Achieve Community investors receive chargeback refunds?
One of the first things serial Ponzi scammers do when one of their schemes goes bust is file disputes with banks, payment processors and credit card providers.
The idea is that, even with an SEC injunction in place, financial institutions will cover their client’s losses while they investigate.
How effective this is I can’t say, but according to one Achieve Community investor the practice was widespread and has left her at a severe disadvantage.
Arla Mendenhall first sought to prioritize herself above other Achieve Community victims back in February.
Despite an exhaustive history of participating in a number of Ponzi schemes over the last few years, Mendenhall argued she ‘had no knowledge of anything illegal when‘ she joined Achieve Community.
The SEC naturally opposed Mendenhall’s request to attach herself as a plaintiff in their civil action against Achieve Community, arguing that she was no different to other victims in the scheme.
In Mendenhall’s July 16th response to the SEC’s opposition, she claims it is “public knowledge” that
a myriad of investors have already received their initial funds back that they have invested.
They have received chargebacks from their Credit Card companies by contacting them of this situation.
Many have also received their initial money invested thru (sic) their banks.
I have done neither, I have not received a chargeback from my Credit Card Company or gone thru (sic) my bank and received and (sic) money due to fraudulant (sic) activity.
I chose to go thru (sic) the court system. If I am not allowed to do that, I will suffer a great deal of loss which will create a hardship.
If credit card companies and banks are covering millions of dollars in Ponzi losses, then that’s certainly news to me.
I am aware that certain banks and financial institutions have cancelled recently issued checks in the past, but I’ve never heard of Ponzi investors in established schemes being issued refunds by their banks or credit providers.
I appreciate the SEC looking into helping investors receive their investments back but when just about all have already done chargebacks and bank refunds I do not see the necessity.
Anyone that has not should have contacted the court already.
Why Mendenhall herself didn’t request a chargeback and/or bank refund is not clarified. She also fails to provide any supporting evidence regarding allegations regarding “just about all” the other victims in the scheme.
I also see that much of the money will have to go others that are now involved in this case to compensate for their time and work on this.
As of yet a claim process for Achieve victims has yet to be established. Nor has a Receiver been appointed int he case, so what Mendenhall is talking about is unclear.
In any event, god forbid a third-party be paid to clean up the millions of dollars in Ponzi fraud mess Mendenhall and other Achieve investors sought to profit from.
I have sent in documents to the Court with my Investments documented and the losses in this business.
I hope that This can be resolved in at timely manner and not take too much more of the Courts (sic) time when this could be handled in a much easier and timely manner.
A decision on Mendenhall’s motion is now pending.
Meanwhile anyone care to explain why financial institutions are eating millions of dollars of losses in Ponzi fraud refunds?
I know the claims are filed by disingenuous investors but as far as I was aware they were pretty much universally denied.
Footnote: Our thanks to Don@ASDUpdates for providing a copy of Mendenhall’s July 16th response to the SEC’s opposition to her motion.
Update 22nd July 2015 – Mendenhall’s motion to add herself as a Plaintiff in the SEC civil case against Achieve Community has been denied.
In an order dated July 21st, Judge Blackburn wrote;
As more detailed fully in the SEC’s response to the motion (filed July 2, 2015) – which I adopt and incorporate by reference herein – Ms. Mendenhall’s request to join this action is barred by section 21(g) of the Exchange Act, which provides:
Notwithstanding the provisions of section 1407(a) of Title 28, or any other provision of law, no action for equitable relief
instituted by the Commission pursuant to the securities laws shall be consolidated or coordinated with other actions not brought by the Commission, even though such other actions may involve common questions of fact, unless such consolidation is consented to by the Commission.Regardless whether interpreted as an absolute bar to joinder of an individual plaintiff absent consent of the SEC, or simply as impermissible when the putative intervenor’s claims would merely mimic those already joined by the SEC’s suit, section 12(g) plainly precludes Ms. Mendenhall from intervening as a party plaintiff in this action.
THEREFORE, IT IS ORDERED that Ms. Mendenhall’s Motion To Be Joined in This Case as a Plaintiff, filed June 15, 2015, is denied.
And that’s that.
It is my understanding that there were people who joined TAC right before they stopped payments that were able to get their money returned via chargebacks, but those funds had not been deposited into TAC’s account. Otherwise they would not have received a chargeback.
While this is my understanding, if anyone has direct knowledge that they can share about this issue would be greatly appreciated for all of us to know.
Arla is just blowing smoke trying to sound like she is an innocent victim when she was one of the worst promoters of TAC. She knew exactly what TAC was, and I’m not buying she lost all her money in TAC.
That I get, same thing happened in Zeek except the checks were sitting uncashed in their office for ages because they were so far behind.
Mendenhall’s trying to make it sound like all and sundry have received refunds and she’s the only left who hasn’t.
They are caught between credit card laws and their own terms.
It’s probably not the place to publicly describe how it’s done, but, rest assured it is being done, and has been for years.
From memory it first began appearing on HYIP ponzi forums during the 12 Daily Pro days
why will banks eat millions of dollars in ponzi losses?
banks are businesses not charities.
banks may agree to reverse a transaction, by debiting the account where the transaction was credited. but in the case of achieve, the SEC action immediately froze all bank accounts of achieve? can transactions be reversed from frozen accounts under the control of the SEC? i don’t know, but don’t think so.
like oz suggests, it may be only freshly issued checks which were not yet processed, that may have been cancelled.
the same ^^ would apply to credit cards. no bank or credit card issuer is going to pay from their own pocket.
I will help everyone out with this one. Greed creates this problem. I read the achieve ad in total, and just by reading the title before anything else, I knew it was scam.
This is a serial scammer hoping to rip others off, then claiming victims here. She should be behind bars, not getting her money back.
So where is the money going to come from, then ??
Certainly not Achieve.
I think you will find that as soon as Achieve had problems, people started to do charge backs on credit cards (service/products) not provided. The banks will do a charge back. This will be before any funds were frozen.
I know many people did charge backs with Banners Broker and got their money back.
Also, I think a lot of these serial scammers are struggling to make money, so all they are thinking about is themselves. They want/need money! And that’s why they keep going for easy money programs.
when a chargeback is done, the money is Supposed to come back from the merchant who received the funds. whether the money Can be Recovered from a merchant may or may not be possible.
a cardholder’s [debit/credit] Issuing Bank forwards the payment to the merchants Acquiring Bank. the Acquiring Bank forwards the payment to the merchant account.
in case of ‘card not present’ transactions [eg internet payments like in achieve], if a card holder requests chargeback, the issuing Bank will make the chargeback and take the amount from the Acquiring Bank.
it is then upto the Acquiring bank to collect the money from the merchant using its network of payment facilitators who actually sign up and maintain the individual merchant accounts.
thus the bell is finally hung around the neck of these payment facilitators who have to recover money from the merchants or write it off as a loss.
in the case of achieve if chargebacks have been processed in large numbers, maybe the acquiring bank or payment facilitators, will have to approach the SEC to cover them from achieve’s frozen accounts?
Interesting read from Patrick Pretty tying Johnson’s new lawyer to Zeek Rewards…
patrickpretty.com/2015/07/20/defense-attorney-with-ties-to-zeek-case-now-representing-kristi-johnson-of-achieve-community-in-criminal-case/
how come a big firm lawyer has been appointed by the court to defend johnson? who’s paying? or is it pro bono work by matthew pruden?
well, isn’t she lucky to get a big time lawyer at no personal cost! she will of course settle her criminal case, i don’t think she will do time at all.
There’s no need for long, convoluted, theory based answers.
The answer is simple: the money comes from the millions of ordinary credit card users who DON’T engage in the misuse of credit card facilities, deliberate or otherwise, to participate in activities such as ponzis and pyramids.
As fashionable as it might be to gleefully dismiss credit card companies taking a hit as “serves them right,” the fact is, “they” as in the credit card companies themselves DON’T “take the hit”
They simply pass the losses on to the end user by increasing costs and charges.
As Don correctly points out in post #7 above, an (increasingly) large number of players use their inside knowledge to use the chargeback laws as a way of participating in illegal pyramids and ponzis virtually “risk free” and have been doing so for years.
Throw in the number of people who legitimately use the chargeback faciity when they realize exactly what it is they’ve become involved with and you’re looking at multiple millions of dollars ending up in the hands of criminals and being paid for by “Joe Everyone”
It’s not. she’s a proven liar and scammer. it’s the whole ‘shift the blame’ game.
yes yes, good people end up paying for misdeeds of bad people and even when you throw them in jail, you end up paying for their upkeep. no point wailing about the unfairness of it all, unless you have a better solution.
in the current context of arla mendenhall claiming before the court, that many people got their money back via chargeback, my little theory lesson just showed how it could ‘work in practice’. does your poor littleroundhead hurt?
true, and as the ponzi underbelly finds loopholes in the system, and uses it to their advantage, even banks and credit companies keep upping their game to fightback.
Acquiring Banks can fine payment facilitators, or drop them completely if their merchant accounts are generating too much chargeback. this can cause the payment facilitator to go out of business, and stop further costs to society.
i’m also noticing that ponzi/pyramisd schemes are finding it more and more difficult to find credit card/payment processor support? recent examples are achieve, ufun, onecoin, dfrf etc.
these to and fro battles will continue between ‘the system’ and those who want to take undue advantage of it.
IMO it is way better to ‘understand’ the system than to ‘wail’ about it.
i have a lot of experience with chargebacks, many of our telexfree clients, we recovered the money via chargeback.
when a chargeback is placed, visa or master card will literally, put their hands inside of the processors pocket, and take the money back, no questions asked, and put back into the clients card.
they money DOES NOT come from other people, it DOES NOT, come from insurance…. the same money you paid with your CC, that went into the payment processors bank act, is taken back from those accounts and into the clients card.
that sis why paymnet processors will hold funds of any given client (achieve, telex, ifs, whoever), and hold them for 6 months, and once these funds are “chargeback risk free” ( a card holder has 120 days to place a chargeback) then the payment processor releases it to its client.
this is why payment processors will drop ponzi clients so fast, because even though they will bring in lots of money, it is a very high risk money. that can end up flagging the payment processor in the visa and MC systems (see ipaoyout or nxpay??? case in zeek and how they went bankrupt because of zeek chargebacks)
in the end, visa and MC just put their hands, without any warning or permission, into the payment processors bank acts, and literally take back the funds that the card holder deposited.
no one looses money. only the pins or its processor. its literally your same money being returned
And what if the processor account has been cleared out?
It’s just a delaying tactic. Arla’s doing a preemptive strike on who’s doing the liquidation of the two, delaying payout of everybody and maybe hide the fact she may be a net winner.
Processor has OTHER money. It’s ultimately processor’s responsibility for accepting that transaction. Unless processor goes kaput, they have general funds. It doesn’t necessarily have to come out of the merchant’s account.
Recall UNRELATED fraud case in SoCal. Some noobs got tricked into being straw buyers of luxury cars, not realizing new cars are prohibited from being exported within 12 months of being sold.
Either they got caught passing a fake ID (but real check), or they got the car, it goes in a container, the VIN gets tracked and customs informs manufacturer, manufacturer fines the dealer, and dealer sues the straw buyer (for THOUSANDS). Straw buyers only get paid like $1000 and they thought it’s easy money.
Similarity here is the processor will pay the bill, and then sue the merchant for the money, even auto-deduct $$$ from account plus penalties if there’s any money left. I think that was the excuse Plastic Cash used to empty the Zeek account.
i have some doubt.
if payment processors will withhold merchant funds for 6 months how can merchants manage their daily/monthly cash flows?
small and medium businesses do not have enough funds to survive upto 6 months without customer payments.
ponzi schemes cannot survive even a few weeks without incoming payments?
according to ‘tara talks’ who blogs about chargebacks :
could you explain, andrew? information will help people.
Who is “wailing” about it ???
Ponzi players and orchestrators “understand” the system just fine.
In fact, they understand it so well, they openly and blatantly describe how to beat it on the usual suspect forums.
It happens and the great majority of non participant folk have no idea that a) they are paying for it and b) it is costing the economy / economies billions of dollars.
you were. you ‘seemed’ to suggest that banks and credit companies are having a whale of a time indulging with ponzi schemes and defraying their ‘costs’ among the honest public.
i do believe some of the ‘hit’ is taken by financial institutions and in the long run, ‘some’ of the costs may be borne by the unsuspecting public, but this is a cost of ‘running’ societies. we cannot have banks and credit institutions failing around us, that will be a greater cost.
yes, fraud costs a lot. that’s why we have anti fraud laws, and the judiciary, and the regulators, and the police, and civil society, all working to reduce fraud as much as possible. even this costs the economy a lot. basically everything costs. what to do?
Only to you, Anjalitroll, only to you.
if the processor account has been cleared out… visa and MC will still put their hand into the payment processors pocket and take that money back, so if the processor already released the funds tho the merchant.. then the payment processor has just lost a lot of money.
these merchants do survive for month without seeing the capital, payment processor only allow them to handle less than 10% of the total deposited capital until it is out of chargeback risk.
a chargeback is the only thing a merchant and/or payment processor CANNOT stop. that is why on pages like achieve, they are so adamant about no refunds, and place notices on their payment pages on about how you are willingly making that transaction and “forfeit” any right to make any claims with the bank at a future time (bollocks you can still do a chargeback no matter what)
again….i make reference to the article OZ wrote about nxpay or payout i don’t recall the name.. of one of week rewards last payment processors, who was being made to pay around 9million of pins funds… and in the end they got cleared of any wrongdoing.
Since they made their case that after week went down, a few months later they got hit HARD with the chargebacks with caused the company to go bankrupt, and also be flagged by visa and MC as a high risk processor.
this all happened long after zeek was gone. and they still kept weeks money..why???… because PAYMENT PROCESSORS DO NOT REALEASE FUND UNTILL THEY ARE CHARGEBACK FREE
this from:
usa.visa.com/download/merchants/chargeback-management-guidelines-for-visa-merchants.pdf
here are the Visa Chargeback Reason Codes and Time Limits
as you can see… none of the chargeback reasons allow for more than 120 days on anything.
you have 120 days from the moment you processed the transaction to go to the bank and get your money back via chargeback seamlessly.
this is what we used to get telexfree chargebacks:
somehow they can magically do what a court order can’t?
but not everyone is going to get all the money they invested back as she is trying to allude to since at the minimum the scheme went over the 120 days
NxPay was ordered to pay $9 million to the Receiver, but settled shortly after on paying $1 million.
behindmlm.com/companies/zeek-rewards/nxpay-claim-they-dont-have-funds-to-pay-zeek-receiver/
Article updated with news of Mendenhall’s Motion being denied.
Arla Mendenhall was partially correct when she claimed the practice of credit card chargebacks is / was being used to “disadvantage” creditors such as her.
What she fails to recognize or acknowledge publicly is, the chargebacks have been completed before the issue of an injunction and / or asset freeze.
Although she is a serial ponzi player / promoter, Mendenhall is not far enough “in” the inner circle of HYIP ponzi players to be told when to cut and run and get her initial deposit back via a “non delivery of service” chargeback.
and how do you chargeback funds you are laundering anyway? lol.
w-h-a-t-e-v-e-r
pfft etc etc.
see, what i’m finding about chargebacks is that the merchant acquirer banks are ‘liable’ to pay for chargebacks when the merchants fails.
when you purchase with a credit card and receive a product/service the transaction is not ‘final’ till the chargeback period has elapsed [varies from 3 to 6 months depending on the card company].
during this ‘non final’ transaction period the acquiring bank is at risk. if the merchant’s business has shut down or is bankrupt, the acquiring bank has to pay the chargeback. in case of bankruptcy, the acquiring bank can approach the receiver for covering the costs through the assets of the bankrupt estate.
the achieve shut down is similar to a bankruptcy as, the ponzi did not have the funds to pay the promised amouts to investors. the initial amounts paid by investors now becomes the liability of the acquiring bank.
the acquiring banks live with this risk, and build in their anticipated chargeback losses, in the service costs they charge merchants.
thus in achieve, depending on which card association is the behind the credit facility, if investors request chargeback within the stipulated time period, they have a right to chargeback by law.
these credit laws are vastly skewed in favor of consumers, and free loaders like ponzi players take advantage of it willy nilly.
credit laws may need some tweaking to get rid of this menace.
yep whip…. VISA and MC are above anyone.. as ludicrous as it may sound, but yes, credit card funds are not subject to govt. asset freeze. credit card companies can ALWAYS reverse a transaction.
if you want you can look up in the telexfree case, how every single account was frozen, but somehow, magically, the three accounts located in the UK where ALL telexfree credit and debit card payments went to… where NOT frozen and ok’d by the court for the funds to be reversed via chargeback.
it is as many say.
with a credit card, you can take risks (like going into these schemes) COMPLETELY risk free (money wise) for 120 days, and fortunately many of these schemes (those that work for some time) will get your initial investment back in less than that. so its a no loose scenario.
however, taking money from other people via joining a ponzi is never a good way to make money. however risk free you can do so for you pocket.
What you are “finding” is just enough to make it look like you know what you’re talking about.
If you believe there is not systematic deliberate defrauding of the credit card chargeback system by a (loosely) organized, interconnected group of ponzi and pyramid players, then come out and say so.
If you believe the banks and credit card companies are going to simply absorb the losses created by the systematic deliberate defrauding of the credit card chargeback system and not pass on such losses on to the large majority of credit card who do not engage in the fraudulent activities, then come out and say so.
If you think the risk minimization strategies used by the banks and credit card companies are sufficient to cover the amount of money lost to those systematicly and deliberate defrauding the credit card chargeback system without having to pass on the losses to consumers, then come out and say so.
uh, i know what i’m talking about:
brighterion.com/PDFArticles/Article_Payment_Business.pdf
post#32: the acquiring banks live with this risk, and build in their anticipated chargeback losses, in the service costs they charge merchants.
if merchants are charged heavily, they will transfer costs to their customers, so in the long run everybody pays for fraud. i’m not denying that.
the banks will use risk minimization strategies and we should all hope this is enough to keep them in business and not cost society much. but systems are not perfect.
what are you trying to complain about LRM?
everybody is just trying to keep the systems working at the best possible efficiency and lowest possible cost.
card associations should start getting really tough with acquiring banks, so they do their due diligence before signing up merchants. acquiring banks in turn need to keep the processor’s butt kicked at all times. these processes have to be perfected.
if ponzi players are taking advantage of consumer friendly credit laws, then it’s time revisit the laws. till then, everybody bears the brunt.
The fact there is a multi million dollar fraud being perpetrated on society by criminals and a known internet troll is trying to rationalize and justify it away with theoretical scenarios to win imaginary points.
Time for you to go back to defending SpeakAsia and explaining how Trudy Gilmond is going to win her case, Anjalitroll.
whatever munchkin.
BTW i’m really interested in the outcome of trudy gilmond’s case. there is a question of law there [SEC jurisdiction], which needs answering.
dislike trudy gilmond! do not dislike her questions!
Settle down kids, Gilmond is offtopic.
he started it!!
Having “Achieve” funds returned to me would be nice. Having received an education in all things PONZI is priceless!