BREAKING NEWS: More jurisdictions slam "Profitable Sunrise" HYIP

Previously we've reported that several US states, as well as UK and Canada have denounced Profitable Sunrise as a suspect scheme.

As it turns out, other states and countries are joining the party.

PatrickPretty.com reports that Ohio and Kentucky have joined the US states outlawing Profitable Sunrise.  Ohio claims that 15 other states have outlawed Profitable Sunrise.

http://www.patrickpretty.com/2013/03/14/bulletin-kentucky-issues-emergency-cease-and-desist-order-to-profitable-sunrise-order-identifies-possible-pitchwoman-issuing-news-releases-that-include-link-to-hyip-investment-calculator/

In a separate report, PatrickPretty.com also noted that New Zealand has also called Profitable Sunrise "illegal", and urge all people who had dealings with it to contact the authorities (FMA) right away. The promo video appears to feature a marketing group based in the US recruiting NZ people.

http://www.patrickpretty.com/2013/03/14/new-zealand-calls-profitable-sunrise-illegal-issues-warning-cites-youtube-promos-and-suggest-u-s-based-recruitment-arm-may-be-part-of-scam/

Genre Analysis: Does Precious Metal MLM Make Sense?

A gold bar. But doesn't it make sense as a MLM?
(Photo credit: Wikipedia)

You can mix almost ANY business with MLM by adopting some sort of a multi-level compensation plan. However, as I have explained many times before, MLM comp plan, due to its nature, requires a product with very high margins. The company has essentially spent the advertising budget on the affiliates instead of traditional media advertising like TV spots, magazine ads, and so on.

Which is why precious metal MLM, such as Auruma, makes absolutely no sense at all. Clearly, it should NOT exist the way it was described.

As the genre suggests, Auruma lets you "subscribe" to gold or silver purchase, except you don't actually get the stuff, but rather, a certificate that says you own this much, but it's store in their vault somewhere. And you can trade your ownership of those with other members. They charge a nominal "storage fee", and pay out multi-level "commission" if you can get other people to sign up as members (i.e. buy silver and gold stored at their place").

The price for gold and silver is published in newspapers every day all around the world. The prices don't vary much in what's known as the "spot" market. Jewelers charge a little more, and so on. Thus, there is NO margin to support multi-level payout.

So where is the mulit-level payout money coming from?

BREAKING NEWS: Canada joins countries denouncing Profitable Sunrise HYIP as suspicious scheme

Multiple Canadian provinces, including British Columbia and Quebec, have their financial regulatory agency released statement about how they will investigate Profitable Sunrise HYIP as a possible fraud.

http://www.patrickpretty.com/2013/03/12/update-canadas-ontario-and-quebec-join-alberta-in-issuing-warning-on-profitablesunrise/

Breaking News: BidXCel closed

BidXcel, which apparently launched in late 2012 (after the Zeek Rewards ponzi scheme was shut down in August 2012), apparently closed in March 2013 with only a terse announcement on its website.

None of the leaders can be found, and even affiliates that formerly claimed to have made "six-figures" from BidXCel is now blaming the company for "management made a lot of mistakes leading to affiliate frustration".

There's even hearsay that one of the company owners allegedly said that this sort of business cannot survive in the US... at a craps table in Las Vegas.

BidXCel supposedly is a "legal" version of Zeek Rewards, where the company compensates affiliates to making bid sales. However, all affiliates seem to talk about was recruitment of more affiliates. The "six-figure" affiliate above claimed to have spent 3 months recruiting 200 affiliates, and each of those affiliates went out and gotten her 2000 downlines, resulting in her six-figure income.

Clearly this "opportunity" ain't what it cracked up to be... But it may have soaked up millions of dollars... and a lot of people bought something worth virtually nothing.

BREAKING NEWS: British authorities cracked down on "Profitable Sunrise" HYIP

British Financial Services Authority (FSA) on March 5th 2013 put "Profitable Sunrise" on its warning list of questionable companies and individuals that does NOT have a license to provide investment anywhere in Great Britain. 

Most of the list were setup by fraudsters to "clone" a real company by making one that sounds very close to it but Profitable Sunrise, operated by the Novaks, made the list because it is an HYIP, essentially a pyramid scheme that relies on recruiting more and more people paying into it to pay a huge return to the early investors. Profitable Sunrise apparently operates out of the Czech Republic. 

It's also reported that New Zealand may join the list of countries declaring this HYIP verboten. 

BREAKING NEWS: Alabama also shuts down "Profitable Sunrise" HYIP

According to Patrick Pretty, Alabama has also issued a warning regarding "Profitable Sunrise" HYIP, which was issued a cease and desist by North Carolina only a week or so ago.

For details, see PPBlog report:

http://www.patrickpretty.com/2013/03/06/urgent-bulletin-moving-alabama-issues-warning-on-profitable-sunrise/

BREAKING NEWS: "Profitable Sunrise" HYIP issued "cease and desist" by North Carolina

After the demise of Zeek Rewards, many Zeekheads ended up on Profitable Sunrise, which was one of the dozens of schemes trying to go after Zeekheads. Profitable Sunrise claims to be in UK, but in reality seem to operate in Czech Republic. On February 27th, 2013, North Carolina issued a cease and desist, ordering Profitable Sunrise to cease operating in North Carolina immediately.

Profitable Sunrise is what's known as HYIP, or "high yield investment program", usually a pyramid scheme or a ponzi scheme. Though it often claimed to be associated with more legitimate names or locations. However, investigators associated with state of North Carolina pointed out that funds are wired to a bank in Czech Republic for deposit into Profitable Sunrise, and thus, there's no doubt that it is offering an investment product, and thus, conducting business illegally in state of North Carolina.