19/03/09. Interview with the admin of GoldNuggetInvest. Part II

Hi guys! Well I have quite a treat in store for you today, make no mistake. Regular readers will no doubt be aware that I have long been been a huge fan of GoldNuggetInvest and of its admin Robert Spearman. Now I’ve been in this business longer than most and over the years I’ve seen them all come and go. Granted there’s been a couple of good autosurfs but if someone asked me to name a better HYIP than GoldNuggetInvest you know the truth is I’d struggle. This is a very rare example of a program that strives to put the financial benefit of it’s members at the heart of it’s every action. Rarer still it’s an example of an HYIP with an actual business behind it and takes great care and indeed pride in it’s level of transparency, customer service and maintaining its well earned reputation as the number one online investment site around today. Now into their third year online, Robert and his partner Jurgen’s track record speaks for itself. The only thing left for me to say is that everybody who has gotten involved with GoldNuggetInvest has made money from the experience. Everybody except the bookmakers that is! They’ve lost a ton of cash but then who likes those guys anyway, lol!

Anyway, as is only natural things have changed an evolved over the course of the last two and a half years. Indeed they have changed since I was fortunate enough to first introduce Robert and Jurgen to you last October. So today I am pleased to re-introduce an old friend of money-news-online and give you this second interview with Robert. Just let me remind you first that for more information on this program that pays from 0.7%-1.1% daily or 6% weekly you can always refer to my original review published here (keeping in mind that things have changed somewhat since then) and you can also see my last interview published here. But first lets hear from Robert.

“1. Hi Robert. Thanks for taking this second interview for MNO. For the benefit of those still not familiar with GoldNuggetInvest can we just recap on a few details. First of all can you please re-introduce yourself to the readers and tell us about your personal involvement with GoldNuggetInvest.

Hello Paul. Let me first express my sincere appreciation for giving us the opportunity to introduce our project to your readers once again. My name is Robert Spearman and together with my partner Jurgen Wilckens we have founded GoldNuggetInvest back in 2006. Neither of us had any previous experience in running such a program. We have since added the services of Todd who handles our day-to-day customer service matters.

2. You have quite a unique method as far as HYIPs go of investing you members money and financing their profits. I refer to arbitrage gambling of course. So what can you tell us about that? How did you get involved and, in simple terms, how does it all work? Can you offer some practical examples of recent events you have made money from?

I started arbitrage trading (or betting) in 2001. When I first started, it was with very limited personal funds and an equally limited number of bookmakers. Jurgen, a boyhood friend of mine, started in 2003.

At this stage, we considered this to be nothing more than a hobby. We maintained accounts with a dozen or so bookmakers; spending a great deal of precious time moving money from one bookmaker to another. This, might I add, is the principal challenge of sports arbitrage betting. It’s all about timing. A successful arbitrage trader, once finding a viable arbitrage situation, has to jump on the bet before the odds start to change at the other end of the transaction.

If a trader has the duty to first transfer funds then make the wager, it’s possible, maybe probable, you will loose the arb. The solution we discovered is to maintain funded accounts with the greatest number of bookmakers as is reasonably possible. To increase our efficiency, Jurgen and I began to pool our money (2004); later on (2006), realizing we were on to something, began collecting funds from friends and family members, thus born, GoldNuggetInvest (GNI).

Because GNI is a global entity with clients worldwide, we needed a reasonably transparent, efficient and affordable payment processor, the likes of which we found in e-gold. E-gold, during this timeframe (2006) was at its pinnacle, and the reason why we gave the name of our venture, GoldNuggetInvest. We registered our domain in October 2006, put up a simple homepage and communicated with our members by email only (at that time, there was no script). Again, we were spending our precious resources maintaining excel charts to track our client’s investment(s).

During the 2006 timeframe, we only offered a weekly plan with a 4% margin. New members were solicited by invitation only.

Recognizing that there was an ever increasing number of online bookmakers (there are currently around 80 who are on-line; give or take) providing new and greater arbitrage situations, we felt we were missing golden opportunities increase our profits and margins by increasing the size of the wager(s). The only way to expand this was to garnish new funds from outside interests. By then we had streamlined our processes enabling us to act on arb situations real-time. The new capital allowed us access to otherwise unavailable arb opportunities as well as allowed us to double-up some of those existing arbs, doubling our level of profit.

Some of these arbitrage opportunities demanded the outlay of significant level of resources, at times, MONTHS in advance of the actual event. The only way we could effectively accomplish this was to make available GNI to the public; and so we did, opening our doors on May 01, 2008, increasing our membership from an initial 180 to our current number which is somewhere in excess of 3700.

To help your membership better understand arbitrage trading, I will explain, in detail, what is necessarily involved.

An arbitrage opportunity exists in sports betting, commodity trading or any other event when you involve two subjective opinions manifested by two separate and independent assessors of value. This means that the pursuer of an arbitrage is able to bet (invest) on all possible outcomes of a certain match or event (or a trade) at odds that guarantee profit regardless of who wins that match or event (google ‘arbitrage trading’).

Let’s be clear, arbitrage trading IS NOT gambling! Indeed, it is anything but gambling as it involves NO risk. It is merely a market phenomenon arising out of statistical analysis which manifests when two bookmakers assess different values (have different opinions) on the outcome of a certain event, be it a game, match or otherwise.

I will give your readers an actual example. A surebet we’ve placed earlier today:

The event is football, or for your U.S. based readers, soccer:

English Premier League – Blackburn vs West Ham, the match will kick off on Mar. 21. Since there is the possibility of a draw, we have three possible outcomes. We found the following situation:

Outcome 1 – Win for Blackburn – Odds of 2.25 at LinesMaker

Outcome 2 – Draw – Odds of 3.46 at Pinnaclesports

Outcome 3 – Win for West Ham Odds of 4.08 at Pinnaclesports

This discrepancy in the bookmakers opinions guarantees us a profit of about 2.2%. Here’s why:

The above situation tells us that Blackburn and West Ham are competing in the English Premier League. It also tells us that LinesMaker have odds of 2.25 for the match to be won by Blackburn. Pinnaclesports have odds of 3.46 for the match to be ended in a draw and the same bookie Pinnaclesports have odds of 4.08 for the match to be won by West Ham. By applying a simple mathematical formula to those odds, we are able to calculate that we can cover all three possible outcomes of the match and make a guaranteed ? 2.2% profit. We have placed our bets in proportion to the odds on each possible outcome. £908.00 staked on Blackburn at odds of 2.25 to return £2,043.00, £591.00 staked on the draw at odds of 3.46 to return £2,044.86 and £501.00 staked on West Ham at odds of 4.08 to return £2,044.08. Therefore we have staked a total of £2,000 and the bets return a risk free profit of ? 2.2% – despite the outcome.

We are currently placing more than 6000 of such surebets a month, an increase of 2500 surebets, compared to last year October, when your first interview with us was conducted.

3. It isn’t as easy as it might look at first though is it? I mean I imagine bookmakers must try to monitor each other to try and prevent things like that, do they? Are there many easy to find examples or does it really take a lot of time and research? Does the growing availability of internet gambling make it any easier?

Perhaps. Nevertheless, but in reality, there is tough competition amongst the oddsmakers.

Having just checked,there are now close to a hundred oddsmakers/bookies competing with each other. If all would offer the same odds, business would concentrate on the few big ones and the others would leave the market one by one. This competition and the fact that the odds do differ from bookmaker to bookmaker is the key to our success.
To find such opportunities we don’t have to do any research. We are subscribing to a couple of leads services, sending us opportunities all day long. The biggest service sends us 50,000 – 70,000 such opportunities every month. So there is plenty of room to play.

4. Staying with the old for a moment, can you tell us in detail about the security of GoldNuggetInvest? Please tell potential investors what measures you have taken to protect the site (and their accounts) from malicious DdoS attacks and hackers.

We are hosted on a managed and dedicated server with BlackLotus and have purchased their Assurance Platinum plan, with Prolexic DDoS protected DNS. We are also using Tomacero’s Oroscript, which has been customized to meet our demands and tested by independent scripters for backdoors and flaws. We think that this script is advanced and has all the necessary security enhancements a project of our size and scope requires.

Furthermore, we have retained Mike, an IT whiz kid and the developer of the original script, who is constantly modifying and enhancing the scripts features. The script is capable of detecting IP changes. If a member tries to login from a different IP than that which they previously (and successfully) logged on, the member will receive an email with a code that needs to be entered on the site in order to login successfully(similar to E-Gold’s AccSent).

5. One thing there has been some changes with recently I know is the script. Tell us about the problems you had there and how you overcame them.

In January we noticed some flaws and other minor issues. The postings of the Daily Variable program did not get through due to timeout issues with our old server. The script was simply outdated, as was the server. It was a real mess up and caused Todd one hell of a lot of work. We then decided to take action, organized the new server, customized the already available new version of the script to meet our demands and got everything under control within a few days. But it was a challenge for the whole team and we needed to reorganize internal structures as well. Once this was done, and the new script was tweaked here and there, everything went smoothly as it should (and did before) and we are more then ever satisfied with this part of our operation.

6. Quite a lot has changed since you started though hasn’t it? Even since our last interview in October. Is it true that you will soon be incorporated as a registered company? Can you tell us how you go about doing this and what are the benefits to the members?

Yes Paul, and this fact is the most significant of all our upgrades since GNI’s inception.

GNI will become incorporated in the next couple of weeks. The finite details will be released at a later date. The principal benefit to the members is the legality of our venture and the peace of mind that we are operating within and complying with an official regulatory governance.

We are living in a time where big financial institutions are collapsing and the set-up of an offshore structure wouldn’t eliminate this fact. Saying so I just want to point out that the measure to incorporate the project GNI might not give members more security – being with us requires common trust in our undertakings and will so in the future. The real benefit of our incorporation is that we are insulated from foreign regulatory entities and their abilities to shut us down for non-compliance or failing to adhere to ‘THEIR’ rules (despite or ethical and moral dealings with our trusted clients). We will be licensed to do what we are doing!
Another important feature of our incorporation will be the introduction of a banking feature that will give our members a new level of convenience, cost reductions and viability. What I am referring to is an ability to accept bank deposits. This is our first priority upon successful conclusion of our incorporation. It should happen within weeks after the incorporation is concluded. This feature is on the top of the wish list of many of our members. The benefits of this are endless, the least of which is the cost savings and expenditure of our most significant resource, time.

The latest LibertyReserve debacle has caused them downtimes and accusations of ‘missing funds’, API spoofing etc. Many of our members are concerned to work with payment processors and looking forward to deal with us with good ol’ bank transfers.

7. Let’s move on to the plans. What are the current plans now available to GoldNuggetInvest members? Explain the details to us, e.g what are the minimum and maximum amounts to invest? And also explain how the indefinite investment term works. What payment processors are you dealing with?

The minimum amount one must have to participate in the two GNI program(s) is $20 for our Daily Variable program or $50 for our more profitable Weekly Fixed program.

Our Daily Variable program is paying a daily profit between 0.7 – 1.1% paid Monday – Friday; our Weekly Fixed program is paying a fixed weekly profit of 6%. About a week ago we added another level to the Weekly Fixed program for our larger investors. We are paying 7.5% weekly for deposits as from $21,000.

Profits are paid to your GNI account balance within our system and a withdrawal request to your payment processor can be posted 24/7.

Both programs are running indefinitely but can be terminated at any time (after a lock-in period of 30 days) the principal of which can be withdraw without any fee.

On February 17th we introduced two new programs: The purpose of these plans are to reinvest smaller amounts, without the requirement to accumulate them first in your account balance, before they can be invested in our Daily Variable or Weekly Fixed programs.

There are two such plans enabled now and I will explain to you how to use them:

Daily Variable Rollover

Interest paid 0.7% fixed, daily from Monday until Friday
Minimum deposit $1
Maximum deposit $500
Prerequisite to invest is an active deposit in the Daily Variable program

Weekly Fixed Rollover
Interest paid 0.8% fixed, daily from Monday until Friday
Minimum deposit $3
Maximum deposit $1000
Prerequisite to invest is an active deposit in the Weekly Fixed program

Please note that deposits in both plans can be cancelled at any time, means there is no lock-in period. This feature, although the interest is lower than in the main programs, allows you to optimize your investment strategy with us. You can reinvest earnings into those plans whenever you have funds available in your account balance.

A client’s principal deposit(s) can be accessed after the 30 days lock-in period. The intent was to give the investors the opportunity to combine the rollover funds with the principal amount leaving them with one investment term which is more manageable for all concerned. While waiting for this 30 period to elapse, the client doesn’t loose the interest from their account balances. It’s an all-win situation for the clients.

8. There are a few more changes lined up there still isn’t there? Will you soon have bank deposit and withdrawal options available to members? How will that work?

Yes Paul, the plans for GNI are broad and far reaching…. Those plans that I can discuss start with the decision and subsequent implementation of our plans to move operations off-shore as said before. Much thought and a significant amount of resources have been utilized to implement this change. The planning of which has gone on behind the scenes with a negligible impact on our business and customer service operations.

In fact, our release of this information amounts to nothing less than an announcement by GNI to our clients, your subscribers and the On-line community as a whole: GNI is formally announcing their intent to locate their business operations under a offshore license. We invite the on-line community to come in, look around and review the benefits of becoming a member of GNI.

9. I also believe you will be appointing representatives to to work with members in some different countries. Tell us more about that. Where and when will that start? Will that be totally online or will you eventually offer telephone support as well? Also what kind of customer support is currently available to members and how will that change?

Well first, as you are aware, we brought Todd in to run our Customer Service Operations. Once he is fully capable and understands completely the Ticket based, Customer Resources Management Program, we can go to the next level which is telephone support.

Currently this matter is being ‘mulled over’ within GNI to ascertain what kind of phone support would best serve our new and current customers, our VIPs and of course, the logistics of it all. We haven’t decided any of the details so I would like to reserve any further comment in this regard.

Some of our other plans include elevating Todd to the position of a trader. He will then bring in and train a new Customer Service Manager.

What this will do will allow GNI to grow beyond the current $1.2 million threshold that limits GNI’s growth. It is our opinion that a good trader can manage around $600,000 of surebet funds. Someone like Jurgen, a trader with substantial trade experience can handle a bit more; whereas someone with little or no experience like Todd, significantly less. How much we grow beyond the $1.2 million dollar amount will depend largely on Todd and his abilities to master the fast-paced and grinding ‘surebet’ arena. We have high hopes with Todd, but one never knows until such time he is actually in the ‘mix.’ This (surebet trading) is NOT for everyone…we’ll just have to wait and see.

The introduction of regional representatives to assist our new and existing clients with the most basic, yet potentially most frustrating aspects of the GNI system, and support system. These representatives will necessarily be well versed in all aspects of GNI procedures and operations. They will be working directly with Todd to provide an additional layer of Customer Service and Support all with the aim of increasing our cutomer’s level of satisfaction with our program that we have worked so hard to create.

We already appointed representatives in the following countries and regions and the official introduction will be made public soon: USA, Germany, Italy, South East Asia, Colombia and for the French speaking countries of West Africa.

If one of our members is interested to represent us in their country or region please contact us. We consider the UK, Canada, France, Brazil, Spain, Australia and the Scandinavian countries as key markets and would like to install a representative in each of those countries.

10. Some of the most successful sites in recent times have eventually gone private. Are you also planning to follow that road? What are the advantages, first of all to existing members, and then to you as an admin in having GoldNuggetInvest as a private investment site? Is there a definite time frame in mind here? Under what circumstances would you then re-open the program to new members?

We are most definitely going to be private again. Initially we were planning to go private at the $1.2 million dollar mark until the decision was made to create a new ‘Trader Position’ giving us more latitude in growing the venture to the $1.8 million dollar mark; again it just depends on how well Todd is able to grasp the concepts.

Our time frame WAS to go private in conjunction with the announcement of our intent to move our operations off-shore (middle/end of April). With that being said, no, we don’t have a definite time frame.

So far as re-opening the venture to new investors….the answer is an emphatic….NO. You see a trader’s capacity is $600,000.00 (plus or minus a few dollars). Even our current investors would not be allowed to increase their investment level once the doors close. The only way a current investor could or would be able to grow their investment further, is if a current investor sold or withdrew their principal balance, releasing some capacity for a new investment. Todd is our last trader. There will be no others.

11. Following on from that if you are to limit the number of members at any one time, will that effect some further changes in the plans? If you need to change them around somehow to reflect the changes in the program, what happens to existing members who might be long term members?

That’s a great question Paul, but it’s not one we have yet put any thought into. Our current focus has been successful surebet trading and moving our operations offshore.

12. In fact what would you like to say to members who might have some concerns about this and so many other sweeping changes coming soon in GoldNuggetInvest? You really have done an excellent job so far but surely you know it’s only human nature that some people simply see no reason to change a winning formula. What is your advice?

All of our changes that we are going to be implementing are done on the basis of increased customer service and the health and longevity of the program. It is our intent to fully comply with international, national, regional and local laws. If we don’t, we’ll be shut down, jeopardizing the sanctity of our customer’s funds. That is unacceptable. We want and need to stay transparent with regard to regulatory requirements and are only doing what we have to do to comply.

13. Just one question about the HYIP industry in general. This business is widely known to be infested with scams and con men, and a lot of high profile programs have collapsed recently. I’m sure you don’t consider any of these to be your peers but weather you like it or not the public perception of you is going to be that you are in a line of work that is at best a bit shady and where attitudes to fraud, dishonesty and the law are, shall we say, a bit relaxed. How do you, first of all respond to that, and secondly, how do you separate yourself from it? Is there a certain ‘guilt by association’ just by being in this business at all, regardless of your own personal honesty and principles? How can you protect the reputation of GoldNuggetInvest from the sins of others?

I thought you said you were only going to ask one question….(LOL). You raise some great points and ask good questions. Paul, we don’t consider any of these HYIPs to be our Peers. We run our operations from the internet, as do most HYIPs. That is where the similarities start and stop; oh and we all use payment processors. That’s it. How we are able to separate ourselves from a ‘run of the mill’ HYIP is the notion that we have an actual business plan which follows our business model. We have a real and defined method of trading and generating a sustainable level of income while comfortably rewarding ourselves for the hard work that we are doing and have done.

Is there a level of guilt? Not at all. We feel we are doing a service for the likes of Forum Operators such as yourself. When you introduce us to your on-line community, you can do so with a totally clear conscience knowing we are legitimate, honest and provide nothing but top-notch Customer Service. In fact Paul, you should be paying us to advertise on your forum for the simple reason we are probably one of maybe 5 or 6 truly legitimate programs on the internet (that offers a high rate of return on their investment).

14. Staying online in this business for what is now into your third year is an almighty achievement. You have my congratulations and I think that too of the entire online investing community. Did you ever expect it to last this long? What was your expectation when you started the site back in 2006?

Paul, Jurgen and I never doubted for a moment that we would be successful. To answer your question I say most emphatically, Yes! Our expected longevity is now what it was when we initially launched GNI, to remain open and operational for the foreseeable future.

15. Maybe I could have brought this up earlier but I also think it’s fitting to mention it here, considering we have discussed how the program has continually evolved up to now. Can you now share the current membership statistics with us? How many members do you have now and what are the active deposits?

As of this writing, we have 1741 active members (members who have actually made deposits). If I recall correctly, we had 700 or so members back when we did our first interview.

Our active deposits are in the region of $1 Million.

16. And finally, still on the same subject but purely a matter for complete speculation for yourself, where would you like to see GoldNuggetInvest in another three years? What would be a realistic expectation given the level of progress you have seen to date? But also, just to be indulgent and forget about reality, what would be your ultimate dream for the site? Just one wish that had to be granted, what would that be?

Paul that is such a subjective question…. You see, we will be hitting full stride in calendar year 2009. Our growth is inherently limited given the nature of our business. This means we are limited in the amount of profits we are able to generate.

My ultimate dream would likely shy away from a business nature. Something along the lines of…. It would be great if we got to know each and every person that invested with us and their families etc. etc. That Paul, could be VERY rewarding!”

My goodness but that man likes to talk, lol! Just kidding. In fact I wish all admins interviewed here would be so forthcoming and, well, just plain easy to chat with and honest about how they run their business. They handle our money after all so it’s not an unreasonable request. And so that is why GoldNuggetInvest is the number one site recommended by me today, and I would say very comfortably inside the top five sites I have ever been involved with. In terms of organization and customer service which are of course vital, but also in terms of profitability. As I said in my introduction, everybody who has joined has found themselves in profit and I guess that’s the best endorsement of all. For further proof, well, you’re just gonna have to join up for yourself and find out. You won’t regret it though. I’ve been in for over six months and have never looked back. So now I’ll just say thanks to Robert for taking the time to provide such detailed and insightful answers to my questions. I hope you enjoyed the interview but more importantly I hope you enjoy your experience with the number one online investment site available today.