e-gold Update: Value Access Plan Approved

“Weber was an Assistant United States Attorney and Chief of Asset Forfeiture in the United States Attorney’s Office for the Eastern District of New York, based in Downtown Brooklyn, where he served for 10 years and prosecuted and coordinated complex multiagency domestic and international money laundering, financial, tax, and forfeiture cases.”

“At the Justice Department, Weber oversaw prosecutions against major domestic and international financial institutions and corporations, including the federal portion of the Credit Suisse and Lloyds investigations, Union Bank of California, American Express Bank International, BankAtlantic, E Gold Ltd. (an internet-based digital currency business), and Sigue Corporation (a global money service business).”

The Major Economic Crimes Bureau will be responsible for all manner of complex financial investigations, including:

• securities, commodities, and investment fraud
• mortgage fraud and financial institution fraud
• commercial bribery and kickbacks
• bank fraud
• structured investment schemes
• internet fraud
• international money laundering and terror financing

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Here is the scam’s pitch:

“So we have found a way to profit from China’s growing economy and don’t want to keep the know-how just for ourselves. With MandarinInvest you will be able to partake in our success and patch up any financial holes your budget might have gotten due to the world financial crisis.”

Strangely enough?… I followed a Pecunix, keyword alert.

and found this wonderful scam interview, posted on a scam promotional web site, for a fraudulent/scam investment ponzi scheme.

Hi everyone! For my first post today I am really pleased to finally have this interview with the admin of what has surely been one of the most successful programs and consistent performers in the online investments industry for the last several months. I’m talking about Robbyn Hart who I’m sure needs little introduction to the many loyal fans of MandarinInvest (reviewed here).

That popularity is in no small part due to the professional service and regular and dependable payouts made by MandarinInvest. In what can be a very difficult area of the HYIP industry to establish yourself in, Robbyn and MandarinInvest have worked tirelessly to earn a reputation as a team that can compete with the more established names in the industry. And I think you’ll agree after reading this that the program is in some very capable hands and managed by some good HYIP professionals.

Before we hear from Robbyn however allow me to just briefly remind you that MandarinInvest is a long term HYI program that offers 1% for 30 days, 1.3% for 100 days, and 1.6%-2.1% for 150 days, with your principal returned on expiry.

I’m so tired of seeing these HYIP investment scams and writing about them (not that anyone cares) but we are today dropping Pecunix and C-gold from any future magazine issues. You are now both banned from our tiny part of the DGC world.  No ads, no articles etc.

I’m very unhappy to make such a decision, but to the operators of those companies, we are distancing the magazine and blog from you because of your continued support and integration with such scams.

I’ve got the term “Pecunix” in my Google keyword alerts along with a few dozen other industry related items.

For years, the term “Pecunix” did not generate to many alerts and in fact most of them were my articles or blog posts. However, since e-gold is no longer the ponzi favorite, the “Pecunix” alerts are many and much more frequent. Each day I’m receiving anywhere from a few to a few dozen.  Unfortunately, they are not the kind I like to see. It does not take a genius to forecast where this kind of business will lead Pecunix.

As first reported by Wired.com, the software, called a “computer and internet protocol address verifier,” or CIPAV, is designed to infiltrate a target’s computer and gather a wide range of information, which it secretly sends to an FBI server in eastern Virginia. The FBI’s use of the spyware surfaced in 2007 when the bureau used it to track e-mailed bomb threats against a Washington state high school to a 15-year-old student.

But the documents released Thursday under the Freedom of Information Act show the FBI has quietly obtained court authorization to deploy the CIPAV in a wide variety of cases, ranging from major hacker investigations, to someone posing as an FBI agent online. Shortly after its launch, the program became so popular with federal law enforcement that Justice Department lawyers in Washington warned that overuse of the novel technique could result in its electronic evidence being thrown out of court in some cases.

“While the technique is of indisputable value in certain kinds of cases, we are seeing indications that it is being used needlessly by some agencies, unnecessarily raising difficult legal questions (and a risk of suppression) without any countervailing benefit,” reads a formerly-classified March 7, 2002 memo from the Justice Department’s Computer Crime and Intellectual Property Section.

The documents, which are heavily redacted, do not detail the CIPAV’s capabilities, but an FBI affidavit in the 2007 case indicate it gathers and reports a computer’s IP address; MAC address; open ports; a list of running programs; the operating system type, version and serial number; preferred internet browser and version; the computer’s registered owner and registered company name; the current logged-in user name and the last-visited URL.

After sending the information to the FBI, the CIPAV settles into a silent “pen register” mode, in which it lurks on the target computer and monitors its internet use, logging the IP address of every server to which the machine connects.

The documents shed some light on how the FBI sneaks the CIPAV onto a target’s machine, hinting that the bureau may be using one or more web browser vulnerabilities. In several of the cases outlined, the FBI hosted the CIPAV on a website, and tricked the target into clicking on a link. That’s what happened in the Washington case, according to a formerly-secret planning document for the 2007 operation. “The CIPAV will be deployed via a Uniform Resource Locator (URL) address posted to the subject’s private chat room on MySpace.com.”

In a separate February 2007, Cincinnati-based investigation of hackers who’d successfully targeted an unnamed bank, the documents indicate the FBI’s efforts may have been detected. An FBI agent became alarmed when the hacker he was chasing didn’t get infected with the spyware after visiting the CIPAV-loaded website. Instead, the hacker “proceeded to visit the site 29 more times,” according to a summary of the incident. “In these instances, the CIPAV did not deliver its payload because of system incompatibility.”

The agent phoned the FBI’s Special Technologies Operations Unit for “urgent” help, expressing “the valid concern that the Unsub hackers would be ‘spooked.’” But two days later the hacker, or a different one, visited the site again and “the system was able to deliver a CIPAV and the CIPAV returned data.”

U.S. man arrested in gold-bullion Ponzi case

By Martha Graybow

NEW YORK (Reuters) – A man accused of running a multimillion-dollar Ponzi scheme in which investors were told their deposits were backed by offshore gold bullion reserves was arrested on Tuesday, nearly seven years after his operation shut down and he moved to Mexico, authorities said.

David Copeland Reed, 38, was charged with conspiracy, money laundering and wire fraud in an indictment unsealed in U.S. District Court in Manhattan, prosecutors and the FBI said.

The charges carry a prison term of up to 40 years.

Reed ran the alleged scam around a purported Internet banking operation he founded known as OSGold, according to the charges outlined in court documents. The business operated from March 2001 until June 2002, when Reed moved from North Carolina to Cancun, Mexico, taking customer funds with him, authorities said.

Millions of dollars of the investors’ and depositors’ money has never been returned, and no gold bullion reserves associated with OSGold have been located, authorities said.

Reed was arrested in Columbia, South Carolina, where he moved recently, authorities said. The name of his attorney was not immediately available.

Authorities said customers opened accounts with OSGold by wiring money to bank accounts that Reed and others controlled. The deposits were said to be backed by gold bullion reserves stored in an off-shore vault.

For the first few months of operation, OSGold operated reliably and developed a reputation as a secure way to engage in Internet banking, prosecutors said in court papers. Once depositors opened an online account, they could purportedly use their OSGold funds to wire money to locations around the world and to purchase items over the Internet, the indictment said.

OSGold account holders were also offered the opportunity to put money in a high-yielding investment program known as OSOpps that promised a guaranteed return of their principal as well as soaring rates of return, the court papers said. The high returns were said to come from gains on foreign exchange trading, but neither Reed nor his associates did any such trades, according to the indictment.

Clients worldwide opened about 66,000 accounts with Reed, transferring at least $12.8 million to three bank accounts that he and his associates controlled, according to the indictment.

Authorities called the alleged swindle a Ponzi scheme, a fraud in which earlier depositors are paid with money taken in from newer ones.

Reed and unidentified co-conspirators are accused of laundering customer funds through bank accounts in the United States, Mexico, Latvia and elsewhere, and using the money for their own personal expenses. Prosecutors said an investigation into the case is continuing.

(Editing by Jeffrey Benkoe)

Digital Gold Bullion Products

Ponzi crowd makes the switch as Liberty Reserve overtakes e-gold in traffic.

Changing of the Guard