Internet Ponzi Scheme Raked In $50 Million, SEC SaysI'm not sure how they determined that Charis "skimmed" $1.9 million from 12DP, except from bank filings. One would surely expect that she would make money from her own program and company, as she is acting president and there would be operating costs, not to mention she obviously wasn't running the program from charity. However, with the SEC order it sounds more likely that it will freeze her bank account and will probably result in the seizure of her new house.
LOS ANGELES (CN) - Charis Johnson, 33, of North Carolina, has raised more than $50 million from more than 300,000 investors an Internet Ponzi scheme, and has skimmed $1.9 million from it since the summer of 2005, the SEC claims in Federal Court. The agency claims that Johnson, of Charlotte, got the money through her Web-based businesses, LifeClicks and 12daily Pro. She sells 12daily Pro "membership units"� as a "paid Autosurf program" whose members allegedly are paid for "�viewing the websites owned or promoted by other online professionals."� Suckers can become "�upgraded members"� for $6 per unit, and the scam is so effective that 12daily Pro "�was recently ranked the 352nd most heavily trafficked website on the Internet," the agency claims.
The SEC says Johnson runs 12daily Pro as "�almost a pure Ponzi scheme -� at least 95% of the funds 12daily Pro uses to pay returns to upgraded members come from new investments in the form of new or existing members" upgrade fees.� She promises to pay each "�upgraded member"� 12 percent of his or her membership fee per day for 12 days, promising a 44 percent profit after 12 days.
Since mid-2005, the Defendants have raised more than $50 million from more than 300,000 investors nationwide and overseas, the agency says. �One of the Defendant'�s payment processors, StormPay, Inc., currently holds approximately $50 million in investor funds, which it has voluntarily agreed to freeze. The Defendants are seeking to undo the freeze.�
The SEC says Johnson has made �material misrepresentations and omissions in offering and selling the 12daily Pro investment program, and says �the bank holding Johnson's account (with the $1.9 million she allegedly skimmed) is unwilling to freeze the funds in the account without a court order.
The SEC wants defendants accounts frozen, documents preserved, accounting, disgorgement with interest, a receiver appointed, and penalties.
This seems to be the final nail in the coffin for 12DailyPro though, and we will find out next if users should expect to get their money refunded or if Charis Johnson will skip town. Regardless, Charis Johnson's name is now tainted in the world of auto-surfing, and any type of investment scheme she might try to open next would probably end up a complete failure. Her best bet would probably be to cut her losses and maybe write a book about the whole ordeal.
Interestingly enough, StormPay seems to have faded from the picture after the Jeff Johnson & ABC4 interview that occur at their offices (at least in the media). User's are still desperately trying to retrieve money out of their accounts that was frozen by StormPay through chargebacks and other filings through their bank. Yours truly withdrew the money that was in my account and successfully received it, although I never invested in 12DailyPro.
We'll find out what the official action taken, sometime Monday, was by the investigators in NC and with the SEC.
ABC 4 - 12 Daily Pro Shuts Down as Investigation Heats up