things, “MoneyMakingBrain” claimed he’d defend Mann “so help me God.”

    On March 12, the PP Blog reported that “MoneyMakingBrain” had asserted the Blog would “go down in flames.”

    On Feb. 18 — at RealScam.com, a forum that educates the public about mass-marketing fraud — “MoneyMakingBrain” published a link to the Mann-associated site that beams the Cox videos. It is unclear if “MoneyMakingBrain” understood that Cox was under arrest on serious criminal charges and is identified with the “sovereign citizen movement.”

    NOTE: The PP Blog believes it is ill-advised to click on any link left by “MoneyMakingBrain” at RealScam.com.

    One of the surveillance photos in the ASD Ponzi case: Source: Court files.

  • Forex Ponzi Schemers Who Targeted Deaf Investors Hit With $6.2 Million In Sanctions; ‘Billion Coupons’ Case Drew Comparisons To Defunct Noobing Autosurf

    A Hawaii man and his company were hit with sanctions totaling $6.2 million in a case that alleged they targeted people with hearing impairments in a Forex Ponzi scheme.

    Both the SEC and the CFTC filed actions against Marvin Cooper and his Honolulu-based firm, Billion Coupons Inc. (BCI). The CFTC announced the judgment against Cooper and the company.

    Investigators said Cooper and BCI “solicited funds from deaf American and Japanese individuals for the sole purported purpose of trading forex,” luring them with payout promises of up to 25 percent per month.

    For his part, Cooper took “more than $1.4 million of customer funds for personal use, including for flying lessons and to purchase a $1 million home,” investigators said.

    He was ordered to pay $3.9 million in restitution to customers and more than $2.3 million in penalties. The company is liable for the same amounts.

    The “Billion Coupons” case drew comparisons to the now-defunct Noobing autosurf, which also targeted the deaf. Noobing became popular in the aftermath of the August 2008 federal seizure of tens of millions of dollars in the AdSurfDaily Ponzi scheme case.

    Despite the federal seizure, some ASD members promoted Noobing. Noobing effectively went bust in July 2009, when the FTC charged its parent company — Affiliate Strategies Inc. — with pushing a scheme that promised “guaranteed” government grants of $25,000 from economic stimulus funds.

    Noobing later was named a receivership defendant in the case. Receiver Larry Cook sold the company’s assets lock, stock and barrel — right down to a lavatory wastebasket. Like ASD, Noobing’s parent firm also owned a jet ski. Cook sold that, too.

    Despite dramatic asset seizures and the federal actions against ASD and Noobing’s parent — and despite previous actions against autosurfs, including 12DailyPro, PhoenixSurf and CEP — some ASD members have continued to promote autosurfs.

    This has occurred against the backdrop of a racketeering lawsuit against ASD President Andy Bowdoin and public filings in which prosecutors claimed Bowdoin had signed a “proffer” letter in the case and met with members of law enforcement over a period of four days in December 2008 and January 2009.

    It also is known that Interpol is seeking the arrest of Robert Hodgins, whose Dallas-based debit-card company, Virtual Money Inc., is alleged to have agreed to launder drug money in the Dominican Republic and assist a Colombian drug operation launder money at ATMs in Medellin.

    ASD members said Hodgins’ company supplied debit cards to AdSurfDaily, and web records suggest that Hodgins or a Virtual Money designate attended an ASD function in the Orlando area in late 2006.

    Even though Bowdoin acknowledged in court filings that he had given information against his interests to the government, some ASD members continue to promote autosurfs and HYIPs. After signing the proffer letter and surrendering his claims to more than $65.8 million seized from his personal bank accounts, Bowdoin later reentered the case as his own attorney.

    One of Bowdoin’s 10 personal bank accounts contained more than $31 million, according to court filings. Another contained more than $23 million. Three other bank accounts contained the exact same amount — a little over $1 million.

    After submitting to the forfeiture in January 2009, Bowdoin fired his attorneys without notice and attempted to reenter the case weeks later as his own attorney. This set in motion a series of bizarre pleadings from Bowdoin, including one in which he claimed he had not been provided “fair notice” of his illegal conduct by the government. ASD members by the dozens then filed their own bizarre, pro se pleadings. U.S. District Judge Rosemary Collyer ruled against each of the filers, saying they had no standing in the case.

    Collyer since has ruled against Bowdoin, awarding title to more than $80 million seized in the case to the government, which said it intends to implement a restitution program. Bowdoin is appealing Collyer’s forfeiture decisions.

    Court filings show that Bowdoin told Collyer the seized money belonged to him. In September 2009, the U.S. Secret Service presented Collyer a transcript of a conference-call recording in which Bowdoin told members the money belonged to them. Although Bowdoin insisted he had big plans for ASD, records show that he let the firm’s registration lapse in the state of Florida — even as he was telling members they should be excited about the company’s future.

    In the recording, Bowdoin claimed his fight against the government was inspired by the compelling personal story of a former Miss America.

  • Bowdoin’s Proffer Talk Of The Autosurf World

    In the end, prosecutors saved their best for last. Ordered by a federal judge April 3 to respond to a series of pro se motions filed by ASD President Andy Bowdoin in a federal forfeiture case involving tens of millions of dollars, prosecutors first addressed Bowdoin’s motion to dismiss the case for lack of fair notice.

    Then they addressed Bowdoin’s motion to set aside the forfeiture because the court lacked jurisdiction over him in the forfeiture action. The first two prosecution responses occurred between April 6 and early in the day on April 24.

    Finally, late in the day on April 24, prosecutors responded to Bowdoin’s motion to rescind a decision he made in January to submit to the forfeiture.

    That’s when prosecutors dropped a bomb, telling U.S. District Judge Rosemary Collyer that Bowdoin, prior to submitting to the forfeiture, had told “law enforcement agents that the material allegations that the government made in its forfeiture complaint in this case were all true.”

    Bowdoin even had signed a proffer letter, prosecutors told Collyer. Prosecutors used the words “confirmed” and “acknowledged” in their memo to help drive home their points (emphasis added).

    • “Mr. Bowdoin confirmed to law enforcement officials that he modeled his enterprise on another’s failed fraud scheme”
    • “[H]e acknowledged that there was almost no revenue independent from what he secured from the ‘members’”
    • “Mr. Bowdoin also confirmed that the revenue figures of the enterprise were managed to make it appear to prospective members that the enterprise called Ad Surf Daily was a consistently profitable, and brilliant, passive income opportunity”

    Web buzz over the weekend focused as much on what prosecutors did not say as what they did say: Prosecutors, for example, did not say precisely what else Bowdoin had told the government. They did not reveal if he had named names. They did note that the proffer letter Bowdoin signed “informed him that his proffered statements would not be used against him in the government’s case-in-chief in any criminal prosecution of him — other than a prosecution for perjury, giving a false statement, or obstruction of justice.” (Emphasis added.)

    But they added (emphasis added) that Mr. Bowdoin’s proffered statements could be used for “other” purposes.”

    Prosecutors did not reveal what “other” purposes they had in mind.

    Proffer letters sometimes are used when prosecutors believe the one who proffers can contribute to an ongoing investigation and perhaps even aid in the prosecution of others.

    In the end, prosecutors said that Bowdoin, who’d been hailed a business genius by supporters who engaged in one letter-writing campaign after another to clear his name, admitted that ASD had no meaningful revenue streams other than member payments and fudged its numbers to create the appearance of brilliance — something that takes arrows out of the quivers of his supporters and destroys the credibility of all those letters written on his behalf.

    Bowdoin himself had encouraged all the letter-writing, but he didn’t tell members about his confirmations and acknowledgments to the government. And he didn’t mention the proffer.

    Not even the Mods at the Pro-ASD Surf’s Up forum — grand central for Bowdoin apologists — had anything to say about Bowdoin’s confirmations and acknowledgements and proffer letter this weekend.