The $5000 Affiliate Marketing Scam

Affiliate Marketing is a weird little world.

It’s a great way to make a living and I’m glad I found it. But it definitely has some downsides as well.

I’ve seen a lot of weird stuff go down behind the scenes during my time here. And luckily, I’ve been able to avoid the big disasters. I did however get caught up in a scam once, when a guy told me about a “Dream Opportunity” and then ran off with all of my cash.

Luckily – it wasn’t enough of a loss to bankrupt me, but it wasn’t fun either.

Here’s what happened.

We’ll call him “Greg”.

Meet Greg

Greg was an ad network rep that I met many years ago. He was working at a major network where I was doing tons of business and spending lots of money.

Greg was my day-to-day contact and had always taken good care of me. He answered his phone on the weekends (which is rare) and always told me about new opportunities that I was able to capitalize on many times.

One day Greg called me and told me he was leaving the ad network.

I’m moving to an underground RTB (real time bidding) network that has figured out a loophole that will make a guaranteed return on your ad spend” he said. “For every $3 CPM you spend, you’ll make back $5-$6 automatically…”

The deal was so good he was also going to be buying traffic for himself and if I wanted in, he was willing to take me with him.

I told Greg I’d think about it, thanked for his help over the years and we exchanged our personal contact details.

A few days later Greg got ahold of me. He said “We’re all setup on my end, let’s get you started, all you need to do is pay for the traffic up front. Can you send a $15,000 pre-payment?

Reading the email gave me a funny feeling.
A feeling I should have listened to.

That feeling is called ‘common sense’ and it can save you from doing some really dumb stuff if you follow it.

But of course, if I had followed my common sense I wouldn’t be telling you this story now, would I?

I replied to Greg and said “Let’s start with $5000 and give it a test, if it does well, we can go from there.

  • Greg agreed and sent me his wire information.
  • I sent the money and waited to hear back.
  • Days went by.

Three Days

By day three I was starting to get pretty worried. When Greg worked at the big ad network he usually got back to me within an hour. A 3-day delay was out of character.

Finally, on Day 4 Greg emailed me.Sorry for the delay, I’ve been setting everything up. We’re ready to go. Can you send in another $5000? I really want to secure more traffic for you. Remember, whatever you send me, I can guarantee you a 100% return with this loophole. And any sales you make on the traffic will be icing on the cake.

At this point my scam radar went WAY up and I told Greg I couldn’t send him any more money until I got some traffic going and could prove the model worked.

Greg agreed and said traffic would start soon.

He was right. A few days later my Tracking202 system started getting traffic from Greg. It dribbled in about $100 worth of clicks to my landing pages and made one sale for a $35 commission.

If you do the math, that means that I lost $65 on the $100 spend. That was fine with me because remember, I was paying a $3 CPM and (supposedly) earning a $6 CPM on the backend, PLUS any sales I might make on the traffic.

So if I spent $100 that day, I automatically earned $200 + the $35 commission. That’s 135% ROI and not a bad deal in my book (if it was real).

I Need More Money

After the $100 spend, the traffic stopped again. I emailed Greg to see what was going on and he emailed back that they were having backend issues. “Don’t worry” he said, “this is going to be huge! Can you send in another $5000 so I can lock in more traffic for you?

Black clouds started gathering around my head.
I heard thunder rumble somewhere off in the distance.

Now it was really starting to look shady. Never in my life had an ad network rep requested I send in more money before my initial balance was spent. It didn’t make any sense.

I had an idea of what was going on but I was still hoping for the best. I mean, I had all of Greg’s contact information, I knew where he worked for the last few years. I had this relationship with they guy that I thought I could count on.

I replied to Greg’s email, “There’s no way I’m sending more money in, until you spend what I’ve already sent and can show the return you promised”.

Days went by, no contact from Greg.

A week later I got a text from Greg. It was 11pm on a Friday night. His message looked awful, something like “Hey it Gret. Hop you’re doing well. Can you plz wire me anthr $10,000 tonite?

WTF?

When someone sends you a text message full of typos at 11pm on a Friday night it’s normally because they’re drunk.

Greg was probably drunk, texting me from the VIP lounge at a club and needed the ten grand to pay for bottle service.

I texted back that I couldn’t send him any more money until traffic was back on and we were able to prove the model. Greg didn’t reply.

Days went by, no contact from Greg.
Then weeks.
Then months.

Greg went totally unresponsive. I emailed, I texted and I called. No answer, no reply. Greg disappeared.

I contacted the old ad network where he used to work. I told the person at the network what was going on. She replied “I’m sorry but I can’t give you information about current or past employees, but I can tell you that you probably shouldn’t work with Greg anymore.

Based on what she said, I figured that Greg probably didn’t leave the company for an “Exciting new opportunity” at all. He was probably fired because they caught him stealing money out of the company’s bank account or something. And after he got busted he came up with a desperate scheme to drag as many clients as he could out of the company with him so he could take advantage of their trust to make some quick cash.

Reality started to sink in.

The $5000 I had sent to Greg was gone.
Greg was gone.
The opportunity was gone.

My initial reaction was anger. I texted Greg a few times to let him know that my attorneys had recommend a lawsuit and unless he contacted me immediately I would proceed.

No contact.
Nothing.

Know When To Fold ’Em

There comes a time in any bad investment experience (or playing poker in Vegas, buying a crappy car or trading stocks) where you have two choices.

  • Sink more time and money into trying to get your investment back.
  • Walk away and use it as a lesson.

I decided to go with door #2.

Luckily I had only sent Greg $5000 and that loss wasn’t enough to cripple me financially.

The time and money it would cost to pay a detective and attorney to track him down and sue him would cost more than $5000. It would be more profitable for me to move on and focus on making more money.

So I let the guy off the hook and forgot about it.

I didn’t really forget about it though, I kept his number in my phone for 3 years just in case I lost my mind one day and needed someone to unleash my wrath upon.

But luckily – that never happened.

I never texted or called Greg again. I deleted his number from my phone.

And these days, I really don’t think about Greg much at all.

< / story>

What’s The Takeaway?

A smart person learns from their own mistakes. But a really smart person learns from other people’s mistakes, so they don’t make them at all.

Here are a few takeaways you can learn from my mistake. Maybe you can save yourself from a bad situation at some point in the future.

  1. If it sounds too good to be true, it probably is. This phrase applies to every facet of life. If someone tells you that they have a “magical” opportunity or loop-hole where you can make money doing nothing, it’s probably a scam. It’s even worse if they tell you they can “guarantee” a profit. There are no guarantees.
  2. Never send in a large pre-payment to an unknown ad network. If you’re working with AOL and they ask you for a $10,000 prepayment, you’re probably fine. But if you get a call from ’24/7 Grind Ad Network” based in Nigeria it’s probably not a good idea. Keep your test budgets with new networks small. It’s always better to work with large, established networks.
  3. Don’t be greedy. Greed will get you every time. Even though Greg’s plan didn’t make much sense to me, my greed took over and I sent the money in anyway. Greed is blinding. Don’t let it trap you.
  4. Don’t chase bad money with good money. Have you ever heard of someone losing $500 in Vegas and then losing another $5000 trying to win it back? They’re spending good money to chase bad money. It happens all the time. In most cases you’re better off cutting your losses and moving on.

I’d like to end this post by saying that I wish Greg all the best in his life. I learned a long time ago that when people steal from you, it’s probably because they need the money more than you do. I mean, what if Greg had a daughter in the hospital and he needed the money to pay for her surgery? In this scenario, I can feel good about donating my $5000 to help save his daughter’s life.

But there’s another side of me that thinks Greg probably spent the money on booze, cocaine and strippers.

And in that case I hope Greg dies in a fire after being struck repeatedly by lightening.

  • Petre Veluda

    Life lesson too. When it sounds too good to be true, it probably is.

    • http://malandarras.com/ Malan Darras

      never fails

  • Fabio Kaya

    Thanks for the post, it is a very valid life lesson.

    • http://malandarras.com/ Malan Darras

      you’re welcome. use it well

  • Jeff

    Awesome post – lots to learn here and a great tale. Greg, wherever you are, go fuck yourself.

    • http://malandarras.com/ Malan Darras

      ditto

  • Cristian Sannino

    Sometimes You Win, sometimes You Learn!
    Thanks for Sharing

    • http://malandarras.com/ Malan Darras

      dude! i like that. sometimes you win, sometimes you learn. very true

  • Andrei

    Good post Malan. I have lost almost $ 10 000 by investing to my friend’s business. It is huge sum of money for me. The lesson – if you wanna loose the close relationship – give money without any agreement ), just trust the words))). But If you wanna have graft/vaccination for the whole life – do the same, I am not sure that any story can teach this. After that you will think more then 7 times in future to give your own money to somebody or not. The great takeaway for me from the story is the emotion which I was feeling, I am sure that I will forget after some years the number of lost money, but I will never forget that feeling and emotion. I can say thank you to the friend). P.S. I do not hate that guy ( and as Malan wrote earlier – may be he needed money much more than me), because hatred makes you the hostage of the situation, and I wanna be free man ); it was just his desire to do like this.

    • http://malandarras.com/ Malan Darras

      yeah the rule with friends is you can lend them money, but don’t expect it back I just give them the money as a gift or I just say “no”.

      • Indieja

        What? That’s horrible. You must have awful friends.

        • Bret Royster

          I’d say… that’s a ‘good’ friend… the worse thing ever is to feel like your friend owes you money… or maybe that you owe your friend money…

          It can really eat away at a relationship from both sides.

  • Ralfs

    I like the story, it’s a valuable lesson to be learned especially in this industry. Good thing you didn’t send Greg the other $5k. It’s sad that he turned out to be a scammer though. It really sounded like he was a top notch rep on the ad network before he left it.

    • http://malandarras.com/ Malan Darras

      that’s what got me. he was a trusted rep for over a year. i talked to him almost every day of the week. otherwise i never would have sent him a dime.

  • felipipi

    This story reminds me a great movie ” A Bronx tale ” the 20.00 bucks scene. Some mothefu@(#*@$!& cost a lot.

    • http://malandarras.com/ Malan Darras

      not sure if i’ve seen it. i’ll look it up

  • Andrea Costa

    When i first started internet marketing i been scammed 2 times, once by a traffic source 500$, and another time from a guy who was suppose to be my “mentor” 2000$ scam.
    Thing is it s plenty of bad people in this industry and it’s really easy to get scammed if you are not careful but there are also good people, focus on those and get rid of losers.

    • http://malandarras.com/ Malan Darras

      when it comes to mentors, i tell everyone the same thing. If the mentor says they guarantee you’ll make money, it’s BS.

      • Andrea Costa

        true story

  • Chris W

    Shitty that u went through that. better to think of it as an expensive lesson than misfortune. one of my most frustrating lesson learned is losing a bankdraft over $10,000 dollars becasue the process of having it reissued is fucked up and i am still dealing with it 6 months after i lost it.

    • http://malandarras.com/ Malan Darras

      ouch. sometimes it’s just better to move on… but it hurts 🙂

  • Francisco Bernabe

    Great post.
    Whoever has been scammed has learned a very valuable lesson.
    It happened to me once ($2k), and I had to put both of my hands to work to get my money back. It made me realize that there’s no get-rich-quick short-cuts.
    Nonetheless, life has interesting ways of putting everyone in his place. That Greg is surely where he deserves by now.
    Karma is a smart and fair bitch.

    • http://malandarras.com/ Malan Darras

      right – he’s probably in jail by now

  • Mitesh

    Awesome post, if it’s too good to be true then it probably isn’t. We were scammed on a green energy deal to put solar panels in. At the time the company seemed legit and asked for payment upfront and then nothing ever happened. Luckily only lost £300.00

    A great lesson learnt.

    Are you not curious as to what Greg is up to these days? And why he had to stoop to such a low level?

    • http://malandarras.com/ Malan Darras

      Desperation probably

  • lukepeerfly

    I’m assuming Greg never came back into the industry?

    • http://malandarras.com/ Malan Darras

      not that I know of

  • greeenranger

    Bad guy Greg. What goes around comes around. He’ll get a taste of his own medicine eventually.

    • http://malandarras.com/ Malan Darras

      K A R M A

  • Jonatas

    Good advices. I’ve lost $200 once with the same kind of new-magical-blessed-by-god business. Cool! Nice post.

    • http://malandarras.com/ Malan Darras

      IF it sounds too good to be true….

  • Jeff

    Eat my ass, Greg.

    • http://malandarras.com/ Malan Darras

      nice

  • Brandon Whited

    Thanks for the info. I almost learned a hard lesson from scammers. Truly if it is too good to be true, it is.

    • http://malandarras.com/ Malan Darras

      yup

  • https://www.facebook.com/sanjaybanerjee09 sanjaybanerjee

    super info

    • http://malandarras.com/ Malan Darras

      super thanks

  • Sumeet T. Harish

    Great Reflection. In great times, great minds need rise to a greater pathway out of shitty situations, love to reframe on that one Malan. 🙂

  • Alex Delibas

    I think it’s human nature to at least try things that might sound good to be true so I wouldn’t beat myself over that. What’s really great is that you were able to turn around a negative experience in one from where you learned a lot.

    • http://malandarras.com/ Malan Darras

      hey.. if it had worked, i would have been a genius

  • Albert Akogo

    You were really giving good advice….but veered off point and totally childish when you mentioned Nigeria…After all the guy who scammed you wasn’t Nigerian….I’m a Nigerian and an honest one…so I see your statement as a slander to my country and nationality….your story shows that scammers can come from anywhere even those living in the U.S!

    • wanted101

      True. Any reasonable individual knows that the vast majority of people in a country are not scammers.

      I’m sure Malan never intended to offend you or your countrymen. It was just an example, as there has been a history of scammers who have been traced to Nigeria (e.g. Google “Nigerian Letter or “419” Fraud” and you’ll see the FBI page on most common scams that the FBI investigates).

  • Matan

    I had ~~ Unbelievable ~~ story on similar topic.
    currently my grammar is too challenging to pass the idea as I want to, but after reading this post,
    1 day I will talk about it. the words in end of the post are so strong man!