The Securities and Exchange Commission (SEC) recently issued an investor warning regarding online paid-to-click scams that promise easy cash in exchange for purchasing a membership upfront.
The SEC warns that some of these programs may be nothing more than a Ponzi scheme, with minimal revenue beyond the membership fees of sales of “ad packs”. An enforcement case was recently unsealed in federal court in Florida, where the SEC alleged that an estimated 99 percent of the “profits” paid to investors were from buy-in fees from new investors. The SEC also alleged that the alleged person running this scheme spent millions of dollars of the invested money to fund other businesses, purchase private plane charters, cars, and a luxury home.
The SEC filed their complaint against Pedro Fort Berbel, who was based in Miami, as well as his company Fort Marketing Group which operated under a number of different names including MLM Shop, The Business Shop, and Fort Ad Pays. According to the complaint, investors were solicited through online videos and posts that they could earn investment returns reaching 120 percent if they purchased an ad pack and clicked on four banner ads per day. According to the SEC, Berbel and his company received more than $38 million from 150,000 or more investors.
“As alleged in our complaint, these companies had no viable source of revenue besides income from investor membership fees and the sale of ad packs, so this boiled down to an ad packs Ponzi scheme in which the promised investment returns to earlier investors were not possible without using funds from new investors,” said Eric I. Bustillo, Director of the SEC’s Miami Regional Office.”
If you were the victim of a scam, our investment fraud attorneys at Meyer Wilson are ready and waiting to provide you with the experienced legal representation you need. Over the years, our firm has recovered more than $350 million in verdicts and settlements, and we continue to fight for each new client who walks through our doors. Call us at one of our offices located across the United States, or fill out our online form to request a free case evaluation today.