WCM777 confirm “we are illegal in the US”
Following what can only be described as a PR nightmare spanning multiple countries and continents, WCM777 have themselves come clean and acknowledged they were selling unregistered securities in the US.
All but confirming the company operated as a Ponzi scheme, owner Phil Ming Xu’s latest update on the WCM777 website is a bit… strange.
Xu begins his update by declaring that
The negotiations between our lawyers and the Massachusetts’ Office of the Secretary went well. We have reached a settlement with Massachusetts.
“Went well”? Huh?
As reported late last week, the Massachusetts Securities Division recently concluded an investigation into WCM777’s business activities.
The end result?
WCM777 is banned in the state of Massachusetts and had been ordered to refund over $300,000 to participating Massachusetts-based affiliate investors. The company is also prohibited from continuing business operations now or in the future in the state of Massachusetts.
What “negotiations” Phil Ming Xu is talking about I have no idea, but short of declaring that he didn’t wind up in jail picking up bars of soap – how the above can be claimed to have “went well” is certainly a mystery to me.
Xu’s update continues,
However, because the sale of securities failed to fully comply with laws and regulations in United States, our operations in the U.S. will be on hold until further notice; WCM Limited will continue operations.
And there you have it, admittance that WCM777 is an out and out Ponzi scheme. The company sold unregistered securities and paid out pie in the sky ROIs using newly invested affiliate money.
What exactly Xu means by “our operations in the U.S. will be on hold” is also unclear to me. As far as I know the company still accepts US affiliate funds for investment via their California-based payment processor, Global Payout.
At this point, with WCM777 recently suspended in Colombia (and its top affiliates under criminal investigation) and the possibility of the Peruvian government following suit, one would think Xu might be feeling the heat from his global Ponzi scheme activities.
The company will implement new compliance procedures and register with the SEC before selling securities.
The company system also needs to be further improved to ensure global legitimacy.
Under the counsel of the lawyer, WCM777 has already registered in the state of California. We will soon re-enter the U.S. market.
We will restore WCM777’s promise and move towards achieving our vision!
Register with the SEC?! Oh please do Mr. Xu! I can’t wait to read how that turns out…
For reasons unknown, Xu seems unable to grasp that accepting new affiliate investments and using it to pay out existing affiliate investors is a Ponzi scheme business model.
Instead, he places the blame of WCM777’s compliance issues on ‘customer service, IT support and sales training‘:
Our customer service, IT support, and sales training are far from ideal. Especially in sales training, we don’t have a proper system set up.
Some of the distributors have exaggerated the sales performance, which has led to complaints.
Oh and naturally it’s their affiliates’ fault too. Nevermind the official WCM777 compensation plan material that clearly lays out the scheme’s Ponzi’esque nature:
But yeah, affiliates are totally to blame for WCM777 getting caught out selling unregistered securities…
So, where to from here?
Well, while we wait for Ming Xu to explain how he’s going to get a Ponzi scheme registered with the SEC in the US, Xu also revealed in his announcement that
WCM777 will hold the grand opening for Hong Kong office in Dubai this coming January.
Holding the grand opening of your “new” Hong Kong office in Dubai? Rightio, nothing suss about that…