24/09/2010. MNOFridays (sixth issue) and Daily News from the Industry

Hi guys! The subject for today’s MNOFridays was inspired by the recent collapse of StrictPay. This was one of the best options and it had all the useful features including many deposit and withdrawal options, including a debit card. So how can you know if one payment processor is not going to scam you next? Can any payment processor be trusted and are they safer than HYIPs? This will be the subject of this issue of MNOFridays that I want to talk about today.

So the first thing to remember – any payment processor dealing with HYIPs cannot be considered safe. That’s not a difficult thing to appreciate. Despite the attempts from payment processors to persuade you that they are for real and your money is safe (that’s what they are all going to say anyway) you shouldn’t take them as serious as your bank account and accumulate huge funds there. It’s one of the mistakes made by investors when they believed StrictPay (I admit that I was one of them and was quite fascinated with their extensive features and support). That will cost you money eventually as was proven many times. There is no such thing as safe and reliable when dealing with HYIPs. You should always be aware of all the risks involved there.

Of course, it would be stupid to say that payment processors collapse more often than HYIPs. Their usual lifespan is far longer than any HYIP but that doesn’t mean that they are not prone to scam you at some point. StrictPay was a perfect example of a payment processor that used to pay everybody while the funds were flowing in (as obviously it was organized on ponzi style lines) but failed to do so once the HYIP industry stalled and the crisis hit them. StrictPay was allegedly incorporated in Panama and had its own KYC policy that didn’t prevent them from scamming the members trying to launch the obviously unsuccessful round two and eventually disappearing without trace and with hundreds of thousands of dollars in their accounts.

Remember that among the current payment processors the main source of danger is mostly from those not requiring any verification from their members and allow anonymous accounts. Needless to say this is contrary to money laundering laws in most jurisdictions and that is why such payment processors cannot be considered legal in a lot of countries. Processors like LibertyReserve, PerfectMoney and GlobalDigitalPay who offer anonymous accounts (which are the most popular among HYIP admins and other members) tend to be of at least questionable legal status. Just imagine that you go to any offline bank and try to open an account without a passport or any other ID. That is simply not possible offline but is a very common practice online where HYIP admins need to conceal their identities. As these activities might be considered illegal in some countries it would be more convenient to be totally anonymous. And the administration of those payment processors are aware of that and give what their clients want – a safe and secure way to overcome all the formalities that can impede you with financial institutions in real life. As I emphasized many times already, HYIPs are all ponzies (regardless of what they try to persuade you) and it’s much more convenient for HYIP members and the admins alike to work with such payment processors like LR and PM that have to have such an extensive network of exchangers that will allow them to make deposits and withdrawals mostly via third-parties and therefore conceal any traces if they are investigated by authorities (which is highly unlikely as they are usually located offshore).

There is another group of payment processors though (that includes SolidTrustPay and AlertPay) that are properly registered and deal not only with HYIPs but also have other clients. They are also aware of the advantages of reversed transactions and the better guarantees for the safety of your money simply based on the fact that those payment processors have a physical address with working phone support. They can be easily contacted by their clients if a problem arises. Just imagine that you could get LibertyReserve or PerfectMoney on the phone (like you can with AlertPay and SolidTrustPay) and discuss your account. Sounds fantastic, doesn’t it? The owners of those payment processors prefer to stay in the shadows and just like their accounts they try not to have any connection with you as real people except via your virtual accounts and your money.

Did you ask yourself why this happens and why are the payments irreversible in LibertyReserve and PerfectMoney? It’s simple. LR and PM harbor so many scams including a huge amount of dishonest HYIP owners, different types of cheaters, hackers and spammers whose accounts cannot be blocked or closed just based on complaints from regular people. Well, theoretically the administration of those processors could do it but what is the point of all that if the money can be exchanged in seconds in one of the dozens of instant exchangers and the scammer can open another account in two minutes flat without submitting any real documents? So it sounds exactly like this – LibertyReserve, PerfectMoney, GlobalDigitalPay and all the other anonymous payment processors simply encourage scammers and all types of dishonest people to use their services attracting them with endless opportunities to achieve their goal of ripping off others and bearing a total lack of responsibility for it. Based on that alone such processors cannot be considered fully legal and any disclaimers about fighting money laundering (like the recent anti-money laundering policies issued by LibertyReserve that created such fuss on some forums) are nothing more that words. They have no practical use because as we said already such payment processors attract all types of scams simply due to their irreversible payment policies and extensive chain of exchangers with some of them being instant and allowing scammers to withdraw their funds quite fast making any type of refund totally impossible anyway. That is why recent discussion about the legality of LibertyReserve, PerfectMoney and others did nothing but put a smile on my face because joining anonymous payment processors you must be perfectly aware of the risks involved.

So is it safe to keep your money in anonymous payment processors like LibertyReserve and PerfectMoney? Of course not and I recommend you keep any funds with them to the minimum you need to play with the HYIPs of your choice. Obviously due to irreversible nature of payments HYIP admins prefer to deal with such payment processors as LibertyReserve and PerfectMoney (and many deal with them exclusively) simply because the blocking of accounts is not possible. Moving funds in and out LibertyReserve and PerfectMoney is also quite easy, fast and doesn’t require any type of verification which is what HYIP admins (and also many members) usually want. And we must admit the entire HYIP industry is at best a very shady activity where nobody, investors or admins, want to deal with the authorities.

But what about the payment processors like AlertPay and SolidTrustPay that are much stricter on HYIPs (and their members), require verification and are able to freeze your account and reverse transactions without asking you simply based on the suspicion of fraud? On one hand, such actions are perfectly legal and provide some welcome protection against scams. On the other hand, blocking the accounts when the reason may not be entirely justified can spell the end of the HYIP in question as happened many times in the recent past. The accounts were blocked and the funds were frozen simply based on some malicious complaints from competing admins or just anti-HYIP crusaders. Some good programs collapsed after their account got frozen. SolidTrustPay also blocks accounts though not very often. Their verification policies are even stricter than those of AlertPay meaning they have removed the need for doing so. But that is also why it’s not very popular among HYIP admins anymore.

Really, what admin with the original intention to scam fast would use AlertPay and SolidTrustPay as his payment choices? That fact was quickly recognized by some investors who prefer to deal with HYIPs that accept at least one of the verified processors (and rightly so considering they have a better chance of a refund). So to a certain extent processors as AlertPay and SolidTrustPay can be considered as much safer options that anonymous e-currencies. At the same time, your account in them can be subject to transaction reversals and verification once you withdraw money which you earned on HYIPs which might be quite stressful for some. That’s why it’s a matter of personal choice to deal with LibertyReserve and PerfectMoney or with SolidTrustPay and AlertPay.

Saying that I want to emphasize that even keeping money in KYC (“know your customer”) policy enforcing processors is quite risky as they cannot be considered as banking institutions. More often than offline banks they are prone to collapses and their recovery will not be sponsored by state authorities as happened during the recession. It’s much safer to keep your money in your local bank. That is why I suggest you to always keep your money in any payment processor to the bare minimum you need for your investments.

As the recent example with StrictPay demonstrates, even a very popular payment processor can collapse without warning. They can tell you any reason they like and it’s usually impossible to say if it was their intention to scam from the beginning. Some payment processors can collapse even years after they come online as they won’t go before they have amassed huge amounts of money. But this can also happen at anytime. I think that should teach us all an important lesson to be more careful and always be on guard when we are dealing with anyone involved in the HYIP industry.

I hope this issue of MNOFridays was useful for you all and any comments will be appreciated in the specially created thread on the MNO forum dedicated to this discussion here. Please submit your opinion about what you have just read and offer more topics for discussion for the next MNOFridays here. Thanks for your attention and make sure to check again next Friday for another discussion on the HYIP industry.

DAILY NEWS FROM THE INDUSTRY.

Staying on the topic of payment processors we will start the news with a rare and therefore extensive update from the admin of FundsOMatic Randy (interviewed here). I remind you that Randy used to run the very popular SurfOMatic program in the past which lasted for over a year and where everyone received their profits by the time the program closed. This is a very rare event in the HYIP industry and that’s why it’s no wonder to me that his new program FundsOMatic (well, not very new anymore, as it’s online for three months already) is going extremely well reaching over 5,000 members already. The investment plans offering 0.8%-1.8% for 200 days and 7%-14% for 26 weeks with no principal return on expiry looks pretty reasonable to me and as Randy proved to be a great administrator in his previous program I believe this one can achieve beter results than SurfOMatic.

Anyway, the last newsletter from Randy of FundsOMatic was almost everything about payment processors and the situation with StrictPay and those members who deposited with it. As the admin’s funds are also tied up there and most probably will never be returned he simply cannot pay to StrictPay members to other payment processors which will definitely deplete the funds there. As StrictPay is most probably gone I believe that nobody will see any money from them. I was just wondering why it took Randy so long to realize that as for me StrictPay became the worst scam straight after it announced the second round which was a desperate attempt to collect more money before vanishing into thin air. So obviously many people were fooled by them and Randy was no exception. Anyway, with the current situation all StrictPay deposits and withdrawals are currently on hold and will not be processed. The latest email also touched on some important topics like safety and security for accounts in the program (please note that changing your LR and PM accounts at a later time is prohibited by the admin), fast growth of FundsOMatic (over 5,000 registered members already), temporary addition of AlertPay deposits manually due to technical issues and the ability of members to promote on forums and monitors. By the way, as MNO forum is one of the main forums for FundsOMatic you can easily submit your questions to Randy there and hopefully they will be answered. If you want to read more on FundsOMatic and the plans it offers please refer to my detailed review of the program published here. Here is the full newsletter:
“Hope everyone is doing well. I want to just give some quick updates and let everyone know how we are doing.
I will touch on a few things today such as how we are doing, Payment Processors (Strict Pay more or less), and just a couple minor questions but seem to be also important.
I have read in the forums, (A full list of ours can be located here. There are about 50 that I am aware of. ) Many are wanting to know how many members we have now. I have also seen that some have been able to get a good estimate from their referral #’s. As of now we are just about 5,000 members in total. This is no small amount and is growing every time i log in I see a whole list of new members. This means that the word is getting out still.
Payment Processors are a key function of any type of online business, more so ours then others. With most processors having a policy where payments are not reversed, unscrupulous people will try anything to deceive others and cheat you out of your funds. To date I have had a total of 193 requests to change LR accounts, I have not done so. Our system tracks IP and mail headers when available. Since I have posted this information in MoneyMakerGroup forum the requests have slowed down a great deal, however still get 2-3 a week. To ensure your protection and safety I will continue to NOT change LR and PM account #’s.
StrictPay, This is a sore and touchy subject. Many members (myself included) have lost a huge deal of money to them. Since the events that have happened with them are beyond the control of myself or any of you we can only pray that they do the right thing and come back. That being said until they do all StrictPay transactions are put on hold. Funds that were deposited VIA StrictPay were invested VIA StrictPay and can not be transferred to other processors. Please do not ask for this as it just can not be done.
AlertPay had some issues that effected IPN functionality today and cause some deposits to be manually credited by me and some that were credited automatically after they fixed the system. This only lasted about half the day but is resolved and more information can be read here. This did cause a delay in some payments being made as fast as normal as my time was diverted temporarily.
On the brighter side of each processor being independent from the others is that the failure of StrictPay has no effect on the functionality and deposits in the others. AlertPay, Liberty Reserve, PerfectMoney and even Global Digital Pay are doing great and continue to be viable options to use.
Some of the questions I have been getting is about plans and how long they last. So for reminder the daily plan is for 200 days and weekly plan is 26 weeks. Accounts are credited 7 days a week on the log in function. This means if your deposit should be credited and your logged in from before refreshing to see, you will need to log out and then back in.
I have also been getting asked about promotional tools and how to convince others that FundsOMatic is a good choice. The best advice I can give is when you talk about us be sure to use the monitors we use (http://www.funds-o-matic.com/rateus.php) and the forums (http://www.funds-o-matic.com/forums.php). Even if your not an avid poster you don’t need to be a marketer or anything special. Just let them see what others have to say.
So if I have rambled too much I extend apologies. Other then to say things are doing great here and updating on StrictPay. There is not much to say. Thank you all for this continued opportunities to serve you and your investment needs. I look forward to several more months of such success as we have had for the past.
RandyM”.

It looks like the admin of InWolton (interviewed here) sold all the shares for Levin and Perfection plans again which used to pay variable daily returns for 15 and 30 business days. Now InWolton only offers two plans: Felicity fund (which pays a variable daily return for 50 business days with the principal returned on expiry) and Sparkler fund (paying 1%-2.5% fixed interest for 25 business days with the principal return at the end). At first glance you might think that the returns are too conservative but InWolton is actually a program that was made to run for a long time (you can understand why if you read my review here) and so such plans will only add stability in the long run. InWolton has been running successfully for over 3 months offering different variable and recently fixed plans which can be joined by buying shares and offering instant payouts for both LibertyReserve and PerfectMoney. From now on the news from InWolton will be regular and will be published on their website every Friday:
“Hello, friends! I am so happy to see you with us for such a long period of time. And again I have wonderful news. All shares of funds “Levin” and “Perfection” are sold out. Our fund “Sparkler” became very popular among investors and many of you see it as a key to financial freedom. And we are so proud to help you! It is so great that we have managed to build such a great and friendly team. From now on every Friday we will publish latest news and week reports of our company. Have a great week-end and see you later on our web-site.”

Two programs have to be moved to Problem status on MNO tonight. Please note that investments are not recommended. These include GroupUniversal and FiboTradePro. Funny that I noticed the issues in both of them yesterday and as usual in those cases contacted the admins for an explanation. The answer was almost the same as they promised to pay to everybody on Friday so that I wouldn’t worry much. It sounded to me like it was coming from the same person, lol, and taking into consideration that I was sure Forexica and FiboTradePro were run by the same administration they might easily run a few others. The fact is neither GroupUniversal nor FiboTradePro paid today and so can be considered as liars and scammers. I always wonder why I should ask the admins about the payout issues which I should not do probably anymore. I would say that I have to move them to Problem status first and then try to negotiate later. Anyway, they themselves set the timeframes for the payouts and it’s only fair to move them to Problem status once a delay occurs. What do you think about that, guys? Please let me know in my ShoutBox.

By the way, thanks to all of you participating in my new poll that is aimed to decide your favorite payment processor after the collapse of StrictPay. The poll will continue till Sunday when the results will be drawn. At this moment, the runaway leader is LibertyReserve with 50% of the vote. AlertPay is second with 26% which is higher than SolidTrustPay with 17%. The clear outsiders are PerfectMoney with 2% and GlobalDigitalPay who have yet to receive a vote. Please keep your votes coming and I think it will be interesting to see the final results on Sunday.

Another poll from MNO Reader Profiles series is still running. I’m glad that just like me 61% of MNO readers do not smoke, while only 22% do. That means that health is not an issue we should discuss here. But maybe the next question should be: how often do you visit a gym? Please let me know your ideas in my Shoutbox.

Please do not forget that the daily cash contest sponsored by PawnShopFund (reviewed here) is still running on the MNO forum. Today’s question about the zodiac sign was still not answered correctly and I would like to encourage everybody to submit a guess. There are only 12 zodiac signs and five of them have been named already so you have a good chance of winning. Please check the contest thread here regularly for your chance to win $5 straight to your LR account.

Below is the list of programs featured on my monitoring page that paid me in the last 24 hours:
FundsOMatic, FxTradingWorldwide, WorldPrivateFunds, VividTrade, FutureTrails, YamaFinance, Vodapex, SyFunds, ReProFinance, PawnShopFund, 144CashAds, CherryShares, MutualTreaty, Flamanta, OilStructure, GrapeVineFunds, OptimumPride, OrderDollar, YoKapital, TradersPower and FenixTrust (the first payment received).

Please stay tuned for tomorrow’s review of FenixTrust and more news from the industry. See you tomorrow, guys!