Can we get off the Newsweek issue? There is no way they can check every ad they receive to check to see if it is legit. If your friend told you about Pinnacle and the great returns they offer, are you going to blame your friend for telling you? Are you going to expect your friend to pay you your money back. NO! You are thinking emotionally, you just want to get your money back just like the rest of us. We all understand that, but you can't go trying to get it from someone or some company who did nothing wrong but inform you. We all checked Pinnacle out, we all made the decision to invest, no one made us. We just got scammed. I'll bet if Newsweek had tried to check them out they would have found exactly what we all did . . . . nothing negative.
hopefulinAZ
I agree with you to a certain extent. Your friend did not profit from it. Newsweek did. If I read the ad in another crazy advertising magazine, I probably would have not committed as I did. Newsweek is a professional renowned company and they owe their readers the correct in formation, Not Bogus. We are not saying they should be perfect. But when mistake are made they should hold themselves accountable. I am sorry but we should also see this situation to the end. Even an apology is in hand. We have to be firm about this.
Sammy
Hello everyone. This is my first post here. I make a habit of visiting several real estate forums as I think it helps to give one the feel of the market as a whole. I must say I have been following this thread for quite some time but it had been a few weeks since I last dropped by. Seeing some of the recent posts I thought perhaps I would log on and share some of my experience as I have seen this process unfold several different times. Let me say that I am NOT a investor in PDP. I simply thought I would share my knowledge and experience. I am in no way looking down at the investors. I have been on the same side as you dealing with people who are the scum of the earth. There is nothing that makes a person more upset than being swindled out of their hard earned money. With that being said, you may not like some of what I have to say. Please do not take it personally as it is only my assessment after having been in business world for quite some time and watching this gut wrenching process run it's course.
First, in regards to the Newsweek issue, HopefulinAZ hit the nail on the head. There are some that are letting their emotions control their decisions. I do not agree with the idea of going after Newsweek or the supposed "net winners". I think, however, that the ethical and moral aspects of that have been beat to death and nobody is going to convince the other party. Lets just look at the basic facts. Like every decision in life, you have to look at the risk reward scenario. There is virtually no chance of any type of reward from pursuing Newsweek. It is important to ask what you hope to accomplish. First, there is no legal recourse. I'm sure you have seen the disclaimer on TV and several media outlets. Bottom line is that companies like this cannot be liable for the business practices of their advertisers or the legitimacy of their claims. Most reputable companies try and use their best judgment and do refuse to advertise certain products. In this case, with the exception of the unrealistic gains promised, there was no warning signals that something was amiss. Every investor here is a testament to that. With no legal recourse, the idea then turns to influencing them to voluntarily give back revenue received from PDP. Firstly, there is a very small number of people who support this idea. Secondly, even if every investor did, it is hardly enough people to influence a company like Newsweek. This is sad but unfortunately true. Additionally, even if these efforts were successful, what would they do with money? Obviously they are not going to divide up the revenue and issue it to individual investors/partners for reasons that are too numerous to discuss. Currently PDP's assets are frozen and even if they were able to receive such funds, it is unlikely that a dime of this would go to investors. But since this scenario is impossible, there is no reason to explain why this is.
Now that the possible reward has been addressed, lets look at the risks or downsides. First, one of the things that is going to make you even more sick to your stomach is when you see the fees and expenses incurred by the Receiver. I mean absolutely no disrespect to Hays, however I don't think any of you are prepared for what the cost of this will be. I have seen instances when the Receiver fees were more than the available assets of the company. I don't think that will be the case here however it will be extremely costly as this is a complex case. The last thing you want to be doing is requesting their help in issue like the Newsweek one. Legally they have to field your calls and address your concerns. Although you may think it is a harmless call, you(the company) will be billed for it and all associated expenses. Lets say the information you request takes a total of 20 hours of time to address (which I can promise you is conservative) at a rate of 500 and hour. After all related expenses you would probably be looking at close to ten thousand dollars. If you think this is an exaggeration, just wait. That is 10,000 that is now not going to be distributed when and if any money does. That is probably more than many lost in total. I really feel like the people suggesting these courses of actions are not considering that their actions will affect everyone involved. They are acting purely out of emotion and that is the first downfall whenever business dealings are involved. However, it is a free country and people will do what they will do so enough on that topic.
Overall this case presents several interesting questions. One of which is the classification of the investors/partners. Technically, the original documents from PDP attempted to establish a partnership between itself and the "investors". I believe this was likely an attempt by PDP to fly below the radar of the SEC and it's regulations. Obviously the SEC involvement essentially reclassifies the "partners" now as "investors". This is a double edge sword however. It is good for investors because it allowed the SEC to step in and take immediate action. This keeps all the investors from having to file suit against PDP in a civil matter if they were on their own and wanted to try and recoup their losses. On the flipside, investors will now be treated much like stock holders of a company which unfortunately moves you to last in line as far as who receives money. There are many mouths to feed besides those of the investors. First, from what I would guess, PDP took out loans on many of the properties that were purchased. These lenders have lean rights on the properties as well as legitimate claims for unpaid interest. Additionally, the properties that remain still have taxes that will be owed on them. If PDP was like any other business, there are a number of creditors that have claims anywhere from office equipment to vehicles etc. etc.. Typically the government will be the first to get paid for all taxes that are collectable. This would include all taxes from the income of all the properties that were sold for an inflated price which is a completely different mess altogether. Then the creditors would be next in line and then ultimately the investors. Of course their is no guarantee this will be how it plays out as there are just so may strange aspects to this case.
Anyway, the only advice I can offer is just to be patient and let the process run it's course. If I was an investor who had more than 130k invested I may consider seeking the advice of an attorney as the complexity of the case is somewhat unusual. Obviously the cost of this consult has to be weighed against the possible benefit. In all honesty, my guess would be that the investors will see anywhere from a 25-35% of their money back. This process should probably take close to 15 months to complete. Of course all of this is subject to the outcome of several issues which have yet to be decided. Just remember, every email, phone call, and even post here by the receiver is going to cost you money. That is nothing against Hays, it is just the truth as they would probably tell you.
It is important not to let this ruin your life or occupy your every waking moment. I have seen people totally destroyed both financially and mentally from events like this. A violation like this is hard to overcome especially when you did not have the money to lose, but you have to try and move on and not let it destroy you. The scam artists at PDP already took your money, don't give them your soul as well.
Hold on a minute here. Nobody said anything about not being patient, of course we do. I'm not saying anything about any legal recourse against Newsweek, of course there isn't.
All I'm saying is this: there was some kind of twisted dumb naive reasoning that occured in my simplistic over-worked and strained brain when I decided to buy Newsweek over the National Enquirer at the checkout stand in July, 2006.
That naive reasoning was a direct result of Newsweek's very successful and most likely very expensive and efficient marketing strategy that sent a message to my poor little brain saying, "you can trust us. We are Newsweek after all"
I did, and got burned.
Will I buy Newsweek again?
I don't know. I'm not sure yet.
I want to see how they react as the true story of this awful fiasco unfolds.
Personally I'm kinda interested to see their take on all of this.
Pretty simple really.
Are they really the great trusted publication I thought they were?
What else can I do while I'm waiting to see if my life savings are gone forever?
It is not my opinion that this thread is for only those who are investors. In fact, it was ironically started by someone asking about it cause he was skeptical before joining. If you don't like my post that is fine but I don't think you are the designated judge to determine what is constructive or necessary. I for one think your posts are counter-productive to the group as a whole but I would not typically say that cause I respect your right to have an opinion.
:superman: :superman: :rock: :rock: :joker: :woohoo: :woohoo:
Hey people I'm still reading the post every now and then. Just decided this post was not being helpful to me anymoretaking to much time. went out st6arted a glass repair co. My sugestion send your paperwork in go on with your life. focus on what you can do to get past this. wish you all well
WHATS UP BIGMAN REMY RDC TXRUNNER CHAD call me lets get together sometime o ya bigman keep them funny!!!!!
WHATS UP BIGMAN REMY RDC TXRUNNER CHAD call me lets get together sometime o ya bigman keep them funny!!!!!
Way to go 00Kevin! Good for you. Good luck in your new business and all your future ventures!
YOU ARE CORRECT! THIS IS FOR EVERYONE!
I will not warn you again to stay civil with other posters on this thread. Thank you.
Robert Hendree sends his love. He is looking for investors for a company called Brookwid Business Consultants (Not sure of the spelling)
I guess he is thoughtfull enough to try to help us get our money back by suggesting investment tools. :protest: here is his number for all interested.
770 895-5170 :shock:
IS HE SERIOUS?
There are so many platitudes and bumperstickers about success that I think ours gets lost in the fray. The fact is we thought long and hard about the WCRT tagline "Success by Association". One of the things that was missing for all concerned (Newsweek notwithstanding- but it was an AD) is an objective, experienced, successful investor looking over your shoulder at this deal.
Again, this is NOT PERSONAL, or an attack, or a look down upon the investors.
I'm simply re-stating my original and unwaivering opinion that there was a lack of real due dilligence here.
That being said, my next opinion is that you need to move on. You lost. Lump it, and move on. I'm not saying you shouldn't make some modest effort to recoup, but odds are you will not- so don't make it the cause of the rest of your life. You gotta pick the hill you're gonna die on carefully, and speaking from experience sueing and being sued-- this ain't it. Move on.
As to Success by Association-- I'm always trying to define the benefits to folks. The issue is that it's always somewhat difficult to define, and it is almost impossible to measure and predictably repeat the results. Until last night.
Last night I couldn't sleep so I was up watching Animal Planet. Predictably, there was the lioness on the hunt. I noted while I was watching that the lioness hunters went after the healthiest wildebeast in the middle of the herd-- oh, no wait, no they didn't. They carefully separated their prey from the herd- a smaller, weaker animal without the benefit of strength in numbers. We as human beings wax romantic about the "lone wolf" but even successful wolves hunt in packs. Build a strong network, and it's much more difficult (and costly) for con artists to pick you off.
Earigoo,
I like your Idea. Can you share more information on it?
Thanks,
Sammy
Hello Everyone,
I have a national magazine that is willing to write a story on how Newsweek dropped the ball on its readers, costing them large amounts of money with poor advertising. If Newsweek will not assist us there are other resources available. Funds can go to the investors account.
Sammy
I have a national magazine that is willing to write a story on how Newsweek dropped the ball on its readers, costing them large amounts of money with poor advertising. If Newsweek will not assist us there are other resources available. Funds can go to the investors account.
Sammy
What magazine is that? What funds are you talking about?
I know a lot of us feel bad about the money we lost. Take a look at this one; it will help you all feel a little better. From almost 400 million to 3.6 million to split...
http://www.haysconsulting.net/correllhorizon/01-25-06%20Amer%20Press%20Update.pdf
I think we got of pretty good compared to where it could of ended up.
http://www.haysconsulting.net/correllhorizon/01-25-06%20Amer%20Press%20Update.pdf
I think we got of pretty good compared to where it could of ended up.
think you meant to say 400 million to 3.6 million. And that is just what they were able to freeze beofre the process even starts.
You were right. It was a typo. Anyway, I think although we lost a lot we came out with a broken arm and bloody nose and maybe a chipped tooth. Those folks came out as amputees or worse quadriplegics. :oops:
I'll take my bumps & keep on movin... :mrgreen:
I think Robert Hendree bit someone's ear off. :crying:
How are you going to claim your loss? Just the principle or principle + return?
Where is everybody, are you all on vacation? Also, havent heard much of anything from Mr. Hays lately. Does anyone have any timline as to when we might see some of our money back?
Hello all.. I was contacted 12/29/06 by my local FBI office. Apparently FBI in atlanta is pursuing mail & wire fraud criminal charges against the key players at Pinn. Because of the high-priority & scope of the case, the atlanta FBI is getting help from the local offices where us investors live. I had a short interview with them & dropping off copies of everything to their office next week. Has anyone else been contacted yet?
To recap recent discussions:
1. I dont think we'd be able to hold publications liable for Pinn's ads. Free speech will prevail. However, maybe a plea to them to throw us a bone such as "how about just giving us whatever Pinn paid you in advertising fees"? Certainly that's not a lot to ask for.
2. "net winners". There has been plenty of debate over the issue & I certainly dont want to re-hash it again. The receiver reads this post & at the end of the day he will probably be the one to decide the appropriate course of action which I will support him on 100%.
3. tax issues: I recommend we all just file extensions. The tax concerns regarding the partnerships should hopefully be worked out by then.
Happy new year to all & 2007 s gotta be better than 2006!!
I am not sure filing an extension would benefit you as I doubt this will all be resolved by Ocotber 07. If you have other capital gains in 06 that can be offset than it may be a good idea to go ahead and write the whole amount off as a loss. Then, when and if any money is returned you can recapture that as income at that time. If you dont have any capital gains to offset, you would be best to treat it as a continuing investment. Remember, you can only ofset 3000 in other income with a investment loss so the rest would be a waste. Only take the loss if you have capital gains for the same period to offset it against.
I think Robert may have thought twice or maybe someone put the brakes on his new "Venture" aka (New scheme) He doesn't answer his business phone anymore. :violin:
Did you guys scare him away? :protest:
He wasn't going to rip anyone off, he promised.... :goofy: His kids wanted to see Christmas too.
According to Mr Hay's tax memo:
http://haysconsulting.net/pinnacle/Pinnacle%20Tax%20Memo.pdf
The loss can be treated as a theft loss according to IRS section 165. This would not be treated as a normal investment loss and wouldn't be limited to offsetting Capital Losses.
The cirteria for Section 165 Theft Loss includes:
Section 165(a) of the Internal Revenue Code allows a deduction for any loss sustained during the taxable year not compensated for by insurance or otherwise. Under § 165(c) losses for individuals are limited to (1) losses incurred in a trade or business, (2) losses incurred in any transaction entered into for profit, though not connected with a trade or business, and (3) losses of property not connected with a trade or business or a transaction entered into for profit, if such losses arise from fire, storm, shipwreck, or other casualty, or from theft. Section 1.165-1(b) of the Income Tax Regulations generally provides that, to be allowable as a deduction under section 165(a), a loss must be evidenced by a closed and completed transaction, fixed by an identifiable event or events, and actually sustained during the taxable year.
Also:
Whether a loss constitutes a theft loss is determined by examining the law of the state where the alleged theft occurred. Edwards v. Bromberg, 232 F.2d 107, 111 (5th Cir. 1956); Viehweg v. Commissioner, 90 T.C. 1248, 1253 (1988). Thus, to claim a theft loss, the taxpayer must prove that the “loss resulted from a taking of property that is illegal under the law of the state where it occurred and that the taking was done with criminal intent.” Rev. Rul. 72-112, 1972-1 C.B. 60.
The Pinnacle fiasco fits all of that...
I've never personally dealt with a theft loss before, so I'll be running it by a Tax professional to make sure that I take the best course of action.
Also, I recently email the Receiver regarding the next Interim Report. It is due to be published sometime this month.
The loss can be treated as a theft loss according to IRS section 165. This would not be treated as a normal investment loss and wouldn't be limited to offsetting Capital Losses.
I assume you mean offsetting capital gains. Where have you heard that this deduction can be taken in full regardless of whether you have gains or not? I am not saying you are wrong but i have never heard that.
I think another important thing to point out is that you can only take this if there is no longer any hopes of recovery. While that is true of any loss technically, if what you say above is true, I would imagine it would be scrutinized much heavier if it can offset other regular income. It is also strange the reciever would point out a option that people may consider that envolves there being no chance of recovery. For the investors sake, I hope that is not a statement of the likelines of any recovery.
It does however state that if you claim the theft loss in the year of discovery and end up recovering some later, you claim it as ordinary income.
For all we know, we won't see a dime.. since you have to claim the theft loss in the year of discovery, are you going to wait until it's too late to claim the loss? Or are you going to claim it this year and if and when you see a portion of it returned claim that as ordinary income? Like I said, I'll be getting professional advise on this, but my choice will be the latter... What if you assume you are going to see some back and never do? There's no second chance to go back and claim as a theft loss once you pass the current tax year.