Secret Service Raids Ad Surf Daily

[wserra]

Bowdoin was arraigned in DC on Friday, and the indictment unsealed. It's actually a good piece of writing. It shows how the law will ignore the smokescreens and cut to the essence of a scheme - a ponzi and a sale of unregistered securities.

People like Ulrich and Lambert from Connecting Us All should read it. Other than contributions from members, where do you get money? What does that make you? Sure, there are lots of gifting schemes out there, many of them crawl under the radar, and you are small potatoes compared to ASD. But do you really want to risk seeing your names on that document instead of "Thomas 'Andy' Bowdoin"?

[ProfHenryHiggins]

I sent both of them (along with a few others) a link to the document.

This was Lambert's response:

Very interesting Prof. But CUA does NOT promote any percentage of
return nor do we ask anyone to purchase a "package' nor do we keep any
of the money except the subscription payments for CUA. Please tell me
how the dead Elite impacts us today cuz I'm not seeing it.

Thanks
Val

[LaVidaRoja]

OMG!! If it walks like a duck...........

[wserra]

This was Lambert's response:

We see it all the time. People will be indicted, and proclaim their innocence. They'll be convicted and go to jail, and proclaim their innocence. They'll get out and do it again, and proclaim their innocence. They'll go to jail again, and proclaim their innocence. There comes a point when delusion is the only explanation.

IPOF, Connecting Us All may just get lost in the mass of similar gifting schemes out there. Or lightning may strike. I wouldn't want to live that way.

Of course, I wouldn't want to scam people either.

[GlimDropper]

Well the preliminary motions are being filed in Andy's criminal trial. Don (aka Wizzard7) is maintaining a website hosting the case files. Two recent filings in particular are of interest. The first is Andy's motion to dismiss, which seems to argue that the charges against Andy are unconstitutionally vague and that ASD does not satisfy all three prongs of the "Howey Test." In another docket entry Andy's attorneys are arguing to transfer the case from the District of Columbia to the Northern District of Florida.

I can kinda see the point in the request to transfer the case but I suspect the real motive is to get the case out of Judge Rosemary Collyer's court. Last December Andy filed a motion seeking to disqualify Judge Collyer, it was denied. Would this make his request to transfer the case more or less likely to be granted?

The motion to dismiss seems fairly farcical. It's filled with the same "it's not an investment, people were buying advertising" drek that didn't hold up in the emergency hearing back in 2008. There is one point I found interesting regarding the third prong of the Howey Test:

Regarding the “predominantly though the efforts of others” component of the third prong, “an investment contract can exist where the investor is required to perform some duties, as long as they are nominal or limited and would have little direct effect upon receipt by the participant of the benefits promised by the promoters.” Steinhardt Group Inc. v. Citicorp, 126 F.3d 144, 153 (3d Cir. 1997) (emphasis added). Here, the payment of both rebates and referral commissions were directly tied to the actual efforts of the advertisers. If the purchasers failed to view the requisite quantity of web pages in the rotator daily, or refused to participate Case 1:10-cr-00320-RMC Document 19 Filed 01/31/11 Page 22 of 25
19
in the viewing component altogether, then those non-participating members would receive no rebates. Payment of rebates was expressly and irrevocably tied to the actual efforts of the membership, and this is another factor confirming that no actionable “investment contract” was employed by AdSurfDaily.

Can this issue possibly hold any merit? Does the fact that "advertisers" needed to click their computer mouse 15 times a day somehow mean the profits gained through ASD were not “predominantly though the efforts of others”?

My complete layman who didn't even stay in a Holiday Inn Express last night understanding is that Andy's lawyers are making an argument to Andy for why he should pay their fees more than an argument to the court. But I'd appreciate the views of people more qualified than my own. Which would include anyone who did stay at the Holiday Inn recently.

And Patrick Pretty is doing his usual fantastic job of blogging on this topic.

[GlimDropper]

Well Andy filed a doctors note today, well make that a chiropractors note. He seems to be arguing that his wife's fibromyalgia is so bad he can't travel to DC for the trial.

And a small correction to my previous post, Andy's demand that Judge Collyer be disqualified from his case was from December 2009, not last year as I said above. And it wasn't the only demand that she step down, but the first demand was from a pro se filing sovereign named Curtis Richmond so that hardly counts.

[GlimDropper]

This is more of a tacked on scam and not directly related to Andy and ASD but another "third party" is soliciting donations to start another lawsuit trying to get people's Ad Surf daily dollars back from the government. Todd Disner has been a staunch defender of Andy and ASD and at one point made a claim of earning close to $60,000 from the program and recently he held a so called "ASD Justice" confrence call. The call is linked in ten minute sections near the bottom of this page. On the call Mr.Disner introduces a close friend of his as "a very accomplished attorney who isn't practicing law now" that friend being Dwight Owen Schweitzer of Florida, formerly of Connecticut. They weren't that specific on the call, Dwight's last name isn't mentioned till near the end of the call which added to the "no longer practicing" comment made me suspicious. Mr. Schweitzer was reprimanded in 2009 for, among other things:

Rule 7.5(a) of the Rules of Professional Conduct states: "[a] lawyer shall not
use.. .letterhead...that violates Rule 7.1 ". Rule 7.1 states "A lawyer shall not make a false
or misleading communication about the lawyer or the lawyer's services. A communication
is false or misleading· if it. ..omits a fact necessary to make the statement considered as a
whole not materially misleading." IIi this case, the Respondent submitted letterhead to the
judge, which identified the Respondent as an attorney and counselor at law, licensed solely
in the state of Connecticut. The Respondent omitted the fact that his license has been
suspended since 2003. We find the fact that the Respondent's license was suspended to be
a fact necessary to make the statement that the Respondent had a· Connecticut license not
materially misleading. The omission of said fact was materially misleading in violation of
Rule 7.1.

(Bolding mine)

Basically Todd and Dwight are asking for at least $100 per person to attack the constitutionality of the forfeiture of ASD's funds. Dwight makes two primary claims, the first being that the governments action was an "illegal search and seizure" (about four minutes into the second section of the recording) and also, less clearly that since the court appointed receiver is taking preliminary steps in setting up restitution efforts, the government is declaring that the funds seized belong to ASD members and not to ASD or Andy (about nine minutes into the same section of the call). On those basis he intends to file pro se to challenge the in rem forfeiture.

Mr.Schweitzer is a talented speaker, if you only listen for what you want to hear. Why didn't Andy's original attorneys not challenge the affidavit in the manner he purposes to do? He strongly indicates that they were just milking the case for billable hours later indicating that Andy has an actionable case against his former representation. He however fails to address why Andy's current lawyers don't use the same approach he intends to. Mr.Schweitzer goes on to make many statements which sound more like a sales pitch for the (at least) $10,000 he expects this all to cost rather than any real legal theory of the case.

This isn't the first time a third party has solicited funds from ASD victims, Bob Guenther had the assistance of a lawyer friend of his solicit at least $100,000 in an effort which I believe was never intended to go any further than the nowhere it did. This is in addition to rafts of pro se sovereign citizen fillings. ASD victims have been futile ground for follow up scammers, I only hope that for what ever money Dwight Owen Schweitzer reaps from Andy's victims it will carry with it ample scrutiny for what promises he makes when soliciting money for his endeavor.

[On Edit]

This is the verification statement by Secret Service Agent Roy Dotson at the bottom on the in rem forfeiture petition:

VERIFICATION
I, Roy Dotson, a Special Agent with the United States Secret Service, declare under
penalty of perjury, pursuant to 28 U.S.C. § 1746, that the foregoing Complaint for Forfeiture In
Rem is based upon reports and information known to me and/or furnished to me by other law
enforcement agents and that everything represented herein is true and correct to the best of my
knowledge and belief.
Executed on this ____ day of August 2008.
_/s/_________________________________
Roy Dotson
Special Agent
United States Secret Service

Mr.Schweitzer makes a major point that since Agent Dotson included information "known to (him) and/or furnished to (him) by others", he did not properly personally verify the information he attested to in the document rendering it an "unconstitutional" and "illegal" search and seizure. (about the seven minute mark of the second call clip linked above). To quote My Cousin Vinny, does the defense's case hold water?

[wserra]

Re: Dwight O. Schweitzer - in addition to the disciplinary decision you cited, GD, consider this one, in which he was suspended for borrowing money from a client and welshing. There are a couple of others which are too old for the CT bar disciplinary website. I'd trust him, right?

Mr.Schweitzer makes a major point that since Agent Dotson included information "known to (him) and/or furnished to (him) by others", he did not properly personally verify the information he attested to in the document rendering it an "unconstitutional" and "illegal" search and seizure. (about the seven minute mark of the second call clip linked above). To quote My Cousin Vinny, does the defense's case hold water?

To quote Marisa Tomei (mmm . . . Marisa Tomei), no. Under what is usually called the "imputed knowledge" doctrine, an LEO is entitled to rely on information received from fellow LEOs, at least in the absence of a reason not to do so. United States v. Hensley, 469 U.S. 221 (1985). The actual verification, as opposed to what you quote Schweitzer to say above, is "based upon reports and information known to me and/or furnished to me by other law enforcement agents" (emphasis supplied).

I'm sure you're shocked that these piggyback scammers would give inaccurate information.

[GlimDropper]

Thank you for weighing in wserra, when listening to the call I could tell Mr.Schweitzer was doing a very good job of telling his audience what they wanted to hear I just didn't know to what extent that was to the expense of legitimate legal advice. And sadly no, I'm not really surprised a "piggyback" scammer is sinking this low. There were claims of 170 people participating live on that call which for a case this old actually isn't that small a number. As word filters through the "downlines" I'm afraid the audience could multiply, there was a stated goal of raising $10,000 to initiate this action but I somehow doubt that they don't hope for significantly more than that.

I did see the disciplinary action you linked to, the loan was made in 1997 and the complaint was filed in 2001, that's a rather longsuffering creditor. The Schweitzer story that amused me most was one I feel compelled to be a bit cautions with, at least one blogger has removed commentary on it in the face of legal threats so I'll stick to the words of an established news account and one which also cannot be readily accused of being anti-semitic. The Jewish Daily Forward in 2004 printed a story about a lawsuit filled by Mr.Schweitzer against the Miami Herald Publishing Company for defamation. Schweitzer had been the Editor of the Herald owned weekly paper the Jewish Star Times and prior to announcing that the Star Times would be discontinued the Herald published two stories about Schweitzer. The Forward wrote:

The first story, titled “Oy Vey,” detailed how Schweitzer kicked a woman whose occupation was listed in the police report as “hooker” and was arrested on charges of battery and possession of narcotic implements. The story was printed in December 2002, a month after the incident occurred, and without a comment from Schweitzer, who was in Taiwan at the time. Schweitzer alleges in his suit that the Herald had decided two months earlier to discontinue the Jewish weekly but had not yet announced this decision.

The Herald published a second story a week after the initial account and reported that the case against Schweitzer was dropped because the woman did not wish to testify. This second story also reported that Schweitzer’s paper was folding.

Schweitzer claims that he informed the Herald about the incident when it occurred in November 2002 and that the Herald’s editors already knew the case was not going to be pursued when the first story was written a month later. The timing of the two stories, Schweitzer told the Forward, “was designed to make it appear that the reason the paper was closing was because of me.”

In his lawsuit, Schweitzer claims that the woman involved in the assault was a paid police informant who was using his apartment to set up a drug bust, and that there were two different police reports about the incident — only one of which listed the woman’s occupation as “hooker.”

I was unable to find out what if anything happened with the lawsuit but fairness compels me to hope that the legal system granted remedy to whatever extent Mr.Schweitzer's complaint held merit.

[wserra]

Schweitzer has posted his current CV. While he never actually says he's a practicing lawyer, he does call himself a "lawyer", and surely never says anything that implies he can't practice due to suspension. He also gives insufficient information for the reader to readily be able to track down his disciplinary history; he gives the Florida address, and never says that he was only admitted in CT. Think that's an accident?

I'm curious about what happened to the defamation case as well, but don't have access to FL state court records.

[Judge Roy Bean]

...
Basically Todd and Dwight are asking for at least $100 per person to attack the constitutionality of the forfeiture of ASD's funds. ...

If the claim were legitimate (which as wes points out, it isn't - that's a boilerplate verification), the defendant's counsel would have or will raise it.

Soliciting funds for a pro-se attempt working under the advice of a unlicensed attorney is a clear indication that they couldn't find a legitimate firm to accept their premise.

The other thing I keep having to remind people who fall for and then promote these kinds of schemes is they come to the court with unclean hands which pretty much dooms anything but the most well-reasoned and convincing argument.

[GlimDropper]

The entire call threw up more red flags than an old Soviet May Day parade. Mr.Schweitzer is fairly clear that he intends to file pro se but never indicates that he's unable to file suit as an actual attorney. The call specifies that any monies sent in should be addressed directly to Todd Disner, checks made out to that name and money orders were suggested at least once. Mr.Schweitzer dismissed the idea of establishing a dedicated bank account with a seperate tax ID number for the cause indicating that that seemed like more trouble than it was worth but at the same time suggesting that any funds sent in may be tax deductible as a business expense. I don't know the actual propriety of soliciting funds in this manner but Mr.Schweitzer's disciplinary history indicates he isn't precisely a stickler for the canon of ethics.

I had seen his CV, he never mentions any professional background as an improvisational jazz trumpeter so I assume tooting his own horn is more like a hobby. I enjoy incongruities which is what drew me to this rather impressive list of qualifications he posted a few weeks ago on a free resume website. I note under the heading "Various Groups & Associations:" he lists among others, the Connecticut Bar Association, Hartford County Bar Association and the American Trial Lawyers Association but without any affective dates of membership. Also on the "ASD Justice" call he proudly proclaimed that he had argued a case before the Supreme Court by the age of 33 yet for some reason he neglected to claim that distinction on any written record of his many and varied accomplishments.

Another question I have from the call is why such a successful and distinguished professional as himself fell prey to a low rent previously convicted con artist like Andy Bowdoin. Yes, he's not only an advocate for Ad Surf Daily members, he and his son were members themselves. The call began with Mr.Disner mentioning that as soon as he got a copy of the forfeiture document he forwarded it to Dwight and Mr.Schweitzer immediately pronounced the indictment flawed. Yet it took him this long to step forward and offer his expertise in defending what were in at least part, his own interests. If I may speculate, suing your former publisher might not be the best way to be hired by another publisher and receiving a reprimand after having your law license suspended might be a negative barometer for your legal career. An individual with a long list of past accomplishments who resorts to using the postjobfree dot com website to drum up employment might resort to other measures to make a little bit of money as well.

[wserra]

Bringing the account of the indictment of Andy Bowdoin, the founder of this particularly egregious scam, up to date:

Bowdoin filed motions to change venue (from DC to FL) and to dismiss the indictment. In a lengthy opinion, Judge Collyer denied the change of venue, largely on the grounds that various ASD issues had been litigated in DC for years.

The motion to dismiss claimed unconstitutional vagueness in the definition of "securities", and that as a matter of law ASD did not deal in “investment contract” securities per SEC v. W.H. Howey Co., 328 U.S. 293 (1946). In another lengthy opinion that probably gives these arguments more credit than they deserve, Judge Collyer noted that Howey itself found that the definition of "securities" in the context of investment contracts was not vague. As to Bowdoin's second argument, Judge Collyer noted that

Contrary to Mr. Bowdoin’s characterization of the ASD business, ASD’s promise to pay back 125% of the value paid to ASD by an advertiser strongly indicates that the joining of ASD via the purchase of an “advertisement” on the rotator in fact constituted an “investment” for a financial return.

Denied.

I have a question in passing: as Collyer noted, ASD promised its members 125% return on what could only be termed an investment. IOW, ASD incurred a liability of $125 for every $100 invested. In the absence of another means of making money, ASD had no way to meet that liability other than recruiting new members. Anybody see any way around the obvious conclusion that ASD was a ponzi? I can't imagine what Bowdoin is going to tell a jury, other than "Look at all these nice dogs and ponies".

Next conference October 21. No trial date yet.

[Judge Roy Bean]

http://www.courthousenews.com/2011/09/26/40050.htm

WASHINGTON - Victims of the AdSurfDaily and other Internet-based Ponzi schemes will soon recover $55 million in forfeited funds, the government said Monday.

[EagleOne]

The hearing that was held on the 21st set a trial date for Andy of September 24, 2012. This is the earliest Judge Collyer could hear the case. Pre-trial motions are due August 1, 2012, four years from the date ASD was taken down. Kind of poetic justice don't you think! Responses are due by August 15.

In the meantime, Andy is now begging his ASD members to join Onex/QLxchange under him claiming not only will they make a ton of money, but also it will give him the funds he needs to pay his attorney's for his defense. You know the program that if you invest only $5 will turn into $99,000+ or some such nonsense. Some never learn. Of course Andy said he had "Prayed" about this, and God was telling him the ASD members were to support him in this fashion. When all else fails, always use God to huckster the people.

I hope they revoke his being out on his personal recognizance since he was told to stay away from Ponzi schemes. It would serve him right.

[EagleOne]

I also forgot to mention that all ASD members who filed a remission claim form were reimbursed 100% of their losses. A first for repayment of the proceeds from a Ponzi.

[JamesVincent]

Onex sounds familiar from somewhere else but I cant place it.

[EagleOne]

Onex sounds familiar from somewhere else but I cant place it.

Ken, the pimp, Russo is in it, and if I am not mistaken so is Faith, the pimp, Sloan. This started around last November, but until now has not gained any traction. Not sure how successful Andy will be in getting his ASD members on board. But if he could get half of his 80,000 members, it could get traction to lure even more people into this Ponzi.

I am just shocked that all the state governor's, and the feds are not in this. It would solve the debt crisis in just 90 days, as well as unemployment. Hmmm, just think if I got all the governor's to join under me, and then all their friends and family members, all those on the unemployment rolls in their state, and then all those on welfare, social security and.......I would be a zillionaire in just 6 months. Where do I go to signup?

[wserra]

FRE 404(b) is greatly despised in the federal criminal defense community. It permits the govt to introduce evidence of prior bad acts which are not part of the currently-charged crimes if such evidence tends to prove the defendant's motive, intent, absence of mistake, identity, etc, etc. Basically, if ten years ago you spit on the sidewalk, the govt gets it in under 404(b). The govt does have to notify you about any evidence it intends to offer.

A couple of days ago, the govt did so as to Bowdoin, to the extent of 97 pages. The govt divides the evidence it intends to introduce into four categories: "Misstatements of material facts" (i.e., goddam lies), and three other scams (Golden Panda, Ad View Global and OneX). James, Lynn, if you wanted info about OneX, here you go. The govt alleges it to be a clear ponzi, ongoing as we write.

This filing caused Judge Collyer sua sponte to schedule a bond hearing for Bowdoin on May 8. She wants "the Government to present at the bond review hearing currently set for May 8, 2012, all evidence (written and testimonial) regarding Defendant's alleged involvement in OneX or any other alleged Internet scheme since the Indictment in this case".

I'd advise Andy to bring his toothbrush.

[wserra]

The govt has filed a second FRE 404(b) notice (5 MB file). As they noted in the first such notice, Bowdoin told his "investors" that his only contact with the law was a speeding ticket in Georgia. The first notice contained documents showing this to be a goddam lie. Among other things, this notice contains copies of twelve prior indictments.

As I wrote above, following the govt's first 404(b) notice, Judge Collyer sua sponte scheduled a bail review hearing for yesterday, May 8. That hearing has been adjourned until May 18, at the request of Bowdoin's lawyer, who says that he (the lawyer) is currently undergoing testing for "a potentially serious medical condition".

Probably hand injuries from beating the crap out of Andy.