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Tag: Todd Disner

  • 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.

     

     

  • On Heels Of AG Examination, Zeek Blog Says Red Carpet Event For Aug. 22 Is Canceled

    With a headline of “Red Carpet Wednesday – URGENT,” the Zeek Blog is reporting that a Red Carpet event scheduled Aug. 22 has been canceled.

    Zeek, the operator of the Zeek Rewards MLM “program” and the Zeekler penny auction, provided no explanation for calling off the event. Zeek is a purported arm of Rex Venture Group LLC.

    The office of North Carolina Attorney General Roy Cooper said last week that it had opened an “examination” into Zeek’s business practices.

    Zeek has been dogged in recent weeks by PR disasters, including the reported firing of purported MLM expert Keith Laggos as a “consultant.”

    Earlier this week, some members of the AdSurfDaily Ponzi scheme announced a plan to “flood” a federal judge with letters of support for former ASD President Andy Bowdoin, who pleaded guilty to wire fraud in May in the ASD Ponzi case. An email circulating among ASD members that called for the judge to be flooded included two ads for Zeek.

    Some Zeek promoters also are known to have promoted ASD, a 1-percent-a-day Ponzi scheme. Two Zeek promoters — Todd Disner and Dwight Owen Schweitzer — sued the United States in November 2011. As part of the lawsuit, Disner and Schweitzer presented a federal judge an opinion from Laggos that ASD was not a Ponzi scheme.

    Like ASD, Zeek plants the seed that a return of 1 percent or more per day is possible. And like ASD, Zeek denies it is offering an investment program.

    The Dispatch newspaper of Lexington, N.C., published a story today that included a July 31 photograph of Zeek prospects waiting in line, apparently to get a chance to turn over money to the company.

    At least one apparent Zeek supporter left a comment that the newspaper’s website that asserted that The Dispatch had printed untrue things about the company and that the reporter who wrote the story had not gone through Zeek “compliance training.”

    Some Zeek supporters appear to hold the curious belief that reporters are required not to use the word “investment” when describing the Zeek “program.”

    Zeek advises its members not to use the language of investments when describing the “program.” ASD did the same thing.

    The U.S. Secret Service raided ASD in 2008, alleging that ASD has a massive Ponzi scheme that sought to avoid the use of the language of investments to keep its 1-percent-a-day program under the government radar.

    Bowdoin later was indicted on charges of securities fraud, selling unregistered securities as investment contracts and wire fraud. The 77-year-old ASD patriarch pleaded guilty to wire fraud and faces up to 78 months in federal prison.

    Federal prosecutors have asked that Bowdoin be sentenced to the maximum term despite his age, alleging he started a new 1-percent-a-day fraud just two months after the August 2008 Secret Service raid.

    This is the entirety of the Zeek Blog post today (italics added):

    Fine People,

    We regret to inform you that Red Carpet Wednesday, scheduled for Wednesday, August 22, 2012 has been cancelled. Please continue to monitor our websites for more information to be forthcoming.

  • BULLETIN: AdSurfDaily Apologists Circulate Plan To ‘Flood’ Judge With Letters Of Support For Jailed Ponzi Schemer Andy Bowdoin; Forwarded Email Includes 2 Ads For Zeek Rewards’ ‘Program’ And Claims ASD Patriarch Was ‘Railroaded’

    “Well we have been dealt a setback today…the judge here agreed with the government to transfer us to the District Court in Washington DC… The same judge who railroaded Andy. I will make a motion for her to recuse herself and if she will not (and she will not) I will take an appeal.” — Remark attributed to Dwight Owen Schweitzer that is contained within email by former AdSurfDaily spokeswoman Sara Mattoon that discusses plan to “flood” a federal judge with letters of support for jailed ASD Ponzi schemer Andy Bowdoin, Aug. 13, 2012

    Thomas A. "Andy" Bowdoin

    Former AdSurfDaily member Dwight Owen Schweitzer — later to join former ASD colleague Todd Disner as a pitchman for the Zeek Rewards 1-percent-a-day-plus MLM scheme — is quoted in an email circulating among ASD members that ASD President Andy Bowdoin was “railroaded” by a federal judge.

    The quotation attributed to Schweitzer was contained within an Aug. 13 email forwarded by Disner after being assembled by former ASD spokeswoman Sara Mattoon. Mattoon has a history of packaging communications friendly to ASD, adding her purported insights to the communications and emailing them to members. The Aug. 13 email calls for ASD members to “flood” a federal judge with letters of support for Bowdoin. The ASD patriarch and veteran securities swindler is scheduled to be sentenced Aug. 29 in the District of Columbia by U.S. District Judge Rosemary Collyer.

    Previous Mattoon emails have quoted Kenneth Wayne Leaming, a purported “sovereign citizen” now jailed near Seattle after a  2011 investigation by an FBI Terrorism Task Force. Leaming was accused of filing false liens against at least five public officials involved in the ASD Ponzi case, harboring two fugitives wanted in a separate home-business scheme, being a felon in possession of firearms and uttering a bogus “Bonded Promissory Note” for $1 million.

    Leaming, who is not an attorney, was said to be performing legal work on behalf of some ASD members.

    In May 2012, Bowdoin pleaded guilty to wire fraud in the ASD Ponzi case and acknowledged that ASD was a Ponzi scheme and that his company never operated lawfully from the inception of its 1-percent-a-day (or more) “program” in 2006. Bowdoin, 77, originally remained free on bond after his guilty plea, pending formal sentencing.

    But Bowdoin was jailed in June 2012, after prosecutors presented evidence that Bowdoin continued to promote scams after the U.S. Secret Service seized more than $80 million in ASD-related proceeds in 2008 and after Bowdoin was arrested on ASD-related Ponzi charges in 2010. Prosecutors identified those scams as “OneX,” and AdViewGlobal (AVG).

    Like ASD, AVG was a 1-percent-a-day “program.” AVG, which launched in February 2009 after the seizure of ASD-related bank accounts in 2008, vanished mysteriously in the summer of 2009 after issuing threats to members and journalists. AVG was referenced in a lawsuit filed by ASD members who accused Bowdoin of racketeering.

    Contained within the forwarded email dated Aug. 13 are at least two ads for the Zeek Rewards’ MLM which, like ASD, plants the seed that a return that corresponds to an annualized return in the hundreds of percent is possible. Precisely why the Zeek ads appeared in the email is unclear. They are attributed to a Zeek affiliate known as “Compassion Ministries” and display Zeek videos produced by USHBB Inc., a company that once produced ads for the Narc That Car pyramid scheme that collapsed in 2010 after the Better Business Bureau raised concerns about Narc and investigative reporters began to write about Narc and produce television reports about the “program.”

    Even as the Mattoon email solicited support for Bowdoin as his Aug. 29 sentencing date approaches, it cautions ASD members to “be careful” if they write to Bowdoin in jail because “they read his mail.”

    Disner and Schweitzer sued the U.S. government in November 2011, claiming the seizure of ASD’s database was unconstitutional. The lawsuit originally was filed in the Southern District of Florida, but a judge there granted a request by the government to transfer the case to the District of Columbia. The case now appears on the docket in U.S. District Court for the District of Columbia and has been assigned to Collyer.

    The Aug. 13 email from Mattoon quotes Schweitzer as saying, “Well we have been dealt a setback today…the judge here agreed with the government to transfer us to the District Court in Washington DC… The same judge who railroaded Andy. I will make a motion for her to recuse herself and if she will not (and she will not) I will take an appeal.”

    When suing the United States in November 2011, Disner and Schweitzer relied in part on a purported expert opinion from Keith Laggos that ASD was not a Ponzi scheme. Like Disner and Schweitzer, Laggos also has been linked to the Zeek Rewards’ scheme.

    Laggos reportedly was fired as a Zeek “consultant” last month. Details surrounding the reported firing remain unclear.

    Zeek is now the subject of an “examination” by North Carolina Attorney General Roy Cooper.

    Zeek’s news Blog published this baffling message yesterday (italics added):

    Hello Fine People:

    The team wanted to let you know there won’t be any training, recruitment or leadership calls for the next few days while planning is going on.  Standby for some important announcements.  Thank you for your patience!

  • EDITORIAL: Karl Wallenda Wouldn’t Do Zeek

    In this editorial:

    • Our assertion: Were he alive today and desperately needed cash, famed daredevil Karl Wallenda would find Zeek’s tightropes too dangerous to walk.
    • Purported MLM “expert” sent to woodshed: Zeek “consultant” and former SEC defendant Keith Laggos reportedly gets the Zeek boot after using phrases associated with the investment trade and after suggesting that gambling regulations could be used to derail the Zeek train in the near future.
    • Train wrecks and pom-poms: To his credit, MLMHelpDesk Blogger Troy Dooly reports the Laggos news and dubs an incendiary audio recording featuring Laggos into a Dooly-produced video. But known for his ability to find something “positive” in an MLM train wreck, Dooly goes on to suggest Laggos used Zeek-banned words because he was distracted and wasn’t concentrating. Dooly later declares that an examination into Zeek’s business practices by North Carolina Attorney General Roy Cooper is “exciting” news.
    • Only in Stepfordian MLM: Zeek cheerleading video with Dooly presented as centerpiece and Laggos presented as key answer man remains online, even after Zeek cans Laggos and Dooly questions the ethics of Laggos while at once making excuses for him.
    • Cluelessness: No guidance from Zeek on whether affiliates should avoid using the video when introducing Zeek.
    • More cluelessness: No guidance from Zeek on whether affiliates should continue to use marketing props published by Laggos’ Network Marketing Business Journal, a previous subject of gushing from Dooly.
    • Plan B: Laggos heralds Lyoness.
    • Stepfordian MLM vomit: Lyoness trades on name of former South Africa President Nelson Mandela, a recipient of the Nobel Peace Prize.
    • Why lots of people are fed up with Stepfordian MLM: As Lyoness uses an image of Mandela in a marketing campaign, AdSurfDaily’s Andy Bowdoin awaits sentencing in case in which ASD was accused of trading on the name of then-U.S. President George W. Bush to sanitize $110 million Ponzi scheme.
    • Whatever “works” is OK in Stepfordian MLM: As nascent penny-auction site and upstart Zeek competitor known as Bids That Give prepped for launch and positioned itself as a company that would aid charities for children, early promos traded on the name of the White House and Chelsea Clinton, the daughter of former President Bill Clinton and U.S. Secretary of State Hillary Clinton.
    • Oddities: Narc That Car/Data Network Affiliates/Phil Piccolo/Text Cash Network.
    • More . . .

    ** ______________________________ **

    EDITOR’S NOTE: While performing a high-wire stunt in Puerto Rico in 1978, legendary daredevil Karl Wallenda fell to his death. He was 73, a risk-taker to the end.

    UPDATED 11:39 P.M. EDT (AUG. 14, U.S.A.)

    This is one of those “only in Stepfordian MLM” stories, a story that features not one, but two tightropes over a treacherously windy gorge Karl Wallenda would judge too dangerous to walk even if the daredevil business were in a sustained slump and he desperately needed cash. These are the tightropes over the Zeekler/Zeek Rewards Gorge, a man-made gulch in Lexington, N.C., potentially MLM’s next Quincy, Fla.

    Quincy was the home of AdSurfDaily, a company that did an almost inconceivable amount of damage to MLM’s already-suffering reputation — first by creating an obvious, five-alarm Ponzi scheme and trying to disguise it as a “revenue-sharing” program and, later, by trying to “save” itself by comparing the U.S. Secret Service to “Satan” and the 9/11 terrorists.

    Like the ASD story (and far too many MLM tales), the Zeek story is one that mixes the incongruous with the bizarre and only reinforces negative stereotypes about multilevel marketing.

    Keith Laggos, a figurative tightrope-walker and purported MLM expert who once opined that AdSurfDaily’s 1-percent-a-day “program” was not a Ponzi scheme and later became a consultant whose image appeared repeatedly in a cheerleading video for the Zeek Rewards 1-percent-a-day-plus “program” after ASD was raided by the U.S. Secret Service in a Ponzi scheme case, is out, the company reportedly told Blogger Troy Dooly. (Link below.)

    Laggos, though, appears not to have been fired for his ASD opinion. Indeed, Zeek may find comfort in that musing, which has been used by at least two ASD members (Todd Disner and Dwight Owen Schweitzer) who accused the U.S. government of presenting a “tissue of lies” to a federal judge when bringing the ASD Ponzi forfeiture case. Both of those ASD members also emerged as Zeek promoters. Curiously, the claim that the government had presented a “tissue of lies” was made long after ASD had lost the case in both U.S. District Court and the U.S. Court of Appeals.

    ASD and its apologists never were known for their impeccable timing. Neither was a 1-percent-a-day ASD knockoff known as AdViewGlobal (AVG), which incongruously announced a month after its February 2009 launch that its bank account had been “suspended” and that its CEO had resigned but would remain in the “accounting” department.

    Two months later, AVG, which purported to operate from Uruguay while using U.S.-based Gmail to perform customer service,  announced its banking problem had been solved by an offshore facilitator. AVG made this announcement on the same day the President of the United States announced a crackdown on offshore fraud. AVG was done weeks later. Before it exited the stage, it apparently thought it prudent to threaten to sue members who shared negative information and perhaps even have their Internet connections shut down.

    Zeek is playing in this same bizarre field. Over the past couple of weeks, Dooly has ventured that Zeek might sue Randy Schroeder, an executive with the Mona Vie MLM company, for using words Zeek might find objectionable — “Ponzi” and “pyramid,” for example. And Dooly has suggested that a North Carolina credit union was risking a lawsuit from Zeek. Meanwhile, a Zeek critic known as “K. Chang” was informed by a purported Zeek “consultant” that Zeek might sue if its efforts to bring down “K. Chang’s’ site on HubPages.com failed.

    Zeek now bizarrely claims that “all” criticism of Zeek has been unfair.

    This claim was made just days after Zeek appears to have fired Laggos for casting his MLM line elsewhere while a Zeek “consultant” and while not sticking to the company line that Zeek does not constitute an investment opportunity. The other “program” is known as  Lyoness, which Laggos has described as his “Plan B” and a “Plan B” for current Zeek members.

    MLM ‘Mo’

    To hear Laggos tell it on tape, the MLM business is the “momentum” business. One of the ways to maintain the momentum is to move certain banking operations offshore, say, to places such as Hong Kong. Laggos helped Zeek do that, according to Laggos. But Zeek might lose the mo and might not be far enough away to neutralize the regulators, he speculated.

    No matter, Laggos ventured. There’s always another company with mo.

    “Since last November, Zeekler has had the momentum,’ Laggos intoned in a recording now playing on Dooly’s Blog as part of a YouTube video and report on the sudden sacking of Laggos. “I believe they are going to lose the momentum shortly . . . The company now that’s gaining momentum — and I think it will be the momentum company over the next six months or a year — is Lyoness. And I’m suggesting that a lot of you guys consider Lyoness as your Plan B company now. Stay working with Zeekler. Keep promoting it. Don’t cross-sponsor it, but build a second income. Now, what’s nice about an ideal Plan B company is you would be able to work passively. Lyoness is that kind of company.”

    In HYIP-speak, the word “passively” is code that tells participants that they won’t have to do much or anything at all to pile up cash (a/k/a “passive earnings”) by the boatload if they send in enough cash at the beginning of a scheme. Zeek is afraid of that word because it’s the type of word that can cause the SEC to come knocking. Lots of MLM scams that rely on willfully blind promoters to gain a head of steam use it in the early stages. When things get too hot, they try to take it off the table. The reason they try to take it off the table — sometimes by threatening affiliates — is it can lead to civil and criminal charges, seizures of bank accounts and investigations by multiple agencies.

    Mixing the language of investments with references to Plan B didn’t do Zeek any favors, to be sure. Another thing that didn’t do Zeek any favors was Laggos’ reference to Zeek becoming the “momentum” company “last November.” In late September of 2011, the U.S. government released about $55 million in remissions payments to victims of the ASD Ponzi scheme.

    This leads to questions such as these: How much of Zeek’s “momentum” was fueled by funds originally seized in the ASD Ponzi case and returned to victims in the form of remissions payments? How many ASD members turned around and plowed what effectively was their crime-victim compensation into Zeek, another 1-percent-a-day scheme? Why did Zeek promoters and former ASD members Disner and Schweitzer wait until November 2011 — the same month Laggos now says Zeek became the “momentum” company — to file their ASD-related lawsuit against the government and to present a federal judge an opinion from Laggos that ASD was not a Ponzi scheme?

    “Plan B,” also known as “Don’t put all your eggs in one basket,” has a long and sordid history in HYIP Ponzi Land. AVG, for instance, was a de facto Plan B company set up after ASD, the Plan A company,  got raided by the U.S. Secret Service on the Tuesday after the previous Friday’s seizure (Aug. 1, 2008) of ASD bank accounts. Lots of ASD members deluded themselves into believing that official company line that God was on ASD’s side. Some of ASD’s earliest post-seizure apologists told the troops that the seizure was a good thing because it would provide the government an opportunity to see how lawful and wholesome ASD truly was, that the government did not understand the business model and had made a monumental mistake.

    The MLM vultures, though, had a slightly different take. In case the government didn’t see the ASD light, they speculated, ASD members could join other autosurfs, HYIPs and cash-gifting schemes. These Plan B schemes would enable ASD losses to be made up elsewhere. “Offshore” programs were positioned as the best.

    Among the tips Laggos provided to listeners of the Lyoness conference call was this: “Don’t put no more than 70 percent back in [Zeek]. Take out 20 or 30 percent [on] a daily basis. [Unintelligible.]  This would be a good place. But, by the same token, if you put $10,000 in Zeekler, if nothing happens over the next year, you’ll probably make $30,000 or $40,000, if that’s all you do without building the front end, the matrix . . . The same amount of money in Lyoness, you’re looking . . . and not doing anything else, without single sponsoring . . . you can probably make a quarter-million dollars.”

    The threat to Zeek, according to Laggos, is the FTC and how U.S. gambling regulations could be applied to penny-auctions such as its Zeekler arm. His words on the tape suggest he is confident that Zeek has sufficient cover to ward off a Ponzi/securities investigation. But even as he’s suggesting Zeek has the securities angle covered, he’s using the language of investments.

    We wonder: Can MLM really have sunk to these deplorable depths?

    But it gets even worse.

    Laggos then suggested Lyoness could be used as a hedge in case the FTC acted against Zeek.

    “If I’m wrong about what’s gonna happen with the penny auctions — and if you look at my career, I haven’t been wrong often — then the worst-case scenario is we screwed up and we made two incomes . . . We’re making two great incomes with two great companies.”

    Dooly, whom to date hasn’t found Zeek’s various claims altogether too much, now has decided that Laggos crossed the altogether-too-much line when he harrumphed for Lyoness and used certain words Zeek finds offensive.

    While the featured speaker on the Lyoness call last month with Zeek members listening in, Laggos spoke about Zeek in “several” ways that were “way out of compliance,” Dooly ventured in his video report running on YouTube.

    Laggos “talks about putting money into the game,” Dooly reports. “I mean, this is bad right here. You can’t put money in. OK? You either join the company and you’re buying memberships, you’re buying bids. But for Keith to be talking like this was an investment-type deal. This is just . . . and we all fall prey to this. But this is why you shouldn’t be doing public calls when you’re under fire and you’re not paying attention to what you say. And you can hear in Keith’s case — the phone [is] ringing, his assistant [is] coming in to talk to him, his mind is not in the game the way it should be. And that is just . . . it’s sad right now ’cause he’s no longer with [Zeek] . . .”

    In short, according to Dooly, Laggos’ big sin was painting Zeek as an investment program in contravention of the Rules Of Zeek.

    Not sticking to the script, however, is hardly an original sin within the Zeek sphere. In 2011, while speaking during a conference call to raise money for the Disner/Schweitzer ASD-related lawsuit against the government, Schweitzer, a one-time lawyer whose license was suspended in Connecticut, said he’d invested in ASD. Nevertheless, Disner and Schweitzer later presented a federal judge Laggos’ opinion that ASD was not a Ponzi scheme and that providing money to ASD did not constitute making an investment.

    Nobel Peace Prize Used As MLM Stage Prop

    Lyoness is an MLM company eager to let its participants and prospects know that it is building a school in the hometown of Nelson Mandela and that a Lyoness team recently was invited to the 1993 Nobel Peace Prize-winner’s home. It even publishes a picture to prove it and notes that a Mandela grandson is a Lyoness rep.

    Back in the United States, meanwhile, former ASD President Andy Bowdoin will find out Aug. 29 how long he’ll spend in federal prison. Zeek’s business model and disclaimer language strongly resemble that of ASD, which the U.S. Secret Service described as a “criminal enterprise” that relied on linguistic sleight-of-hand to draft tens of thousands of people into an electronic Ponzi scheme. ASD traded on the name of then-U.S. President George W. Bush, in effect using the White House to sanitize a massive international fraud caper.

    Welcome to the Highwire Wing of MLM.

    While all of this is going on, a nascent penny-auction “program” and upstart Zeek competitor that claims it exists to elevate children out of poverty is getting ready to unleash itself on the consuming public.

    That “program” is known as Bids That Give. One prelaunch promo claimed that a founding affiliate was an SEO expert once hired by a candidate for the U.S. Presidency. The first three minutes of the promo did not even reference Bids That Give. Instead, it dropped names linked to the White House, including the name of former First Daughter Chelsea Clinton and Doug Read, an adviser to two U.S. Presidents. For good measure, the promo dropped the name of NBC News anchor Lester Holt.

    The most vomitous MLM “programs” are infamous for dropping names. It is typically the case that the individuals whose names are dropped have no affiliation whatsoever with the “program.” But name-dropping and brand leeching have proven to work time after time in MLM scheme after MLM scheme. (See screenshot.)

    Did Mark Zuckerberg REALLY endorse JSS Tripler/JustBeenPaid. According to this Blog, the answer is yes. Facebook did not respond to a request for comment from the PP Blog last year on claims that Zuckerberg had endorsed JSS/JPB, which purports to provide a return of 60 percent a month.

    MLM And Wordplay

    In 2009, ASD’s Bowdoin was sued by some members of his own company under the federal racketeteering (RICO) statute. Looking at it another way, the ASD members came to believe that ASD was a criminal enterprise with a plan to expand while coming up with new and better ways to steal.

    Because veteran MLM huckster Bowdoin also was a veteran securities swindler who’d been charged at the state level with fraud in at least three Alabama counties before launching Florida-based ASD in 2006, federal prosecutors said, Bowdoin tried to avoid the use of the language of investments as a means of keeping the 1-percent-a-day ASD scheme under the radar.

    The linguistic cover Bowdoin chose — a cover the Feds stripped bare — was that ASD was an “advertising” company with a “revenue sharing” program, not an investment company selling “securities.”

    Bowdoin tried to create additional cover by saying payouts were not guaranteed, according to federal court filings.

    Now, four years after the ASD raid, Zeek is using the same type of disclaimer language and members are getting the same sort of instructions on what words to avoid.

    Federal investigators became wise to this type of linguistic charade long ago. The charade was outlined in the 2010 criminal indictment against Bowdoin. The indictment quoted Bowdoin himself laying out the linguistic plot to hide the true nature of the 1-percent-a-day ASD program and keep the government at bay (italics added):

    “[L]et’s don’t (sic) use the words investment and returns. Instead, lets (sic) use ad sales and surfing commissions. The Attorney Generals in the U.S. don’t like for us to use these words in our program.”

    Wordplay to mask an investment scheme also was referenced repeatedly in the forfeiture complaints against more than $80 million in ASD-related bank accounts (italics added):

    “The [undercover agent] asked her about investing with ASD. She immediately said, ‘Don’t call it investing, you know what I mean, we can get in trouble if we say that, we have to be careful.” — Source: Federal forfeiture complaint, Aug. 5, 2008.

    Only In MLM La-La Land

    To be sure, the departure from Zeek of Laggos is a big story. But it’s not the biggest story. The biggest story is that the Paul Burks-led company already was walking a tightrope when it hired the tightrope-walking Laggos and now has cut his rope, casting him into the gorge without informing the membership at large and without pulling the tightrope-walking promotional material that references Laggos or was produced by his publishing company.

    Some of that promo material features tightrope-walking Dooly, who’s now questioning the ethics of tightrope-walking Laggos.

    How strange is the latest PR disaster to rock Zeekland? So strange it almost defies description.

    As noted above, news of the Laggos departure was delivered by Zeek-friendly Blogger Dooly. And the news was delivered even as images of Dooly appeared online as a centerpiece in the same cheerleading video that features images of Laggos as centerpieces. The video largely consists of still photos taken at a Zeek “Red Carpet Day” event in Clemmons, N.C., on June 13. Incredibly, the video continues to appear online, despite the sudden and unexpected departure of Laggos last month.

    On Aug. 4, Zeek used its Blog to accuse unspecified “North Carolina Credit Unions” of slander for expressing concerns to customers about Zeek. The post implied Zeek members who didn’t toe the company line would be penalized. Such members were “violators” of company policy, the firm said.

    But Zeek has not addresed the Laggos issue on its Blog. Nor has it provided any guidance on whether members should stop using the Zeek cheerleading video that features both Laggos and Dooly, along with Zeek staffers, executives and members who showed up at the June 13 event in Clemmons. The Laggos-produced written materials also are out there, with no guidance from Zeek about whether members should continue to use them or to rely on them in any way.

    Like ASD, Zeek plants the seed that participants will earn a return that corresponds to an annual return in the hundreds of percent but insists it is not offering an investment. The office of North Carolina Attorney General Roy Cooper said last week that it had asked Zeek to produce “documents” as part of an “examination” of its business practices. Dooly described that development as “exciting.”

    Zeek is making MLM look ridiculous. Troy Dooly is making it look sillier yet. He should not be “covering” a company that is trading off his credibility as an MLM advocate to sell itself. Dooly now is questioning the ethics of Laggos even as Dooly permits Zeek to use his image in marketing promos that also feature images of Laggos.

    Prior to opining that ASD was not a Ponzi scheme — only to be one-upped later by Bowdoin, who said that it was when entering a guilty plea to wire fraud in May 2012 — Laggos agreed to settle a 2004 case with the SEC that alleged he issued laudatory press releases and a laudatory article for a company that later become the subject of a securities investigation without disclosing he was being compensated for touting the purported opportunity.

    Laggos neither admitted nor denied the SEC’s allegations, which involved a company known as Converge Global Inc. and a subsidiary known as TeleWrx Inc. The future Zeek consultant settled the SEC case by disgorging nearly $12,000, paying interest of nearly $2,000, paying a civil fine of $19,500 and agreeing to a five-year penny-stock ban.

    In April, Network Marketing Business Journal, which lists Laggos as its president, published a laudatory article on Zeek. Dooly memorialized the article’s publication by publishing a special Sunday story about it on Dooly’s MLMHelpDesk. He memorialized it further by producing a gushing video in which he described Laggos as “my good friend and mentor.”

    “He is breaking a story here that I thought was amazing,” Dooly said of the NMBJ Zeek article, which gushed that Zeek has a 25 to 1 customer to rep ratio. The claim is important because, if true, it could take Ponzi and pyramid concerns out of play. Some Zeek critics doubt that it’s true.

    In April, Dooly noted that NMBJ was one of his favorite publications and that he picked it up on that particular Sunday while relaxing near his pool over a cup of tea.

    But now — less than four months after Dooly’s April 15 gushing story and video on NMBJ’s gushing story about Zeek and less than two months after images of both Dooly and Laggos appeared in the Zeek video in which Zeek gushed about itself — Laggos is out at Zeek.

    “Breaking MLM News: Zeek Rewards Officially Parts Ways With Dr Keith Laggos After Recorded Call Goes Public,” Dooly advised readers in a headline.

    The precise reasons for the departure of Laggos remain unclear. Also unclear is whether Laggos will retain a reported Zeek downline of about 4,500 members that he apparently was managing while at once being a paid Zeek consultant.

    Produced by USHBB Inc., which once produced videos for the bizarre (and failed) Narc That Car license-plate recording scheme that claimed some affiliates were out-earning the President of the United States, the Zeek video heralding Laggos, Dooly and others shows Dooly mugging with Zeek executive Dawn Wright-Olivares and Laggos posing with Peter Mingils. The last names of both Laggos and Mingils are misspelled in the USHBB video.

    Like Dooly, Mingils is a board member of the Association of Network Marketing Professionals. He’s also Zeek’s Training & Incentives Coordinator and is “rockin’ the Certified Trainers course curriculum,” according to Zeek.

    Zeek, which at one time listed USHBB executive OH Brown as a Zeek employee, now says Brown is “banging out video after video.”

    Some of the backstory surrounding the failed Narc That Car scheme is remarkably similar to the Zeek scheme. In addition to the presence of USHBB, Narc and Rex Venture LLC, Zeek’s purported parent company, both have scored the Better Business Bureau’s lowest rating: “F.”

    Affiliates of both Narc and Zeek, meanwhile, have sought to turn attention away from the core issues surrounding both Narc and Zeek by suggesting that the BBB is a fraud.

    But perhaps most compellingly, the now-failed Narc scheme once did at least part of its banking at NewBridge Bank, one of the banks that Zeek used before mysteriously announcing on Memorial Day that it was ending its relationship with NewBridge. Narc was based in Texas. How it ended up banking at NewBridge is unclear.

    What is clear is that Narc was a pyramid scheme that planted the seed it existed to help the U.S. AMBER Alert system for locating abducted children and traded on imagery of the White House. Both the U.S. Department of Justice and the National Center For Missing and Exploited Children, which administers part of the AMBER Alert program, confirmed to the PP Blog more than two years ago that they had no affiliation with Narc.

    A Narc Knockoff With Phil Piccolo As Background Player

    Narc appears to have inspired a knockoff MLM scheme known as Data Network Affiliates, which was linked to longtime MLM huckster Phil Piccolo. In late 2011, DNA’s website — and the website of another a Piccolo-linked “program” known as OWOW — were used to drive traffic to an emerging MLM scheme known as TextCashNetwork (TCN).

    In December 2011, the PP Blog reported that TCN had used the name of Rex Venture Group on its website in the context of a purported “ASSIGNMENT” clause. The Rex Venture reference later mysteriously went missing from the TCN site, a circumstance that could cause investigators to question Rex Venture about whether it was aware that its name appeared on the TCN site and whether it had any business relationship with TCN.

    If this is modern MLM, MLM is in a lot of trouble. Karl Wallenda, who built a magical name in the daredevil business and made a career out of taking risks, wouldn’t do Zeek.

     

  • URGENT >> BULLETIN >> MOVING: Florida Federal Judge Grants Government Motion To Transfer Lawsuit Filed By AdSurfDaily Figures Todd Disner And Dwight Owen Schweitzer To District Of Columbia; Ruling May Put Case In Hands Of Judge Collyer

    URGENT >> BULLETIN >> MOVING: A federal judge has granted the government’s request to transfer from Florida to the District of Columbia a lawsuit against the United States filed by AdSurfDaily figures Todd Disner and Dwight Owen Schweitzer.

    The ruling today by U.S. District Judge Cecilia M. Altonaga of the Southern District of Florida deals a blow to Disner and Schweitzer, who earlier argued that federal prosecutors had gone shopping for a “frendly [sic] forum” in the District of Columbia when bringing the ASD Ponzi case in 2008 after an investigation by the U.S. Secret Service.

    Altonaga’s ruling may mean that U.S. District Judge Rosemary Collyer — whom ASD President Andy Bowdoin and purported “sovereign” being Curtis Richmond tried unsuccessfully to have removed from the case for alleged bias — will preside over the Disner/Schweitzer complaint.

    Disner and Schweitzer, who raised the prospect they could be charged with tax evasion, argued to Altonaga that their Constitutional rights were violated when the government seized the ASD database in 2008.

    ” . . . the Court finds that Plaintiffs can litigate their claims in the District of Columbia without undue inconvenience or prejudice,” Altonaga ruled. “The public interest factors also favor transfer, given the District of Columbia’s extensive familiarity with the forfeiture proceedings that gave rise to this action. In view of that familiarity, the District of Columbia is in a better position to efficiently judge whether Plaintiffs’ case warrants dismissal or whether the Government’s actions constituted an unreasonable search and seizure of Plaintiffs’ property in violation of the Fourth Amendment and other statutory requirements.”

    In her ruling today, Altonaga noted that Disner and Schweitzer already have claimed they’d try to have Collyer removed from the case if made its way from Florida into her courtroom.

    Disner and Schweitzer sued the government in November 2011, bringing their action in the Southern District of Florida and arguing that ASD was not a Ponzi scheme and that prosecutors and the Secret Service had authored a “tissue of lies” in the District of Columbia. About seven months later — in May 2012 — Bowdoin pleaded guilty to wire fraud before Collyer, who’d earlier ordered the forfeiture of more than $80 million in the civil portion of the case.

    In a statement of offense, Bowdoin acknowledged ASD was a Ponzi scheme that never operated lawfully from its 2006 inception. He remained free after his guilty plea, but Collyer ordered him jailed in June 2012, after prosecutors presented evidence that Bowdoin continued to foist scams (AdViewGlobal and OneX) on the public even after the seizure of tens of millions of dollars in the ASD case and even after he was arrested on Ponzi charges in December 2010.

    Bowdoin has been held at a local jail facility in the District of Columbia since last month. His formal sentencing on the Ponzi-related charge of wire fraud is set for Aug. 29 before Collyer.

    After their ASD days, Disner and Schweitzer became pitchmen for the Zeek Rewards “program,” which has an ASD-like compensation scheme. In arguing that ASD was not a Ponzi scheme, Disner and Schweitzer relied on an opinion from purported MLM expert Keith Laggos, whom Zeek now claims as a consultant.

     

  • Zeek Promoters Send Email To AdSurfDaily Members, Asking Them To Wire Money To Confessed Ponzi Schemer Andy Bowdoin’s Jailhouse Account In The District Of Columbia; Zeekers ‘Owe This Man A Great Deal Of Gratitude And More’ For Opening ‘Path To Success,’ Email Claims

    ASD's Andy Bowdoin

    UPDATED 8:42 A.M. EDT (JULY 14, U.S.A.) It’s beginning to look as though the Zeek Rewards’ MLM “program” has within it a large downline consisting of members of the AdSurfDaily Ponzi scheme. And in what may go down as one of the most spectacular PR blunders in the history of multilevel marketing, some former ASD promoters who now are Zeek promoters are encouraging their email contacts and downline members to wire money to jailed ASD President and recidivist securities huckster Andy Bowdoin — while using Zeek’s name in the appeal and describing Bowdoin as a pioneer who inspired “programs” such as Zeek to model themselves after ASD.

    “You are also all aware that I believe those of us in Zeek and other programs that modeled themselves after the business model that Andy pioneered owe this man a great deal of gratitude and more,” the email read in part. “Please get in touch with your down lines as well.” (The email is reproduced below.)

    For good measure, the email described Bowdoin as the man who’d provided MLMers the “path to success.” It also included a link to join the Zeek “program” under a headline of “Tired of Recruiting and Selling?” and this text teaser: “Get Rewarded DAILY for Placing Ads just like this one! Get Paid Every 24 Hours.”

    A second ad in the email encouraged readers to “Get your FREE Gold Savings Account here and qualify to receive Free Gold.”

    The PP Blog received news of the email early last evening, as it was preparing a post that reported an alleged HYIP purveyor in Ohio had been named in a 49-count federal indictment charging him with wire fraud and money-laundering. Terrance Osberger, 48, of Genoa, Ohio, was accused of pushing HYIP Ponzi schemes through an enterprise known as Eagle Trades LTD.

    The returns Osberger allegedly offered were on par with the returns suggested by both ASD and Zeek: in the hundreds of percent per year. And like ASD and Zeek, Osberger allegedly used SolidTrustPay, an offshore payment processor, and issued a preemptive denial that a fraud scheme was under way. The alleged Eagle Trades HYIP fraud appears to have gathered at least $1.8 million, a relatively modest sum compared to HYIP frauds such as ASD ($110 million), Legisi ($72 million), Pathway To Prosperity ($70 million) and Genius Funds (an estimated $400 million).

    In February 2012 — while announcing the guilty plea of Gregory McKnight in the Legisi HYIP Ponzi scheme — a special agent of the U.S. Secret Service noted that such schemes engage in form-shifting.

    “Fraudulent schemes such as this have evolved significantly over the last several years,” said Jeffrey Frost, special agent in charge of the U.S. Secret Service Detroit Field Office.

    AdSurfDaily was an online Ponzi scheme that said it set aside 50 percent of its daily revenue to share with affiliates. Those affiliates received an unusually consistent return of 1 percent a day. ASD described itself as a revenue-sharing program and encouraged members not to describe the “opportunity” as an investment.

    Zeek also says it is a revenue-sharing program. Like ASD, Zeek claims it sets aside 50 percent of its daily revenue to share with affiliates. Affiliates have said they are earning between 1 percent and 2 percent a day, a percentage that corresponds to an annualized return of between 365 percent and 730 percent.

    And like ASD, Zeek tells affiliates not to describe the “opportunity” as an investment program. Some Zeek affiliates are said to earning $1 million a month. Similar to ASD, which preemptively denied it was a Ponzi scheme, Zeek has preemptively denied it is a “pyramid scheme” — all while planting the seed that the U.S. government is running a pyramid scheme through its Social Security program.

    In May, ASD’s Bowdoin pleaded guilty to wire fraud in the ASD Ponzi case. The ASD patriarch admitted his “program” was a Ponzi scheme, saying in a statement of offense the company never operated lawfully from its 2006 inception. As part of a plea bargain, Bowdoin has been banned from multilevel marketing, Internet programs and mass-marketing.

    The email circulating yesterday disclosed none of these things, instead painting Bowdoin as an MLM pioneer and inspirational figure.

    Nor did the email disclose Bowdoin’s felonious history as a securities huckster in Alabama a decade before he rolled out ASD in 2006. And it did not disclose that one of his business partners in ASD was implicated by the SEC in the 1990s in three prime-bank swindles, including one that suggested prospects could earn a return of 10,000 percent. In court documents originally filed under seal in February 2009 — as an upstart autosurf known as AdViewGlobal was launching — the U.S. Secret Service alleged that Bowdoin also had a “silent partner” in ASD.

    That silent partner, according to the Secret Service, was Bowdoin’s sponsor in the 12DailyPro Ponzi scheme that sucked in tens of millions of dollars before the SEC destroyed it just months before ASD launched in the late summer and fall of 2006. Bowdoin and his silent partner simply tweaked the 12DailyPro business model, reducing the daily payout rate to about 1 percent and using linguistic sleight of hand in a failed bid to keep ASD under the radar, according to court filings.

    Bowdoin’s nearly four-year-long legal saga began in July 2008, with the U.S. Secret Service starting an undercover probe. That probe has led to the filing of at least three civil forfeiture complaints, the seizure of tens of millions of dollars, court actions and seizures of bank accounts against certain individual ASD members, special statements by the U.S. Department of Justice and the U.S. Secret Service and the ultimate filing of criminal charges against Bowdoin.

    In 2009, Bowdoin and former ASD attorney Robert Garner were accused of racketeering in a proposed class-action lawsuit filed by three former ASD members. That lawsuit was placed on hold because of all the other litigation piling up against Bowdoin and ASD-related assets.

    All of it appears to be meaningless to certain ASD members now promoting Zeek.

    Also apparently meaningless is Bowdoin’s record of criminality in Alabama in the 1990s in at least three counties

    In June 2012, Bowdoin’s bond was revoked after federal prosecutors proffered evidence that he continued to promote scams after the seizure of more than $80 million in the ASD case by the U.S. Secret Service in August 2008 and after Bowdoin was arrested on the ASD-related Ponzi charges in December 2010. One of the alleged “programs” linked to Bowdoin by investigators was AdViewGlobal, an ASD-like autosurf that collapsed during the summer of 2009.

    Bowdoin also was linked to a “program” known as “OneX,” which prosecutors described as a “fraudulent scheme” and “pyramid” that was recycling money in ASD-like fashion. Some Zeek promoters also are known to have been OneX promoters. It also is known that some Zeek promoters also are pushing JSS Tripler/JustBeenPaid, a “program” that purports to pay 2 percent a day (730 percent a year) and may have ties to the “sovereign citizens” movement.

    In recent days, JSS/JBP published a claim that it had hired a criminal defense lawyer in Salt Lake City. Like ASD, Zeek, OneX and Eagle Trades, JSS/JBP has a business relationship with SolidTrustPay. (NOTE: OneX now claims it no longer uses SolidTrustPay and is trying to get a new processor after a deal it thought it had with another processor fell through. In a conference call earlier this week, OneX blamed its members for the developments and claimed it had been targeted by fraudsters. Now under indictment in Ohio, Eagle Trades’ Osberger told investors in Massachusetts that his “program” also had been targeted by fraudsters, according to records.)

    The email some ASD members received last night that references Zeek appears to have forwarded by former ASD pitchman Todd Disner, who became a Zeek promoter. Former ASD member Barb Alford — also a Zeek promoter — appears to have been the author. The email’s “To” line also references Jerry Napier, another former ASD promoter who became a Zeek promoter.

    Napier once was featured in a promo on Zeek’s Blog. Records suggest he signed a petition in 2008 — after two forfeiture complaints were filed against ASD-related assets — that asked the U.S. Senate to investigate the ASD prosecution team and the U.S. Secret Service agent who developed the ASD Ponzi case with the assistance of a Florida-based Task Force consisting of investigators from the IRS, the Secret Service and other agencies.

    Alford is a former moderator of the pro-ASD Surf’s Up forum, which disappeared mysteriously in 2010. Teralynn Hoy, another former Surf’s Up moderator, hosted a conference call for Zeek last year. Zeek once listed Hoy as an “employee.”

    In 2011, Disner joined with former ASD member Dwight Owen Schweitzer — who also became a Zeek promoter — in a lawsuit against the United States for alleged misdeeds in bringing the ASD Ponzi case. Disner and Schweitzer, who have raised the prospect in court filings that they could face prosecution for tax evasion in the aftermath of the the ASD investigation, continue to press the lawsuit — despite Bowdoin’s guilty plea to wire fraud in the ASD Ponzi case and acknowledgement he was operating a Ponzi scheme.

    Here is the email circulating last night (italics/bolding added):

    As you all are aware, Andy, is now sitting in a DC jail ward. He is in need of funds in his account so that he can purchase shoes, tooth brushes, tooth paste etc. the prison system charges ridiculous prices for this stuff. A pair of shoes alone in there costs 65.00.

    You are also all aware that I believe those of us in Zeek and other programs that modeled themselves after the business model that Andy pioneered owe this man a great deal of gratitude and more. Please get in touch with your down lines as well.

    I have received info where funds can be wired into his account to help him with his daily needs.

    We can do this one of two ways. Anyone wishing to assist in the effort can send the money to me and I will wire all at once or we can do it individually. I have enclosed the wiring information below.

    Let’s not drop the ball on this one. Anyone willing to do the right thing, one more time, please contact me.

    I would appreciate any help you can give. It is not right that this man sits alone in jail hundreds of miles from home with no end in sight when it was he who gave us the path to success.

    Respectfully
    Barb Alford
    [Phone number deleted by PP Blog]

    It has to go through Western Union to be placed on his account.

    City Code: [Deleted by PP Blog]
    State: Tennessee
    Senders Acct # [Deleted by PP Blog]
    Sender: Thomas Bowdoin

    Here is his address if you want to write him
    Correction Treatment Facility
    1901 East St. SE
    Med-96 Inmate 335084
    Washington DC 20003

    George said he gets his mail on Tuesdays and Saturdays.

    Anyway, GF, I know you said a few people might want to donate to help him. I know he would love to get a letter from YOU. I am sending one tomorrow so he can get it on Saturday, I hope.

     

  • UPDATE: (1) Article In Portuguese By Zeek Affiliate On Google News Says Program Has 100,000 Members In Brazil Alone; (2) American Pitchman Calls Zeek An ‘Investment’ On YouTube — And Then Takes It Back

    Screenshot: Part of a promo for Zeek translated from Portuguese to English by Google Translate

    UPDATED 1:59 P.M. EDT (U.S.A.) An article on Google News by an apparent Portuguese-speaking affiliate of the U.S.-based Zeek Rewards MLM “program” that is married to a penny-auction site known as Zeekler claims that Zeek has more than 100,000 members in Brazil alone.

    Meanwhile, a promo by an American affiliate dated July 7 on YouTube describes Zeek as an investment program — before the affiliate backtracks and says Zeek is not an investment program. The YouTube development first was reported by BehindMLM.com. (Link at bottom of story.)

    Portuguese is the official language of Brazil, the largest country in South America. The claim of 100,000 Brazilian members could not immediately be confirmed, and no breakdown of the specific Zeek membership ranks Brazilian members had chosen was provided in the article. Zeek categorizes members as “Free,” “Silver” ($10 a month), “Gold” ($50 a month) and “Diamond” ($99 a month).

    In addition to selecting a membership rank within the Zeek MLM organization, affiliates can opt to send the company up to $10,000 as a means of gaining a daily share of what is known as the Retail Points Pool (RPP). Those shares later can be converted to cash payouts that correspond to an annualized return in the hundreds of percent. The RPP program has led to questions about whether Zeek is selling unregistered securities as investment contracts and using linguistic sleight-of-hand in a bid to avoid regulatory scrutiny.

    Zeek, purportedly part of Rex Venture Group LLC,  is based in North Carolina. On June 20, the office of North Carolina Attorney General Roy Cooper said it had concerns about the company, which plants the seed that members can earn a return of between 1 percent and 2 percent a day but denies it is offering an investment program. Zeek’s business model resembles that of AdSurfDaily, which the U.S. Secret Service said in 2008 was a massive, online Ponzi scheme that was offering securities and disguising itself as an “advertising” program.

    Andy Bowdoin's booking photo in the District of Columbia.

    ASD President Andy Bowdoin is now jailed in the District of Columbia after pleading guilty to wire fraud in the ASD Ponzi case in May 2012. ASD’s purported payout of 1 percent a day was on par with Zeek’s purported daily payout. Because it is known that some affiliates of the ASD Ponzi scheme also are promoting Zeek and because Zeek has highlighted some of those ASD promoters on its website, questions have been raised about whether a core group of MLMers who move individually or as part of “teams” from one investment scheme to another is engaging in willful blindness by promoting Zeek, which is similar to ASD in key respects.

    And because the U.S. government returned millions of dollars to ASD victims last year in the form of remissions payments that came from funds seized in the ASD Ponzi case, questions have been raised about whether Zeek’s growth has been fueled at least in part by the funds originally seized in the ASD case. The government is believed to have returned about $59 million to former ASD members.

    Although Zeek says it is not offering a return on investment and instead is offering revenue-sharing program, the resultant payouts correspond to figures typically associated with HYIP Ponzi investment schemes. Like Zeek, ASD also claimed to be a revenue-sharing program.

    The English version of the Portuguese article for Zeek, according to Google Translate, includes this line: “The easiest way to earn money is by posting at least one ad per day to earn a daily rebate.” (Emphasis added by PP Blog.)

    ASD also called its payouts to members “rebates.” The affiliate article for Zeek in Portuguese includes this phrase: “uma bonificação diária.” The phrase, according to Google Translate, means “a daily subsidy” or “a daily rebate.”

    In the ASD case, federal prosecutors said use of the word “rebate” was a means of masking the investment element of the ASD “program.”

    Zeek also may have a presence in Portugal itself, according to text below a YouTube video (www.youtube.com/watch?v=w07uP5XF39w) in which former ASD pitchman Todd Disner appears. Disner speaks in English in the video, but others appear to be speaking Portuguese and a link below the video points to a website styled in part as zeekportugal.com. Other text at the YouTube site points to a YouTube site styled “parttimezeekrewards’s channel.”

    Disner and former ASD member Dwight Owen Schweitzer sued the United States in November 2011, claiming that ASD was a legitimate business and that government undercover agents who joined ASD had a duty to identify themselves to ASD management. Schweitzer also is promoting Zeek, according to an online promo on a classified-ad site.

    ASD’s Andy Bowdoin’s guilty plea and acknowledgement ASD was a Ponzi scheme were recorded in May 2012, about six months after Disner and Schweitzer sued the government. Both men are seeking to press forward with the lawsuit, despite Bowdoin’s guilty plea to wire fraud and Ponzi concession. The duo claims the seizure of information from ASD’s database by the government was unconstitutional under the 4th Amendment. A federal judge in Florida is expected to rule soon on whether the Disner/Schweizer claims can proceed.

    Virality And Customer-Service Concerns

    The article on Google News that claims that Zeek has 100,000 members in the Portuguese-speaking country of Brazil may speak to the virality of the “program” on the Internet. At the same time, it may explain — at least in part — why Zeek’s customer-support systems appear to be severely taxed if not broken, with Zeek instructing its members to go to their uplines for support. Requests for help through Zeek itself have backed up for weeks or even months. Some English-speaking members of Zeek have complained their support tickets were ignored or closed without explanation.

    Having thousands or even tens of thousands of affiliates in countries whose citizens may not be fully conversant in English leads to questions about whether Zeek has both the resources and the infrastructure to support a global membership base, even as some Zeek members who may not speak English are sending the company one-time sums of up to $10,000 and monthly fees on top of that. It also leads to questions about whether Zeek can police its own global network of affiliates, whether Zeek has the capacity to adequately monitor claims about the “program” in languages other than English and whether Zeek can determine whether its U.S. domestic and international affiliates are operating in “teams” to engage in downline “stacking” designed to concentrate earnings in favored familial or local pools.

    Like ASD, Zeek has instructed members not to describe the “opportunity” as an investment program. But BehindMLM reported yesterday that a Zeek member on YouTube was doing just that before catching himself and going into backtrack mode. From BehindMLM.com, quoting from a Zeek affiliate’s July 7 YouTube promo (italics added):

    [8:58] Do it, I did it! Do it and you’ll see how quickly you can recoup your investm..recoup your investment-ahh, I’m sorry, it’s not an investment – your original purchasing of bids.

    Visit this story thread on BehindMLM.com.

  • BULLETIN: Federal Judge Denies Motion By ASD Figures Dwight Owen Schweitzer And Todd Disner For Government To Produce Names Of Potentially Thousands Of ASD Members Who Filed For Remissions

    BULLETIN: (UPDATED 8:06 P.M. EDT U.S.A.) A federal judge in Florida has denied a motion by AdSurfDaily figures Todd Disner and Dwight Owen Schweitzer that, if granted, could have made the duo privy to information on the identities of any ASD participant who filed a claim for remissions in the ASD Ponzi case, their financial stake in ASD and how much money was returned to them by the government through the remissions claims process.

    U.S. District Judge Cecilia M. Altonaga said no today, ruling that Schweitzer and Disner had not shown why they were entitled to the information and that the government was not compelled to produce it.

    The flap started when Disner and Schweitzer asserted earlier this month that a certificate of interested parties filed by the government in the Disner/Schweitzer lawsuit was “inadequate as a matter of law” because it didn’t include the information on individuals who filed remissions claims. Court records show that about 11,000 ASD members filed claims in the case.

    The government countered by arguing that Disner and Schweitzer were confusing the ASD forfeiture case filed in the District of Columbia with their own lawsuit filed in Florida.

    Altonaga sided with the government today, ruling that the government certificate as it stands “is not necessarily incomplete for failing to list those who have a financial interest in other forfeiture proceedings.”

    “Plaintiffs fail to explain in their Motion why unnamed parties who may have a financial interest in other forfeiture proceedings also have an interest in Plaintiffs’ declaratory judgment action,” Altonaga ruled.

    And the judge further pointed out that Disner and Schweitzer had not complied with her order to file their own certificates in the case. She now has given them until July 6 to do so, warning that “[f]ailure to comply will result in the entry of an order of dismissal without prejudice without further notice.”

  • UPDATE: AdSurfDaily-Like Weirdness Increasingly Creeps Into Lawsuit Against United States By ASD Pitchmen Dwight Owen Schweitzer And Todd Disner, Who Now Are Promoting Zeek Rewards

    Federal prosecutors went to court in the Southern District of Florida today, saying AdSurfDaily figures Todd Disner and Dwight Owen Schweitzer were confusing their November 2011 lawsuit against the government with two forfeiture actions filed in the District of Columbia by federal prosecutors and the U.S. Secret Service in the ASD Ponzi case.

    An assistant U.S. Attorney serving under U.S. Attorney Wifredo A. Ferrer of the Southern District of Florida is serving as the attorney for the United States in the case because Disner and Schweitzer sued the government. Although the ASD Ponzi case was brought in the District of Columbia, Disner and Schweitzer sued the government in Florida. They later claimed that prosecutors had gone forum shopping in Washington to bring the Ponzi forfeiture case.

    Among other things, Disner and Schweitzer claim that undercover agents who joined ASD had a duty to identify themselves to ASD management and that the ASD Ponzi case is a “house of cards” despite ASD President Andy Bowdoin’s guilty plea and public acknowledgment he presided over a Ponzi scheme.

    In a puzzling motion stamped June 20 and entered on the docket of U.S. District Judge Cecilia M. Altonaga on June 21, Schweitzer and Disner claimed they had personally determined that a certificate of interested parties filed by the government in response to an order was “inadequate as a matter of law.”

    Disner and Schweitzer, according to Disner and Schweitzer, had a right to know the identities of any ASD participant who filed a claim for remissions in the ASD Ponzi case, how much money they put into ASD and how much was returned to them by the government through the remission claims process.

    Nonsense, the government said today.

    “The plaintiffs misapprehend the purpose and spirit of the court’s order requiring a certificate of interested parties,” the government said in its response to the Disner/Schweitzer motion. “The instant case is not a forfeiture case as the two forfeiture cases involving AdSurfDaily have already been resolved in the District of Columbia.

    “The certificate of interested parties is not some kind of alternative discovery vehicle collateral to the discovery provisions in the Federal Rules of Civil Procedure,” the government continued. “Rather, the certificate of interested parties in both the federal district and appellate courts is designed ‘to assist judges in making a determination of whether they have any interests in any of a party’s related corporate entities that would disqualify the judges from hearing the [appeal].’”

    Moreover, the government argued, Disner and Schweitzer “did not confer with the defense” as required by the local rules in the Southern District of Florida prior to filing the motion.

    As many as 11,000 parties filed remissions claims in the ASD case, according to federal court records.

    Disner and Schweitzer apparently want to know who all of them are and to ascertain “the financial interest of each[,] including those individuals, separately identified, who applied for remission and, as to each, stating whether the request was approved, approved in part, or denied.”

    The government, however, advised Altonaga that neither Disner nor Schweitzer have filed their own certificates of interested parties in the case.

    Separately, Altonaga today granted the government’s June 4 motion by default to stay discovery in the case, explaining that Disner and Schweitzer have “not filed an opposing memorandum of law to the Motion, nor have they sought an extension of time to do so.”

    Disner is a co-founder of the Quiznos sandwich franchise. Schweitzer is a former attorney now living in Miami whose license was suspended in Connecticut.

    Both men later became pitchmen for Zeek Rewards, an MLM firm whose business model closely resembles the ASD business model that ASD’s Bowdoin admitted was a Ponzi scheme. Bowdoin is jailed in the District of Columbia. A federal judge revoked his bond June 12 after prosecutors proffered evidence that he continued to promote fraud schemes after the U.S. Secret Service seized tens of millions of dollars in the ASD Ponzi case and after Bowdoin was arrested on Ponzi-scheme charges in December 2010.

    Bowdoin pleaded guilty in May to wire fraud in the ASD Ponzi case. His formal sentencing is set for August. He has been banned from multilevel marketing, Internet programs and mass marketing.

    Other ASD-Related News From The OneX Fraud Wing

    In other ASD-related news, a conference call cheerleading session for the purported “OneX” program was canceled tonight after a rah-rah session that had been scheduled for last Thursday also was canceled.

    Tonight’s cheerleading session was to be sponsored by a downline with ASD ties and was contemplated to be one that would build on the purportedly exciting announcement OneX said would be made last week to identify its new payment processor, a source told the PP Blog.

    But OneX apparently canceled the Thursday conference call and never identified a new payment processor, so there was nothing for the OneX downline with ASD ties to cheer about tonight.

    “It is not possible to move forward without the processor being in place,” the ASD downline group said, according to the source.

    But the group held out hope that OneX would announce its new payment processor tomorrow, according to the source.

    In April, federal prosecutors said OneX was a “fraudulent scheme” and “pyramid” that was operating in ASD-like fashion.

  • BULLETIN: North Carolina Attorney General’s Office Refutes Suggestion That Zeek Has Been Deemed ‘Legal’; ‘We Do Have Concerns,’ Agency Says; TV Station Removes Video Report Zeek Was Linking To On Its Blog

    BULLETIN: (UPDATED 2:04 P.M. EDT U.S.A.) The office of North Carolina Attorney General Roy Cooper told the PP Blog this morning that it never said the Zeek MLM or auctions programs were legal.

    The agency said it had asked a local television station to issue a corrected report, and the station has removed a video report that Zeek was linking to from its Blog this morning.

    “We do have concerns about [Zeek],” said Noelle Talley, a spokeswoman for Cooper.

    Zeek has two arms: an MLM program known as Zeek Rewards, and a penny-auction site known as Zeekler. Zeek Rewards plants the seed that participants can earn a return of between 1 percent and 2 percent a day. The Zeekler arm is auctioning sums of U.S. currency and advertising that successful bidders can receive their winnings through offshore payment processors.

    Zeek has denied it is operating either an investment program or a “pyramid scheme” through its Zeek Rewards’ MLM arm. It also claims to run clean penny auctions through Zeekler. Some customers, however, have complained they had not received their winnings of auction cash.

    The TV station — WFMY Channel 2 — aired a video report that focused on a “penny auction craze.” The report, which made a passing reference to Zeek’s MLM arm, focused on Zeek’s Zeekler arm while explaining the concept behind penny auctions and the potential pitfalls. A Blog version of the station’s report references both company arms and notes that “a court has not yet ruled whether this operation is legal or illegal.”

    WFMY’s video version, however, suggested that Cooper’s office had received a handful of complaints about the Zeek arms but had determined Zeek was conducting business legally.

    No determination that Zeek is operating legally has been made, Talley stressed this morning.

    The PP Blog learned this morning that Zeek’s news Blog was linking to the broadcast version of the WFMY report. The TV station now has removed the video, Cooper’s office said.

    In another strange development, at least two Zeek affiliates have spammed the TV’s station’s website with offers for Zeek. One of the spams appears to have originated with Barbara Alford, a promoter of the AdSurfDaily Ponzi scheme and a former moderator of the pro-ASD “Surf’s Up” forum that mysteriously disappeared in 2010 after shilling for accused ASD Ponzi schemer Andy Bowdoin around the clock for more than a year.

    Bowdoin pleaded guilty to wire fraud in the ASD Ponzi case last month. He is jailed in the District of Columbia. Zeek’s business model is similar to the model employed by ASD.

    Cooper’s office supplied the PP Blog with a list of complaints the state has received about Zeek. (Note: The paragraphs below do not take into account all of the complaints Cooper’s office has received about Zeek. There are at least 10 complaints on file.)

    One complaint that originated in Utah on May 16, 2012, alleged that a customer had given Zeek $20,000 in April but never received credit and was unable to get any satisfaction from customer service.

    “The customer service is non existent and I am beginning to think Zeekler is a pyramid scam,” the customer told Cooper’s office.

    Zeek responded to the complaint by informing Cooper’s office that it believed the Utah complainant wasn’t actually a Zeek customer. Rather, according to Zeek, the complainant was the father of two sons who were Zeek affiliates and had contacted the attorney general out of “personal curiosity.”

    Another complaint received by Cooper’s office from a Florida man in November 2011 was forwarded to the Securities Division of the North Carolina Secretary of State’s office for review, according to the correspondence trail. No final outcome is noted.

    Another complaint Cooper’s office received on May 8 originated in the District of Columbia after being sent to the Office of the Attorney General of District of Columbia by an individual in Oregon four days earlier. The District of Columbia forwarded the complaint to Cooper’s office, which opened a file.

    “This is a Huge Ponzi scheme,” the sender complained. “If not [looked] at carefully and stopped by the US AG, [t]his would be a tremendous task to [sort] out to pay back the consumer. This is [n]o different tha[n] AD Surf Daily ([i]f you remember the [c]ase).”

    Meanwhile, a Zeek customer in Miami contacted Cooper’s office and told the agency that he had sent U.S. Postal Service money orders totaling $1,000 to Zeek in April and that the sum never was credited to his Zeek account.

    Yet another Zeek customer — this one from California — told Cooper’s office that he had wired more than $2,000 in March from his account at Bank of America to Zeek’s account at NewBridge Bank in North Carolina. Although the complainant said he’d confirmed both through his bank and NewBridge that Zeek had received the money, the money never got credited to his Zeek account.

    The California customer also told Cooper’s office that Zeek closed his support ticket without providing a resolution, a circumstance that forced the aggrieved customer to open a second ticket.

    Zeek announced suddenly on May 28 — Memorial Day — that it was closing its NewBridge bank account.

    Another individual who contacted Cooper’s office suggested she’d also contacted her member of Congress, the IRS, the FTC and the SEC about Zeek and questioned whether a “whistleblower” award might be available if Zeek proved to be a scam. That communication identified several purported Zeek promoters, including former AdSurfDaily promoter Todd Disner.

     

  • KABOOM! Alleged International Scammer Targeted In Secret Service Undercover Probe Extradited To United States; ‘Prosecution Demonstrates That Those Who Try To Rip Off Americans From Behind A Computer Screen Across An Ocean Will Not Escape American Justice,’ Top Federal Prosecutor Says

    EDITOR’S NOTE: The PP Blog first reported on the arrest in France of alleged international fraudster Vladislav Anatolievich Horohorin on Aug. 11, 2010. The arrest came as the result of an undercover operation the U.S. Secret Service conducted on online forums.

    As the Blog reported at the time, “The arrest of Vladislav Horohorin is notable on a number of levels. First, the arrest in Europe was a result of an online fraud scheme that allegedly crossed international borders and made its way to the United States, where criminal charges were filed. At the same time, the crime allegedly involved the transfer of money though international payment processors. Perhaps more than anything, however, the case against Horohorin demonstrates that the U.S. Secret Service is “plugged into” forums that promote international lawlessness. His arrest is very bad news for credit-card crooks and HYIP and autosurf Ponzi schemers — and their corrupt colleagues.”

    Today the PP Blog is reporting that the United States successfully arranged the extradition of Horohorin. His first court appearance was made in the District of Columbia, the venue from which the AdSurfDaily Ponzi case brought by the Secret Service is playing out. The office of U.S. Attorney Ronald C. Machen Jr., which was instrumental in guiding the ASD case, is in charge of certain elements of the Horohorin case.

    The office of U.S. Attorney Sally Quillian Yates of the Northern District of Georgia also is handing elements of the Horohorin prosecution.

    The allegations in the case are alarming: “According to the indictment filed in the Northern District of Georgia, Horohorin was one of the lead cashers in an elaborate scheme in which 44 counterfeit payroll debit cards were used to withdraw more than $9 million from over 2,100 ATMs in at least 280 cities worldwide in a span of less than 12 hours,” the Justice Department said in a statement.  “Computer hackers broke into a credit card processor located in the Atlanta area, stole debit card account numbers, and raised the balances and withdrawal limits on those accounts while distributing the account numbers and PIN codes to lead cashers, like Hororhorin, around the world.”

    ** ______________________________________ **

    UPDATE: Alleged international credit-card fraudster Vladislav Anatolievich Horohorin, also known as “BadB,” is in an American jail after an undercover probe on online forums by the U.S. Secret Service and a parallel investigation by the FBI.

    Ronald C. Machen Jr., U.S. Attorney for the District of Columbia

    “We are pleased that he has been extradited to the United States to face these criminal charges in a District of Columbia courtroom,” said U.S. Attorney Ronald C. Machen Jr. of the District of Columbia.  “This prosecution demonstrates that those who try to rip off Americans from behind a computer screen across an ocean will not escape American justice.”

    Horohorin, whose age was listed as 27 after his August 2010 arrest in France on U.S. charges, also will be prosecuted in U.S. District Court for the Northern District of Georgia.

    “International cyber criminals who target American citizens and businesses often believe they are untouchable because they are overseas,” said U.S. Attorney Sally Quillian Yates of the Northern District of Georgia.  “But as this case demonstrates, we will work relentlessly with our law enforcement partners around the world to charge, find and bring those criminals to justice.”

    News of Horohorin’s extradition by France to U.S. soil occurred against the backdrop of claims by an HYIP “program” known as JSS Tripler/JustBeenPaid that members must affirm they are not with the “government” and that the “program” is not located in any “unfriendly political jurisdictions.”

    A JSS/JBP “defender” known as “MoneyMakingBrain” asserted in March that “law enforcement agencies don’t pay attention to what’s being said on forums and blogs.” The claim was at odds with various public records that show U.S. law enforcement pays close attention to forums and Blogs and even conducts undercover operations by infiltrating forums.

    Among other things, “MoneyMakingBrain” asserted he’d defend JSS/JBP’s purported operator Frederick Mann “so help me God.” The PP Blog became the subject of threats from “MoneyMakingBrain.” JSS/JBP, which uses offshore payment processors, purports to provide a return of 60 percent a month, has no known securities registrations and may have ties to the “sovereign citizens” movement.

    Underscoring the importance of the Horohorin arrest and extradition, Machen and Yates were joined in the announcement by the head of the U.S. Department of Justice’s Criminal Division and top officials from both the U.S. Secret Service and the FBI.

    Horohorin, said Assistant Attorney General Lanny Breuer, was “one of the most notorious credit card traffickers in the world.”

    “Due to our strong relationships with our international law enforcement partners, we secured his extradition to the United States, where he now faces multiple criminal counts in two separate indictments,” Breuer said.  “We will continue to do everything we can to bring cybercriminals to justice, including those who operate beyond our borders.”

    A top U.S. Secret Service official, meanwhile, said the agency viewed the alleged Horohorin caper as an “attack” on America’s financial system.

    “The Secret Service is committed to identifying and apprehending those individuals that continue to attack American financial institutions and we will continue to work through our international and domestic law enforcement partners in order to accomplish this,” said David J. O’Connor, assistant director of investigations.

    In addition to providing security for the President of the United States, the Secret Service is in charge of protecting America’s financial infrastructure. The agency has described AdSurfDaily as a “criminal enterprise,” with the Justice Department asserting that ASD was an example of an “insidious” business that permitted fraud to spread globally.

    Just two days after Horohorin’s first appearance in a U.S. courtroom in the District of Columbia, AdSurfDaily members Todd Disner and Dwight Owen Schweitzer claimed that the federal prosecutors who brought the ASD Ponzi case in August 2008 had gone shopping for a “frendly [sic] forum” in which the government could enlist “some of their Washington D.C. operatives to become members of ASD, thereby making them potential witnesses.”

    Disner and Schweitzer sued the United States in November 2011 for alleged misdeeds in the ASD case. Among other things, Disner and Schweitzer asserted that undercover agents who joined ASD had a duty to inform ASD management.  The Secret Service described ASD as a massive online Ponzi scheme involving at least $110 million. ASD President Andy Bowdoin pleaded guilty to wire fraud last month, admitting ASD was a Ponzi scheme and that the company never operated legally from its inception in 2006.

    Disner and Schweitzer now are affiliates for Zeek Rewards, a “program” that plants the seed it can provide an ASD-like return of 1 percent or more per day without being a pyramid scheme and without constituting an investment opportunity. The payout Zeek plants the seed it can provide is on par with the returns advertised by JSS Tripler/JustBeenPaid, which does not disclose its base of operations.

    A top FBI official said the arrest of Horohorin showed that international agencies are working together to divorce criminals from their abilities to use computers to reach across borders to pull off egregious crimes.

    “Horohorin’s extradition to the United States demonstrates the FBI’s expertise in conducting long-term investigations into complex criminal computer intrusions, resulting in bringing the most egregious cyber criminals to justice, even from foreign shores,” said Brian D. Lamkin , special agent in charge of the Atlanta division. “The combined efforts of law enforcement agencies to include our international partners around the world will ensure this trend continues.”

    Court and other records show that Horohorin, like ASD, had a presence in both the District of Columbia and the Northern District of Georgia.