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Tag: sovereign citizens

  • EDITORIAL: ‘Our Mentor Has Had To Take A Break Due To Legal Reasons,’ OneX Pitchman Claims About ASD’s Andy Bowdoin

    Purported "Mentor" Andy Bowdoin

    Back in 2008 — when the U.S. Secret Service raided Florida-based AdSurfDaily in a Ponzi probe and people who called ASD’s office were told God was on the company’s side — federal prosecutors alleged that ASD President Andy Bowdoin had “followers.”

    The meaning of “followers” largely was left to the imagination. Much of the mystery was taken away, however, when a now-defunct cheerleading forum for Bowdoin known as “Surf’s Up” served up impossibly tortured defenses for the ASD patriarch around the clock for more than a year.

    Although it’s hard to distill the peculiar essence of Surf’s Up in a single thought, this one at least approximates it: ASD = good; government = evil.

    One Surf’s Up member advanced the notion that Bowdoin’s problems could be solved by a “militia” storming Washington. Another opined that the interests of justice best would be served if the then-lead federal prosecutor were placed in a torture rack and ASD members drew straws to determine who got the honor of turning the wheel. Another ASD member — on the seventh anniversary of the 9/11 attacks — issued a “prayer” for the prosecutors to be struck dead.

    “Root them out of the land of the living!” the “prayer” petitioned. “Let evil slay them, and desolation be their lot!”

    For good measure, the “prayer” called for God to order “divine angelic prophetic assaults . . .” against the prosecution and evidence in the case, including the ASD database.

    Bowdoin himself removed some of the “followers” mystery when he compared a government raid designed to protect the financial interests of thousands of victims ensnared in an alleged $110 million Ponzi scheme to the 9/11 terrorist attacks that killed nearly 3,000 people. He further demonized the Secret Service and federal prosecutors by comparing them to “Satan.”

    Another part of the mystery perhaps was decloaked when Bowdoin’s son — in 2010 — asserted his father “is a man with no conscience” who’d used religion for years to fleece the masses.

    The government has filed at least three civil forfeiture actions related to ASD. Two of the cases have proceeded to final judgment, with ASD on the losing side. (A third civil forfeiture case remains pending. Elements of the third case are directed at certain specific ASD members who allegedly benefited from the fraudulent scheme, meaning that the members themselves may have significant legal exposure.)

    In both cases that have proceeded to final judgment, Bowdoin unsuccessfully appealed the losses to a higher court. He filed one of the appeals, despite the fact he’d never entered a defense in that specific case. The case he did not defend is one in which certain members of  Bowdoin’s family may have significant legal exposure.

    Separately, Bowdoin was named a defendant in a lawsuit by disaffected ASD members who accused him of racketeering. By December 2010, Bowdoin had been arrested on ASD-related charges of wire fraud, securities fraud and selling unregistered securities. Although his trial date is set for September, he faces a bond-review hearing on Friday. Prosecutors now say they’ve linked Bowdoin to at least two post-ASD frauds, including one known as “OneX.”

    Bowdoin began pitching OneX in October 2011, about 10 months after he was indicted in the ASD case.

    “I believe that God has brought us OneX to provide the necessary funds to win this case,” Bowdoin said last year.

    Both Bowdoin and supporters habitually use pronouns such as “us” and “we”when discussing ASD or matters pertaining to Bowdoin. The precise reason why remains unclear. So far, Bowdoin is the only ASD figure known to have been charged publicly for alleged misconduct directly tied to ASD, which the Secret Service described as a “criminal enterprise.”

    Bowdoin’s reference in his OneX sales pitch to “this case” was in the context of the ASD-related criminal case against him. He earlier blamed the loss of the ASD  civil cases on a “single, lone judge,”  prosecutors/agents who’d allegedly “crucified” him and earlier defense attorneys who’d allegedly railroaded him.

    Did we mention that some ASD members have accused a federal judge of “treason” and that purported “sovereign citizen” Kenneth Wayne Leaming — an ASD story mainstay — is jailed near Seattle on federal charges that he filed false liens against at least five public officials involved in the ASD case?

    Meanwhile, Christian Oesch, a Leaming colleague in a failed lawsuit against the government for alleged misdeeds in the ASD case, strangely has taken to calling himself a “transmitting utility” in response to a nonASD lawsuit in which he is named a defendant.

    Records in Washington state show that at least two companies that use the phrase “transmitting utility” in their names have a business tie to Leaming through an entity known as American-International Business Law Inc. Other records show that the phrase itself has been linked to the so-called sovereign-citizen movement. “Sovereign citizens” have an irrational belief that laws do not apply to them.

    When Leaming was arrested by an FBI terrorism task force in November 2011, he was found with two federal fugitives from Arkansas, according to court filings. Leaming also allegedly discussed a plan by which he’d serve John Roberts with a writ through the school his young children attended. That writ apparently was part of a scheme to file false liens against two U.S. prison officials for alleged misdeeds against a former Leaming business colleague serving time in a federal penitentiary.

    John Roberts is the Chief Justice of the United States.

    And yet Bowdoin — despite everything that has happened to date in the ASD case and its surrounding circus of the bizarre — still has followers.

    The PP Blog received information through a source last night that some of Bowdoin’s followers will continue on with OneX, despite the government’s recent assertion it is a “fraudulent scheme” and “pyramid” that is recycling money to members in ASD like fashion.

    An email circulating last night from Bowdoin’s OneX “team” strangely referenced Bowdoin without naming him. The email used the pronouns “our” and “we.”

    “As many have noticed our Mentor has had to take a break due to legal reasons,” the email read in part. “We had hoped for a breakthrough on the 8th, however it was postponed to later this month.”

    Bowdoin’s bond-review hearing originally had been scheduled for May 8. A federal judge later rescheduled it for May 18 — Friday.

    That Bowdoin — an accused felon with a felonious history — gets accorded the description of “Mentor” (with an uppercase “M”) hardly can be a source of comfort to the good men and women at the Department of Justice and the U.S. Secret Service. Agents and prosecutors alike must be scratching their heads today and wondering where it all will end.

    Here is the OneX email in its entirety (italics added):

    Ninja Success Team Updates

    Dear Team,

    As most know we have been going through some changes with the Ninja Success Team. As many have noticed our Mentor has had to take a break due to legal reasons. We had hoped for a breakthrough on the 8th, however it was postponed to later this month.

    I have gotten a lot of emails in the last week and I hope that my honesty has made you feel at ease and I hope that you will find patience until the challenge has been met.

    Another challenge that we are facing is the financing of the servers that everybody’s Lead Capture Page Systems, the 1xTraining Site, and the Ninja Back Office sit [sic]. Our Mentor has been paying this out of his own pocket for all time. Because of the legal challenges, we are left to finance ourselves.

    The management team has been tossing around a bunch of ideas, from donations to selling the lead packages. We have decided to ask for donations as well as to continue to sell the new ninja tools (which are getting awesome results).

    As we all know we are at a very big momentum right now and are at the downhill roll to making all of our business worth quite a bit of money and this is due to the working of our Ninja Success Team. In order to continue as one of the biggest, most successful teams of the OneX opportunity, I implore everybody to at least make a donation or purchase of the New Ninja Turbo tools available on the training site or the Ninja Back Office.

    Below is the link to make a donation or you can find on the menu part of the Training Site. A donation of $10 or $20/mon. would be extremely welcome.

    [Link deleted by PP Blog]

    I want to personally thank everybody as well for the patience they have shown during this challenge.

    Alan

    The Ninja Success Team

    If the government is right, it means that Bowdoin is pushing a pyramid scheme even as he awaits trial in a major Ponzi scheme case.

    And if purported email author and OneX pitchman “Alan” is right, then the Bowdoin “team” is getting “awesome results” from selling “tools” to drive traffic to a program the government says is a pyramid scheme.

    “Alan” apparently does not feel compelled to pull the plug on the Bowdoin “team” OneX promos even though the “Mentor” possibly faces severe bond restrictions or potentially even loss of his freedom owing to the pitches.

    What’s important to “Alan,” apparently, is that the “breakthrough” now is expected to come through on May 18 after a 10-day delay.

    Whether the judge conducting the bond-review hearing might have a differing notion on the meaning of the word “breakthrough” is a question that may be answered in the coming days.

    In any event, “followers” — a word used by the ASD prosecutors long ago — proved to be pretty much spot on. What no one knew at the time was that not even three forfeiture cases, a racketeering lawsuit, an arrest on serious criminal charges and Bowdoin’s own felonious history could deter some of those followers from seeing him as anything other than a mentor.

     

  • AdSurfDaily Figure Christian Oesch Named Defendant In Lawsuit Filed By Fannie Mae; Utah Man Calls Himself ‘Fiction & Transmitting Utility’ In Response To Complaint

    From pleadings by Christian Oesch in a lawsuit filed against him in Utah by Fannie Mae. (Redaction/emphasis by PP Blog.)

    EDITOR’S NOTE: In July 2010, Christian Oesch of Utah, and Kenneth Wayne Leaming of Spanaway, Wash., sought to sue the United States — apparently for the staggering sum of more than $29 trillion — for its actions in the AdSurfDaily Ponzi forfeiture case brought by the U.S. Secret Service in August 2008. The Secret Service described ASD as a “criminal enterprise” operated by Andy Bowdoin, a 77-year-old recidivist con man.

    ASD had gathered at least $110 million from tiny Quincy, Fla., by offering outsize investment returns of 1 percent a day, the Secret Service alleged. It has been known since the earliest months of the ASD case that the business had ties to so-called “sovereign citizens.”

    One of the calling cards of the “sovereign citizen movement” is what has been described as “paper terrorism”: an effort to clog the courts with baseless or vexatious litigation and legal pleadings designed to tie the hands of public servants and/or courtroom opponents

    Leaming, a 56-year-old purported “sovereign citizen,” was arrested by an FBI terrorism task force in November 2011 on charges of filing false liens against at least five public officials involved in the ASD case. A superseding indictment was returned against Leaming earlier this year. He remains jailed at a federal detention facility near Seattle. A September trial date for Leaming has been set in federal court in Washington state, the venue from which he allegedly filed the false liens and committed other crimes such as harboring fugitives and possessing firearms as a convicted felon.

    Judge Christine Odell Cook Miller of the U.S. Court of Federal Claims ultimately dismissed the lawsuit brought by Oesch and Leaming, saying in December 2010 that the “complaint deteriorates into rambling.” Earlier — in July 2009 — Oesch had sought to intervene in the ASD case and set aside the forfeiture of tens of millions of dollars in the personal bank accounts of Andy Bowdoin. Like Leaming, Bowdoin is scheduled to go on trial in September. Bowdoin’s trial will be conducted in the District of Columbia.

    Oesch, known to have business ties to Leaming, has not been accused of wrongdoing in the ASD case.

    U.S. District Judge Rosemary Collyer of the District of Columbia — later allegedly targeted by Leaming with false liens — denied standing to Oesch and numerous other pro se litigants in the ASD case.

    The ASD case has been marked by strangeness, including pro se court filings that accused Collyer of treason and operating a “Kangaroo Court.” Oesch accused Collyer of interfering with commerce, arguing that the judge and federal prosecutors also were guilty of “Anti-Trust Violations” and “Criminal RICO” violations.

    That same type of language now is being used by Oesch in his responses to a January 2012 lawsuit in Utah in which he was named a defendant by mortgage giant Fannie Mae . . .

    Using the same street address in Midvale, Utah, that appears in court filings in the civil-forfeiture portion of the AdSurfDaily Ponzi case, ASD figure Christian Oesch curiously declared himself a “Fiction & Transmitting Utility” in his response to a lawsuit in which he was named a defendant by the Federal National Mortgage Association, the PP Blog has learned.

    The U.S. mortgage giant commonly known as Fannie Mae initially sued Oesch, Becky Oesch, Michael A. King and two alleged “Doe” occupants of a home on South Wayside Drive in Sandy, Utah, in January 2012. The complaint was removed to federal court in Salt Lake City in February, but now has been kicked back to Utah state court, according to court dockets.

    Oesch, who once claimed that U.S. District Judge Rosemary Collyer and other public officials involved in the ASD case were guilty of racketeering and antitrust violations, now has essentially accused Fannie Mae of the same thing.

    “Securitization is illegal under US legislation — primarily because it is fraudulent and causes specific violations of R.I.C.O., usury, Antitrust and bankruptcy laws,” Oesch argued.

    At issue in the case is a dispute over the ownership of the Sandy home. King was listed as the owner of the home in a September 2011 notice of trustee’s sale for the property. Fannie Mae said in court filings that it purchased the home at the September trustee’s sale and that “Defendants have failed to vacate and yield possession of the Subject Property” and hold it in “unlawful detainer.”

    Oesch went on to argue that “US authorities from the highest level downwards, financial institutions, intermediaries, Intelligence Power operatives and others are gearing up for what they doubtless hope will be intensified racketeering and trading activity with (corrupt) foreign counterparties.

    “This behavior is being fine-tuned ‘as we speak’ . . .” Oesch ventured.

    He went on to advance a conspiracy theory that involved the “US Treasury, the White House, the US State Department and the Central Intelligence Agency and its subsidiaries such as the lethal Office of Naval Intelligence . . .”

    ASD is not referenced in the Utah complaint against Oesch and the others. Filings suggest, however, that Oesch lived at one time in the Sandy house that is the center of the case. Fannie Mae is seeking treble damages for an alleged failure of the defendants to vacate the property when requested.

     

  • Alleged Missouri ‘Sovereign Citizen’ Indicted In $212,000 Social Security Rip-Off, Feds Say; Charles Daniel Koss Allegedly Sent Agency ‘False Negotiable Instrument’ To Pay Off Debt

    Charles Daniel Koss, 62, of Independence, Mo., allegedly owed the Social Security Administration $212,000 because he collected disability benefits to which he was not entitled between September 1994 and January 2010.

    Koss allegedly was working with his wife at Embassy Mortgage in Blue Springs, Mo.,  and “willfully failed” to let Social Security know about “the income derived from his work activity,” federal prosecutors in the Western District of Missouri said.

    A purported “sovereign citizen,” Koss now has been charged with two counts of theft of government money, one count of Social Security disability fraud, one count of passing a fictitious instrument with the intent to defraud and one count of mail fraud, federal prosecutors said.

    When Koss learned he had to repay the money, he allegedly mailed the Social Security Administration a false financial instrument dubbed a “Registered Private Money Order” in purported payment of the debt.

    The bogus instrument allegedly was part of a “redemption” theory favored by “sovereign citizens.” Under the theory, prosecutors said, the government is purported to have created “secret accounts” from which debtors can draw to satisfy their obligations.

    In a news release, the office of Acting U.S. Attorney David M. Ketchmark said:

    Koss subscribed to what is known as the redemption theory, the indictment says, which claims that a “Birthright Trust” is created with the U.S. Treasury when parents of a newborn child pledge the child’s birth certificate to the government. Redemption theory involves bogus claims that when the United States government abandoned the gold standard in 1933, it pledged its citizens as collateral so it could borrow money. The movement also asserts that common citizens can gain access to funds in secret accounts using obscure procedures and regulations.

    According to the indictment, adherents of the redemption theory sometimes call themselves “sovereign citizens.”  The sovereign citizen movement is a loosely organized collection of groups and individuals who have adopted anarchist ideology. Its adherents claim that virtually all existing government in the United States is illegitimate and they seek to “restore” an idealized, minimalist government that never actually existed. Redemption theory and sovereign citizen beliefs are totally without merit and they have no basis in law or fact.  Individuals often use these ideas to further various fraudulent schemes.

  • Husband And Wife (And Purported ‘Sovereign Citizens’) Jailed In Georgia; Edgar Lee Rodgers And Diane Rowe Charged With Racketeering Amid Allegations They Tried To Sell Homes That Did Not Belong To Them

    Edgar Rodgers And Diane Rowe: Source: Booking photos at Fulton County Jail.

    Bond has been set at a combined $130,000 for a Georgia couple arrested Thursday by Atlanta police on charges they tried to sell homes that did not belong to them in an alleged paperwork scam involving bogus courthouse filings.

    In recent years, Georgia has been near the top of the list in both bank failures and foreclosures. A number of scams have evolved, including “squatters” divining themselves a right to sell or move into homes that do not belong to them and foreclosure-rescue schemes in which foreclosure subjects are told they can remain in their homes by paying “rent” to purported third-party deed-holders who somehow whisked ownership rights away from banks.

    Bond for Edgar Lee Rodgers was set at $85,000, according to the Fulton County Sheriff’s Office. Meanwhile, bond for Diane Rowe was set at $45,000.  Both Rodgers and Rowe — purported “sovereign citizens” — are detained at the Fulton County Jail.

    Rodgers has been charged with a single count of racketeering and five counts of theft by deception. His wife was charged with one count of racketeering and one count of theft by deception.

    Here is how the Atlanta Journal Constitution put it in a story yesterday:

    “Edgar Lee Rodgers and Diane Rowe are accused of filing false adverse possession documents — essentially claiming squatters’ rights — to homes that were vacant, likely due to foreclosure.”

    Also see coverage at CBS Atlanta, which quoted Atlanta Police Sgt. Paul Cooper on the arrest of the couple.

    View video report at WXIA (11Alive).

  • ‘SOVEREIGN’ UPDATES: (1) Tennessee Man Indicted In Alleged ‘Quit Claim’ Deeds Scam; (2) Virginia Man Facing Trial On Gun Charge Allegedly Had Driver’s License From ‘Kingdom Of Heaven’; (3) Texas Man Allegedly Told Cops To Bring ‘Body Bags’

    EDITOR’S NOTE: This is a links post presented in the form of briefs.

    Three significant stories about purported “sovereign citizens” — all from different areas of the United States — have been published and/or broadcast in recent days. The venues include Tennessee, Virginia and Texas.

    1.) WMC TV is reporting that Devitoe Farmer, 44, of Memphis, has been indicted on federal charges of filing bogus “quit claim” deeds against foreclosure properties — in effect, to cloud their titles and take control of real estate without paying for it.

    Farmer also faces state-level charges.

    Read WMC TV story originally filed in March 2011 and updated last week. (There is an accompanying video report.)

    2.) Randy Linamen, 60, of Manassas, Va., faces trial this week on charges of being a felon in possession of a firearm and driving while his license was revoked, Northern Virginia Daily reports.

    Linamen’s case started with a traffic stop by police last year. When approached by officers, Linamen allegedly produced a document that purported to be a driver’s license from the “Kingdom of Heaven,” NVDaily reports.

    Read story.

    3.) John Joe Gray, accused nearly 12 years ago of assaulting a Texas state trooper, has avoided a court date since the alleged incident unfolded, USA Today reports.

    Local authorities have feared a violent confrontation with Gray for years, the newspaper reports.

    Gray had told an investigator that, if law-enforcement officers came for him, they’d better bring “body bags,” USA Today reports.

    The stalemate is “perhaps the longest-running standoff in the U.S. between law enforcement and a fugitive living in plain sight,” the newspaper reports.

    Read the story in USA Today.

  • STATUS QUO CHANGE IN ‘PROGRAM’? Conference-Call Recordings Of ‘Carl Pearson’ Go Missing From JSS Tripler/JustBeenPaid Website; Development Explained Away As Response To Potential ‘Hackers’ — Although Frederick Mann Recordings Remain

    Purported JSS Tripler/JustBeenPaid COO Carl Pearson. From: YouTube.

    It sometimes is the case in the corrupt universes of HYIPs that a change in the status quo signals panic or devastating news. It’s also sometimes the case that significant developments get explained away as meaningless or part of a plan that had been in place all along in response to explosive growth.

    It is almost always the case that HYIPs such as JSS Tripler/JustBeenPaid and their various purveyors reveal incongruities and internal inconsistencies — and a few big ones now are in play at JSS/JBP.

    Within the past several days, audio recordings of JSS Tripler/JustBeenPaid “conference calls” featuring pitchman and purported COO “Carl Pearson” have gone missing from the JSS/JBP website. The recordings previously had been embedded on the site below the embedded recordings of Frederick Mann, the purported operator of JSS/JBP. Although Mann’s recordings remain, the recordings of Pearson have vanished.

    No recording from Mann was added to the site last week, meaning the last embedded Mann recording carries a date of March 15. No recording was posted for March 22, meaning that the streak of posting a recording of every Mann Thursday conference call dating back to Feb. 16 had been broken.

    In the March 15 call, Mann told members that JSS/JBP was paying them with money from “new members” and that it was OK to call JSS/JBP an investment program. Using money from new members to pay old members is the central element of a Ponzi scheme. And because Mann himself described JSS/JBP as an investment program, promoters could find themselves confronting assertions they are selling unregistered securities as investment contracts.

    JSS/JBP members who identified themselves of residents of the United States or Canada were on the March 15 call (and also on previous calls). Their nationalities and citizenship are potentially important because JSS/JBP has no known securities registrations, meaning that regulators from either the United States or Canada could move against the enterprise and perhaps even some of its promoters.

    Mann has declined on multiple occasions to identify JSS/JBP with a nation-state — and promoters still are pushing the scheme, despite the fact they appear to have no clue about the internal workings of JSS/JBP and how they (and their recruits) ever could recover their investments in the event of a collapse or a government intervention.

    In January, the Italian securities regulator CONSOB announced a JSS/JBP-related action — and affiliates still promoted the program, with JSS/JBP itself claiming it was posting record numbers of new members daily.

    At least a few JSS/JBP members have noted the removal of the Pearson calls. Earlier today, the PP Blog viewed an affiliate’s Blog for JSS/JBP in which an assertion was made that Pearson had become too busy with other duties to host calls.

    “Due to the unprecedented growth of JBP, Carl Pearson will no longer be doing the weekly conferences,” a comment from a reader asserted. “He is prioritising now full time in the back office operations of JBP.”

    The comment was dated March 21. A follow-up comment dated March 22 suggested the recordings had been removed for security reasons and that other information also might be removed.

    “From the conference room yesterday at around 8pm Dominick got on the mic and announced it,” the post claimed. “He also said that staff members could have their pictures and information removed from the site if they wanted to and Carl as well as other staff members decided it would be best to have that information removed. He said that they are growing so fast that they could be targeted by crooks and hackers.”

    But what the explanation did not reveal is why Mann’s recordings remained on the site if concern about crooks and hackers was great enough to trigger the removal of the Pearson recordings.

    As often is the case in the HYIP sphere, the information was posted anonymously, meaning it could not be verified. Even so, the information is potentially disturbing in the sense that it defaults to well-known HYIP clichés such as introducing the prospect of hackers  — while ignoring the potentially damning information contained in the jettisoned material as a factor in the removal decision and the obvious fact that information that remains on the site may be equally damning.

    With a straight face, for example, JSS/JBP purports to pay a daily return of 2 percent and a monthly return of 60 percent.

    JSS/JBP openly advertises that it pays a return of 60 percent a month on TOP of affiliate commissions totaling 15 percent over two tiers.

    In 2007, when the alleged AdSurfDaily Ponzi scheme stopped making payments to members (even as its operator allegedly was making political donations with Ponzi money), ASD President Andy Bowdoin allegedly blamed the halted member payouts on script problems and “Russian” hackers who’d allegedly taken $1 million.

    Bowdoin never filed a police report about the purported theft of $1 million, federal prosecutors said.

    In 2008 promotional materials attributed to Mann, Mann was identified as an ASD pitchman. As the ASD prosecution moved forward, it became apparent that certain ASD members either were “sovereign citizens” or sympathizers. Some “sovereign citizens” hold extreme antigovernment views and have an irrational belief that laws do not apply to them.

    In November 2011, ASD figure and purported “sovereign citizen” Kenneth Wayne Leaming was arrested by an FBI Terrorism Task Force in Washington state on charges he had filed 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.

    On Feb. 27, the PP Blog reported that a website linked to Mann included links to 11 videos concerning Francis Schaeffer Cox, a purported “sovereign citizen” under indictment in an alleged murder plot against public officials in Alaska.

    One poster on the JSS/JBP-related Blog from which the “hackers” explanation was advanced had a different take on conference-call-related developments.

    “Heat is also the REAL reason why Carl Pearson has moved off the conference calls,” the poster speculated.

     

  • BULLETIN: Ronald James Davenport, Purported ‘Sovereign Citizen,’ Sentenced To 41 Months In Federal Prison After Filing ‘False Liens’ Against Public Officials And Trying To Attach Their Real Estate and Personal Property

    BULLETIN: Ronald James Davenport, the Washington state “sovereign citizen” convicted in November 2011 of filing false liens for billions of dollars against four public officials, has been sentenced to 41 months in federal prison, the Justice Department said today.

    Davenport was convicted of the false-liens charges during the same month AdSurfDaily figure and purported Washington state “sovereign citizen” Kenneth Wayne Leaming was accused in a separate case of filing bogus liens against five public officials involved in the ASD Ponzi case brought by the U.S. Secret Service in August 2008.

    Leaming’s targets included a federal judge and three federal prosecutors in the District of Columbia and a special agent of the U.S. Secret Service, according to court filings.

    Davenport, described by prosecutors as a tax defier, targeted the U.S. Attorney for the Eastern District of Washington, an assistant U.S. Attorney, an IRS agent and a court clerk with false liens, prosecutors said.

    “The liens were filed in the county auditor records of Spokane and Whatcom Counties, Wash,” prosecutors said.  “Each lien claimed that the victim owed Davenport $5,184,000,000.  It also purported to attach all of the victim’s real and personal property as security for this debt.  As proved at trial, the defendant chose these four victims because of their involvement in an effort to collect from Davenport more than $250,000 in back taxes.”

    U.S. District Judge Garr M. King of Oregon sat in special designation in the Davenport case because the Washington state federal judiciary recused itself, prosecutors said.

    The Justice Department’s Tax Division and the Treasury Inspector General for Tax Administration (TIGTA) prosecuted the case because the U.S. Attorney’s Office in Eastern Washington also recused itself, the Justice Department said.

  • 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.

  • UPDATE: Antihistorical ‘MoneyMakingBrain’ Claim: ‘Law Enforcement Agencies Don’t Pay Attention To What’s Being Said On Forums And Blogs’

    “There is a line between First Amendment Rights vs. Libel here. So, when does your right to form an opinion begins (sic) and when does it constitute a defamation of character? The answer is, law enforcement agencies don’t pay attention to what’s being said on forums and blogs, so get your head straight and feet firm on the ground.” — “MoneyMakingBrain,” in March 4, 2012, post on RealScam.com

    As previously reported on the PP Blog, a JSS Tripler/JustBeenPaid “defender” known as “MoneyMakingBrain” (MMB) has emailed threats to the PP Blog, hatched bizarre conspiracy theories here and at RealScam.com and planted the seed that he was someone to fear.

    The email threats were received after MMB claimed Feb. 18 on RealScam he had performed “due diligence” on JSS Tripler/JustBeenPaid. On a website known as “ReviewOPedia,” a poster with the same handle offered this on Feb. 14, in the context of JSS Tripler/JustBeenPaid:

    “They are for real! ”

    Within the same Feb. 14 ReviewOPedia post, MoneyMakingBrain ventured this (italics added):

    “BTW, everybody should check out the JBP live support chatroom which has over 160 people at any given time and is live 24/7. You can ask all the questions you can come up with and there is always moderator. Who does that? I’m sold already. So, if someone here claims that they ‘didn’t get paid’, either they still don’t understand how the matrix works or they’re just internet trolls.”

    Whether the “MoneyMakingBrain” on the PP Blog and the “MoneyMakingBrain” on ReviewOPedia are one and the same is unknown to the PP Blog.

    Precisely why the MMB known to the PP Blog and RealScam.com has been trying to chill specific individuals and antiscam forums is unclear. What is known is that what he’s doing is hardly unique.

    Lessons Of HYIP History Ignored

    While asserting that he knows the PP Blog’s IP address and posting location, MMB now is making a claim on RealScam, a forum that concerns itself with international mass-marketing fraud, that “law enforcement agencies don’t pay attention to what’s being said on forums and blogs.”

    That claim is contrary to the public record, which shows that any number of agencies, self-regulatory bodies and private attorneys have been noting for years that HYIP schemes are proliferating on the Internet and being spread by posters on forums and social-networking sites. It also ignores the reality — also a matter of public record — that law-enforcement has a history of filing court documents that reproduce HYIP forum posts and of infiltrating HYIP schemes.

    Prominent FINRA Warning On HYIPs

    In July 2010,  the Financial Industry Regulatory Authority issued this highly public alert. FINRA noted that “HYIPs use an array of websites and social media — including YouTube, Twitter and Facebook — to lure investors.”

    HYIPs fabricate a “buzz” and create “the illusion of social consensus,” FINRA said, describing the sinister approach as a “common persuasion tactic fraudsters use to suggest that “everyone is investing in HYIPs, so they must be legitimate.”

    Forum Posts Become Evidence In HYIP Cases

    In the SEC’s May 2008 prosecution of the Legisi HYIP scheme, the agency included page after page of forum posts as part of a 267-page evidence exhibit in support of an asset freeze.  A federal judge approved the freeze. (The screenshot below is from one of the forum pages.)

    Legisi operator Gregory McKnight pleaded guilty to criminal charges of wire fraud last month. He also faces millions of dollars in civil judgments. The SEC Legisi filings also include a reference to the MoneyMakerGroup forum, which is listed in other federal court filings as a place from which HYIP Ponzi schemes are promoted.

    This section of the Legisi Terms of Service purports that members must avow they are not an "informant, nor associated with any informant" of the IRS, FBI, CIA and the SEC, among others. The others included "Her Majesty's Police," the Intelligence Services of Great Britain, the Serious Fraud Office, Interpol and others.

    Included within the SEC filings is a reproduction of Legisi’s bizarre Terms. (See graphic at right. It is taken from court filings.) Among other things, the Terms made members avow they were not an “informant” for various government entities.

    JSS Tripler/JustBeenPaid has similar Terms. The Terms read like an invitation to join an international financial conspiracy. (The next two paragraphs are verbatim from the JSS Tripler/Just BeenPaid member agreement. Italics added.)

    6. I affirm that I am not an employee or official of any government agency, nor am I acting on behalf of or collecting information for or on behalf of any government agency.

    7. I affirm that I am not an employee, by contract or otherwise, of any media or research company, and I am not reading any of the JBP pages in order to collect information for someone else.”

    When the U.S. Postal Inspection Service filed criminal charges against Nicholas Smirnow in May 2010 for his alleged operation of the Pathway To Prosperity HYIP Ponzi scheme, MoneyMakerGroup, TalkGold and ASAMonitor were specifically referenced in the service’s case filings. Smirnow now has his face on an INTERPOL “Wanted” poster.

    MMB took great exception to the PP Blog’s Smirnow post, apparently believing it had no relevance in the context of JSS Tripler/JustBeenPaid. MMB also apparently believes the PP Blog and RealScam are treating Frederick Mann, the purported operator of JSS Tripler/JustBeenPaid, unfairly.

    Among other things, MMB asserted on the PP Blog that “no one is invisible to the MoneyMakingBrain and you need to stop doing what you’re doing against this man immediately. Because if you don’t, I am going to make a formal complain (sic) to the very authorities you purport are coming after scam sites and send all the evidence I’ve gathered so far from posting on your site and the realscam site. I don’t like witch hunts and I am sure Fred Mann can whip your ass in court for your highly suggestive, provocative, highly contentious and flat-out defamatory commentaries against his character on your sites.”

    MMB further suggested that JSS Tripler/JustBeenPaid critics may be “needing to look for another ISP because you won’t have internet access at home or your office, wherever.”

    About three months after the SEC brought the $72 million Legisi/McKnight HYIP Ponzi case, the U.S. Secret Service — in August 2008 — filed evidence exhibits in support of an order to freeze tens of millions of dollars in AdSurfDaily-related bank accounts. The complaint in support of the seizure specifically references an ASD-related “Breaking News” Blog, and an evidence exhibit labeled “Government Exhibit 5” consists entirely of an ASD-related post on a different Blog that took up 15 printed pages.

    The 15-page post featured alleged comments from ASD President Andy Bowdoin in which he threatened to sue critics.

    “These people that are making these slanderous remarks, they are going to continue these slanderous remarks in a court of law defending about a 30 to 40 million dollar slander lawsuit,” the post quoted Bowdoin as saying. (The screen shot below is from Government Exhibit 5. It has been a matter of public record approaching four years.)

    Both the ASD and Legisi investigations used government agents in undercover capacities, according to court filings.

    Meanwhile, in June 2009, attorneys suing Bowdoin on behalf of ASD members in a civil RICO (racketeering) case referred to the PP Blog’s reporting on the ASD Ponzi case, specifically its reporting on a spinoff surf known as AdViewGlobal (AVG). (See court document. See June 30, 2009, related story. See PP Blog story the attorneys referenced in their filings.)

    Threat Of  HYIP ‘Fire Power’

    Also in June 2009, a poster who purported to be an attorney issued a veiled threat to the PP Blog, stating that that “[i]f you keep pushing it now the toes you are stepping on might start stepping back. Looks like they have some fire power behind them now.”

    AVG ceased payouts about 24 days after the threat. Even as it suspended cashouts, AVG threatened the media with copyright-infringement lawsuits for reporting on the payout suspension. Within days, it planted the seed that it would arrange to have the Internet Service Provider (ISP) connections of critics suspended.

    During its short run, AVG bizarrely asserted that it operated as a “private association” that enjoyed U.S. Constitutional protections in Uruguay. AVG used U.S.-based Gmail addresses to conduct business, something JSS Tripler/JustBeenPaid is doing. The defunct surf further claimed that it had appointed a person who held the title of “Protector.”

    Such claims have been linked to the so-called “sovereign citizen” movement. On Feb. 27, 2012, the PP Blog reported that a site linked to Mann published videos of Francis Schaeffer Cox, a purported “sovereign citizen” indicted in Alaska in an alleged murder plot against public officials. The site features a drop-in ad for JSS Tripler/JustBeenPaid that encourages prospects to register with  a Gmail address.

    Whether MMB is aware of all of these these historical incidents while issuing threats and planting the seed he has the power to divorce JSS Tripler/JustBeenPaid critics from their Internet connections is not known. MMB’s posting privileges were revoked by the PP Blog last week after he emailed threats and menacing communications. RealScam has continued to permit MMB to post on its forum.

    The PP Blog believes it is unwise to click on any link MMB has posted on RealScam. He appears to be attempting to bait members of the antiscam community into clicking on links as part of a bid to gather IP addresses and other data from posters — all while asserting he has the power to use the information to harm individuals and entities such as Eagle Research Associates, a California based nonprofit that seeks to educate the public about scams.

    Piling On The HYIP Absurdity

    In what would become one of the most visited threads in the history of the PP Blog, a poster known as “CORRECTION” repeatedly demanded that the Blog retract this June 3, 2009, headline about the AdViewGlobal (AVG) autosurf and a strategy advanced by a promoter by which AVG upline sponsors could gather money from individual prospects and funnel it through the sponsors’ local banks before passing it to offshore payment processors — instead of letting AVG gather the money.

    “Get it right before you lead with this inaccurate, bias (sic) and unfair reporting!!!!!!!!!!!” CORRECTION demanded.

    The PP Blog did not submit to the demand to retract the headline.

    It was revealed later in court filings that the grand jury that indicted Bowdoin on charges of wire fraud, securities fraud and selling unregistered securities began to meet in May 2009, about a month prior to ASD- and AVG-related threats and demands made against the PP Blog.

    More Gov’t HYIP Documentation

    Read this SEC warning about social-media fraud.

    Read a December 2010 statement from a top FBI official on “Operation Broken Trust” and why Americans need to be vigilant in the era of HYIP schemes and mass-marketing fraud.

    “The focus of this sweep was fraud committed against individual investors, including Ponzi schemes, high-yield investment fraud, and market manipulation cases,” said Shawn Henry, the FBI’s executive assistant director. “Operation Broken Trust highlights the pervasiveness of the threat we face, and its impact on individuals from all walks of life.

    “The perpetrators of these crimes are those who YOU might trust . . . friends and colleagues — people from your workplace, your child’s soccer team, even your church,” Henry said.

    Read this March 1, 2012, story that reports a top U.S. Justice Department official speaking in Mexico referenced bogus libel lawsuits filed to protect criminal enterprises. Read this Justice Department news release last week on a meeting in Ottawa between top U.S. officials and top Canadian officials to discuss cross-border fraud.

    More HYIP Nonsense: No ‘Unfriendly Political Jurisdictions’

    JSS Tripler/JustBeenPaid purports to pay a daily return of twice that offered by Bowdoin and ASD — and eight times that of Legisi. The JSS Tripler/JustBeenPaid returns are somewhat on par with the returns offered by Pathway To Prosperity.

    At the same time, JSS Tripler/JustBeenPaid says this on its website (italics added):

    “Our business operations are geographically decentralized. We don’t have any central office. We’re not located in any ‘unfriendly political jurisdictions.’”

    It is difficult to conceive how JSS Tripler/JustBeenPaid could send any brighter signals of a scam in progress, given its absurd advertised rate of return and a public proclamation that it is not located in any “unfriendly political jurisdictions.”

    In 2008, Frederick Mann, the purported operator of JSS Tripler/JustBeenPaid, identified himself as an ASD pitchman. On Jan. 23, 2012 — six weeks ago today — the Italian securities regulator CONSOB announced it had opened a JSS Tripler-related probe and issued a 90-day suspension order.

    During a March 1 conference call for JSS Tripler/JustBeenPaid, a caller informed Mann that a member of his second-level downline had informed him that the member’s bid to advertise the “opportunity” had been blocked in Holland amid concerns of legality.

    “Tell him not to advertise in any particular country,” Mann replied.

    In a Feb. 23 conference call, Mann declined to identify JSS Tripler with a nation-state, asserting that the opportunity was “not located in any specific part of the world. We’re all over the planet.”

     

     

  • BULLETIN: Already Under Scrutiny, JSS Tripler/JustBeenPaid May Be Using ‘Regional Reps’ To Increase Ponzi Reach Over National Borders

    Redacted screen shot of "regional representatives" claim today on the website of JSS Tripler/JustBeenPaid.

    BULLETIN: The PP Blog has learned that JSS Tripler/JustBeenPaid is publishing a page in which it advertises the availability of “regional representatives” in various parts of the world, including Italy.

    On Jan. 23, CONSOB, the Italian securities regulator, took action against certain JSS Tripler/JustBeenPaid affiliaties. Despite the CONSOB action, JSS Tripler/JustBeenPaid is openly advertising that it has at least two affiliates who speak Italian and that the affiliates are available to “assist you with ALL aspects of the program IN YOUR LANGUAGE.”

    The page also touts the native-language talents of JSS Tripler/JustBeenPaid affiliates to assist members in Hong Hong, Taiwan, Belgium, Canada, Ireland, the United Kingdom, the United States (to assist people who speak English or Japanese), Germany, Lithuania, Indonesia, Malaysia, Mongolia, Poland, Portugal, Latvia, France, Chile, the Dominican Republic, Ecuador and Spain.

    JSS Tripler/JustBeenPaid described its outreach via regional reps as “AMAZING!”

    “The people on this page have been thoroughly trained in all the workings of JustBeenPaid’s programs, and are happy to assist you TODAY!” the murky entity crowed.

    In a Feb. 23 conference call, Frederick Mann, the purported operator of JSS Tripler/JustBeenPaid, declined to say precisely where the “opportunity” itself was located.

    JSS Tripler/JustBeenPaid, Mann asserted to an audience of Americans and at least one person who claimed to be a resident of Canada, was “not located in any specific part of the world.

    “We’re all over the planet,” he said, speaking with an English accent that appeared to be native to South Africa.

    The assertion led to questions about whether Mann was running the “program” in a fashion reminiscent of a sort of small-scale Bank of Credit and Commerce International (BCCI). BCCI deliberately structured itself in murky fashion to ward off oversight by regulators. Its collapse created one of the great business scandals of the 1990s, prompting the Wall Street Journal (Europe) to observe that BCCI had been set up to be “offshore everywhere.”

    BCCI’s collapse also triggered Congressional probes in the United States, along with both civil and criminal prosecutions.

    The CONSOB probe in Italy, which the agency announced nearly six weeks ago, was not referenced on the “representatives” page on the JSS Tripler/JustBeenPaid website.

    Incongruously, the “representatives” page included a link to an “agreement” page in which JSS Tripler/JustBeenPaid registrants and/or prospects were informed they must affirm “that I am not an employee or official of any government agency, nor am I acting on behalf of or collecting information for or on behalf of any government agency.”

    Moreover, the registrants and/or prospects were informed they must affirm “that I am not an employee, by contract or otherwise, of any media or research company, and I am not reading any of the JBP pages in order to collect information for someone else.”

    The collapsed Legis HYIP published similar terms. (More on the Legisi prosecution below.)

    How long the JSS Tripler/JustBeenPaid regional reps have been in place was not immediately clear. Also unclear was whether each of the reps had a physical presence in the respective countries or were using the Internet to reach over borders and perform customer service and recruit downlines in the respective nations.

    The U.S. government and other governments of the world have become increasingly concerned about cross-border fraud. Yesterday, U.S. Attorney General Eric Holder and Janet Napolitano, the secretary of the U.S. Department of Homeland Security, met with top officials in Canada to discuss the problem.

    Perhaps aghast over JSS Tripler/JustBeenPaid developments, a poster on the MoneyMakerGroup Ponzi forum declared today that having regional reps for JSS Tripler/JustBeenPaid is an “insane idea.”

    “Forget about the matrix spots and payouts,” the MoneyMakerGroup poster wrote today. “[W]hy is 200,000 + members not enough and why arent (sic) we off the radar and private and not opening ourselves up to potential problems ? Regional reps is an insane idea, Im (sic) sorry but the admin needs to protect us and wakeup (sic) to the reality that you cant (sic) get this huge and expect nothing bad to happen.”

    The poster did not explain his apparent belief that JSS Tripler/JustBeenPaid had a duty to go “private” and to get “off the radar” of regulators. Nor did he say precisely what constituted something “bad.”

    HYIPs have been the subject of both civil and criminal litigation in various jurisdictions.

    It is common for HYIP purveyors to tout purported “offshore” operating venues and to claim such venues insulate an “opportunity” from prosecution. It also is common for HYIPs to announce they are “private” programs and therefore not subject to government oversight. At the same time, it is common for HYIPs to try to structure a Terms of Service or Member Agreement that purports either that the “opportunity” is not selling securities or is not subject to regulatory oversight.

    Some HYIPs, including JSS Tripler/JustBeenPaid, have preemptively denied they are Ponzi schemes.

    JSS Tripler/JustBeenPaid purports to pay a daily return of 2 percent. On an annualized basis, the sum is between 48 and 73 times the purported returns of imprisoned Ponzi schemer Bernard Madoff. It is EIGHT times the daily return touted by Gregory McKnight, who pleaded guilty last month in federal court in the Eastern District of Michigan for his operation of the Legisi HYIP scheme.

    The purported returns of JSS Tripler/JustBeenPaid are somewhat on par with the returns of Nicholas Smirnow of the alleged Pathway To Prosperity HYIP Ponzi scheme. Smirnow is listed as “Wanted” by INTERPOL.

    On Feb. 27, the PP Blog reported that a website linked to Mann displayed videos of Francis Schaeffer Cox, an American and purported “sovereign citizen” under indictment in Alaska in an alleged murder plot against public officials.

    Separately, a YouTube promo for JSS Tripler/JustBeenPaid dated yesterday asserted that “[a]ll you have to do is wait for your money to increase!!!”

    A Blog post dated today, meanwhile, makes this assertion (italics added):

    “The JSS Tripler new site is one month old. It has been a month of phenomenal growth, but it’s nothing compared to what’s in the future. Some ‘Big Things’ are on the horizon that will enable many of the members to become millionaires, some could even become billionaires.”

    Neither the March 3 Blog post nor the March 2 YouTube video referenced the CONSOB probe.

    In 2008, AdSurfDaily President Andy Bowdoin asserted that ASD had a plan to create 100,000 millionaires in three years. On Dec. 1, 2010, the U.S. government announced that Bowdoin had been indicted on Ponzi-related charges of wire fraud, securities fraud and selling unregistered securities.

    About 16 days later — on Dec. 17, 2010 — U.S. federal prosecutors announced they had filed forfeiture litigation against at least two ASD affiliates. One of the alleged affiliates was purported ASD “trainer” Erma Seabaugh.

    Seabaugh also was an affiliate of an enterprise known as Ad-Ventures4U (ADV4u), which crashed in 2009 amid allegations that its operator had been threatened by members.

    In web promos, Mann has described himself as a promoter for both ASD and ADV4U. Some affiliates have described him as a “genius,” the same description accorded Bowdoin before the August 2008 raid on ASD headquarters by the U.S. Secret Service.

    After the event — and facing both civil prosecution and a criminal investigation — Bowdoin told ASD members that the raid was the work of “Satan.”

    It is a descriptor completely contrary to the typical view Americans have of the Secret Service, which has the twin duties of protecting the nation’s financial infrastructure and the life of the President of the United States.

    Most Americans believe the Secret Service consists of heroes who place themselves in harm’s way every day to keep the United States safe, doing everything from making sure U.S. grandparents have safe places to deposit their Social Security checks to making sure that the President is well-protected and accessible to the American people.

    Kenneth Wayne Leaming, an ASD member and purported “sovereign citizen,” allegedly filed a bogus lien against the Secret Service agent who led the ASD investigation in 2008, the FBI said in November 2011 court filings.

    Leaming also allegedly filed bogus liens against a federal judge and three federal prosecutors involved in the ASD case, according to court filings by the FBI. He is jailed near Seattle awaiting trial on those charges, along with charges of filing false liens against other public officials, concealing two federal fugitives wanted in a home-business caper in Arkansas, being a felon in possession of firearms and uttering a bogus “Bonded Primissory Note” for $1 million.

    Court filings suggest Leaming was conducting financial research on John Roberts, the chief justice of the United States and the head judge of the U.S. Supreme Court, while hatching a scheme to serve papers on Roberts through a school attended by the distinguished jurist’s children.

  • EDITORIAL: Top Justice Department Official Speaks On Transnational Organized Crime, References Bogus ‘Libel’ Actions Brought Against ‘Individuals Who Expose . . . Criminal Activities’

    EDITOR’S NOTE: A top U.S. official — speaking today in Mexico City at the High-Level Hemispheric Meeting Against Transnational Organized Crime hosted by the Mexican government under the framework of the Organization of American States (OAS) — addressed the challenges the world law-enforcement community is confronting in the Internet Age.

    In remarks apt to cause unease within the HYIP and organized-crime spheres, Deputy U.S. Attorney General James Cole noted that the government was wise to efforts by criminals to chill efforts to expose crimes by filing libel lawsuits. (A link to Cole’s full prepared remarks appears at the bottom of this story.)

    Some recent Ponzi cases in the United States involving incredible sums of money — and the corresponding behavior of some of the participants — help prove the point . . .

    Now-convicted racketeer Scott Rothstein threatened libel lawsuits when his $1.2 billion Ponzi scheme was on the verge of imploding.

    AdSurfDaily President Andy Bowdoin, named a defendant in a 2009 civil case that alleged racketeering,  issued “slander” lawsuit threats prior to the August 2008 intervention by the U.S. Secret Service in the ASD scheme. The threats were issued not long after Bowdoin had returned from a trip arranged by a lawyer in which the ASD patriarch had ventured to Panama and Costa Rica, according to court filings.

    Bowdoin later was indicted, amid allegations he was presiding over an international  Ponzi scheme that had gathered at least $110 million. Robert Hodgins, who was referenced in 2007 ads for ASD, is an international fugitive wanted by INTERPOL. The United States accused Hodgins of laundering proceeds for narcotics traffickers in Colombia.

    In advance of today’s High-Level Hemispheric Meeting Against Transnational Organized Crime, OAS Secretary General José Miguel Insulza noted that such crime “is the principal continental source of activities such as drug trafficking, the illicit trafficking of firearms and immigrants, human trafficking, money laundering, corruption, kidnapping, and cybercrimes.”

    Befitting its importance, the hemispheric meeting was hosted by Felipe Calderón, the president of Mexico.

    Among others things, Deputy U.S. Attorney General James Cole said this at the meeting:

    “The advance of globalization and the internet, while hugely beneficial to people everywhere, has also created unparalleled opportunities for criminals to expand their operations and use the facilities of global communication and commerce to carry out their criminal activities across national borders.”

    Although Cole did not use the term “HYIP” in his remarks, it is clear that the U.S. government is well aware of the dangers online fraud schemes pose as they reach across borders to accumulate tens and even hundreds of millions of dollars — sometimes through a single fraud scheme.

    As the PP Blog read the text of Cole’s remarks, another thing leaped off the page. Indeed, Cole said this (emphasis added):

    “Because of the sophistication of the world economy, organized crime groups have developed an ability to exploit legitimate actors and their skills in order to further the criminal enterprises. For example, transnational organized criminal groups often rely on lawyers to facilitate illicit transactions. These lawyers create shell companies, open offshore bank accounts in the names of those shell companies, and launder criminal proceeds through trust accounts. Other lawyers working for organized crime figures bring frivolous libel cases against individuals who expose their criminal activities.“

    Cole, of course, wasn’t talking specifically about the AdSurfDaily Ponzi case and ASD’s preposterous claims that Bowdoin had found a legitimate way to pay interest of 1 percent a day on the tens of millions of dollars sent in by participants and that ASD would create 100,000 millionaires in three years.

    Even so, the words Cole uttered in Mexico City today have deep relevance to the HYIP sphere. Indeed, ASD reached across international borders and relied on an international sales force.

    Here is how ASD worked: It relied on “legitimate actors” of the sort Cole described — in ASD’s case, a lawyer who allegedly scrubbed the “opportunity” to ensure compliance, and Moms and Pops and entrepreneurs (and people down on their luck) who signed up and became the friendly faces to their prospect bases. The salespeople were paid 10 percent for recruiting a friend with money and 5 percent more if the friend could recruit a friend with money — on top of “surfing” earnings of 1 percent a day and even more through the purported miracle of “compounding.”

    The current HYIP scheme of JSS Tripler/JustBeenPaid has the same type of payout schemes that ASD foisted on the marketplace. One big difference is the JSS/JBP says it can provide twice the daily payout of ASD.

    JSS/JBP’s purported operator is Frederick Mann, a former ASD pitchman.

    In September 2011, the U.S. Secret Service described ASD as a “criminal enterprise.”

    You’ll note above that Cole today used the same phrase to describe one of the inherent threats of transnational organized crime. And, as noted above, he also spoke about bids to chill critics through the filing of libel lawsuits.

    Those same types of threats were made in the ASD case, beginning in the summer of 2008. In fact, federal prosecutors even included an evidence exhibit in case filings that alluded to one such alleged threat. Unmentioned in the initial ASD case filings were the bids to chill reporters in at least two states and a newspaper in Georgia.

    If you’ve been following the HYIP sphere for any length of time, you know that threats to sue members of the antiscam community are part of the landscape — so much so, that it has become an HYIP cliche. The bids to chill are not limited to threats to sue for libel and “slander,” however.

    It also is becoming an HYIP cliche that the operators and apologists for brazen HYIPs threaten to file complaints with the ISPs of members of the antiscam community — i.e., if you report about us we’ll take down your Internet connection and/or sue you for copyright/trademark infringement.

    These things are transparent bids to chill speech. They also are designed to have a secondary “benefit”: to make the marks — who may consist in part of people who are otherwise “legitimate actors” — believe that harm will come to them if they ever complain, that there are severe consequences to those who complain.

    These nefarious methods have surfaced in scheme after scheme after scheme, as have various assertions about “offshore” venues and the purported “safety” the “offshore” venues provide. Longtime observers know the claims are part and parcel to the HYIP sphere — and that claims that someone is a successful businessman who has presided over multiple companies almost certainly will be incorporated into the sales pitch for an “opportunity.”

    The FBI, for just one example, has been warning for years about securities fraud, the “shadow banking system” and the use of shell companies to disguise fraud proceeds. The director has testified repeatedly on Capitol Hill  about the subject, while simultaneously warning about debit cards that are being used in nefarious ways and the dangers posed by lone wolves and “home-grown, violent extremists.”

    All of these things are or may be in play in the HYIP sphere. Here are some things you should know:

    • It is likely that the scheme’s operator is trading on the credibility you have with loved ones and friends within your immediate sphere of influence to drive dollars to the scam. It is equally likely that you are being denied the sort of information that would empower you to make an informed purchasing decision and highly likely you are being asked to participate in a venture that could result in prosecutions under both civil and criminal law, possibly even the RICO statute.
    • The rate of return will be preposterous in any real-world context and the math will be fuzzy and confusing, if not downright impossible.
    • Your sponsor will lie to you or pass on GIGO that is part of the company line because the company line is more convenient than the uncomfortable truth. It will be garbage coming in, and garbage going out.
    • You will be subjected to a direct or indirect threat or a bid to chill, especially if you ask uncomfortable questions or raise any doubts.
    • There  is a chance you’ll be working for a racketeer or an international criminal, perhaps even a “sovereign citizen” who has hatched a construction by which nothing is a crime, that all conduct is lawful in the name of freedom and free markets. If your sentiment is against the government or “big business” because of your personal financial situation or your political or philosophical views, an extremist may try to exploit your sentiment for personal profit.

    Just some things to think about in the age of the HYIP, the age of terrorism and the age of transnational organized crime as practiced on the Internet . . .

    Read the full remarks of Deputy U.S. Attorney General James Cole here.