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Tuesday, October 13, 2009

Federal Prosecutor of internet ponzi case is now 'off the case'

The Federal prosecutor who kept 'Ad Surf Daily' (ASD) in his crosshairs is no longer on the case and has officially turned in his government badge.

US Department of Justice Senior Trial Attorney William R. Cowden spearheaded the investigation into internet marketing firm 'ASD' and its president, Andy Bowdoin, after feds seized the company's assets in August, 2008.
Department officials have stated: 
"Bill Cowden has left the Department of Justice for private practice. DOJ related inquiries to the Asset Forfeiture & Money Laundering Section at 202-514-1263. AdSurfDaily inquiries may be directed to the United States Attorney's Office for the District of Columbia at 202-514-7700."

It is not clear exactly why Cowden left the DOJ but officials say the case will now be prosecuted by the Chief of Asset Forfeiture Division for the District of Columbia.

ASD's problems began last fall when Feds raided ASD's headquarters in Quincy, Florida. Cowden then filed charges against Bowdoin after determining he was operating an elaborate ponzi scheme. Federal officials contend the internet company’s business model required its ‘members’ to purchase what are termed as ’ad packs’ in order to participate in the online marketing program. Members then received a profit each time they clicked on websites of cooperating members who also paid a nominal fee to advertise their businesses with ASD. Cowden claims the company was a ‘ponzi’ because many members did not have legitimate businesses and ASD was only able to generate revenue by having new members pay to participate in the program. ASD is estimated to have upwards of 125,000 paying members nationwide.


In total the federal government seized $53M (fifty three million dollars) of assets from 'Ad Surf Daily' (ASD) and $14M from Golden Panda (GP), another similar internet company they say was controlled by Bowdoin. In late July, 2009 the US Attorney General’s office completed its investigation and officials say they were able to convince Bowdoin to release Golden Panda’s assets to the government. Cowden maintains that Bowdoin voluntarily ‘walked away’ from his claim on the GP money after reviewing the Government’s evidence against him. Cowden asserts Bowdoin was never offered any deals and is still subject to criminal charges.


On September 21st, 2009 Bowdoin announced he is going to fight the federal charges against him and ASD by taking his case to trial. He hopes to convince jurors that ASD was a legitimate business and did nothing illegal. Bowdoin's decision to go to trial has sparked mixed reactions from ASD members. Many have expressed their opinions on various online forums dedicated to discussing problems surrounding the company. Bowdoin admits to having already spent more than a million dollars in legal fees and those costs will certainly skyrocket if and when the case goes to trial. Many members support Bowdoin and his fight against the federal government while others are outraged and feel he should be imprisoned for the questionable methods he used to operate the company. Still others remain hopeful they will retrieve money they've invested in ASD.

Government officials say they are already prepared to distribute the $14M seized from Bowdoin's other company, Golden Panda. Officials say anyone who lost money while doing business with GP is urged to contact the United States Attorney's Office for the District of Columbia at 202-514-7700.

The United States Department of Justice has posted an online form for ASD members who wish to recoup any money they lost while doing business with ASD. Members can fill out the form by going to the government's website:
'www.usdoj.gov/usao/dc/Victim_Witness_Assistance/adsurfdaily.html'
or contact the DOJ by emailing information to the Department at 'usadc.adsurfdaily@usdoj.gov'.

There are some 'Ad Surf Daily' members who refuse to submit their information to the government. They fear that in doing so they may also be investigated for conducting business with ASD and could subsequently face federal charges.

Many still support Bowdoin and believe the company is a legitimate business. Cowden says it has been difficult for ASD's members to face the facts, "Every time there's one of these cases the victims and people are disappointed to find out it's a fraud."

17 comments:

  1. The money should be returned to ASD investors. Fighting the U S Gov. is an impossible situation because they bleed you of money and issue negative publicity to wear a person down. I do not know if Andy is guilty or not and do not care. I do not want to be involved in his battles(like an alcoholic family - need to walk away) but I want my money back. Andy should have been very precise starting ASD since he had past problems. Yes, Gov Attorney's like publicity and winning as everyone regardless but I am not interested in fighting someone's business issues - Andy created it. Ralph

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  2. Mike,

    thanks for the reporting, although in fairness, the $53mm is an incorrect number. Upwards of another $40mm in cashiers checks, money orders and credit card payments were ceased from the office in Quincy, FL when the fed swept in. These could have very easily been returned, but weren't. In fact, they were deposited by the fed into the closed accounts. Why does no one ever mention this?

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  3. Where does anyone get the idea that Andy Bowdoin can choose to take the case to trial?

    Judge Collyer denied the emergency motion brought by Bowdoin (at which he did appear to defend, in spite of asking for it). She said that he had not proved that ASD was not an illegal business.

    Andy Bowdoin later forfeited his right to the seized assets WITH PREJUDICE which was accepted by the Judge and therefore a trial is not longer an issue. Then Bowdoin changed his mind about his WITH PREJUDICE relinquishment of the assets. What remains to see is IF Judge Collyer will allow him to do this, or whether she will insist on enforcing the relinquishment and proceed to forfeiture.

    The only possiblity Bowdoin has of going to Jury Trial is if Judge Collyer accepts his change of mind and reverses her acceptance of his relinquishment of assets.

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  4. Mike,

    Please check document 150, a Notice of Appearance by the Chief of Asset Forfieture Unit. Perhaps she will be the new prosecutor, ya think?

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  5. Thanks Drew for bringing that in. My family had three cashier's checks seized and cashed by the government, not ASD. These had all of our info attached and could have been returned by the government if the gov was really interested in helping we the people! We should trust them more than we trust Andy? I don't think so!

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  6. Yes, I spoke with the Chief of Asset Forfeiture and she confirmed her office is now handling the case,

    MM

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  7. The problem is by filing for a refund, it's like filing a complaint against ASD and or Andy,
    which we here in our Canadian group are NOT going to, just like the rest of the members, we too want our money back but we will NOT be a witness for the Gov NEVER, all we want is our money back, period

    Gerhard

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  8. We want our money back whitout expose our information to the gov.We are honest citizen...of USA...period.

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  9. It's true that Andy did not prove to the satisfaction of the court that ASD was NOT a Ponzi, but no one has proved that it IS. Are people not innocent until proven guilty anymore? Why is so difficult to prove it IS a Ponzi, if it is???!!! It's never been difficult before. Perhaps the $54+ millions dollars is just a little bit too hard to let go of.

    Personally, I had two very legitimate website businesses in the advertising program and was thrilled that I could get potential customers viewing my site at an affordable price. But I barely had time to reap the monetary rewards, but DID purchase a Water4Gas system that was in the advertising rotation and it's saving me 30% in gas costs. Nnot to mention the environmental benefits.

    The government needs to "get a life" and leave us alone, unless we ask for their help and until they moved in there were ZERO victims of ASD. Sure, I want my money back, but I want even more for ASD to be up and running, so everyone involved can reap the fruits of creative free enterprise that I thought this country was founded on.

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  10. I gave a cashier check made out to ASD. Before I could even get started, the government walked in. I did not even get a member number or have the chance to get my business website into the system. In other words, I never made a penny because the government closed everything down.

    Of course, if ASD is no longer, I want the government to give me my money back. They should not have it anyway.

    That was savings I put into the business to help it grow. Being a small business, more exposure online could have helped.

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  11. It is all very well to reintroduce the argument that ASD was genuine advertising company, but it should have been done by Andy Bowdoin at the for Emergency Hearing he requested in order to retrieve 2$million for putting ASD into legal operating shape. Noone could do it then, so what makes anyone think that they can do it now?

    A few people claim that their advertising was worth the money they spent on it, without any rebates, but they are few and far between. At 1$ a view and with only a maximum of some 1870 or so views actually being received, irrespective of the amount purchased/invested, it is unlikely that anyone can honestly claim that the advertising was worth the tens of thousands invested by some. The vast majority also recognise that, without rebates, the advertising had very little value.

    As ASD's own expert witness Gerry Nehra himself stated, for an MLM style/affiliate style company to be legitimate, there must be a reasonable percentage of paying customers who receive no comissions for recruiting or from sales. This is a good test of the viability of a product and one that Avon, for example, does pass with flying colors. ASD does not. Noone bought thousands of dollars worth of advertising without claiming rebates. There were no unique customers as all customers were also members and no non members were customers

    The addition of ASD/Bowdoin's negative to run the ad rotator once the computers were returned,even though he DID have the money (in Antigua etc) further reinforces the argument that the advertising side of ASD was incidental and not the principal purpose of its business.

    And that is all without taking into account the issues of lack of outside revenues to pay out more than was received, and to pay out what was paid out with new members money.

    Bill Cowden, whatever one may or may not opine of him and the US Government and its role in society, certainly seems to have stuck closely to his job description on this ocasion and has carried out the prosecution of ASD with great care and meticulousness (and with enormous restraint, given the insults and harrassment he has been subject to from some of the less controlled ASD "professional business" members.)

    What he cannot do, is change the facts and the figures that are available. They show ASD as running insolvent and using new members money to pay old members, and to be paying out substantially more than they were receiving. They show money being moved offshore and undeclared. They show an absence of any basic audited business accounts and many other irregularities that are rarely found in legitimate businesses.

    In the Maddoff case, the government has been heavily cricitized for NOT taking remedial action ten years ago, nor even discovering the ponzi - Maddoff himself did that job for them. It is ironic that, having salavaged at least some tens of millions of dollars from Andy Bowdoin's accounts which they have chosen to offer back to member victims, that same government is now being so heavily censored for protecting at least some of the members money.

    The members of ASD who really want ASD "up and running" are a small minority. Most just want to salvage what they can and move on and many want to see justice done and for those in ASD who lied and manipulated them to pay for their actions

    Bill Cowdens transition into the private sector is neither surprising nor unusual, but is highly unlikely to have anything whatsoever to do with the prosecution of ASD and Andy Bowdoin. To think otherwise is clutching at straws., especially as he has been replaced by the Chief of the Forfeiture Division!

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  12. Comparing ASD ponzi scheme with Gov. SS accounts and medicare, I think ASD have a lot to learn from Gov., what do you say?

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  13. I do not criticize the government for saving some of the money. My problem is that they went in there and shut the place down on August 1st. My check had not been deposited yet and was deposited on August 5th. Five full days after the DOJ took over. If teir intention was to protect me from Andy B. they should have sent my check back leting me know they had saved me from being ripped off. But they didn't do that, they took my money and now do not want to return it. Sorry Alasycia that is not protecting me that is taking my money against my will while pretending to protect me. That is my problem. As for Andy I really don't give a rats ass if he is a crook or not. That is the DOJs problem.

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  14. Alasycia...you sound so intelligent.

    Could you please then explain how the heck "Lehmans Brothers, Fannie Mae and Freddy Mac etc" collapse the financial and housing markets and have the the Government Bail them out for their "EXCESSIVE GREED."

    Please explain why Government bailing out CEO's on Wall-Street and Banking Firms is okay using Tax payers money?

    I guess excessive greed is okay for the Government.

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  15. Drew, good comment about the cashiers checks. However, if you check the federal statutes, you will find that it would have been ILLEGAL for the government to return any uncashed checks and/or cashiers checks. Read up on the laws concerning equality amongst fraud victims -- if the government gave you your cashiers check back, you'd be treated better than the other victims, which is not allowed.

    As for Gerhard Rempel, I would challenge you to put your money where your mouth is -- write a letter to the DOJ and request, since you so strongly believe in ASD, that you do NOT want any restitution if the final rulings go against Andy. It seems like you want it both ways, but it doesn't work like that. Chose a side, then stick to your guns. Go down with ASD, if Andy loses. OTOH, if you personally made money from ASD, get ready for clawbacks and possibly criminal liability.


    As for proving or disproving ASD's Ponzi status as Anonymous posted, please read up on the laws of civil forfeiture. If there is compelling evidence of wrongdoing, assets can be seized. The authorities must provide such evidence to a federal judge and convince the judge that the asset seizure can take place. The owner of the property, Andy Bowdoin in this case -- and yes Drew, Andy owned the cashiers check you sent in, not you! --, can challenge the seizure and get it overturned by demonstrating that the assets were not obtained illegally. He has not done so, and in fact has signed a proffer letter acknowledging the government's allegations. Don't worry though, Andy will get his opportunity to do the "innocent until guilty" thing soon enough, except that in that case it will be on criminal charges. Actually, that reminds me -- Gerhard, if you had any substance, you'd also include in your letter to the DOJ a demand to be treated exactly like Andy, both in the civil case and in the upcoming criminal case. In other words, when he goes to prison, you should as to go to prison as well. If Andy walks, you walk.

    Finally, as to "no victims before the government stepped in", please study how Ponzi schemes work. OF COURSE their were no victims at that point in time. ALL Ponzi schemes pay out until they don't or they are shut down. Duh. See AVG, Noobing, BizAdSplash, PushButtonExtreme (have I forgotten any of the ASD offshoots??) for examples of failed Ponzi schemes that did not require government intervention to fail.....

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  16. Hi Mike,

    Any updates or new news?? What about the judge? When is she suppose to make a decision? Is there any timeline on this case. I think ASD victims would just like some answers. Is that asking too much? Please see what you can find out for us. Appreciate your help! Thank you!

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  17. any new news on this ASD ordeal.

    Been a long time since we have heard anything or any reports of anyone being arrested or anything else.

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