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Well, this is what Stormpay states as it's reasons.
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Dear StormPay Member,
Please read this news update as it contains important information concerning your StormPay account as well as spends from your account to the "Auto-Surf" industry.
Traditionally "auto-surf" is a "traffic exchange" industry as to where persons gain traffic credits for promoting their URL (website address) in exchange for viewing websites offered by others. Any monies taken in on these types of "traffic exchanges" are normally for upgrades to have your URL (website) shown at a higher rate of exposure. For an example of how a true auto-surf works, you can visit www.autohits.dk or other sites comparable.
"Paid to click", or "Paid to Read" types of sites are normally where an advertiser pays to have his/her ad displayed and the end user gets paid a portion of the advertiser dollars for clicking on and reading/viewing the ad. The end user who is being paid for reading/viewing the advertisement does not spend any monies to participate. An example of this type of service is StormPay's own "StormClix" where participants are not charged to view advertisements and are rewarded an account credit for viewing the advertisement.
It has recently been brought to the attention of StormPay Inc. that the current rash of new Auto-Surf and Paid to Read accounts are NOT operating in the traditional manner. Further investigation by both StormPay and other outside investigational organizations/law enforcement agencies have drawn early conclusions that these types of programs are nothing more than well hidden "Ponzi" or "Pyramid" schemes. While many of you may not agree, or wish to agree that these programs or illegally operated ponzi's, there are many facts that that are unavailable to you, or that may have been hidden by the operators of these programs. Please note that StormPay's user agreement has always banned merchant accounts for these types of activities.
Throughout the investigations into these programs, StormPay has asked the "Merchant(s)" to provide a detailed explanation of the workings of these programs including how profit margins and customer payments are made. These questions were asked point blank by StormPay while on a conference call with the owner/operator and their attorney. The requests for information from the "merchant" were simply denied leaving StormPay no choice other than to report those findings to the other organizations who required the information from StormPay. These findings and reports caused the seizure of funds of the merchant(s) StormPay accounts until all legal matters are resolved. Please be reminded that this could have been avoided if the merchant(s) could have, or would have provided information proving no illegal pyramid or ponzi activity.
Furthermore, investigations and calculations show that these merchants were already at an "upside down" point where they are/were not able to meet the financial obligations made to their program participants. These merchants who were already failing to make good on their claims seem to now be using StormPay as their "Scape Goat" for the failure of their own pyramid or ponzi scheme. These programs are always doomed to failure and for that very reason, deemed illegal. Please site the following from StormPay's user agreement:
"17. Get Rich Quick" Schemes: Get Rich Quick Schemes are prohibited resell items by StormPay. Get Rich Quick schemes include any type of self-employment, start-up businesses, or investment opportunity where the claims of profit or returns on investment are unrealistic or unsupported. By law, if a business opportunity costs $500.00 USD or more, the promoter is required to support any claims regarding earnings or profits with written documentation.
Pyramids don't pay. StormPay Inc. and the Federal Trade Commission caution consumers about clubs or programs that promise quick money for recruiting new members. Don't bank on the pyramid promise that someone else will pay you. For more information on get-rich-quick schemes, visit the FTC at www.ftc.gov."
We know that the most prominent question in your mind is "What happens to the money I sent these programs?" Answer: At the moment any funds frozens in these merchant's accounts are frozen and not payable until all investigations are completed. At such time investigations are completed, any remaining funds will be released to the merchant's, or refunded to the purchasers, based on the outcome of the investigations. Please be aware if determination is made that these are ponzi schemes, a great deal of the funds received by these merchant's will have been used to pay obligations to those who joined earlier into the programs. In other words, they will have used your money to pay other members thus creating a deficit of funds needed to refund all users. Please be patient while investigators decide the best procedures for handling this serious situation. Contacting your credit issuers or banks requesting chargebacks only compounds the problems for all involved, including the merch!
ants and their customers, and delays returns of any funds. These actions could also be punishable by law.
StormPay will keep you updated of developments as information is available and allowed to be released.
StormPay Inc.
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Your Security Friend in Las Vegas.
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