When the Securities and Exchange Commission charged R. Allen Stanford Feb. 17 with operating a multibillion-dollar fraud scheme through his bank in Antigua, the news created banking pandemonium on the tiny Caribbean island and also in Panama.
In the days that followed, a surf known as BizAdSplash referenced the banking situation in Panama without referencing Stanford by name.
BizAdSplash was one of three surfs that came to life in the months following the seizure of funds tied to AdSurfDaily Inc., a surf registered in the United States and accused of running a $100 million Ponzi scheme.
One of the key sales points of BizAdSplash was its purported offshore location. Two other surfs — AdViewGlobal and AdGateWorld — also bragged about being offshore. Promoters for the surfs said the offshore locations provided protection from the SEC, the IRS and state attorneys general. Promotions for the new surfs repeatedly referenced ASD.
“We want to let you know that even though our banks in Panama are closed for the next day and half, the payment processors are NOT CLOSED,” BizAdSplash said on Feb. 24. “You can still buy Ad Packages through your chosen payment processor. You will get your 100% match today and will continue into next week.
“So,” BizAdSplash continued, “if you purchased new Ad Packages yesterday from outside your Cash Balance, you received a 100% matching bonus.
“This 100% matching bonus will continue on today, through the weekend and on through Friday, March 6th!!!” the surf exclaimed.
On Feb. 27 — just three days later — BizAdSplash told customers it was ending its affiliation with StrictPay, a payment processor with Panamanian ties, but again did not mention Stanford or refer to the regional banking crisis.
“We are suspending the use of the Strict Pay Payment processor,” BizAdSplash said. “This is due to Strict Pay having some technical difficulties at this time. If you have requested a cash out using Strict Pay this past week, please change this and any future cash out request to one of the following: Alert Pay, Solid Trust Pay or Bank Wire. Please note that using the bank wire, the minimum to cash out is $1,000. Until Strict Pay has corrected the problems we will not allow this processor to be available.”
Alert Pay and Solid Trust Pay are payment processors headquartered in Canada, and friendly to the autosurf trade.
AdSurfDaily is another surf with Caribbean ties. Federal prosecutors said ASD had more than $1 million on deposit in Antigua. After prosecutors made the claim, ASD President Andy Bowdoin told members that $500,000 of the sum was a deposit that enabled ASD to process credit-card orders.
Bowdoin never referenced Antigua until prosecutors referenced it first.
ASD said it relied on the expert guidance of attorney Robert F. Garner. The Feds now say Garner was a shill for ASD, and Garner has advertised his legal services to help companies establish a presence offshore.
The extent of the problem the alleged Stanford Ponzi has caused surfs is unclear. But several surfs that purport to be operating offshore have collapsed in recent days