Wings Network suspend US operations
Company launches Ponzi scheme, regulators get involved, company suspends US operations, company makes big roo-rah about it being a “voluntary” shutdown, regulators file lawsuit and shut them down anyway.
The above is fast becoming a reality for Ponzi scheme operators that operate in and out of the US. It was only a few months ago that the California-based WCM777 Ponzi scheme went through this exact scenario:
- October 2013 – WCM777 shuts down US operations, doesn’t reveal it’s under US regulatory investigation
- November 2013 – Massachusetts shuts down WCM777, reveals they started investigating in September 2013
- November 2013 – WCM777 admit they are illegal in the US
- January 2014 – California issue WCM777 a cease and desist
- March 2014 – SEC file Ponzi scheme lawsuit against WCM777
Now, in the wake of the $1 billion dollar TelexFree Ponzi scheme bust, comes Wings Network.
Announced sometime over the last 12 hours, Wings Network advise they have ‘decided to suspend operations in the USA for the time being.‘
The move comes after it was revealed less than a week ago that the Massachusetts Securities Division was investigating the company:
We attended one of their events,’’ Massachusetts Secretary of State William F. Galvin said.
“We had heard from some investors who, in light of TelexFree, had become concerned — and we’re concerned.’
Galvin’s office is likely to “be concerned” over Wings Network’s business model.
Launched under the guise of cloud-services (similar to WCM777’s ruse), Wings Network charges affiliates $299 to $1499 for positions on the promise of recruitment commissions paid – on the condition participants rope new affiliates into the scheme.
Indirectly acknowledging their business model falls ill of pyramid scheme law in the US, Wings Network advise
We recommend for all members within the United States to postpone all further meetings until advised otherwise. In addition it will be necessary to temporarily suspend the registration of new members in the United States.
We want to inform you that WINGS NETWORK is fully committed to operating legally in this country and is itself conducting its own internal investigation in a pro active effort to ensure full compliant with all state and federal laws in the USA.
WINGS NETWORKS looks forward to operating a prosperous, legal and ethical business in the USA for years to come.
Given that the Massachusetts Securities Division are the same regulators who spearheaded investigations into WCM777, what happened to there is a likely roadmap of what will now happen going forward.
Wings Network now have the option of scrapping their pyramid scheme, which will in turn alienate their current top recruiters who will then flee the business. That bottoms out the company and the scheme collapses.
What is far more likely however is that they’ll cosmetically cease doing business in the US, as WCM777 did, and then have a cease and desist and/or regulatory charges filed against them at a later date. Once you’re formally under investigation, it’s too late to try to pop the cork back in.
Footnote: Note that Wings Network’s suspension notice is currently only being shown to US-based visitors to the site. Whether or not they intend to inform their participants in other countries is unclear.