In this frame from a cash-gifting video dated May 3, 2008, then-AdSurfDaily pitchman Hank Needham opens an envelope from a cash-gifing scheme — and five $100 bills purportedly from "George" spill out. The date on the video coincides with a period of time in which Needham's image appeared in an ad for ASD. Needham later would emerge as a Club Asteria principal and purported owner of the "program," which suspended cashouts earlier this year and caught the attention of regulators in Italy.
Is anybody at home at Club Asteria and the purported Asteria Philanthropic Foundation? And where, precisely, is home?
The Club Asteria Blog on a .US domain has not been updated since Oct. 15. In the recent past, the Blog had been updated approximately every three (or so) days, according to the date notations on the site. Updates were posted on Oct. 15, Oct. 12, Oct. 9, Oct. 6, Oct. 3, Sept. 30, Sept. 27, Sept. 24, Sept. 21, Sept. 16.
Fifteen full days have passed since the most recent update.
Separately, the Club Asteria “News” page on its .com domain has not been updated since Sept. 12, a period that encompasses more than a month and a half.
Although the American Red Cross sent the Asteria Philanthropic Foundation a cease-and-desist letter six days ago amid concerns of brand leeching, Club Asteria continues to publish the Red Cross logo and name in its October house organ. The firm uses the publication, an emagazine, for recruiting.
It is common for fraud schemes to plant the seed they are affiliated with a legitimate entity.
Meanwhile, the Asteria Philanthropic Foundation, which also is known as the Asteria Foundation and uses street addresses in the United States and Hong Kong, also continues to publish the Red Cross name and logo on the foundation’s .org site.
Before suspending member cashouts earlier this year, Club Asteria issued payments via wire from a purported Hong Kong entity known as Asteria Holdings Limited, according to “I Got Paid” posts on infamous Ponzi scheme forums.
Last month, Club Asteria removed from its house organ an image and purported “interview” with actor Will Smith. A “JOIN NOW” button had been placed near the Smith-related content. In this month’s house organ, a “JOIN OUR MISSION” button was placed inside a quotation from Mahatma Gandhi, the slain Indian champion of freedom. Gandhi’s name was misspelled in the promo.
Virginia authorities said on Oct. 20 that Club Asteria was not registered as an issuer of securities in the state. They declined to say whether a Club Asteria probe was under way.
In May, CONSOB, the Italian securities regulator, banned promos for the firm in Italy.
In a video dated May 3, 2008 — prior to the apparent formation of Club Asteria and the Asteria Foundation but during a period of time in which Club Asteria principal Hank Needham’s image appeared in a promo for AdSurfDaily — Needham appeared in a video for cash gifting, the PP Blog has learned.
Needham is seen in the cash-gifting video opening an envelope from a courier service that contained a smaller envelope. The package purportedly was sent by “George.”
When Needham opened the smaller envelope, five $100 bills spilled out.
“Thank you, George, ” Needham said.
Needham then fanned the bills in front of the camera.
In August 2008, the U.S. Secret Service seized tens of millions of dollars in the ASD case, amid Ponzi allegations. It is known that some ASD members also were cash-gifting enthusiasts. After the ASD-related seizures, some ASD members sought to recruit others for cash-gifting, autosurf and HYIP schemes, claiming the schemes were excellent ways to make up for ASD losses while highlighting the purported “offshore” locations of some of the “programs.”
BULLETIN:Thanh-Viet “Jeremy” Cao, the California Ponzi schemer and purported “sovereign citizen” who was sentenced in May to 30 years in federal prison for the Ponzi caper, now has been sentenced to an additional 41 months for a Nevada crime in which he filed false liens for hundreds of millions of dollars against government officials.
Under investigation by the U.S. Secret Service, the Justice Department, the SEC and the IRS, Cao reacted by filing 22 false liens against against “SEC attorneys, U.S. District Court Judges, U.S. District Court Magistrate Judges, the U.S. Attorney for the Southern District of California, Assistant U.S. Attorneys, USSS special agents and special agents of the IRS,” the Justice Department said.
Cao pleaded guilty to six counts of filing false liens in which he listed the federal officials as “debtors,” prosecutors said.
It was not immediately clear if Cao’s sentence in the liens case will run concurrently or consecutively to the 30-year sentence in the Ponzi case. In May, U.S. Attorney Laura E. Duffy of the Southern District of California described Cao as a “financial predator.”
The Ponzi scheme sentence was among the longest in the history of Southern California, and investigators said Cao kept his victims in a state of terror by telling them he knew people who previously had “chopped up” a baby in front of the baby’s parents, and then killed the baby’s mother,” prosecutors said.
As part of his liens fraud, Cao developed a “hit list” in which he promised to obtain certain personal information of government offcials “so he could ruin them financially,” prosecutors said.
In a case that drew comparisons to AdSurfDaily because of recidivism, undisclosed bankruptcies and ties to Utah, the three principal figures of the Philip R. Lochmiller Sr. real-estate Ponzi scheme in Colorado will be going to federal prison.
Lochmiller Sr., 63, was found guilty in July after a 10-day trial in which the jurors returned the verdicts in three hours. He will be sentenced after a final computation of losses is completed. The case involved a company known as Valley Mortgage Inc. The case involved about $30 million.
Lochmiller Sr. was found guilty of conspiracy, money laundering conspiracy, money laundering and mail fraud.
His stepson, Philip R. Lochmiller Jr., 38 when charged, has been sentenced to eight years in federal prison for conspiracy to commit securities and mail fraud and money laundering. Business associate Shawnee N. Carver, 33 when charged, has been sentenced to two years for conspiracy to commit securities and mail fraud.
Prosecutors announced the sentences imposed on Lochmiller Jr. and Carver yesterday.
“Philip Lochmiller Jr. helped orchestrate an investment scheme which defrauded over 400 victims out of more than $30 million,” said James Yacone, special agent in charge of the Denver FBI office. “Several elderly victims were financially devastated. [The] sentencing sent a strong message that white collar criminals will not be tolerated. The FBI will continue to aggressively investigate and seek prosecution against the groups and individuals who defraud unwitting victims out of their earnings.”
Lochmiller Sr. was sentenced to three years in a California state prison in the 1980s after he was charged with 60 counts of securities fraud and pleaded guilty to about half of them. Investors in his new scheme at Valley Mortgage were not told of his history as a securities swindler, federal prosecutors in Colorado said.
Federal prosecutors in the District of Columbia said the same thing about ASD President Andy Bowdoin, who was charged with felonies in Alabama in a securities scheme in the 1990s.
Meanwhile, Lochmiller Sr.’s investors also were not told that both Lochmiller Sr. and Jr. had bankruptcies on their records. Federal prosecutors in the District of Columbia alleged in August 2008 that ASD members and members of a companion autosurf known as Golden Panda Ad Builder were not told about the bankruptcy of Golden Panda President Clarence Busby.
Nor were they immediately told that Busby had a run-in with the SEC in the 1990s and was accused of purveying three prime-bank swindles, according to records.
The Lochmiller case also has a tie to Vernal, Utah, a community to which ASD also has a tie. The Lochmiller case was in part about real estate in Vernal. Vernal is the community in which the so-called “Arby’s Indians” got their start.
ASD mainstay Curtis Richmond was a member of the bogus “tribe” based in Vernal. The tribe, which used the address of a Vernal doughnut shop as the address of its purported “Supreme Court” and was ruled a “complete sham” by a federal judge, got its derisive name because it once held a meeting at an Arby’s restaurant in Provo.
Richmond went on to become a pro se litigant in the ASD Ponzi case, accusing the judge overseeing the case in the District of Columbia of “TREASON” and operating a kangaroo court. Richmond claimed the judge overseeing an unrelated case in Utah owed him $30 million. Other ASD figures later claimed government officials owed them sums ranging from the millions of dollars to the trillions.
Another parallel between the ASD case and the Lochmiller case is the presence of the IRS. ASD’s early deceptions were uncovered by a U.S. Secret Service/IRS Task Force operating in Florida, according to court filings.
“Investment fraud is like a ‘house of cards’; the underlying structure can fall apart at any time leaving many investors in financial ruin,” said Sean Sowards, a top IRS agent working the Lochmiller case.
Sowards is the special agent in charge of the IRS-Criminal Investigation unit in Denver.
“These sentences should remind us that defrauding investors is a serious offense and those who do will be held accountable,” Sowards said.
Both Lochmiller Jr. and Carver testified at the Lochmiller Sr. trial, prosecutors said.
Screen shot: Pitchmen now are trading on the name of Oprah Winfrey to hawk JustBeenPaid. The name and likeness of Warren Buffett also have been used in JustBeenPaid pitches, and Ponzi forum chatter also includes the name of Charlie Sheen.
UPDATE: In addition to trading on the name of Warren Buffett, the JustBeenPaid “program” is trading on the name of entertainment icon and business titan Oprah Winfrey.
Actor Charlie Sheen’s name also has been referenced in Ponzi forum chatter about JustBeenPaid, an “opportunity” whose braintrust once recruited members for Florida-based AdSurfDaily. ASD, according to the U.S. Secret Service, was operating a $110 million Ponzi scheme.
YouTube recently has been deleting JustBeenPaid promos.
JustBeenPaid became a darling of the Ponzi scheme boards earlier this year. The Winfrey development occurs against the backdrop on a September incident in which Club Asteria — another Ponzi board darling — published a likeness of actor Will Smith in a promo.
Club Asteria later removed the image, which featured Smith’s likeness over a “JOIN NOW” button. It is common for schemes to plant the seed that a famous person or entity endorses a “program” — even when no such endorsement exists.
Winfrey’s name and likeness repeatedly have been used by scammers to sanitize their fraud schemes, leading to litigation filed by Winfrey herself, the Federal Trade Commission and the attorney general of Illinois.
“Click on the Oprah banner below,” a prompt for a current JustBeenPaid promo urges. A likeness of Winfrey appears below the prompt, which creates the appearance that she has endorsed the “program.”
“The Profit Program for the Most Special Moneymakers!” the promo exclaims.
When the image is clicked, a page for a JustBeenPaid affiliate loads.
An appeal for visitors to join “OneX” appears on the same page that abuses Winfrey’s name and likeness. OneX and Club Asteria, which trades on the name of the World Bank, were among the “programs” pitched on the Ponzi boards by “manolo” earlier this year.
In April, “manolo” used the name of JPMorgan Chase when pitching a “program” known as ThatFreeThing.
In 2010, the DataNetworkAffiliates “program” linked to Phil Piccolo traded on the name of and likeness of Winfrey. Piccolo has been called the “one-man Internet crime wave.”
A website through which accused Ponzi schemer Andy Bowdoin of Florida-based AdSurfDaily hoped to raise $500,000 to pay for his criminal defense has been offline for at least 11 hours. The reason why is unclear.
The site — known as Andy’s Fundraising Army — launched on July 26 after weeks of prelaunch hype and after having missed at least two advertised launch dates. The site’s URL now resolves to a page that beams advertisements.
Bowdoin’s used the website and emails to paint himself the Christian commander of an “Army” that was “fighting mad.” The site used images of David and Goliath and accused the government of “wrong doing” and “suppression.”
In 2008, Bowdoin referred to the Secret Service and federal prosecutors as “Satan,” and compared the seizure of tens of millions of dollars from his 10 bank accounts to the 9/11 terrorists attacks. In a video released July 26, he claimed he was “crucified” and “heavily ridiculed” by two U.S. Attorneys and three Secret Service agents.
Bowdoin’s PR strategy of demonizing the government for seizing the money in August 2008 appears to have backfired. As of last week — after more than two months of fundraising — Bowdoin reportedly was 95 percent short of his $500,000 goal.
Three weeks ago, the government returned $55 million seized in the case to members.
Screen shot: Neither of these two YouTube videos for JustBeenPaid will load on a site associated with the purported "opportunity" — but a repurposed video featuring billionaire investor Warren Buffett will. It is common in fraud schemes for scammers to trade on the names of celebrities and to suggest a famous person endorses a "program."
There are the deliberate shills for JustBeenPaid — serial Ponzi board hucksters such as “10BucksUp,” for example.
And there are the unwitting shills whose celebrity is stolen without their knowledge to sanitize the over-the-top fraud that promotes absurd returns — people such as famed investor Warren Buffett. Buffett’s only tie to JustBeenPaid is that he lives and breathes on the same planet occupied by the collective of international scammers behind the purported “opportunity.”
A YouTube video in which Buffett is giving a speech to a group of Florida MBA students is shoehorned into a JustBeenPaid promo at BigBooster.com. As Buffett arrives at the podium, he makes sure the microphone is working.
“Testing,” he quips. “One million, two million, three million.”
The audience appreciates the line.
Buffett’s repurposed appearance sandwiched into the JustBeenPaid promo at BigBooster.com is one filled with irony that is the very definition of bizarre. As this post is being written, it is the only video on the page that works. Two in-house videos for JustBeenPaid do not work and carry these messages:
“This video is no longer available because the YouTube account associated with this video has been terminated.”
“This video has been removed because its content violated YouTube’s Terms of Service.”
This YouTube video of famed investor Warren Buffett is playing in a promo for JustBeenPaid on a website known as BigBooster.com.
But the repurposed video of Buffett is every bit as dangerous as it is bizarre: It is being used to help the JustBeenPaid Ponzi scheme proliferate globally. And the people behind JustBeenPaid once promoted AdSurfDaily before the U.S. Secret Service exposed the ASD Ponzi scheme in August 2008. (See graphic near bottom of story.)
To its credit, YouTube has been removing JustBeenPaid videos at least for several days. But even as YouTube does the right thing by taking the videos offline in the age of epidemic white-collar crime and global money-laundering and Ponzi theft, the video of Buffett still plays on the BigBooster site. The likely reason is that there is no easy way for YouTube to associate Buffett’s 13-year-old speech at the University of Florida to a relatively recent BigBooster.com ad for JustBeenPaid, a “program” of recent vintage.
Research by the PP Blog suggests Buffett delivered the speech on Oct. 15, 1998 — when Saddam Hussein still was presiding over Iraq and George W. Bush still was governor of Texas before being elected President of the United States more than two years later. A decade passed — as did the 9/11 terrorist attacks, Bush’s eight-year occupancy of the White House and the fall of Saddam Hussein — before the people behind JustBeenPaid apparently had the brainstorm of shoehorning the Buffett video into the BigBooster promo to help them sell a scam.
YouTube’s removal of the JustBeenPaid videos poses only a minor hurdle, according to an email attributed to JustBeenPaid honcho Frederick Mann, who’s also the apparent braintrust behind BigBooster.com and a former ASD member.
“We’ve started moving our videos to our own server,” the JustBeenPaid email attributed to Mann read in part.
BigBooster.com appears to be hosted in South Africa; JustBeenPaid.com appears to be hosted in the United States. Both domains use a street addresses in South Africa that lists Mann as the administrative contact.
Here is some of the advice attributed to Mann in the BigBooster.com promo associated with JustBeenPaid and related “programs.” (Italics added.)
Get in early.
Get in with “significant” money
If the program performs well, do some early compounding.
Sponsor as many people as possible to earn referral fees.
Withdraw your original risk capital as soon as appropriate to get into a “can’t-lose” position.
Parlay, compound, or let run some of your profits.
Think in terms of maximizing the money you “take off the table.”
Much of the power of this formula is that it enables you to make money with programs that fail after a few months, but if a reasonably good program lasts 6 months or longer, you could earn tens of thousands.
The message could not be more at odds with the principles for which Buffett stands, and yet Mann and JustBeenPaid incongruously sandwich him into the promo after previously leading ASD recruits to disaster.
And even as JustBeenPaid tells members it is saying goodbye to Google’s YouTube, is is encouraging members to register for the “program” by using a Google Gmail addresses.
“Gmail E-mail addresses work well with JustBeenPaid! – and they are free!” the firm informs prospects on its sign-up page.
But it gets stranger yet: Payouts from JustBeenPaid come from an email address assigned to “michael” on the BigBooster.com domain, according to “I got paid” posts by shills on the Ponzi forums such as MoneyMakerGroup.
Not “JustBeenPaid” or “Frederick” — but “michael.”
And the cheerleaders and shills cheer on, even as a condition has developed in which the program is trying to rescue itself from collapse, offshore servers apparently are being brought into play — and the money is being routed from AlertPay in Canada to a murky business with footprints in both the United States and South Africa and the “opportunity” just happens to be trading on the name of Warren Buffett after previously pushing traffic to ASD.
This is happening through a process by which a 13-year-old speech by the billionaire has been repurposed and made to load on the BigBooster site via YouTube — even as JustBeenBeen can’t get its own YouTube videos to load and even as it apparently is saying goodbye to YouTube while encouraging people to use Google Gmail addresses to sign up so they purportedly can get paid by “michael” at BigBooster.com for JustBeenPaid.
Like JustBeenPaid, ASD had a tie to AlertPay. And ASD and a spinoff surf known as AdViewGlobal also used Gmail addresses and relied on videos to spread the scheme.
On May 14, 2008, according to research by the PP Blog, ASD was touted on BigBooster.com as a “cash cow.” Less than three months later, the U.S. Secret Service alleged that ASD was an international Ponzi scheme that had sucked in tens of millions of dollars, routed money through Canada and was contemplating ways to get offshore.
“I (Frederick Mann) have been with ASD since January 07,” remarks attributed to Mann on the BigBooster site read. “Past performance indicates a strong probablility (sic) that ASD will continue to perform as advertised. (By early May 2008, I had received 14 payments totalling over $6,000!”)
On May 14, 2008, BigBooster.com was touting AdSurfDaily.
Screen shot: Even as JustBeenPaid concedes YouTube is removing its videos, the "opportunity" is encouraging prospects to register by using a free Gmail addresss. Google owns both YouTube and Gmail. Payments for JustBeenPaid are being routed through Canada-based AlertPay by a person apparently known as "michael" of BigBooster.com. Both BigBooster.com and JustBeenPaid.com use street addresses in South Africa, and the linked companies appear also to have a presence in the United States. (Red rectangle around Gmail's name and red block of sponsor's name added by PP Blog.)
Combined with corporation records and documents such as news releases, this post on the MoneyMakerGroup Ponzi forum raises questions about whether AdViewGlobal, an autosurf with close ties to AdSurfDaily, was part of an elaborate penny-stock scheme and money-laundering conduit that consumed the EWalletPlus payment processor and left AVG members holding the bag.
EDITOR’S NOTE: Longtime readers of the PP Blog will recall that the purported AdSurfDaily (ASD) spinoff known as AdViewGlobal (AVG) and some of its members engaged in particularly bizarre behavior in May 2009. The absurdities included announcing (and then unannouncing) a puported deal with a new offshore wire facilitator, announcing (and then unannouncing) a new website with purported new services and claiming the upstart company was healthy enough not only to pay out 250 percent matching bonuses to members and 200 percent matching bonuses to recruiters, but also to pay out multilevel downline commissions and purported surfing income of up to 8 percent a day.
Just two months earlier — in March 2009 — AVG suddenly announced its account at an unspecified bank had been suspended and that its chief executive officer had resigned. The firm bizarrely added that CEO Gary Talbert would not leave the company altogether. Rather, Talbert would remain in the accounting department.
Just a month earlier, Talbert, also a former ASD executive, had been introduced in an AVG conference call by Terralynn Hoy, an ASD member and moderator of the pro-ASD Surf’s Up forum and an emerging forum for the AVG autosurf. The introduction occurred in February 2009 after weeks of assertions by AVG that there were no ties between itself and ASD. The introduction was preceded by a bizarre announcement in late January of 2009 by AVG that the appearance of its graphics on an ASD-controlled webroom was an “operational coincidence.” The person making that announcement on AVG’s behalf was Chuck Osmin, a former ASD employee.
AVG’s websites ultimately disappeared. Members claimed AVG was owned by George and Judy Harris, and at least one of the AVG websites identified George Harris as an AVG trustee. George Harris, described in court filings as the head of ASD’s purported real-estate division, is the stepson of Andy Bowdoin and the son of Bowdoin’s wife, Edna Faye Bowdoin.
It later proved to be the case that May 2009 — the same month in which AVG was reimagining itself as one of the world’s leading advertising and communications firms while at once announcing and unannouncing key bits of purported news — was the same month the grand jury that indicted ASD President Andy Bowdoin had convened.
The PP Blog is reporting today that records strongly suggest AVG was a cog in a larger fraud — one that somehow married the AVG autosurf to a penny-stock scheme with a purported arm in the “oil” businesses and a branch that owned an Arizona payment processor known as EWalletPlus that later collapsed.
Here, now, our Special Report . . .
Is stock manipulation in multiple venues part of the bigger picture of the AdSurfDaily Ponzi scheme? Out of the clear blue sky in the fall of 2008 — as ASD awaited a critical court ruling in the Ponzi forfeiture case against the assets of President Andy Bowdoin — ASD claimed it expected a $200 million revenue infusion from Praebius Communications, a penny-stock firm that did not disclose audited sales figures.
But the Praebius announcement, which ASD later withdrew without explaining why, may not be the firm’s only tie to a penny-stock company.
A May 2009 post on the MoneyMakerGroup Ponzi forum is adding to lingering questions about whether AdViewGlobal — an autosurf with close ties to ASD — was part of an elaborate penny-stock scheme and money-laundering conduit involving multiple companies, domestic and offshore venues and individuals with ties to ASD.
On May 5, 2009, a MoneyMakerGroup poster who used the handle of “IMCanadian” claimed he (or she) had received autosurfing payouts totaling $1,300 from AdViewGlobal (AVG) on unspecified dates. The payments, according to the post, were routed through SolidTrustPay (STP), a Canadian payment processor.
The MoneyMakerGroup post potentially provides a glimpse into how fraudulent securities businesses may layer themselves to confuse both investors and authorities. The post cites two different email addresses as the sources of STP payments from the AVG scheme. Although the email addresses purportedly were used by AVG to cause STP to issue AVG autosurf payouts, neither of the addresses used a domain name owned by AVG. Instead, they used Yahoo and Gmail addresses.
AVG, according to records, could have chosen to use email addresses that corresponded to its own domain names. The firm owned at least two namesake domains before it suspended member cashouts in June 2009: ADVGlobal.com and AdViewGlobal.com.
But relying on free email providers such as Yahoo and Google was not the sole oddity associated with AVG, a firm an early promoter predicted would become a “1 Billion Dollar Company [before the] end of 2009.”
“Most if not all of your leaders are joining,” the promoter flatly counseled on a forum known as FreeLunchRoom on Dec. 23, 2008, two days before Christmas.
The MoneyMakerGroup posts that followed cited not only the Yahoo and Gmail payout addresses, but also two different STP usernames from which AVG payouts to “IMCanadian” purportedly originated. Absent in both usernames was any reference to AVG itself.
Like AVG, ASD also used STP, according to records. In August 2008, the U.S. Secret Service alleged that ASD had wired “several million dollars” to STP just prior to the seizure of tens of millions of dollars from the personal bank accounts of ASD President Andy Bowdoin.
A payment of $200 for AdViewGlobal earnings was received through STP from an STP user who used the acronym “avg” as part of a yahoo.com email address, but did not use an AVG domain, according to the MoneyMakerGroup post. The STP username linked to the AVG payout was “karveck,” not AdViewGlobal or AVG, according to the post.
An AVG payment for $1,100, meanwhile, had come from an STP member who used the words “tmscorp” and “usa” — along with the abbreviation “llc” as part of a Gmail address, according to the post. The STP username for the payout was “tmscorp,” not AdViewGlobal or AVG, according to the post.
Ten days after the claims appeared on MoneyMakerGroup, the grand jury that indicted ASD President Andy Bowdoin in the District of Columbia was sworn in, according to records. The swearing in occurred just 11 days after the Obama administration announced a crackdown on offshore fraud schemes. On the same day Obama himself spoke about the crackdown — May 4, 2009 — AVG announced it had secured a new offshore wire facilitator in the aftermath of the purported suspension of AVG’s bank account in March 2009. Research by the PP Blog suggests that AVG sought to route money to itself by using a Florida shell company that had sought the services of an offshore firm later banned by the National Futures Association.
The seal on the Bowdoin indictment was lifted on Nov. 23, 2010, during a period in which some ASD members were discouraging others from filing remissions claims in the ASD forfeiture case brought by federal prosecutors and the U.S. Secret Service in August 2008.
Bowdoin was arrested in Florida on Dec. 1, 2010. He faces an upcoming trial on allegations of wire fraud, securities fraud and selling unregistered securities for his operation of ASD. AVG’s name does not appear in the indictment.
The Operative Word: ‘Murky’
Much remains murky about the degree of connectivity among ASD, AVG, STP, Karveck, TMS Corp and EWalletPlus. It is known that ASD and AVG had members and promoters in common. Both firms used STP to process payments, but it remains far from clear how many STP accounts the companies and their executives or insiders controlled and how much money generated in the ASD scheme remained in offshore accounts that later could be tapped to channel money to AVG.
ASD and AVG are known to have turned to members and moderators of the now-defunct Surf’s Up forum to sanitize the respective schemes. The surf firms, according to AVG, also shared at least two of the same employees: Chuck Osmin and Gary Talbert.
Some ASD members have claimed Bowdoin was a silent partner in AVG and fronted the money to acquire EWalletPlus, AVG’s purported in-house payment processor. If the assertion that Bowdoin provided money to buy EWalletPlus is true, it may mean that the deal was heavily layered to shield Bowdoin from being identified as the funding source and that AVG had more than one silent partner.
Karveck and TMS Corp used multiple versions of their names, a potential indicator of money-laundering — i.e., a bid to dupe banks into warehousing fraud-scheme proceeds. Karveck, for example, has been referred to as just plain Karveck, but also Karveck International. Records show that at least three versions of the TMS Corp. name exist: TMS Corp., TMS Association and TMS Corp. USA LLC.
TMS Corp. USA LLC is listed in Nevada and Arizona records as using ASD’s address in Quincy, Fla. Its manager is listed as Talbert, the former executive at both ASD and AVG.
Each of the TMS firms appears to have a tie to EWalletPlus, which once shared the same server in Panama with AVG. Despite serving pages from Panama, AVG purported to be based in Uruguay and to enjoy U.S. Constitutional protections even though it was operating offshore. Making the situation even murkier is that a penny-stock company known as Vana Blue Inc. claimed in 2008 to own TMS Corp., the parent company of the EWalletPlus web portal, and to have have acquired Karveck International in February 2009.
The claims came in the form of news releases — and news releases are common tools in penny-stock frauds.
AVG formally launched in February 2009, a year after VanaBlue claimed ownership in a news release of TMS Corp. and EWalletPlus and months after the seizure of Bowdoin’s assets in August 2008. Prior to the seizure, Bowdoin ventured to Costa Rica and Panama, according to court filings by the Secret Service.
The purpose of the Bowdoin trip, according to the Secret Service, was to to incorporate ASD Cash Generator — a replacement autosurf for a Bowdoin surf that had collapsed in 2007 — and an entity known known as La Sorta Trading outside of U.S. jurisdiction. The agency made the claim on Feb. 26, 2009, less than a month after the formal launch of AVG and during the same period in which AVG reportedly had met with a convicted securities felon and announced the formation of a purported offshore “private association.”
Also in February 2009, Vana Blue declared Karveck International a “newly acquired asset” that had produced $1.8 million in revenue in January 2009. Karveck was described as a company that “specializes in internet advertising and promotion in a search engine and ad clicking type environment.”
Mysteriously, however, VanaBlue disowned Karveck International just six months later — in August 2009. What Vana Blue initially had described in February as a completed acquisition of Karveck International was redescribed in August as deal that had fallen through as a result of “further due diligence.”
“Vana Blue was unable to complete this transaction but is in the final stages of negotiation with an oil company to continue its plans of acquisitions,” Vana Blue claimed on Aug. 17, 2009.
During the month of August 2009, ASD’s Bowdoin announced in court filings that he was “negotiating” with federal prosecutors. The August 2009 negotiations, which collapsed by mid-September of the same year, marked at least the second time that Bowdoin or his legal team claimed that the ASD patriarch was seeking to find a way to settle the ASD forfeiture case.
Bowdoin’s negotiations pleading appeared on the docket of U.S. District Judge Rosemary Collyer on Aug. 4, 2009. Thirteen days later — on Aug. 17, 2009 — Vana Blue announced on Business Wire that its acquisition of Karveck International — a deal it described in February 2009 as completed — had fallen through.
Vana Blue claimed in the same announcement it was proceeding on a deal for an oil company despite its sudden loss of Karveck International.
Earlier this year, a source told the PP Blog that she provided $5,000 to her sponsor — and that the sponsor converted her money to cashier’s checks made payable to TMS Association, one of the “TMS” companies records suggest was tied to both AVG and EWalletPlus. The woman told the Blog that she believed she was a victim of the ASD scheme.
On Dec. 21 2010, just 20 days after Bowdoin was indicted, an email that appeared to have originated with an AVG member began to circulate among ASD members.
The email accused members of ASD who were participating in the remissions program established by the Justice Department and the Secret Service of signing their “morals and soul away” and supporting “innocent peoples lives being destroyed.”
In a possible bid to intimidate ASD members, the email further claimed that an unspecified “back lash” would occur against any ASD member who participated in the claims program.
Last month ASD members who filed approved claims forms received back 100 percent of the money they had directed at ASD. The remissions payments were funded by money seized by the Secret Service in the ASD Ponzi case.
Although its is believed the government also has opened a probe into the affairs of AVG, prosecutors have made only veiled references to AVG in court filings in the ASD case.
James Leonard Craft booking photo: Source: Etowah County Sheriff's Office.
BULLETIN: The cavalcade of senior citizens implicated in alleged securities schemes continues. James Leonard Craft has been taken from a jail cell in Florida and placed in one in Alabama to answer felony charges that he was at the helm of a securities swindle.
Craft, 71, of Milton, Fla., originally was arrested in Florida Sept. 23 on an out-of-state fugitive warrant. He was held at a Santa Rosa County detention facility until yesterday, when he was transported to Etowah County Jail in Alabama to face charges. Bond was set at $30,000, according to records.
In October 2010, the Alabama Securities Commission (ASC) named Craft in a cease-and-desist order. The agency alleged that Craft, beginning in 2008, was selling unregistered securities for a purported lumber business that produced or sold railroad ties.
The securities were offered through LLCs known as Universal Wood Products LLC, Century Lumber and Land LLC and Milton Timber LLC, according to the ASC order.
An Alabama resident told investigators he was introduced to the opportunity by a “business associate and missionary residing in Tennessee,” according to ASC records. Whether ASC suspects affinity fraud was not immediately clear.
NorthEscambia.com is reporting that Craft was part of an October 2010 ribbon-cutting ceremony for an upstart business that the struggling Florida small town of Century expected would create 500 jobs. Those jobs never materialized, the site reported. More than 3,000 applications for employment were received.
ASC records claim that at least two Alabama residents were told that the purported lumber firms could make money because Craft and a business partner bought railroad ties in “South America” and sold them to U.S. railroad companies “suffering from a shortage of the lumber product.”
Alabama investors directed at least $180,000 to a promissory-notes scheme involving Craft, according to ASC.
Precisely how the Craft case had morphed into a criminal prosecution was not immediately clear today. Etowah County Jail records show that Craft is being held for another “agency,” but the name of the agency was not listed.
In Alabama, county-level prosecutors and ASC work together on securities cases.
The emerging Craft case has bizarre coincidences and parallels to the AdSurfDaily case. ASD was operated by Andy Bowdoin, a senior citizen in the small Florida town of Quincy, which is situated in Gadsden County. Craft, himself a senior citizen, also operated from a small town in Florida. By coincidence, the jail in which he’s currently lodged is in Gadsden, Ala.
Andy and Faye Bowdoin at a July 2008 Chamber of Commerce photo op. The small town of Quincy was pleased that ASD had created jobs, but the ASD story took a sour turn when the U.S. Secret Service accused Andy Bowdoin of operating an international Ponzi swindle a month after this photo was taken. Some ASD employees were getting paid in "ad packs," according to court records.
In the case of ASD, the Gadsden County Chamber of Commerce announced in 2008 it was pleased that ASD had made its home in Quincy and was creating jobs. The Century Area Chamber of Commerce appears to have felt the same way about the Craft-related firms. The NorthEscambia.com story linked to above shows a Chamber banner at the Craft ribbon-cutting ceremony. Craft appears in the photo alongside people who appear to be genuinely pleased and proud that a jobs-creator had come to the small town.
Like Craft, ASD’s Andy Bowdoin was implicated in an Alabama securities swindle. Bowdoin’s Alabama caper occurred in the 1990s, according to records.
UPDATED TO ADD COMMENT FROM U.S. MARSHALS SERVICE AT 3:21 P.M. EDT (U.S.A.) Federal prosecutors in the District of Columbia this morning declined to comment on an email received Saturday by some AdSurfDaily members that encouraged them to file documents at the “county” level and “name” federal officials as “thieves.”
Prosecutors also declined to comment on whether the government had beefed up security for judges and prosecutors in response to strange developments in the ASD case. On Saturday, some ASD members received an email that encouraged them to send a “notary certified copy” of theft claims they file in their home counties against federal officials to the home address of U.S. Chief Justice John Roberts.
“No comment,” the office of U.S. Attorney Ronald C. Machen Jr. said.
The U.S. Marshals Service, which provides security for the U.S. court system, said this afternoon that “it is the policy of the U.S. Marshals Service not to comment on or confirm ongoing judicial threat investigations.”
The PP Blog reported yesterday that ASD figure Kenneth Wayne Leaming, a reputed “sovereign citizen” who sometimes goes by the names of “Kenneth Wayne” and “Keny,” filed involuntary bankruptcy petitions in 2009 against the Washington State Bar Association and a Franciscan hospital in Washington state.
Leaming’s combined claims totaled more than $41 billion. He was permanently enjoined “forever from filing a bankruptcy petition or any other pleadings before this court without the advance leave from one of the bankruptcy judges of this court,” according to federal records.
“Keny” has been cited by ASD members as the author of a November 2010 “legal opinion” and as the author of Saturday’s email that provided guidance to ASD members. The ASD case had been marked by strange events since the U.S. Secret Service seized tens of millions of dollars in a Ponzi scheme probe in August 2008.
In the profiles, Leaming had been listed as an attorney who advertised a fee structure of up to $250 an hour from Spanaway, Wash.
Leaming was the subject of a letter sent in 2005 by the Practice of Law Board of the State of Washington. The Law Board made a determination in December 2005 that Leaming’s conduct in cases it was investigating “constitutes the unauthorized practice of law.”
In one case, the Law Board said, a notary public accused Leaming of coercing her into “notarizing documents that resulted in the loss of her notary license.”
Leaming became a figure in the ASD case in 2010 after he was denied leave to file documents in the civil portion of the ASD case and later joined with ASD figure Christian Oesch, an unsuccessful pro se litigant in the case, to sue the United States — apparently for the staggering sume of more than $29 trillion.
Civil judgments against money and property seized by the Secret Service in the ASD case were entered in the government’s favor in 2009 and 2010, and the prosecutors returned $55 million to about 8,400 ASD members last week through a process known as remission.
There were repeated efforts by some ASD members to discourage others for filing for remissions.
Bowdoin’s email followed on the heels of an email by an ASD member named “Sara” that claimed to provide “insider information” that a government plot was under way.
Since at least July, Bowdoin has been soliciting ASD members to pay for his criminal defense on charges of wire fraud, securities fraud and selling unregistered securities.
AdSurfDaily figure Kenneth Wayne Leaming, also known as "Kenneth Wayne" and "Keny."
EDITOR’S NOTE: A week after the U.S. Department of Justice, the U.S. Secret Service and federal prosecutors in the District of Columbia put $55 million from civil judgments back in the pockets of AdSurfDaily members as the criminal prosecution of ASD President Andy Bowdoin continues, a new effort by some ASD members to undermine the credibility of public officials by describing them as thieves who are encouraging ASD members to lie appears to be under way. Whether the government is taking extra security precautions in the ASD case is not known. The U.S. Marshals Service and the office of U.S. Attorney Ronald C. Machen Jr. in the District of Columbia did not respond immediately to the PP Blog’s requests for comment on this story. The Blog was unable today to contact the Public Information Office of the Supreme Court for comment.
UPDATED 8:10 A.M. EDT (OCT. 3, U.S.A.) Is a purported “sovereign citizen” whom records show filed an involuntary bankruptcy petition against the Washington State Bar Association in 2009 that claimed he was owed an outstanding debt of more than $32 billion now leading an effort to destroy the reputations of public officials involved in the AdSurfDaily Ponzi case?
On Saturday, two ASD members confirmed to the PP Blog that they had received copies of an email that encouraged them to identify federal prosecutors and a federal judge in the District of Columbia — as well as a U.S. Secret Service agent — as “DOJ thieves.”
The email accused prosecutors of running a “scam” against Florida-based ASD and encouraged ASD members to file an “affidavit” with their “county recorder” that would name the prosecutors, the judge and the Secret Service agent as criminals. It further encouraged members to send a “notary certified copy” of their claims to the home address of John G. Roberts Jr., the Chief Justice of the United States.
Why members were encouraged to send documents to Roberts at his home address was unclear. Roberts, 56, is the nation’s highest ranking judicial officer and is chief judge of the U.S. Supreme Court.
In the email, ASD members were further encouraged to send certified copies of their “DOJ thieves” claims to U.S. Attorney General Eric Holder and the “RUST Group.” Rust Consulting Inc. is the government-approved remissions administrator in the ASD Ponzi case. Federal prosecutors last week released $55 million seized by the Secret Service, and Rust deposited the money into the bank accounts of about 8,400 ASD members who filed approved remissions claims in the case.
ASD members who participated in the remissions program would be “coerced” into lying by prosecutors to put Bowdoin in prison, according to the email.
If they did not “TESTILIE” — a new phrase that marries the words “testify” and “lie” and apparently means misrepresent their testimony at prosecutors’ requests — they will “be put into prison for false claims and fraud,” according to the email.
“MARK MY WORDS,” the email emphasized in all-caps. The word “TESTILIE” also was capitalized in the email, quotes from which were attributed to ASD figure “Keny.”
“Keny” is the nickname of ASD figure Kenneth Wayne Leaming. Leaming has been identified by the Anti-Defamation League as a so-called “sovereign citizen.”
Records in Washington state identify Leaming as one of two persons who filed an involuntary bankruptcy petition against the Washington State Bar Association (WSBA) in 2009 that claimed a debt against the association of “US$32,091,000,000.00.”
The petition against the bar association was filed on Oct. 12, 2009. WSBA moved within days to have the petition dismissed and for sanctions against Leaming. Leaming moved for a continuance and to have the judge removed, according to records. The judge denied both the continuance bid and a motion styled “Notice of Duty to Recuse,” and the case was dismissed on Oct. 23, 2009. A judgment of $2,750 was entered against Leaming, and he was enjoined “forever from filing a bankruptcy petition or any other pleadings before this court without the advance leave from one of the bankruptcy judges of this court.”
Also during the month of October 2009 — while the involuntary petition against WSBA was in the courts — Leaming filed a petition to place Franciscan Health Systems, a community hospital in Washington state, in involuntary bankruptcy. That petition also was dismissed.
Records in Pierce County, Wash., show that Leaming filed a purported lien for $9.24 billion against the hospital, seeking to attach “all tangible and intangible property” of the facility, including its fixtures, furnishings, motor vehicles, bank accounts, passbooks, saving certificates, stock certificates, lines of credit, inventories, promissory notes, office equipment, educational equipment — and even its mineral and water rights.
Leaming and ASD figure Christian Oesch sought last year to file a lawsuit apparently seeking $29 trillion against the United States for the government’s actions in the ASD case. Leaming’s company — American-International Business Law Inc. — is referenced in the April 8, 2011, Congressional Record as the filer of an unspecified claim against the United States.
Some ASD members have been associated with a practice that has been called “paper terrorism.” The practice is designed to chill litigation opponents and create inconvenience for public officials such as judges and prosecutors by making them the targets of vexatious litigation pleadings or other documents designed to nuisance them.
Here are the comments attributed to “Keny” in the email ASD members reported receiving yesterday on the heels of the remissions payouts by the government last week. (Italics added.)
SCAM by DOJ …. By accepting these funds, they claim to be ASD/Andy’s VICTIMS (NOT DOJ victims) who will be required to testify that they were victims of ASD/Andy if they don’t want to be arrested and prosecuted for perjury /false claims. It will totally bury Andy.
As a “victim refund” they will now be coerced into testifying that they were a victim of Andy, not the DOJ, and unless they TESTILIE claiming that Andy scammed them, they will be put into prison for false claims and fraud. MARK MY WORDS.
They MUST (within 72 hrs) acknowledge “receipt of the funds stolen by the DOJ, and specifically (name the ss agent, us attys, and judge as the DOJ thieves), and do so in affidavit form, filing a certified copy into public records (county recorder, etc,) and sending a notary certified copy to Eric Holder, DOJ, and the Chief Justice (Roberts) of the Supreme Court of the United States (at home), and to the RUST Group.
ALSO, maybe close out with “Claimant hereby conditionally waives any punitive and/or exemplary and consequential damages claims in the event the funds taken are returned to me within 30 days of (NAME OF AGENT/OFFICER) receiving this claim.”
“Keny”
Whether the government has taken or will take extra security measures because of the strange nature of the ASD case was not immediately clear. There have been repeated attempts for months by some ASD members to discourage ASD members from filing for remissions from proceeds seized in the Secret Service’s ASD Ponzi probe and to cast prosecutors, investigators and judicial officers as corrupt.
Andy Bowdoin: Is ASD's patriarch now accusing the government of subornation of perjury?
UPDATED 3:44 P.M. EDT (U.S.A.) Facing felony charges of wire fraud, securities fraud and selling unregistered securities and the potential of 125 years in prison, accused Ponzi schemer Andy Bowdoin has responded by accusing federal prosecutors in the District of Columbia of forcing members to lie to qualify for compensation from a victims’ fund in the AdSurfDaily case, according to an email ASD members have received.
Last week, the government released $55 million seized in the ASD case and began to distribute it through Rust Consulting Inc., the remissions claims administrator approved by the U.S. Department of Justice and the U.S. Secret Service. Members began to receive payments Friday. About 8,400 ASD members filed approved claims, according to the government.
In an email to ASD members yesterday in which Bowdoin continued his efforts to solicit $500,000 to pay for his criminal defense, the ASD patriarch suggested prosecutors had set up the remissions program to dupe them into identifying themselves as crime victims. (Emphasis added.)
“We need the legal defense funds now more than ever to combat this great injustice where the government forced members to sign the untrue statement to get a refund of their monies,” Bowdoin claimed in the email.
The remissions money was not the proceeds of a Ponzi scheme, Bowdoin claimed. Rather, the money members received constituted a return of their “advertising expenses.”
Bowdoin did not explain in the email what he intended to do if the government produced evidence that people were advertising nonexistent businesses on ASD’s closed network. Nor did he explain what he would do if the government produced evidence that the sums sent to ASD for individual advertising purchases bore no connection to the real world: a sole proprietor of an MLM sideline business hawking fruit juice who historically posted $5,000 in gross revenue suddenly spending three times that amount to advertise on ASD, for example.
Bowdoin himself was accused in 2008 of advertising a failed, dissolved business in his own advertising “rotator” to generate purported “rebates.” In making the assertion, the government effectively was claiming that even a nonexistent business — or perhaps even a blank page or a page that promoted a personal Facebook site — could generate a return on investment if inserted in ASD’s rotator.
“To secure some of ASD’s rebates himself, Bowdoin promoted a bogus website through ASD,” prosecutors claimed on Aug. 25, 2008. “Bowdoin explained to the Secret Service that he used the ‘advertising’ he secured from ASD to promote GPS Tech, an unsuccessful business endeavor that had already been dissolved.”
In a footnote within the three-year-old filing, prosecutors claimed “Bowdoin also acknowledged that he modeled ASD after12dailypro, that ASD had no significant income (except maybe a couple thousand dollars) other than what its members paid in (and expected back as rebates). Bowdoin said he was not sure how ASD differed from 12dailypro except, he said, ASD did not guarantee a particular percentage, and its payments were only based on its sales. Bowdoin acknowledged that representations that he had met with the Securities and Exchange Commission (SEC) in Washington, DC, and representations that a team of SEC attorneys that he hired had approved of his operation were made up, as was ASD’s representation that Bowdoin had been awarded a Medal of Distinction by President Bush for business acumen.”
12DailyPro was an autosurf successfully sued by the SEC in 2006 amid allegations it was operating a massive online Ponzi scheme. Prosecutors said later that Bowdoin had a “silent partner” in ASD — and that the silent partner had been Bowdoin’s 12DailyPro sponsor. The government has said all along that ASD falsely traded on Bush’s name to sanitize a fraud that gathered tens of millions of dollars.
The U.S. Secret Service and prosecutors said in August 2008 that Bowdoin had disguised his securities venture as an advertising company that paid “rebates” of 125 percent. They later said that ASD’s internal computer systems described payouts to members as “ROI” — for “return on investment.”
Bowdoin, though, claimed yesterday that ASD, “by definition,” was not a Ponzi scheme. He did not addresses the government’s contention about the “ROI” reference, instead insisting that ASD offered “no guarantees” that members would receive payouts. In August 2008, the government claimed that ASD’s Terms of Service included these words:
“Advertisers will be paid rebates until they receive 125% of their ad purchases.”
An expert witness hired by ASD acknowledged in 2008 under cross-examination that the words had appeared in ASD’s TOS. Despite the fact that the TOS document has been a matter of public record for more than three years, some ASD members claimed that the government has produced no evidence and that ASD members who agreed that they are victims of a massive financial crime will be “torn apart” on the witness stand by ASD’s lawyers.
The “torn apart” claim was made on Jan. 17, 2011, two days before the deadline for ASD members to file a remissions claim with Rust in the case. The claim followed previous claims that a “group” of ASD members might sue persons who identified themselves as victims.
Bowdoin, 76, further claimed in yesterday’s email that, at his upcoming trial, the government will use claims forms signed by members to prove “they were ‘investors’ and therefore victims” of a Ponzi scheme.
On Jan. 23, 2009 — just 10 days after Bowdoin withdrew his claims to the seized money “with prejudice” and just one day after a federal judge memorialized Bowdoin’s withdrawal and consent to forfeit the seized money — federal prosecutors explained the law to ASD victims and said the compensation program would be governed by these federal regulations. (Emphasis added in next paragraph.)
“Under Section 9.8(a)(1) and (2) of Title 28 of the Code of Federal Regulations, in a petition for remission or mitigation of forfeiture a non-owner victim must demonstrate that it suffered a pecuniary loss of a specific amount directly caused by the criminal offense(s) underlying the forfeiture, or a related offense, and that the loss is the direct result of the criminal acts,” the government said in explaining remissions regulations.
A month later — in February 2009 — Bowdoin reentered the case as a pro se litigant and sought to rescind his decision to submit to the forfeiture. That effort failed after months of legal wrangling, and U.S. District Judge Rosemary Collyer issued a final order of forfeiture for the lion’s share of the seized funds in January 2010.
Bowdoin appealed that order and a separate forfeiture order issued by Collyer, but lost both cases in the U.S. Court of Appeals.
In April 2009, in response to Bowdoin’s pro se pleadings, prosecutors revealed that Bowdoin had signed a proffer letter in the case and acknowledged that the government’s material allegations were all true. Bowdoin later revealed in his own court filings that he had met with prosecutors over a period of at least for days in late 2008 and early 2009 and had given information against his interests.
In yesterday’s email, Bowdoin did not address the proffer issue and his own acknowledgment that he’d provided information against his interest in the hopes of receiving a sentencing reduction. Instead, he asserted that he had “very strong feelings about what the govt. is really doing.
“[B]ut due to my court case and upcoming trial, I can only pass on a statement made by one of the attorneys on my Legal Defense Team, in response to the govt. media press release issued on Monday, Sept. 26th, with the headline – “$55 MILLION BEING RETURNED TO VICTIMS OF INTERNET FRAUD – Victims Receive Forfeited Ponzi Scheme Proceeds,” Bowdoin continued.
“I am in full agreement with what my attorney had to say about this govt. press release, which is in ‘quotation marks’ as follows:
‘The release is a gross distortion of the facts. There are no ‘victims.’ Not a single person lost a dime until the government shut down the business. These customers bought advertising on the net. They were not investors.’”
Bowdoin did not say whether the email he sent to members yesterday in which he claimed the government “forced” members “to sign the untrue statement” to qualify for remissions was approved by his attorney.
Bowdoin fired his original attorneys in 2009, after he had submitted to the forfeiture and agreed to cooperate in the investigation. He later hired replacement attorneys.
Prior to Bowdoin’s email, an ASD members who identified herself as “Sara” claimed in an email that some ASD members had received amounts like “$50,000 and $60,000” back through the remissions program.
The email attributed to “Sara” painted a picture of a government conspiracy.
One apparent ASD member posting on Bowdoin’s Facebook fundraising site claimed last week that he received back $27,690 through the remissions program. The person did not say whether the business he had advertised on ASD had posted revenue that would justify such an advertising purchase, and the government had no comment on the Facebook assertion.
