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Tag: V-Local

  • No Stranger To Controversy, Donald Allen Says He Is Cooperating With Secret Service In INetGlobal Probe And Has ‘One Hell Of A Story’ To Tell

    Donald Allen

    UPDATED 6:08 P.M. ET (U.S.A. JAN. 20, 2011.)

    EDITOR’S NOTE: The story below includes an assertion by Donald Allen that his IBNN.org website was knocked offline Sunday by a company with ties to INetGlobal. Moments before the story was set for publication, the IBNN website returned. The story does not reflect this later event, and it is possible that the site is not viewable in all parts of the world owing to an apparent change in nameservers. Events surrounding the apparent change in nameservers are unclear.

    Acknowledging he had been advised that he potentially has “exposure” in the INetGlobal Ponzi scheme investigation, Donald Allen II said this morning that he had nothing to hide and would cooperate with the U.S. Secret Service and federal prosecutors “100 percent.”

    That cooperation already has begun, Allen said. He added that his thinking about INetGlobal has evolved since the Feb. 23 raid of company headquarters in Minneapolis, and he insisted he was out of the loop on INetGlobal’s financial affairs and that his efforts to promote the firm were legitimate.

    “Let me make it perfectly clear,” Allen said this morning. “I did the Global News Distribution and was never let in to the ‘workings’ of iNetGlobal. I met with the US Secret Service and [its] position is that I ‘shielded’ [Steve Renner] to operate a Ponzi, which is untrue.”

    Allen, a vice president with V-Newswire, an entity in the INetGlobal family controlled by Renner, claimed this morning that the company had blocked his access and the access of readers to a public-affairs Blog he operates. The Blog is known as the Independent Business News Network (IBNN).

    The company, Allen asserted, was penalizing him “for coming forward to answer ANY questions the Government has regarding iNetGlobal.”

    Renner has not been charged with a crime and has denied wrongdoing. The Secret Service said in court documents filed in February that “there is probable cause to believe that Renner is operating a large, Internet-based, Ponzi scheme through his umbrella corporation, InterMark, and some of its subsidiaries, particularly Virtual Payment Systems [LLC of Wisconsin/Brackets Denoting the LLC Designation added Jan. 20, 2011], V-Media, Cash Cards International, and V-Local.”

    NOTE IN BOLD ADDED JAN. 20, 2011: An Indianapolis-based company known as Virtual Payment Systems Inc. has contacted the PP Blog to let it know it is not affiliated with the Renner company Virtual Payment Systems LLC of Wisconsin, which is referenced in the paragraph above.

    The Secret Service alleged INetGlobal was the “primary vehicle for the perpetration of this fraud.”

    INetGlobal, which features an advertising rotator, is the so-called “autosurfing” platform of the Renner companies. The government has prosecuted several autosurf companies in recent years, saying they were selling investment programs disguised as advertising programs and engaging in wire fraud and money-laundering.

    Renner’s company has a high concentration of Chinese members who may have limited or no facility in English, the agency said. At least one INetGlobal member has said Americans flocked away from Renner’s autosurfing enterprise after the Secret Service, in August 2008, raided a similar company in Florida known as AdSurfDaily (ASD).

    The ASD litigation is referenced in court papers in the INetGlobal case.

    Allen said this morning that he also had performed work for V-Media and V-Local — both of which the Secret Service said had ties to the alleged INetGlobal fraud — but he insisted that he had done nothing wrong.

    “I wasn’t privileged to know anything about the compensation program” of InetGlobal, Allen said. “I could not explain it to this day.”

    An error message that reads “This Account Has Been Suspended: Please contact the V-Webs.com billing/support department as soon as possible” now appears on the IBNN site. In the early hours after Allen lost control of the Blog, the site would not return a ping and produced a “bad destination” error message, according to records.

    Even though Allen moved the content of the site from a hosting company controlled by Renner weeks ago, Renner controlled the domain registration and thus has the ability to block access, Allen asserted this morning.

    Allen’s access to the site was blocked sometime after “noon on Sunday,” two days after he met with the Secret Service, Allen said.

    Agents appeared at his home Friday unannounced, Allen said.

    He described his initial meeting with agents as “excellent.” Allen added that he is consulting with an attorney.

    “[The Secret Service] asked me if I would like legal representation,” Allen said. “I said yes.”

    A second meeting with the Secret Service occurred yesterday. Allen said he was consulting with his attorney again today, saying a characterization that described him as cooperating with the agency was “totally accurate.”

    The move to block IBNN also followed on the heels of a letter Allen gave to Renner April 22, Allen said. The letter claimed that Allen had “clear and documented” evidence of violations of the Federal Equal Employment Opportunity laws in a hiring decision it made.

    In the letter, Allen suggested he was not given an opportunity to interview for a job that went to an INetGlobal member with a large downline. The letter also questioned the operations of the company’s board of directors and claimed an INetGlobal “receptionist” was performing “confidential” work that should have been handled by the firm’s Human Resources department.

    Moreover, Allen said this morning that nothing in his employment contract with the Renner entity permitted the company to block access to the IBNN site. He claimed that the company now wants him to sign an agreement not to write about INetGlobal and also to inspect his computer.

    Allen Questions INetGlobal’s Operations

    Allen said this morning that he questioned how the company was paying its bills in the aftermath of the federal seizure of its assets. He claimed a member of INetGlobal with a Chinese name had received a promotion to a position that purportedly paid $120,000 a year after the seizure. This member, Allen said, also may have a seat on the board of directors and also purportedly had a downline organization in the company that purportedly paid $10,000 a day.

    His first question for Renner, Allen said, is “how is that possible with the current funds frozen by the US Government?”

    Allen said his position with the company was supposed to pay $75,000, but that he had not seen “a penny.”

    “I’m a little upset, a little traumatized by this attempt to shut me down, because I had one hell of a story,” Allen said. “I’m kind of devastated; I have a civil-rights Blog. A lot of people read it.”

    No Stranger To Controversy

    Allen and his IBNN Blog have been the subjects of controversy. He used an offshoot of the Blog to claim in March that “federal officials” were leaking information about the INetGlobal case to the PP Blog. After the PP Blog began to report on INetGlobal, Allen began to post comments on the PP Blog without initially identifying himself as a Renner employee, claiming that the PP Blog was “minor league” and engaging in a “witch hunt.”

    Separately, Allen used the IBNN Blog to attack the Star Tribune newspaper of Minneapolis St. Paul for its coverage of the INetGlobal raid. Meanwhile, Allen’s name is listed in the Secret Service affidavit filed in February to obtain search warrants at the firm’s headquarters. In the affidavit, the agency painted Allen as a person who provided confusing information to an INetGlobal prospect at a January event in Flushing, N.Y.

    Undercover agents attended the Flushing event, and one agent’s observations of Allen are noted in the affidavit.

    An INetGlobal prospect “stated she was struggling to understand how the business worked and explained that the person who brought her to the conference was not able to explain it either,” the agency said in the affidavit. “She asked what would happen if she sold iNetGlobal products to someone who had a website and they did not see an increase in their profits.

    “Donald Allen asked her what type of products the person was selling and the woman gave the example of beauty products,” the agency continued in the affidavit. “Donald Allen replied that if she was advertising beauty products and not selling any, then maybe she should be in a different business. The woman further challenged Donald Allen on people not truly viewing the websites, just simply opening them. Patricio Diez, iNetGlobal’s marketing director for Spanish-speaking countries, then stated that ‘that doesn’t matter for you.’

    “When the woman pressed further, stating that it does matter to whomever she sold the package to, Donald Allen simply stated ‘we have solutions for that’ but failed to expand upon those solutions,” the agency said.

    After the raid at INetGlobal’s offices in Minneapolis, Allen used the IBNN Blog to criticize both the media and the government for what he described as unfair treatment of the company — without disclosing his tie to the firm. Allen later told the PP Blog he should have disclosed the tie.

    Allen said this morning that his thinking about INetGlobal has evolved. He added that he also had revisited certain events at INetGlobal and had come to believe that things were not quite right.

    At an event in Las Vegas last year, for example, Allen was not given time to talk to attendees about V-Local, he said. In recent days he has publicly questioned why few if any members were interested in purchasing the company’s editorial products.

    “I can’t recall ever selling a press release to a Chinese member of iNetGlobal,” Allen said in a comment on the PP Blog April 23. “My yearly budget was in-part based on iNetGlobal members buying a press release from V-Newswire — hasn’t happened yet.”

    Meanwhile, Allen said this morning that he was sympathetic to Steven Keough, INetGlobal’s former chief executive officer and potentially the government’s star witness in the case. The company has claimed Keough tried to hatch an extortion plot after he was dismissed for incompetence.

    “Keough understood that INetGlobal members needed to buy the products,” Allen said this morning. “Steven Keough was the best thing that ever happened to that company,” adding that he believed Keough saw “noncompliance” with laws and was dismissed for pointing them out.

    See earlier story.

  • Is A New Company Known As RGMG Emerging To Promote Elements Of Inter-Mark Corp. In Wake Of Secret Service Raid At INetGlobal Amid Ponzi Allegations?

    Image of the logo of V-Local.com from a March 2009 news release.

    UPDATED 5:43 P.M. ET (U.S.A., Jan. 20, 2011.) On Feb. 23, the U.S. Secret Service raided the Minneapolis offices of INetGlobal, a company operated by Steve Renner under the Inter-Mark Corp. umbrella. The raid occurred amid allegations that INetGlobal was operating an autosurf Ponzi scheme and also engaging in wire fraud and money-laundering.

    A week later — on March 2 — a domain titled RGMG.net was registered in the name of Matt Renner, according to web records. The domain lists a different Minneapolis address than the Steve Renner entities, some of which used a “V” theme: “V-Media” and “V-Local,” among others.

    Matt Renner, 27, is Steve Renner’s son.

    “We’re running a legitimate business,” he said of RGMG.

    V-Local, which has a website at V-Local.com that is registered to Renner’s Inter-Mark in Las Vegas, was “offered to iNetGlobal members as a service they could sell,” the Secret Service said in an affidavit last month.

    Matt Renner, who worked as an executive at V-Local, said V-Local provided legitimate products and services.

    “We at V-Local were doing nothing wrong,” he said.

    And Matt Renner defended his father. “I don’t believe any wrongdoing was done,” he said.

    Steve Renner was convicted in December of four felony counts of income-tax evasion.  He was awaiting sentencing in the tax case, even as the Ponzi allegations surfaced against INetGlobal.

    V-Local’s logo is featured prominently on the RGMG.net site, which says, “RGMG LLC is a rising player in Digital Media Planning, Buying, Selling and Development. With over 35 years combined digital marketing experience and more than 800 past and current clients, the team at RGMG has the experience to deliver high value wide ranging services.”

    Another section of the RGMG site says, “Based out of the Beautiful city of Minneapolis Minnesota, RGMG started because the demand for a company who’s (sic) Executives pay more attention to their customers (sic) needs, than their own pocket books, was felt by Founder and President, Matthew D. Renner.”

    Yet another section of the RGMG site says, “The team at RGMG has developed many custom platforms including in partnership with V-Media and iNetGlobal the powerful local lifestyle and business directory V-Local.com.”

    Although there are serious allegations of wrongdoing against INetGlobal and it is possible that Ponzi proceeds were used to fund V-Local, the RGMG.net site does not mention the allegations or inform visitors that the Secret Service painted a picture that Steve Renner’s claims about V-Local were overblown. (Read a section of the affidavit concerning V-Local lower in this story.)

    “[T]here is probable cause to believe that [Steve] Renner is operating a large, Internet-based, Ponzi scheme through his umbrella corporation, InterMark, and some of its subsidiaries, particularly Virtual Payment Systems [LLC of Wisconsin/Brackets Denoting the LLC Designation added Jan. 20, 2011], V-Media, Cash Cards International, and V-Local,” the Secret Service said last month. It further alleged that INetGlobal was the “primary vehicle for the perpetration of this fraud.”

    NOTE IN BOLD ADDED JAN. 20, 2011: An Indianapolis-based company known as Virtual Payment Systems Inc. has contacted the PP Blog to let it know it is not affiliated with the Renner company Virtual Payment Systems LLC of Wisconsin, which is referenced in the paragraph above.

    There have been no assertions of wrongdoing against RGMG, and the RGMG site does not appear to have a surfing component among the services listed. RCMG stands for “Renner Global Media Group,” according to the site.

    Matt Renner, who said he read the Secret Service allegations, said he was not worried that problems could spill over into RGMG and create a problem for the emerging brand.

    “It’s a legitimate website,” he said. “It’s a legitimate company; it’s absolutely a valuable service.”

    The site, however, may come with a built-in PR dilemma: how to navigate the choppy waters of embracing the Steve Renner V-Local brand without addressing the Ponzi assertions against INetGlobal and V-Local, perhaps especially if a Renner family member is at the head of RGMG.

    At the same time, certain marketing materials and the prominence with which Steve Renner’s V-Local is referenced on the RGMG site — indeed, V-Local’s logo appears on the site in at least two places and RGMG encourages visitors to make V-Local their “new Homepage” — may leave some customers and employees of INetGlobal and its “V” entities scratching their heads.

    V-Local’s name is prominently mentioned in INetGlobal marketing materials, including a news release dated March 25, 2009. The headline on the news release said, “iNetGlobal launches V-Local and iNetSurf on Saturday, March 28, 2009.” The news release included the V-Local.com logo (pictured above.)

    Despite the claim that V-Local launched in March 2009, a news release issued 11 months later — in February 2010 — claimed a January 2010 launch date for V-Local under this headline: “V-Local Reports Exponential Growth Following January Launch.” The Feb. 16 news release includes a graphic of a logo for V-Local labeled “BETA.”

    Why the news releases list two different launch dates for V-Local is unclear. Steve Renner’s own website — SteveRenner.com — announced the launch of V-Local on March 3, 2009.

    “Steve Renner who is known for his knack of creating successful online ventures, has Struck Gold with his latest project, V-Local,” the website reported.

    No mention was made that Renner already was under indictment for tax evasion and that another Renner entity — Cash Cards International — had been unable to return money to victims of a Ponzi scheme known as “Learn Waterhouse,” amid assertions that Renner had spent customers’ money as though it were his own and had invested $250,000 in the Learn Waterhouse scheme.

    Renner’s site said the type of service V-Local provided “would normally cost the $1,000’s but V-Local has set the price at an extremely affordable price of just $59 per month, for their Top Of The Line ‘Showcase’ listing.”

    By clicking on the “Contact Us” link on The V-Local.com website, visitors arrive at a page that lists the street address of Steve Renner’s Minneapolis entities.

    A section of the Feb. 16, 2010, news release reads, “V-Local, the first-of-its-kind online business and lifestyle directory, announced today that it has experienced unprecedented growth since its launch on Jan. 15, 2010. Site traffic increased 900 percent in February alone, according to Google Analytics, with more than 100,000 visitors since the site’s launch.”

    Going back 11 months, the body copy of the March 2009 news release that announced V-Local’s launch read, in part: “On Monday, March 16, 2009 iNetGlobal did a ‘soft’ launch of iNetSurf. This product and had over 3,000 internet users sign up in one work day. At iNetSurf current pace, we can expect over 200,000 active ‘surfers’ in 6 months!”

    Meanwhile, the emergence of RGMG after the Secret Service raid at INetGlobal could lead to questions about why INetGlobal ever used an autosurf component and folded components such a V-Local into the enterprise.

    Between Jan. 11 and Jan. 29, according to a Secret Service affidavit, undercover agents logged in to the INetGlobal website on “multiple occasions.”

    Among the things agents noted while logging in, according to the affidavit, was that ‘V-Local’ has an address listed as 250 Second Avenue South, Suite 145, Minneapolis, Minnesota, 55401.”

    The Secret Service said it conducted surveillance of the office suite in January — prior to the raid — from a skyway and corridor open to the public.

    “Agents saw signs reading ‘iNetGlobal’ and ‘V-Local.com’ at the door of Suite 106A, and saw signs reading ‘V-Records’ and ‘VWebs’ at the door of suite 145,” the agency said. The office suites later were searched as part of the raid.

    The phone number associated with RGMG.net in its domain registration also is referenced in INetGlobal marketing materials that quote Matt Renner.

    In the Feb. 16 news release, which was issued about a week before the Secret Service raid, INetGlobal is described as V-Local’s parent company.

    “V-Local is a lifestyle and business directory, featuring over 3.5 million businesses, events, classifieds and coupons,” the release said. “As a premier online advertising resource for businesses, V-Local provides a platform for businesses to leverage their brand and generate local and global exposure. V-Local bridges the gap between businesses and consumers at both global and local levels.”

    A week after the Feb. 16 news release, the Secret Service suggested in its affidavit for a search warrant that Steve Renner’s V-Local marketing claims were overblown. Here is a snippet from the affidavit:

    “[Steve] Renner claimed that iNetGlobal’s business directory, V-Local, had over 3.5
    million businesses signed up. He explained that attendees could make a great deal of money selling V-Local and signing up businesses to participate in V-Local.

    “[Steve] Renner stated that V-Local was expanding into Canada, Europe, and China. He claimed that when a company was listed on V-Local, iNetGlobal would list the business with over 65 local directories, plus social networking sites, and would arrange for the business to be input into Garmin and TomTom GPS navigation devices, as well as Cadillac OnStar.

    “On January 28, 2010, [an undercover agent] searched for ‘coffee shop’ in Minneapolis, Minnesota on V-Local, asking V-Local to find the nearest coffee shop. There were no results. [An undercover agent] then broadened the search to coffee shop, food and dining. V-Local then identified six coffee shops in Iowa, Kansas, and other states, only one of them in Minnesota (in Byron).

    “[Steve] Renner stated that if an attendee wanted to sell V-Local the attendee would need to pay $300, watch several videos, and take a certification test. Renner stated that for every person in a member’s ‘downline’ who got certified to sell V-Local, the original member would receive $100. Renner stated that this would be an enormous jump in a member’s income. Approximately one week after the Freedom Conference [in New York Jan. 23], [an undercover agent] searched on V-Local for ‘gym’ and ‘restaurant. There were no hits in the search for gym, and only one hit in the search for restaurant.”

    Matt Renner said he believed RGMG would emerge a leader, despite the assertions against INetGlobal.

    “They didn’t shut the company down,” he said, referring to INetGlobal. “No arrests were made. RGMG is a company that will generate good, positive results.”