Speech from FTC with comments and Federal Law cites on Ponzi and Pyramid Schemes.

[brokepoker]

Speech from FTC with comments and Federal Law cites on Ponzi and Pyramid Schemes.

http://www.ftc.gov/speeches/other/dvimf16.htm


The speech link above is a good one and the way I read it, there are MANY existing laws (and not just state laws but Federal ones) to deal with Ponzi schemes.

Perhaps some of these sites should be reported to the FTC so their assets and the owners assets can be taken into receivership NOW so they can not be squirreled away somewhere if the sites are deemed ponzi schemes. I would like to know if Watchdog has done this yet. Wouldn't it be as simple as getting a Grand Jury together and determining if the Matrix Sites have violated existing laws?

By looking at the lists for EZ-EXPO, there is a bunch of money at stake here. It seems to me that the FTC could move much quicker than a class action lawsuit. Also what they do is not a civil case and to me carries more weight.


PS...

I would personally like to know what people here think the "FIRST" known internet matrix site was. Was it EZ-Expo or another one?

[damion]

On this note, the FTC would have to deem them Ponzi schemes first and the main thing that prevents this is the fact that a product is sold (regardless of the inherent cost).
This is, most likely, why Jeffrey Wilens (Tim's Attorney) went after EZ Expo on the grounds of illegal lottery.

For reference, tymglobal.com is the first one I saw. I based the EZ Expo site off theirs, implemented auto-cycling (original idea) to make the lists move quicker and help keep them from stalling as they have done now. I just happened to be a better marketer than the owner of tymglobal.com. BTW the owner of tymglobal.com has recently shut down. Guess what scam he runs now....StormPay.

Damion

[brokepoker]

Product, shmoduct...

Lets take your average ticket scalper. Some of them carry a whole handful of little crappy merchandise like buttons, pencils or something to do with the event he is scalping for. He says here, let me sell you this collectable pencil for $500.00 and I will give you these Michael Jackson tickets for free as a bonus..a FREE GIFT if you will.

Now Mr. Ticket Scalper gets arrested (for scalping) and goes in front of a judge. Does he go to jail? Of course he does. The law looks at what the money was actually given in consideration for. In this case, it was the tickets not the collectable pencil. It is funny you still see scalpers trying to do this when you go to a game. And they still get arrested for scalping tickets all the time. But judge...I was selling them a ebook on a floppy disk...not the INSYNC tickets..I swear...honest....these ebooks are very valuable..I was giving them the tickets as a free bonus...yeah right.. 60 days in county for scalping tickets...next case.

In my opinion, any Judge that looks at a Matrix site will immediately form the opinion that it is a ponzi scheme. He will then ask, what did people give the money in consideration for? The ebook or the entry into the scheme. He will draw the obvious conclusion that it was for the scheme...as the e-books are not worth that much money. They are of secondary value.

The laws on the books all say the same thing, "that the product sold must not be of secondary value" I would say that a ebook is of secondary value to a Plasma TV..wouldn't you?

There was a pyramid scam a few years ago that sold you prints of artwork....and tried to hide behind this fact. BUT, the main thing they were actually selling was a monthy membership for people to buy the prints and people got commisions on that. You would think a artwork print (much like an ebook) would have a indeterminate value. NO..that is not how the judge looked at it. The main thing the people were buying was the monthly membership...not the art print. In matrix sites, the main thing people are buying is an entry into the matrix, not the e-book.

Matrix sites, pay earlier people with the later peoples money...I guess you know what that is called under the laws.

Try to pick it apart all you want but a judge will draw the same conclusions. They are very smart people.

[peterdragin]

Now least we forget you Damion had to pay for the so called ebook once. (if you did pay for them, which I don't think so )

As everybody knows they come with full reseller rights, so the only guy that paid for them was the first guy that signed up.

The rest of the people who signed up for the free "gift"
only signed up for the prize since the books were already paid for by the first guy signing up. PONZI SCAM !!!!!

Now if you bought ebooks for everyone who is on the lists it would not be a PONZI SCAM !!!!

But you used ebooks for a reason, you did not have to pay for them only once and this makes a bigger pot for you.

Now tell me I'm wrong......

[damion]

I originally paid for the ebooks with resell rights (which means I could sell them to as many people as I wanted - not just one).

I also had a lot more ebooks available when I ran the site.

I do not stand here and pretend to know all. I ran a business based off a model I seen somewhere else. I improved on that model and was a larger success at advertising than they were.

I got out of it, gave it to a friend, and then said friend tried to screw me and blame me for all of his problems after begging me to give it to him.

You can't please everyone. I sometimes wish I would have never started the site but I have to live with the fact that I did and try to recoop my losses through my new business(es).

Damion

[peterdragin]

Yup but you didn't sell them, you had them download them from your site. If your Matrix scam is to be legal you BETTER have proof that everyone that signed up got them.

What you should have to protect your butt is sent them to everyone and kept a copy of the mails of you sent them to, otherwise you are up the big creek without a paddle..

You have no proof that anyone got the ebooks. No one wanted the books anyway all they wanted is the free " gift " , The ebooks are there for worthless. Presto PONZI SCAM !!!!

[peterdragin]

By the way I'm the urlkiller !!! rember me ??

18,000 plus auctions canceled ans 215 sellers NARUed just for the update.

[Arzel]

Good points peter. Damion will never admit that the ebooks were basically worthless, or that the only reason people bought them was to get into the matrix. He would be admitting his own guilt.

Damion, did you really place fake names and testimonials on EzExpo when you were running the site?

[damion]

For the record and this will be the last time I post anything about this:
I placed fake names on the list to cycle out slower lists. My mistake in this is that I did it without telling people that I was doing it.

I placed 1 fake testimonial on the site to fill up the page because people would not send in their testimonials when they cycled. Even today after well over 1,000 people have received their products (I personally cycled over 1,000) their is still only 5 or 6 testimonials on the site.


I am not sure who you are peterdragin(urlkiller) - you must be someone that Shelby dealt with since he has taken over the site.

I respect what you all are doing. When I ran the site I did not see anything wrong with it because people were cycling in a timely manner, people were receiving products when they cycled, and there were no major problems (very few minor ones either). I was giving refunds and answered all questions within a few hours except when I was sleeping (which was not much).

Now that I have seen everything take a turn for the worse, I do see the inherent problems. As much as I would love to blame everything on Shelby, we all know that would not be fair. While I do not believe in some of the ways he runs things and treats people - he is only partially at fault for the decline - the rest lies in design flaws. Some of these flaws could be re-examined and worked out on a new site but it would be next to impossible to implement anything that would catch the liabilities that a site as large as EZ Expo has.

As far as your post peterdragin, people do not have to download something to say they got it. If I sent them a download link, and they chose not to download it - that is their fault, not mine. If Microsoft started selling Windows on their website, people would pay and then get a download link - just because they do not download it does not mean that Microsoft is at fault.

I, of course, cannot comment on the value of the e-books.

Believe it or not people - I am not the enemy. I am an intelligent, hard working man. I try to make business moves with other people in mind but sometimes I do not make the best decisions.

I will leave it at that.

Damion

[MaxPower]

That's what I was thinking Damion... when you ran the business it may have actually been illegal (I do believe that you indeed believed that it was not). But you had a 100% refund policy, therefore, nobody was conned out of their money because they could just get it back at anytime.
Maybe that will help your defense in court. Because at that time nobody could be scammed due to the fact that you could always get your money back. (ponder that for a while; or run it by a lawyer). I am no legal expert, nor have I ever claimed to be (I only know basic law).
Your alright in my book. As for Shelby I think of him as a scummy crook (just my opinion though: I'm sure there are others that feel the same). Cantinarec... I just don't like her attitude... I have nothing agasinst her personally.:D

[peterdragin]

MaxPower
I totaly agree with you, Damion is an OK guy but Shelby is the one who is the crook.

And ditto on Cantinarec, I can't post on that forum, was kicked off a long time ago, but I would voice the same opinion if I could.

I never used any profanity or any thing like that just asked some questions that I guess they did not want to hear, So off I went.
peterpan was the name i was useing on your forum.


Later Damion and the best to you.

[damion]

Peterdragin - all names that were banned are no longer banned. I unbanned everyone when I took it back over. Feel free to post your thoughts over there if you want.

Damion

[virology76]

Just wanted to say something about the post by BrokePoker that begins with the ticket scapler...
The case it not cut and dry as you put it. I am not a lawyer or a judge (actually just a microbiologist) but I do know that nothing is ever simple in the courtroom, especially when this many people and this much money is involved. You should not try to simplify this case so much, as I believe in my opinion that you may be underestimating the complexity of the potential case in court. It is also possible that you are overlooking the fact that in some of the cases, depending on the matrix product and the actual content of the E-Books, the matrix product may not be the item of primary value. Not to say that I believe this, but that a good lawyer will introduce this type of stuff to confuse the case.
Also I have to take exception to your statement that judges are smart people. Most judges are smart people, but some are total retards. Take for example the houston judge that ruled that a woman who beat her son over 60 times with a 2X4 can have her 6 other kids back after she gets out of jail... figure that one out