"An Internet company that bilked investors out of more than $50 million dollars
was charged with securities fraud by federal regulators on Monday.
The Securities and Exchange Commission charged Charis Johnson, 33 of Charlotte,
N.C. and her companies 12daily Pro and LifeClicks LLC in the federal district
court of Los Angeles, Calif. The agency said that she defrauded investors
through the Web site 12dailypro.com.
Johnson's Web site, which raised more than $50 million from over 300,000
investors worldwide, claimed to be a "paid autosurf program" that would
generate money through Internet advertising, according to the SEC.
Johnson's company was considered by regulators to be a sizeable Ponzi scheme
where investors are promised vast returns but are paid with money from
subsequent investors instead of revenue generated by business.
The SEC said 12dailypro.com allegedly lured in investors with promises of 44
percent returns just after 12 days.
"Paid autosurf programs have become an enormous industry on the Internet,"
Randall Lee, the regional director of the SEC's pacific regional office said in
a statement. "When these schemes depend on attracting new members in order to
pay returns to current members, they are destined to collapse. We urge the
public...to exercise extreme caution before investing in any get rich quick
scheme."
Johnson allegedly funneled over $1.9 million in investor money into her personal
bank account since mid-2005, according to the SEC, while advertising revenues
generated by 12daily Pro and LifeClicks were either negligible or
non-existent."
