In early September of 2009, I had been asked to review the Guardian Equity Group and then attempted to explain my honest opinions about the program as “nicely” as I could.  When comparing Guardian Equity to similar sophisticated, long-term ponzi schemes, GEG fit the bill without any doubt in my mind.

In the previous article weighing the likelihood of Guardian Equity being a scam, we discussed some of the major red flags:

#1. GEG offered its investors between 5.1% to 5.9% per week for nearly 50 weeks straight.  Some risky investments can occasionally return 20% to their investors, but such outrageous monthly performance without variance is absurd and essentially impossible in any financial market – and by “essentially impossible,” I mean a confidence level of 0.00000000001% – i.e. basically zero.

#2. Not one single form of proof has ever been displayed or referred to GEG researchers, and the only ridiculous response that followed the questioning of this absence of proof was along the lines of: “Oh…. well if you want to fly out to meet the people running the company, I know a guy who knows a guy whose best friend’s father has seen some proof regarding GEG. You could do the same.“  As if I should be required to fly out a couple thousand miles just to receive proof of legal and ethical investments, as any professional or respectable company would provide to its members via simple and convenient 24/7-available electronic resources?

#3. Discussion on GEG topics outside the officially approved “Guardian Equity forum” was forbidden. Many Guardian Equity members discussing the program outside their forum were threatened by other paranoid and/or self-righteous members and told they would be reported to GEG administration and have their accounts “banned.”  Guardian Equity refused to offer even the bare minimum proof of legitimate assets to their members, and yet these members couldn’t so much as let one peep of “GEG” outside the GEG forums without risking the safety of their account?

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As of January 28, many Guardian Equity members are now familiar with the e-mail and follow-up sent by Mr. David Cullen and Robert of GEG, respectively.  David Cullen’s side of the story indicates that Robert was not only unqualified to handle thousands of trusting individuals’ investments, but also that he does not necessarily plan on fulfilling promised payouts to GEG members.  Note that if Mr. Cullen’s testimony is true – i.e. Robert’s operation of the company was completely dysfunctional and unprofessional, no records of trades or balance sheets existed, and the program’s investments (what’s left of them anyway) are “missing” – then Robert was most likely running nothing more than a crafty ponzi scheme model the entire time.

Considering the “creativity” that’s been witnessed throughout the history of major, long-term ponzi schemes in the HYIP industry, there is some legitimate debate about the possibility of this “Robert vs Mr. Cullen” fiasco being nothing more than a clever drama designed to buy the scam artists behind GEG some more time before they run off with the remnants of GEG members’ money.  However, whether David Cullen is telling the truth or not, it appears Guardian Equity and the UPBAN (United Pacific Bancorp Limited) project is drawing its last breaths.

Activities on the official Guardian Equity forum were recently brought to a halt, leaving many GEG members complaining about being unable to access any information for days.  Several testimonies by angry members have now been brought into light, many of which sound similar to the following:  “I have been patiently waiting for Guardian Equity to complete my withdrawal request for months! They reassured us on the forums that cashouts would soon resume, but now the forum is closed!!”

I don’t think Guardian Equity’s recent actions of closing its forum after releasing troublesome news to its “investors” is a coincidence of any sort.  I think the dark secrets behind the true operations of Guardian Equity are about to come into the light; the ponzi scheme pool has dried up, and efforts are already being made to silence the uproar that will soon develop.  Unfortunately, I fear the GEG operators are currently sitting on their island in the Carribean, smuggly counting the remains of loyal GEG investors’ money, and attempting to plan their next steps to “close shop” for good.

Many Guardian Equity “investors” currently believe their funds are safely tucked away in CDs (certificates of deposit) issued by GEG / UPBAN.  CDs are generally issued by banks to balance their assets, the most common of which are mortgage-backed securities for commerical and residential real estate.  However, I fear this was just another gimmick devised by GEG owners based on these simple reasons:

#1. United Pacific Bancorp is NOT a legally registered bank
#2. GEG / UPBAN does NOT even possess basic financial statements that prove the “CDs” it is offering are properly backed by real assets, as required by real organizations.

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I have already explained this line of reasoning to many current GEG members, and most of them only ask me the following question:  “Should I withdraw my money?”

Hopefully, those who recognize these intense red flags will still have the opportunity to reclaim at least a percentage of their investments; however, at this stage, don’t be surprised to hear many angry GEG members telling stories about delayed payments and little to no communication on GEG’s part.  If you are presented with an opportunity to withdraw some of your funds from GEG – even if you face a penalty – I recommend you do so immediately.

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- Mr. Ryz

www.MrRyzFinancial.com

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Note: Comments will be enabled for those who wish to express their concerns or problems with Guardian Equity / UPBAN.  This is NOT the place, however, to rattle off cheerleader praise or “I was paid” rants.  These and all other off-topic comments will be deleted immediately.

Tags: David Cullen, GEG, GEG Robert, Guardian Equity, Guardian Equity forum, Guardian Equity Group scam, ponzi scheme, United Pacific Bancorp, UPBAN, UPBAN scam