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Eleven Forsage Ponzi promoters have been accused by the SEC of securities fraud.

According to the SEC, Forsage is a $300 million Ponzi scam.

Vladimir “Lado” Okhotnikov, the proprietor of forage, is one of the eleven accused.

The following defendants are included in the SEC’s complaint, which was submitted on August 1st:

Lado “Lado” Okhotnikov, Vladimir (right, the public face of Forsage, Russian national living in Georgia)

Lola Ferrari (a pseudonym for a Russian national residing in Indonesia who claims to be the “goddess” of Forsage)

Russian citizen Mikail Sergeev, also known as Mike Mooney and Gleb and Gleb Million, works as the director of development at Forsage.

Alexander Maslakov (main Russian promoter, Russian national living in Gelendzhik or Moscow)

William D. Ellis (Forsage YouTube shill, US national living in Kentucky)

Hamlin, Mark F. (Forsage YouTube shill, US national living in Virginia)

Theissen, Sarah L. (Crypto Crusaders admin, US national living in Wisconsin)

Martinez, Carlos L. (Crypto Crusader’s co-founder, US national living in Illinois)

R. Ronald Deering (Crypto Crusader’s co-founder, US national living in Idaho)

Cheri Beth Bowen (right), a co-founder of Crypto Crusaders and a resident of Mississippi, and Alisha R. Shepperd (Crypto Crusader’s co-founder, US national living in Florida)

The eleven Forsage defendants are accused by the SEC of

created, ran, and maintained a Ponzi and pyramid scheme online using Forsage.io.

The founders of Forsage are listed as Vladimir Okhotnikov, Lola Ferrari (below), Mikhail Sergeev, and Sergey Maslakov.

Through strong internet marketing and the ongoing creation of new investment platforms, the Founders maintained Forsage and its smart contracts.

The Founders used the unregistered offer and sale of securities in Forsage during the relevant period to raise money from individual investors in the US and other countries.

The Founders participated in actions that functioned as a fraud or deceit upon investors in connection with the offer and sale of such securities, as well as in a plan to defraud investors.

Forsage proponents include Samuel Ellis (below), Mark Hamlin, and Sarah Theissen;

In the same time frame, the Founders hired Americans Samuel D. Ellis, Mark F. Hamlin, and Sarah L. Theissen (collectively, the “Promoters”) to advertise Forsage on platforms that Forsage maintained, such as the Forsage Official YouTube channel and Forsage’s educational resource, the Forsage Academy.

The Promoters then offered and sold securities in Forsage without first registering to do so.

It is stated that Theissen, Carlos Martinez, Ronald Deering, Cheri Bowen, and Alisa Shepperd

commanded the largest Forsage promotional organization in the country.

By doing this, the Crypto Crusaders offered and sold shares in Forsage without first registering to do so.

Additionally, the Crypto Crusaders promoted Forsage in the US as part of a conspiracy to mislead investors and continued to engage in actions that operated as deception or fraud against those investors.

The Crypto Crusaders were the most effective Forsage promotional team in the US, in large part because they adopted the Founders’ original Forsage marketing plan. Indeed, there are over 75,000 subscribers to the Crypto Crusaders Facebook page and YouTube channel.

In terms of Forsage itself, the SEC claims that

a classic Ponzi and pyramid scheme. During the applicable period, it did not really or ostensibly sell any tangible, consumable goods to legitimate retail consumers, and its only apparent income source was money from investors.

This aligns with the coverage BehindMLM will begin providing for Forsage in April 2020.

There have been six variants of the Forsage Ponzi scam recorded so far by BehindMLM:

Forsage (April 2020)

Fortron (September 2020)

ForsageTron (March 2021)

XGold Forsage (March 2021)

BUSD for Forsage (May 2021) MetaForce is also (July 2022)

A curious break between Okhotnikov and his fellow co-founders earlier this year is noted by the SEC.

The Forsage Founders broke up on or around March 7, 2022.

Ferrari and Sergeev disagreed with Okhotnikov on the direction of Forsage, and Okhotnikov was reportedly denied access to Forsage.io and the Telegram channels, among other things.

However, Okhotnikov continued to be in charge of the Forsage Official YouTube Channel, which he utilized to produce films lambasting his previous partners.

Soon after, the two groups of founders built their matrix marketing platforms: Okhotnikov founded “Meta Force,” while Ferrari and Sergeev introduced “Express Smart Game.”

Both platforms reflect efforts by the Founders to maintain the flow of funds into Forsage and to attract Forsage investors to these new platforms. They are variants of the pay and recruiting structure utilized in Forsage.

Express Smart Game is intimately related to Forsage and duplicates several elements of the Forsage matrices.

Forsage has evolved onto a new smart contract as Meta Force, commonly known as New Forsage and Force.

The SEC’s lawsuit’s denials of the Forsage Ponzi scheme are another intriguing aspect.

The Founders, Promoters, and Crypto Crusaders vehemently refuted the accusations and fraudulently convinced investors that Forsage was a genuine organization when it was brought to their attention that it was a pyramid scam.

In April 2021, BehindMLM published an article on Lado Okhotnikov’s assertion that securities regulators “don’t grasp the law.”

Additionally, the Crypto Crusaders were upfront with investors about their recruitment strategy, making it clear that they would remove investors from their Facebook groups if they voiced complaints or failed to recruit more investors into Forsage. They also stated that they would not tolerate any criticism of Forsage.

Anyone who promotes or witnesses the marketing of MLM cryptocurrency Ponzi schemes ought to be aware of this conduct.

The substantial amount of earnings that the Defendants touted was not indicative of the returns that the majority of investors experienced, notwithstanding their active advertising of Forsage as a chance to create money.

Indeed, given that Forsage functioned as a pyramid scam, the “financial independence” that the defendants advertised were simply out of reach for the majority of participants.

In actuality, similar to the majority of such scams, the money was predominantly concentrated at the top of the pyramid, with the Defendants, who possessed older Forsage IDs, benefiting at the expense of subsequent investors.

Scammers that use MLM and cryptocurrency frequently use the ruse that their schemes have been detected. This disregards the fact that they aren’t as a result of being put up by a person or group of people.

Despite telling investors that Forsage was “the world’s first 100% decentralized matrix project” through the Forsage Marketing Materials and website, the Founders were heavily involved in the company’s operations and ongoing sustainability over the pertinent period.

The Forsage Founders played a key managerial role in ensuring the operation and success of the Forsage Investment Platforms, including the introduction of Forsage BUSD as the newest investment opportunity to keep the scheme afloat. They also maintained the infrastructure to sustain the scheme.

It’s a myth that MLM cryptocurrency scams develop and maintain themselves.

Among the falsehoods the Forsage defendants allegedly told their victims were the following ones:

Maslakov decried the Philippines Commission’s probe as “nonsense” and said that “all individuals who have a common sense laughed at this” in a video that was broadcast on YouTube on August 17, 2020.

Forsage “is not involved in investment-taking operations,” he asserted. Maslakov continued by denying the charges of the plot, claiming they were only driven by “something [the critics] can’t control” that led them to brand Forsage with “grave crimes.”

On September 7, 2020, and October 8, 2020, Hamlin clearly stated that investments in Forsage were “totally real” and “absolutely legal” and that Forsage was “not an investment scam” in films released on YouTube for the Forsage Academy and on his Facebook page.

“Goodness gracious dude,” he said, “you start to discuss this smart contract and what it can achieve and then you have other people with their negativity because they don’t know any better and they want to throw that negativity on you.”

Deering posted a 10-minute YouTube video on October 25, 2020, in which he outlined the reasons why Forsage was not a scam.

Because “nobody can steal your money,” Forsage, in Deering’s opinion, “doesn’t have a single thing in common with [a] plan;” The “requirement of a tangible commodity is an outmoded cliché,” and Forsage is “100% decentralized.”

Deering went on to tell his audience to “find up what [a Ponzi/pyramid scheme] is and then go study about it before you open your mouth and start disparaging anything,” according to his advice.

On February 10, 2021, Martinez spoke with a visitor who disputed that Forsage was a fraud, and he backed up his visitor’s assertion.

In a YouTube video on February 18, 2021, Ellis said to his fans that “[w]e can overcome [objections] that [Forsage] is a pyramid… Unless they’re talking about bringing it up themselves, I’m not sure why others would have that problem (that this is a pyramid scheme). However, if you approach it and discuss it like a business – which it is – that has the potential to earn you millions of dollars, then people won’t even pay attention to that criticism.

On February 27, 2021, Okhotnikov took part in an interview with Forsage Indonesia that was later posted on YouTube. Okhotnikov said, “Forsage is an anti-pyramid,” when asked if the Forsage scheme was a fraud.

A few weeks later, Okhotnikov took part in another Forsage Philippines panel, which was broadcast on YouTube on March 6, 2011, when he answered the allegations stated by the Philippines Commission in detail.

Many of you are familiar with the allegations made by the Philippines Securities Commission. I’ve at least heard some odd claims. Securities or investments are unrelated to forage.

As you are aware, Forsage is wholly unregulated by the SEC.

Two days later, Bowen held a webinar on the YouTube channel of the Crypto Crusaders where she urged her audience not to mention the word Forsage in any Facebook postings because, in her opinion, people would Google Forsage and find videos and articles that said it was a Ponzi scheme.

On March 11, 2021, Ellis said in a new YouTube video that the purpose of the Forsage Academy’s curriculum was to “ensure that governments and bureaucrats realize that we’re not some fraud, a pyramid scheme.”

In one of his monthly seminars on the Crypto Crusaders YouTube channel on April 5, 2021, Martinez particularly addressed the Montana CSI’s cease and desist letter, claiming that it had “no validity” and that the Montana CSI “doesn’t understand crypto at all.”

To have the cease and desist order “removed,” he continued by assuring his audience that “Forsage leadership” was looking into the situation. One of his guests further claimed that Forsage even constituted an investment contract and that neither the Philippines Commission nor the Montana CSI had “proved [Forsage] guilty.” They had just made charges that Forsage was a scam.

Deering commented on the Montana CSI’s conclusions at the webinar Martinez gave on April 5, 2021, stating that “anything that they say in there is not correct.”

Shepperd was informed by one of the investors in the Crypto Crusaders organization that Forsage was a fraud.

Shepperd barred the investor from the group’s Facebook page after the investor complained about it in the media.

When reporting on MLM crypto Ponzi scams, BehindMLM regularly encounters this kind of argumentation and denials.

Another illustration may be seen on Forsage’s official Medium account, which was uploaded in late 2020;

According to the SEC, as of May 2022,

Forsage saw 1.05 million participants in the Ethereum iterations, 455,246 in the Tron iterations, and 434,992 in the BUSD iterations.

Regarding the transfer of funds from Forsage’s inventors and leading proponents to its victims;

At least $4.8 million was received by Vladimir Okhotnikov and the other Forsage founders; Okhotnikov and Mikail Sergeev also obtained an additional $433,909 through money laundering outside of Forsage.

Defendants were reckless in their failure to know that For each additional $256,731 that Lola Ferrari received, Sergey Maslakov received another $110,741 or more, Sam Ellis at least $72,405; Mark Hamlin at least $565,828; Sarah Theissen at least $130,118; Carlos Martinez at least $462,925; Ronald Deering at least $267,075; Cheri Beth Bowen at least $303,00; and Alisha Shepperd at least $5

Forsage did not sell or offer to sell any products to bona fide retail investors, or people who are consumers of an actual, consumable product and are not participants in an income opportunity. Defendants had previously participated in other MLM projects and knew this or were reckless in their failure to know it.

In that aspect, the Defendants were careless in their failure to comprehend that Forsage was not doing any legitimate retail transactions. It was only concerned with the selling of the right to take advantage of an income opportunity.

The awards under Forsage’s compensation scheme were also dependent primarily on contributions from the later investors because the money earned through the selling of slots came from investors who attracted new investors.

Defendants understood they were running a typical Ponzi scheme because they used these later contributions to pay off earlier investors, or they were careless in failing to realize it.

The Forsage Defendants are facing charges from the SEC for

The SEC is requesting an injunction against the Forsage Defendants, as well as the disgorgement of ill-gotten gains and a civil penalty, for unregistered offers and sales of securities in violation of the Securities Act, fraud in violation of the Securities Act, fraud in violation of the Exchange Act, and fraud in violation of the Exchange Act.

The fraud allegations against defendants Sam Ellis and Sarah Theissen have already been resolved.

Two of the defendants, Ellis and Theissen, consented to settle the accusations and be permanently restrained from violating the charged provisions and engaging in specified unlawful behavior without admitting or disputing the allegations.

Theissen will be compelled to pay disgorgement and civil penalties as assessed by the court, and Ellis consented to pay disgorgement and civil penalties as well.

The judge must approve both agreements.

SEC’s case is not yet available on Pacer as of the time of publication. For a docket update later today, I’ll be back.

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