15/10/09. Question and Answer Session with Robert Spearman of GoldNuggetInvest

GNI IS ON HOLD STATUS AT THE MOMENT! YOU’RE NOT ADVISED  TO INVEST THERE UNTIL THE PAYOUTS RESUME!

Hi everybody! This evening I’m really pleased to bring you what must be, according to the mail I’ve been getting from you, one of the most eagerly awaited articles to ever be published on MNO. It is of course the “Q and A” session with Robert, the admin of GNI. If you cast your mind back a couple of weeks you may remember that as a sort of acknowledgment of the support shown by the members for the program since it was first launched and also to mark its third anniversary Robert graciously agreed to participate in a third interview with money-news-online. Except it wasn’t to be a real interview in the traditional sense but rather an opportunity for you, the readers of MNO, to put your own questions to him.

As you can see it’s quite a lengthy piece so I hope you’re not too busy for the next while, but then you guys have a lot of questions! Hopefully you will find them answered here. Apologies if you think your exact question has been missed but many of them were repeated several times. Once I first put the request out for you to send your questions it quickly became apparent that this was going to morph into something a lot bigger that even I had first anticipated so in the interests of brevity I had to edit many of them, just to avoid repetition.

At this point I hardly think that GoldNuggetInvest needs much of an introduction. My own feelings about it are well known by now and are well documented within the pages of this blog. GoldNuggetInvest is widely regarded as the best online investment opportunity available today (possibly ever) and in three years online I have yet to personally encounter one single dissatisfied member. Sure there have been ups and downs, but at the end of the day every single member has gotten every single penny that was owed to them. If I was to be cold and clinical about it I would say that that is the real reason anybody has joined and you shouldn’t look for a better endorsement that that. But I think we all know by now there is a bit more to GNI than just a business transaction between strangers. It’s not just an online HYIP. In fact it’s not even an online HYIP. There is a certain sense of community there and even if it is just online it still can’t be denied that it does exist. And the testimonials keep piling up by the week, either from people who have been helped out of a serious financial problem or from those just sitting back and enjoying the benefits of a secondary, and in some cases primary, income. And you know that they’re not just stories but genuine events. After all, it is you guys, the readers of this blog and the members of GNI, the very same people who contributed to this very article you are reading now, who are the ones feeling the benefits of membership of this most wonderful program.

So before we proceed let me just remind you that you can always refer back to my original review of the program published here, and for a little bit more on Robert’s thoughts on the project you can see my previous interviews with him, originally published here and here.

“1. Hi Robert, welcome back once more to money-news-online. For anybody who does not know who you are can you introduce yourself to us again and tell us about your personal role in GoldNuggetInvest.

My name is Robert Spearman. I am the Senior Administrator here at GNI with overall responsibility for all administrative aspects of the GNI project. This would necessarily include deposits, interest payments, development / implementation and plan assessment, human resources type tasks and employee development, technical (IT) upgrades and implementation; essentially Paul, all tasks associated with the successful administration of our program.

2. Also since our last interview there have been a couple of new staff members added to the GNI crew. Please introduce them all to us again, from your partners to the support staff, and explain what their individual roles are within the company.

The two Senior Principles of the venture are myself and Jurgen Wilkens, whose responsibilities include the timely and efficient trading of arbs and, with the concurrence of the other two partners, the strategic direction of the project. They, especially of late, often step in to assist audit the books and accounts, reconcile indiscriminate transactions and other associated tasks unique to our program.

Todd. We then have our Customer Support Team of which is headed up by Todd; who will be celebrating his first year as an associate of ours in November. Along with the CSR oversight tasks, he is also instrumental in handling some of our more complex client issues including lost or missing transactions, specific client complaints, media questions (and answers) and generally all other tasks we feel are appropriate to his position.

Lim. When the work-flow became unmanageable, we first brought in Lim. Lim is outstanding with our customer base, shows a lot of patience and will take whatever steps he finds are necessary to assist clients with their issues.

Romiko. Romiko has proven to be an efficient, tireless go-getter. He has a thorough understanding of our project and is doing well.

Debbie. Our newest addition to the support team is Debbie, who has joined the team working support tickets, overseeing our unique, non-operations tasks such as the Gift Card Drawing; held to commemorate the third anniversary of our on-line presence.

Ingenue. We recently added Ingenue to administer our private forum and to monitor those forums which receive the greatest attention from members and non-members alike; including that which we direct our potential clients; ASA Monitor. He brings forth much knowledge in this area and are glad to have him.

3. Concerning the extra customer support staff, will you be adding either Live Chat or telephone support at any point in the future? Many people do not like waiting for support tickets to be answered.

Absolutely. Before we commit to any schedule and method of Real-Time Customer Service Assistance, we want to evaluate the needs of the program after we are comfortable with the performance of the new script. The reason for waiting is the new script has a support function built into it. You may recall we had every intention of implementing phone support. Whether this is something we’ll do is still not clear. The obstacles causing us consternation are two-fold; 1. the absence of any paper-trail which could lead to accountability issues; and, 2. the resources and level thereof, that would be necessary to have a viable and sustainable phone support program. We will keep all advised following the successful implementation of the new script.

4. What about the new GNI members forum? Why did you find it necessary to establish that? Why will it be more beneficial than the ASA discussion? I know only members can contribute but will the general public be able to at least view it?

It had always been our intention, once the decision was made to bring the project to the internet community, to have our own forum. As such, we can be sure the information is accurate, timely and sincere. Obviously, the Antagonist will portray us as using this as an avenue of disinformation, it’s to be expected; and it’s not a concern. We have shown our character from the beginning and trust our members feel the same.

5. I think we have covered the subject of how arbitrage betting works in the past and readers can follow the links back to previous articles for that. But maybe you could just give a very brief description of how GNI generates money.

The easiest way to grasp the concept of arbitrage is to use an example of which everyone is familiar:

Baseball NBA – Match: Dallas Mavericks vs Detroit Pistons – October 15, 2009 – Selection 1: Dallas Mavericks at odds of 1.47 with betfair – Selection 2: Detroit Pistons at odds of 4.05 with Pinnacle – Guaranteed Return: about 7.85%.

A correctly staked wage of £2,000 guarantees a return of £2,157.96, respectively £2,154.60 whatever the outcome of the match.

The above information tells us that the Dallas Mavericks and the Detroit Pistons are competing. It also tells us that betfair have odds of 1.47 for the match to be won by the Dallas Mavericks, and Pinnacle have odds of 4.05 for the match to be won by the Detroit Pistons.

By applying a simple mathematical formula to those odds, we are able to calculate that we can cover both possible outcomes of the bet and make a guaranteed 7.85% profit.

We would place our bets in proportion to the odds on each possibility. The amount to bet on each outcome is calculated using a simple formula. £1,468 staked on Dallas Mavericks at odds of 1.47 to return $£2,157.96 and £532.00 on Detroit Pistons at odds of 4.05 to return £2,154.60. Therefore we have staked a total of £2,000 and the bets return a risk free profit – despite the outcome.

6. But has it always gone so smoothly? What happens in the case of a bookmaker “moving the goalposts” after a bet is placed, for example claiming that the wrong odds were posted? Have you ever just made a mistake with the calculations?

I think you really meant to ask, have the odds makers made a mistake in the calculations? This is where longevity, relationship building, trust and experience lends itself well. The bookies we use are professional, usually bonded, have been doing what they do for many, many years, are reputable and very rarely, if ever, make the kind of mistake such as this. If they did, they wouldn’t be in business long.

I would need to confirm with Jurgen, but the scenario you described has happened, I believe twice in 2008 and only a few more times this year.

7. For anybody who doubts that all of this is possible, can you give just one example of an upcoming sports fixture that readers can take your advice and then go bet on themselves if they wish and see the result?

We could Paul, certainly…however, given the nature of the business, the arb will have expired 5 minutes after we give you and your readers pertinent information to make the requisite trades. The following link will enable your clients to obtain the necessary information to proceed on their own should they desire to: http://www.sportsarbitrageguide.com/components/alerts.php

8. Hopefully the skeptics will win a few dollars on that and proceed to join GNI. If they do then what are the various investment plans you have to offer? How much will it cost and what are the payment methods you are using?

Paul…we are NOT seeking to entice anyone to join or not join our program. We see this interview as a means to convey information about our program and clear up any misinformation that may be circulating around the globe. Whether your readers join or not join is entirely their decision.

We have three plans:

1) Weekly Fixed

Minimum deposit is USD50 and max is USD20,000. This plan earns at a fixed rate of 6% per week with a lock-in period of 30 days (funds cannot, under any condition be removed, switched or withdrawn during this 30 days). Earnings will be reflected in the account balance exactly one week after its initial deposit, until such time the investment is canceled.

2) Weekly Fixed Premium

This plan is identical to the Weekly Fixed; however, the minimum deposit has been increased to USD21,000 and the max has, likewise been increased to USD50,000. This plan earns at the increased rate of 7.5% per week.

3) Weekly Fixed Rollover

This plan was developed at the bequest of our members. The intent of the plan was to give our clients an investment vehicle to place their funds while waiting for the maturity of their various deposits to accumulate, allowing them to make a singular deposit of (at least) $50.00.

The Minimum deposit is USD3 and max is USD1,000; earning at a daily rate of 0.8% (weekly, 4%), Mon – Fri. Earnings will be reflected in the account balance around the same time the next day.

Besides the permissive ability to invest small amounts, we have disabled the lock-in period for this plan. Because there is no lock-in period, clients can move funds in and out of this plan unencumbered. While this plan is a great staging area, it does not benefit the program in any capacity. We are unable to place the full amount of these funds in trade as they have to remain available for client withdrawal.

How much will it cost? What are the payment methods you are using?

There is no charge to invest in our venture, in fact, we offset any fees that the payment processors charge when depositing into our program.

We use the services of:

1. SolidTrustPay (STP)

2. LibertyReserve (LR)

3. StrictPay (SP)

4. PerfectMoney (PM)

Direct bank / Wire Transfer

9. Apart from the obvious benefit of an increased weekly payment, are there any other benefits to being in the Premium Plan, eg preferential treatment on support issues etc?

No / None.

10. One interesting question I got from a reader was if you would consider introducing another plan for those still trying to reach $21,000 in their account but not able to afford it just yet. An example he offered was to pay 6.5% to those with let’s say $10,000 deposited.

No, there are no plans for assisting our clients build their wealth other than to provide the plans we do.

11. After gradually building up my deposit to reach the $21,000 required for the premium plan, what do I do next to obtain the 7.5% payout? Contact support, withdraw into the back office and redeposit, etc.?

To qualify for the increased interest offered by the premium plan, said funds MUST be part of a single deposit at or above 21,000.00. Any deposit made prior or subsequent to this deposit, will be made at the lower rate of 6% unless they too are part of an additional 21k deposit.

Once a client has an accumulated amount of 21k in a single currency (we cannot combine different e-currencies to qualify for this increased amount) in their GNI account balance (GNI Holding/Staging area), they should then proceed with this 21k deposit. The increased interest will reflect in their first week’s interest payment.

12. One reader who is in the Weekly Fixed Plan says he earns enough interest per week to re-invest into this plan, i.e he is earning more the $50. His question is this: Once he earns enough to finally push him into the Premium Plan, what can he do about re-investing his weekly payment then? If he wants to re-invest the entire amount does it have to go back into another Weekly Fixed account? Or is it that when you finally do have a Premium account you can then deposit whatever amount you like into it then?

This issue has been addressed above.

13. Another interesting question I got was your attitude to AlertPay. You don’t accept them at the moment. Is there any particular reason why not? Would you consider taking them or is it just unnecessary at this stage?

We have found AlertPay to be less than completely desirable for a program such as ours. You are correct, we do not accept them at the moment, nor do we have any intention of accepting them in the future.

14. Does all your money come from arbitrage betting? Do you have anything coming in from outside business projects?

The entire client base’s interest payments result exclusively from our arbitrage trading/wagering. If we were generating our income in a manner other than this, we would be obligated to disclose this to our client base. Hence, we do not.

We do maintain a reserve fund should a catastrophe ever ensue. A catastrophe, by our definition would be something along the lines like the sudden and unexpected dissolution of a payment processor.

We break our reserves down to tactical (those reserves that are liquid and easily accessible) and, strategic…reserves that are invested and used for the catastrophic situation previously described. These funds are not as liquid and could take 7-10 days to access.

15. When it comes to bank wires, what is the proper procedure for changing bank wire withdrawals from one bank to another? One reader told me that he tried to switch banks but his payout still went into his old bank account.

To avoid a situation as you just described, your reader should have informed our Support department to change his banking details as we keep this kind of information safely on file (we never disclose this information to anyone). Other clients have given us updated information and have found this to be the best way to enact the change(s).

16. Staying on the subject of bank transfers a couple of readers have raised the point that they experiencing a lot of delays recently, up to ten days in one case, and they ask what, if anything, can be done to address and improve the current situation? Is it true that you may consider moving banks?

Our current bank, of which we have been quite satisfied has now developed an issue with a correspondent bank which has resulted form an on-going political situation which is beyond anyone’s control. It is the result of this bank’s physical location, not the result of performance, security or anything else justifying their changing banking partners.

For the long term, however, the turnaround time is unacceptable. We have made an interim decision to monitor the situation and see what, if anything develops that will speed up the processing time. In the meantime, we have and are offering to withdraw interest payments to the payment processor of their choice.

17. If a member deposits via StrictPay or SolidTrustPay, is it possible to request payment via another method, namely a bank transfer?

Once the new script is implemented, it will be. Regarding a bank transfer, this was addressed in #16.

18. One member says he has made several deposits via a variety of payment processors and has something in the rollover plan as well. He asks if he can withdraw everything into his members area and the consolidate all his money under one plan paid into one payment processor?

Not at the present time. Our new script will offer this possibility, but there is necessarily a premium we have to charge (in the neighborhood of 4%) to offset the costs of exchanging.

19. You only take deposits in US dollars. Considering that it’s not what it used to be would you consider accepting Euros at some point?

We always will consider any realistic / reasonable proposition. If it’s “do-able,” we’ll do it. If it’s not, we won’t.

20. One thing I know a lot of people are very interested in is the new script. Having been allowed a sneak preview myself I must say I was most impressed. What can you tell us about it?

It’s been a long, labor-intensive process which has required input from members, staff, principles and of course, the development company; of a script that had been fully developed before customizing it to fit our specific wants and needs.

When will it be launched?

Soon. That’s as far as I can go with that.

How much more secure is it than the previous one?

Please don’t misunderstand the issues here. Our current script is not “unsecure(d).” It is unsupported. Because it’s not supported, we are unable to modify the script to mirror the enhancements of our partners (such as the PPs). Each time our partners release a new version of their script, ours becomes more obsolete. We then have to “patch” the software or in a worst case scenario, disable the scripts function. It creates voluminous amounts of work for our support people they would otherwise NOT have to do. It, however, was NOT the reason our script was compromised back in the July / August time period.

Who is the programmer and what do you know about their track record in this area?

Chris, the Senior Developer and CEO of Shadowscripts is a software “dynamo.” He spent years developing the Shadowscripts software and has promised a level of support second to none. You and your membership are free to review this at http://www.shadowscripts.com

21. There were a couple of questions from readers in relation to the script including the following.

Will I be able to see the complete list of who is in my downline?

Yes

Will the process of depositing change?

Yes

Will I still deposit from my e-currency account into my member’s area and then into my chosen plan?

Yes, the process is the same, the procedure is a bit different. The vast majority of our clients will have NO problems as currently envisioned.

22. Why don’t referral links load directly to the username anymore? When someone opens their ref-link the register page doesn’t offer by default their username but rather “no sponsor” instead? Why do you have to choose your own up-line instead of having it come automatically from the link you have followed? Will the new script solve this?

The new script should resolve all of these issues.

23. What are your own long term plans for GNI? Let’s say over the course of the next one to five years and ultimately your retirement from the business?

My current plans are to get this script loaded and fully operational, get through the end of the year, then take the program private with little or no downtime.

Once this has been done, we will obviously have to tweak the program to accommodate the changes that will have been made. From that point forward, we will continue with what is/has been working and change those that are not. Don’t look for me to go anywhere within the next five years.

24. Following on from that is there any contingency plan in place in the event that you are no longer able to work or simply don’t want to do it anymore? Should you wish to retire what would you do? Sell the business, let your partners buy you out, hire more traders to take the extra work and leave it as is, etc, etc?

This question is very complex, but fair. We have a succession management plan that has been developed, the participating principles having developed the hierarchy and implementation scheme. This would be invoked should something happen to myself or Jurgen.

I would be less than forthright if I said it would be a totally smooth transition. This has and will be taken to task and is necessary to be compliant when we go private. In fact, much of this question is being currently considered. It would be inappropriate for me to comment as the final decision(s) have yet to be made.

25. Hardly a week goes by without some self appointed “expert” trying to tell the rest of us that GNI is on the brink of collapse, with the admin of one online pyramid scheme causing some controversy on your ASA forum thread recently by being the latest one. What is your reaction not just to this particular incident but to all the people who ask how much longer you can continue?

Well, the way the question is put, implies that the program has a pre-defined lifeline, indicative of a PONZI.

I’ve said this before and I’ll say it again, the program will continue, We’re NOT a PONZI. We’re taking the necessary steps to further establish us in the world community as a premier, benevolent, investment program looking not just to help our clients but those who need assistance of whom we do NOT have a current relationship.

26. The whole subject of closing to new investors and going private has thrown up a number of questions from readers. Here are the main ones.

Before I take a look, I want your readers, our clients and those who may have an interest in us to understand that this matter needs to be addressed delicately and in a way that will not compromise those goals that we seek to achieve by so doing. Further, I have reserved for myself; for the benefit of our most loyal, the client base, the means of conveying any Program Level Announcements, to our Newsletter. This ensures fairness and equality for all who participate, in lieu of any one selected group. I certainly hope you will appreciate this position.

a) First of all, what exactly does it mean to “go private” and how will it affect existing members?

“Going Private” to the Principles of GNI, is loosely interpreted as the process of becoming, in the eyes of the financial services sector, regulatory compliant such that we can operate unencumbered in any Jurisdiction in the world.

Will existing members still be able to add to and withdraw from their principals at will?

This has not yet been established; suffice to say, “at will” deposits, if we have hit our prescribed limit, are less likely to be the norm.

b) Next, what is the reason for it? Why go private at all?

To answer this question will give those who we seek to remove ammunition or ideas to perpetrate an illegal act, therefore I cannot comment.

c) What is the provisional date for this to happen, and when an actual date is finalized how much notice are we going to get?

This will be announced in one of our Newsletters during December, 2009 or January, 2010.

d) Do you anticipate any negative changes after GNI goes private (e.g., lower interest rates, longer lock-in period, less frequent payouts, etc.)?

No, in fact this shouldn’t have a negative impact on our operational capacities, it should improve on any areas of our concern(s).

e) Under what circumstances will new members be admitted? Will members who leave or inactive members be replaced on a “one out one in” basis? Will it be by invitation only and if so then invited by whom?

We are not ready to announce these guidelines.

27. American readers in particular seem to be fixated with the entire legality aspect of GNI. Taxes seem to be of particular concern. Can you once and for all explain exactly how much authority the US legal system has over GoldNuggetInvest (the program and it’s owner, not the US based members).

No, I cannot; for the simple reason, you are asking a legal question, it must be answered by an attorney who is licensed to practice law in the jurisdiction from where this question originated.

And for those constantly worried about one or another arm of the federal US government shutting you down or freezing your assets, do they have the authority to do that?

Again, this question falls into the category of a legal matter…I will, therefore, give you my understanding as it has been explained to me by our team of legal counsel. It has been, and will continue to be our policy to run this program within the parameters established by the Independent nation of Belize. We do not advertise our program to Americans, we do not trade in America, we do not bank in America.

No hair on the head of the US Government has regulatory authority any aspect of the GNI Project, which is consistent with our operating policy and Belize Law. However, we are not so ignorant to think for a moment, the US wouldn’t use it’s economic and industrial might to lean on any country in the world; even to break its own laws if the interests serve the US Government. A perfect example is its (The US Government) ability to compel Switzerland, after the German government bribed a Swiss bank employee to disclose confidential banking information in contravention to Swiss Banking Rules, Laws and Regulations.

We have adopted a strategy to comply to the fullest extent possible with the rules and laws of common sense in an attempt show all jurisdictions we run our operations to the fullest extent possible, with every country and client’s interest at stake.

1) We include and respect the laws of the US as much as we can.

2) Todd, had we chosen to ignore the SEC, would be at a trading desk at this point..

3) We remind, insist, even demand our clients pay there taxes or other municipal obligations.

4) We investigate all program anomalies and client discrepancies giving the benefit of the doubt to our client.

5) Should a situation arise whereby we feel it is in either the client or the program’s best interest if we part ways, regardless of fault, we consistently pay all outstanding obligations with the accrued interest, IN FULL.

28. One of the oddest questions I got was why do you bother? You have come across an excellent method of earning money, so why did you ever decide to share it? You could have found an easier way to fund the whole thing than an online investment program? So why do you need the rest of us? You could easily just do it for yourselves and still have a good income.

This is an outstanding question and is certainly something we, when deciding to open the program up to the on-line community, pondered.

We started this program at a time when on-line investing, sometimes referred to as High Yield Investment Programs, had reached their pinnacle and were on a downward slope. Jurgen and I are compassionate persons. We couldn’t get on the internet without reading about how some scam program bilked another unwary investor out of all of his funds.

We had found this market phenomenon some time before and had already been investing friends and family funds, it was our obvious best source of funds. While you are correct, we DON’T need the money, we like it, but we are not in a situation that we need it. But we like what we’re doing…we’re giving back and that carries a lot of weight with us.

29. We know how long GoldNuggetInvest is running, but is this a full time job for you? If so when did you finally make the decision that this would be your main source of employment? Can you describe a typical work day for you and your main partners?

LOL, yes this is TWO full time jobs for all of us here at GNI. We knew the program had great potential, given the power of the internet. We also felt we had found a niche that had not been, to this point, fully exploited. We knew if we were honest, paid our clients a fair (6% a week) return, we could make this happen.

A typical day, of late, has proven to be anything but typical. My day usually starts by speaking with Todd, if he is available to see what has transpired during my sleep period. This is followed up by the releasing of payment requests back to the begins with the release of client funds from their GNI Balance. At this point, I attempt to all business matters as it pertains to the project. Currently, I am testing the script in preparation of implementation.

The facts be known…anytime there is additional time, I trade.

30. I know you were asked about long term plans already but what can we see in the immediate future for GoldNuggetInvest? Let’s say between now and Christmas and into the first three months of 2010.

Successful script implementation!! The selection of a world-wide, viable charity that we, as a “family,” can fully embrace and support during the forthcoming holiday season; followed by privatization of the program.

Needless to say, I have a full plate.

31. And finally as most readers will know by now you have just marked the third anniversary. You have my heartfelt congratulations on that of course, it’s a truly remarkable achievement. So if you don’t mind a personal question, maybe you can tell us your personal feelings about this? It must give you a tremendous sense of accomplishment. Three years ago did you think that GNI would be in the position it’s in today? Are you in anyway surprised at the success or is this pretty much how you imagined things would happen? What were the highlights of the experience, especially since opening to the public for the first time in 2008?

When Jurgen and I took the concept from thought to paper, then paper to actualization, we knew, immediately we had a winner. We knew this was a market segment that had not been exploited (as opposed to the Forex), we had already established a good relationship with our trading (wagering) partners and the potential to grow our client base with the family and friends we already had. So yes we knew we had something good.

The last six – nine months our growth has been phenomenal, and, thanks largely to new technology, sustainable for the short term. As everyone knows, we are in the process of clearing the way to go private and have defined a limit that we will accept regardless of how much, of clients funds, we can manage.

To answer your question, the highlight of 2008 was taking the program to the internet community, the October 3rd anniversary and that highlight that we envision, taking the program back to private.

I would like, at this time, to thank those clients who have stood by us through both good times and trying times, without them, we have nothing. I would also like to thank you Paul, for giving me the opportunity to express and explain our program. It is necessary so everyone understands what it is we bring forth as they are trusting us with their hard earned funds.

We look forward to working with new and current clients alike and promise to be responsible, always showing integrity at every turn.

Thank you!”

Thanks a lot to Robert for making such a supreme effort to get through all of that. I know that the man’s work schedule is hectic on a quiet day, so I do appreciate his efforts.

But thanks most of all to you guys! The contributors to this article. Thanks for all your questions, comments, and suggestions, and I hope this article has helped answer what you most wanted to know.

Given the size of today’s post I think it best to postpone the news update I had intended to add on. In any case, this particular article was the single biggest news story of the day anyway, at least in relation to the programs covered by my monitoring page. But I’ll be back as usual tomorrow with all the latest news from around the online investments industry as well as bringing you another brand new review of one of the new programs I have just joined. So stay tuned for that!