The online pitch goes something like this: Invest in our paid autosurf program and earn a 125-150 percent return for every dollar invested. All the investor has to do is surf a few Web sites each day. At least that's what Thomas A. Bowdoin and his AdSurfDaily.com site claims.
Sound too good to be true? That's exactly what the U.S. Secret Service thinks, and on Aug. 1 the agency seized approximately $53 million in funds and two homes as part of an investigation into what federal authorities claim is a "massive Internet-based wire fraud scheme."
According to a complaint filed in the U.S. District Court for the District of Columbia, the scheme involves ASD (AdSurfDaily.com) generating advertising revenue by automatically rotating advertised Web sites into its investors' Internet browsers.
Since ASD creates no significant new wealth by selling advertising to purchasers outside of its investor-members, authorities claim ASD is a classic Ponzi scheme, using money from new investors to pay off earlier investors before the whole thing collapses.
Federal prosecutors and the Secret Service raided ASD's Quincy, Fla., headquarters Aug. 1, seizing the $53 million. In court documents filed Aug. 4, the Secret Service claims that the money and Bowdoin's homes in Quincy and Myrtle Beach, S.C., are forfeitable to the United States government.
Neither Bowdoin nor anyone else connected to ASD has been criminally charged in the investigation, although the seizure of Bowdoin's funds makes it difficult for ASD to do business for the time being.
The court complaint says ASD masked its Ponzi scheme ambitions by calling its investors "advertisers," their investments "ad purchases" and the ASD payments to investors "rebates." However, according to the complaint, ASD did not operate as a seller of advertising services and there was no legitimate product being sold to support the profits ASD promised to pay its investors for relinquishing their funds.
While the Secret Service was mum on the investigation, bloggers were not.
"I truly believe Andy set this company up to be legal. He is a proven ethical businessman," wrote Ginger from Tennessee on Tallahassee's WCTV Web site. Quincy is located just outside Tallahassee, and the station covered the raids on Bowdoin's home and office.
Another post to the site claimed, "Just because the feds take civil action against someone does not mean the allegations are true, and this is one ... such case. This company had only the best intentions, shared the wealth with all involved, and were working with their legal team to ensure government compliance on all laws."
But the Internet & Affiliate Marketing News blog carried this post: "First of all, they are a classic Ponzi scheme because money is being paid out from new members investing to the old members who already earned their credits and are ready to cash out. This scam is growing fast and there are more and more people cashing out, so they need more new members to cover all the payouts."