A reality TV couple wanted to 'bless' Black people suffering financially. The FTC says it was a pyramid scheme.  STOCK ILLUSTRATION: Covid scams. (iStock) | A Texas couple once featured on an OWN network reality show "Family or Fiance," promised people they could get a financial blessing of 800 percent in as little as a week. It turns out they were running a pyramid scheme that targeted and then bilked Black people affected by the pandemic, according to two lawsuits filed against the Black couple. In a joint complaint filed on June 16, the Federal Trade Commission and the state of Arkansas accused Marlon and LaShonda Moore of operating a pyramid scheme program called "Blessings In No Time," or BINT. The Texas attorney general also has filed a lawsuit against the couple for scamming needy Black families. For an upfront fee of $1,400 or $1,425, participants were told they could receive a return of $11,200 or $11,400 respectively — eight times their contribution to a "blessing loom." "In general, these schemes falsely promise a big return — or as BINT termed it, being 'blessed out' — following a modest initial payment," the FTC and Arkansas complaint said. "In reality, however, very few consumers make any money. And the few consumers that do make money sometimes lose their profits by reinvesting in the scheme." Marlon Moore is known as DJ ASAP, which he says in marketing materials stands for "Always Serve A Purpose." Participants said in interviews that the couple often chastised people for not recruiting enough. And in one call, they tried to discredit my reporting and warnings about pyramids schemes, one participant said. Attempts to contact the Moores were unsuccessful. Coretta Vanterpool of Florida said she lost close to $13,000. In total, Vanterpool said she and the family members she recruited were out $30,000. Others paid as much as $62,700 to participate in BINT, according to the FTC. Vanterpool said she was told that an initial contribution of $1,425 would net her a "blessing" of $11,400 in seven to 10 days. To make even more money, she paid for multiple places on the blessing loom board. She was going to use the money to help pay down some of her $50,000 in student loans. "They just made it sound so real, so nice," said Vanterpool, whose nephew recruited her. "Since he received his first payment, he thought it was legit. A lot of people came in because they had been furloughed or they had lost their jobs. Their companies had closed. A couple of ladies were about to lose their homes. I met one lady through the group who was trying to get the money so she could pay for chemotherapy." The type of fraudulent schemes alleged in the complaint go by various names — sou-sou, gifting circle, money board, or blessing loom. The illegal operations borrow the principles of legitimate sou-sous, informal savings clubs that have cultural roots in West Africa, the Caribbean and other immigrant communities. In the real-deal saving circles, groups are small. People pool their money, taking turns receiving a payout. But they don't get back more money than they put into the pot. It's more like a forced savings program with accountability partners. The hallmark of an unlawful pyramid scheme hinges on two key elements: You are asked to pay an upfront entry fee with the expectation of a significant payout, and you have to recruit others to do the same. Typically, people are relentlessly pushed to recruit. There are steps or levels of the circle or octagon that lead to a center, which is when you are supposed to get your payout. The core of the con is that you'll get a substantial "gift" relative to what you put up from people joining after you. The whole enterprise eventually collapses, and the last folks coming in — the wide base of the pyramid — lose their money. Here's why these scams work. Some participants get the promised payout. They in turn share testimonies of their substantial gains. But after several rounds of this fraudulent scheme, the money dries up because not enough new people are recruited who are willing to make upfront payments. I've been reporting the rise of illegal pyramid schemes since last summer as desperate folks started looking for quick ways to make money. Promoters often target certain communities in which they share an affinity. Black promoters, for example, have been exploiting the disenfranchisement that many African Americans are feeling, especially those who have lost jobs because of the coronavirus. The operators get recruits to drag in family and friends, fellow church members and co-workers. The message of building Black wealth that the Moores espoused resonated with people, the lawsuits said. "People were really vulnerable, just ready for any kind of hope," one California woman who was involved in BINT said in an interview. "They were talking about building a Black community and building generational wealth. Those are the catchphrases now. They were just kind of selling people a dream." I asked Vanterpool how she felt recruiting family members who lost money. "It hurts because I brought someone else into a situation that they didn't have to be in when they were already suffering," she said. "I've put in money that I really don't have that I should have just used for what it was for and that was for my loans. Now I'm starting back at square one and hoping and praying that I'll get this money back." Reader Question of the Week If you have a personal finance or retirement question, send it to colorofmoney@washpost.com. In the subject line put "Question of the Week." Please note that questions may be edited for clarity. Q: As a federal civil service employee, I heard that when I retire, I can't specify which Thrift Savings Plan fund (e.g., C fund or G fund) I can withdraw from. It sounds like any amount I withdraw will be from all funds that I have invested in. Is this true? A: For those not familiar with the federal government's workplace retirement plan it's called the Thrift Savings Plan or TSP, which is available to federal employees and members of the uniformed services, including the Ready Reserve. TSP generally offers the same types of savings and tax benefits that many private corporations offer their employees under their 401(k) or similar plans. If you have a TSP and will be tapping the funds, you should read "Withdrawing from Your TSP Account." You can leave your entire account balance in the TSP after you leave federal government service if the balance is $200 or more. The options in the TSP include the following: G Fund – Government Securities Investment Fund F Fund - Fixed Income Index Investment Fund C Fund - Common Stock Index Investment Fund S Fund - Small cap stock Index investment fund I Fund - International Stock Index Investment Fund L (Lifecycle) Funds - A diversified mix of the five core funds (G, F, C, S, and I) So, as to the question, can you withdraw from specific TSP funds? The answer is no. Distributions are taken proportionately from each fund. When participants retire, they can specify whether they want to withdraw solely from their traditional (pre-tax) balance or from their Roth money. But, "the withdrawal will come from all of the funds," said Kim Weaver, director of external affairs at the Federal Retirement Thrift Investment Board. "A participant cannot specify which fund she or he wants to withdraw from." Weaver said participants can rebalance their accounts with an interfund transfer if they want to, pre or post-withdrawal. Two years ago, there were major changes to withdrawal options for TSP account holders. Here's a Washington Post article that explained the changes: Federal employees have more withdrawal choices for their retirement savings In Retirement News Part of planning for retirement and then living on the money you've saved or invested for retirement is keeping up with the issues that you need to know. In this section, I feature blogs, news stories, new research, surveys, and government policy changes that could affect your retirement. If you see a news story or issue you think would help folks, let me know and I'll check it out and share it with newsletter subscribers. This week, since there was a question about TSP, I thought you'd be interested in an opinion column written earlier this year by Teresa Ghilarducci, a professor of economics at the New School for Social Research, and Kevin Hassett, vice president of the Lindsey Group. They argued that the government should offer a TSP-type investing option to disadvantaged workers. They write: "The TSP design draws from important findings in behavioral economics to help workers create retirement wealth. Most federal employees are eligible to participate and are automatically enrolled in TSP. Tax-deferred contributions are withheld from their paycheck and the government matches that contribution up to 5 percent of their annual salary. By default, those contributions go into a very low-expense mutual fund appropriate for the age of the employee. Evidence suggests the high level of TSP participation is thanks to the simplicity of enrollment and the government match." Their bottom line: "Workers at all income levels find space in their budgets to save when the right incentives are in place." Read: Everyone should have the retirement plan federal employees enjoy Retirement Rants and Raves What are your thoughts about saving for retirement? If you're retired, how is it going? What advice would you have for others about retirement? This is your space to rant or rave about anything related to retirement. Send your comments to colorofmoney@washpost.com. Please include your name, city, and state. In the subject line put "Retirement Rants and Raves." Responses may be edited for clarity. Amid the pandemic, JoAnne Montana from Maryland wrote that she decided to retire after 46 years as a nurse. She retired on April 1, 2020. "Not what I had planned for but then no one had," she wrote. "My travel plans and thoughts of life after work were squashed but luckily in Maryland, our government did provide guidance. I was able to do most activities virtually, banking, exercise classes, shopping, and 'travel.' I relied upon my Social Security which I took at age 68. I maximized my contributions when working, which the company did match up to a point. Rolling over some retirement plans was a challenge as offices were closed, transactions were virtual, and relying on the United States Postal Service was iffy at best. I have not used these monies as my expenses are minimal, with no mortgage or dependents. I have watched my investments grow during this time and hopefully will be able to access these monies for travel in the near future." What's different in retirement? "Most of all I missed the human interactions which I knew would diminish when I quit working, but not to the extent of the isolation we all experienced. Vaccination, on Valentine's Day no less, was amazing. I am so excited to see everything opening up, but I am cautious in what I do and where I go. I don't believe we will ever return to our old ways, but life is always changing and we must adapt." | 
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