This is an archived article that was published on in 2006, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

Now that federal prosecutors have branded investment Web site 12DailyPro "a massive Ponzi scheme" and issued warnings about other sites, Utah Consumer Protection Director Francine Giani has been swamped by complaints from alleged victims.

And with the number of Utahns saying they were bilked by 12DailyPro now topping 8,400, the Beehive State has the distinction of being among the most-bilked state in the nation, authorities said.

Such so-called autosurf sites, most of them of recent origin, promise to pay investors for viewing a few online advertisements. A ''member'' goes to the site and clicks on an automatic surfer that visits a series of ads, after which the viewer is rewarded with monetary credit.

There are dozens of such sites, some of which are legitimate businesses. But the Security and Exchange Commission said others, especially those promising to pay members huge profits, can be scams.

As of midday Wednesday, Giani estimated her office had received more than 100 complaints from 12DailyPro clients, the vast majority of them coming after the SEC announced Monday that it had sued the Web site and its owner, Charis Johnson, of Charlotte, N.C.

"Up until two weeks ago, we had received one complaint," Giani said. "What probably happened is a lot of folks thought, 'If I don't say anything, I'll get taken care of.' With the charges filed, that's changed. The complaints have been pouring in."

Although state investigators had earlier issued several subpoenas in the case, Giani said the plan now is to cooperate with the SEC and other states' prosecutions as they develop.

Giani said 12DailyPro's pattern in Utah seemed to wind through the state's typically large, close-knit families. "By and large, it has been family members who have gotten hooked and then got other family members involved."

Although the state's investigation is not complete, Giani found no reason to quibble with the SEC's description of 12DailyPro as a Ponzi or pyramid scheme, a scam paying abnormally high returns from money conned from subsequent investors rather than from real business revenue.

"A pyramid scheme just offers memberships, no products or service, just money," Giani said.

"People who got money at the beginning [of 12DailyPro] are fat and happy, but a lot of the people underneath never got their money back," she said.

Specifically, the SEC complaint, filed in Los Angeles U.S. District Court, charges Johnson with running a $50 million scam involving more than 300,000 investors - and skimming off nearly $2 million of 12DailyPro's proceeds for herself.

The SEC said Johnson, without admitting guilt, had agreed to a tentative settlement in which she promises to stop recruiting new members.

The deal also freezes her assets and calls for the government to appoint a receiver to monitor Johnson's company and distribute whatever refunds are eventually approved.

Prosecutors say 12DailyPro had promised that in exchange for buying $6 units, up to a maximum of $6,000 worth, investors could expect a 144 percent return within 12 days simply for using an application to automatically click on, or autosurf, a dozen Internet advertisements daily.

In late January, 12DailyPro began to collapse after an online payment service called StormPay halted processing payments for the site. StormPay, which is under investigation by Tennessee authorities, said it took the action after learning 12DailyPro had come under suspicion as a scam.

StormPay's assets, too, are targeted by the SEC.

That all came as an unpleasant surprise for Derek Dodge, a Salt Lake City mortgage broker who says he and a partner lost $2,300 in 12DailyPro.

"We were leery of this for a long time because Utah has always been notorious for scams," he said. "And then we finally got in, but apparently at the wrong time [to make money].

"I didn't think it was illegal, and we knew some people who made a killing on this early on, but we also know a lot of people who lost their butts on this," he added, noting that some investors opened up accounts in their spouse's and children's names, as well as their own.

Giani said it all makes her "very sad."

"The old saying is, if it sounds too good to be true, it probably isn't true. An awful lot of people seem to have forgotten that."

About 12DailyPro

* The investment Web site allegedly raked in $50 million from 300,000 investors nationwide, more than 8,400 of them in Utah.

* The scheme, purportedly an Internet version of the classic Ponzi or pyramid scam, spread among extended families by word of mouth.

* 12DailyPro offered investors 144 percent returns over 12 days for autosurfing, or rapidly viewing, a series of Internet advertisements. Prosecutors say only a small percentage - the earliest investors - saw any money.

* To find out how you can file a complaint, visit the Utah Division of Consumer Protection at