Charles Ponzi

How do you know if you’re considering investing in a Ponzi scheme? The promoters will never come out and tell you they are running a pyramid scheme, so the investors have to be smart enough to recognize them on their own. The good news is it is easy to spot a Ponzi scheme.

Now I don’t mean that it’s easy to prove in a court of law that something is a Ponzi scheme. In a civil or criminal case, there are certain standards of proof that need to be met. But you’re not a court. You’re simply an investor. Whether you have $10,000 to invest or $10 million to invest, your money is probably pretty important to you.

Guest post by Charles Seavey

The Federal Reserve owns $849 billion in mortgage-backed securities. Total reserves are $2,872 billion, so mortgage-backed securities comprise 30% of reserves. (No wonder the dollar can’t bounce, even with Europe falling apart.)

See: http://www.federalreserve.gov/releases/h41/Current/

To give a sense of the scale of this unprecedented investment in questionable private securities, currency in circulation is $1,052 billion so the Fed owns almost as many mortgage-backed securities as there are dollars in existence.

I’ve written previously about Fortune Hi Tech Marketing (FHTM), a multi-level marketing company that is all about recruiting more people into your pyramid, rather than actually selling products.

Fortune Hi-Tech Marketing has previously been the target of legal action by the Attorney General of North Dakota, and has been a target of the North Carolina Attorney General, cracking down on “business opportunities”:

Guest Post by David Quinones, Executive Director, International Association for Asset Recovery

After 55 percent of the loans it wrote went to foreclosure, Allied Mortgage Capital is in the government’s crosshairs thanks in part to a whistleblower lawsuit brought on behalf of a former branch manager by IAAR Advisory Board member Brian Mahany, Joe Bird and their firm, Mahany & Ertl.

A massive fraud case developing in New York threatens to bring down the largest privately held mortgage company in the nation, and early indications are that asset recovery will play a large role in sifting through the wreckage.

The case of the Marcus Evans fraud gets even stranger. A couple of months ago, I wrote an article about my experience with Marcus Evans. It wasn’t particularly noteworthy. It was just that from the start, something didn’t seem right.

I got two cold calls from two separate sales people using the same tired script, and my internet research turned up something interesting. When searching for “marcus evans fraud” or “marcus evans complaints” or “marcus evans scam,” I came upon many websites that I believe were created by Marcus Evans to dominate the search engine ranking for those terms.

I wondered aloud if there was something to hide.

Marcus Evans, welcome to the Streisand Effect. For those unfamiliar, the Streisand Effect is a phenomenon where someone takes a relatively small, unimportant, unnoticed issue, and makes such a big deal about it that it actually gets more publicity.

Last week I wrote about a company called Marcus Evans, who got my attention by using dishonest sales tactics and scripted phone calls. That wouldn’t have been unusual or noteworthy, except when I Googled “Marcus Evans complaints,” “Marcus Evans scam,” and “Marcus Evans fraud,” I found tons of websites that were clearly set up by the company to dominate the search engine rankings for those terms.

What scams, complaints, or frauds would Marcus Evans want to hide? I’m not sure, but the story keeps getting more interesting.

A couple of weeks ago, I got a call from a nice woman at Marcus Evans, a company that puts on events in a variety of industries. Her talk was scripted, but it sounded good.

I pay a fee to attend an event (they say it is not a conference or seminar, but a “summit”). At this event will be chief legal counsel for Fortune 1,000 companies who are looking for service providers with various specialties. Marcus Evans says they match those executives in need of services with appropriate providers, pre-screening both so that they know it is a good potential match. Each person like myself who pays to attend is guaranteed 8 to 10 face-to-face meetings with these executives. (Which, of course, would be aimed at securing a new client for me.)

LifeLock sucks. When I first heard about LifeLock a few years ago, I was very intrigued by its service. I was especially interested in how it advertised the services: With the company’s CEO telling everyone his social security number.

The company “guarantees” that your identity will never be stolen, and it offers a “$1,000,000 Service Guarantee.”

Recently, the cat has been let out of the bag that UFirst Financial, the company selling the worthless “Money Merge Account” software via a multi-level marketing business model is on its last legs.  Top members of the salesforce are plotting how to oust other sales people and keep the profits for themselves. The numbers show that about 75% of MMA’s users have stopped using the software.

Now the news is that the powers that be at United First Financial are shopping the company to private equity groups. Of course, they don’t want anyone to know…. especially not their sales force.  The ship is sinking quickly, and the owners are trying to offload the company before there is nothing left to sell.

Here’s the note that recently went to upper management at U1st Financial:

This interesting information was posted on a Canadian discussion board where the members were talking about United First Financial. As you saw here, some of the top people in UFF see that the company is going under, and are looking for a way to take this horrible software to a new company, and leave all the dead weight agents behind.

Too bad users aren’t actually using the software anymore, according to the below.