ATM LEASEBACK SCHEMES-- any insight?

[rogfulton]

Also, have any of the supporters gone up to the ATM, run a transaction and saw it on the report? Heck, if any are located near me in the NH area I might be willing to process a transaction just to see if it showed up on the report. Of course, before doing so I would need the investor to agree to email me a copy of an unsanitized report so I could confirm my transaction myself. No matter the outcome I would sanitize both my ATM receipt and the report and post that.

Didn't one of the True Believers say the agreement prohibits visiting the sites the ATMs were supposed to be in?

[worried]

hmmm.... that's a good idea webhick....
But,... there could be many ways this scam is run... maybe Joel/Ed have a contact in the processing company who feeds them actual reports (padded with ficticious entries if necessary). That would make it pretty easy, Joel/Ed don't have to invent serial numbers, locations, transactions, it's all there. So, when Joel sends out a notice (in old-fashioned-harder-to-track mail) that NAS has 'acquired more ATMs', or 'more ATMs have been "released"', really that means that they've paid their contact in payment processing to provide add'l machine reports. If they were strict about it, they would NEVER 'sell' the same 'machines' to two different people. Those people could post their transaction reports on a site like this and the other one would see it and know they'd been scammed. Have Joel and Ed been that careful? I had thought about suggesting that current investors do exactly that: post their transaction reports here so they and others can compare. But, that can ONLY prove it's a scam IF duplicates are found. A lack of duplication doesn't prove anything. So, probably not worth the effort... or is it? What if a duplication WAS found? That would be 'smoking gun' evidence that the SEC/FBI would HAVE to act on.

A year or so ago, I DID do a pretty exhaustive search of the internet looking for ATM's actually LICENSED to NASI, and I DID find a couple back east (New Jersey?) but those licenses were listed as expired several years earlier. Those were the ONLY ones I found. That doesn't mean there aren't others I couldn't find (I'm no expert). It DOES indicate that NASI DID (or still DOES?) own SOME ATMs. If anybody actually went digging for PROOF of NASI's legitimacy, or lack thereof, I'm sure Joel would offer up the few REAL ATMs that NASI actually owns first.

I lean toward the theory that Joel and Ed have a contact in the payment processing company, that would make it too easy it seems to me. They can actually own real machines too so they have all the realistic licensing, servicing, maintenance, tax issues to go along with them so they look like a real business. But,... my imagination may be getting too creative, I don't know much about business myself (and certainly nothing about running a scam)... the truth may be even simpler (some elaborate setup would be less likely to keep from falling apart over a long period of time?)...

[worried]

Also, have any of the supporters gone up to the ATM, run a transaction and saw it on the report? Heck, if any are located near me in the NH area I might be willing to process a transaction just to see if it showed up on the report. Of course, before doing so I would need the investor to agree to email me a copy of an unsanitized report so I could confirm my transaction myself. No matter the outcome I would sanitize both my ATM receipt and the report and post that.

Didn't one of the True Believers say the agreement prohibits visiting the sites the ATMs were supposed to be in?

That is absolutely true, my contract (with Joel's signature) says exactly that. That is such a HUGE red flag. I also couldn't figure out why Joel needed my SSN (my family member tried to get me involved and Joel sent a contract to me). And, by the way, that contract is only about 10 pages long in total which includes a cover letter, the 'purchase' contract, the 'lease' contract, and the single-page 'addendum' that guarantees the buy-back option. It is NOT 30 pages long as SomeYuppie asserted...

[worried]

Here's the one FACT that is clear and indisputable, and this, by itself, doesn't sound illegal to me, but it's far from ethical, that's for sure:

Joel and Ed have been taking some people's LIFE SAVINGS into an "investment" that CANNOT BE VERIFIED TO BE LEGITIMATE IN ANY PRACTICAL WAY. Is that REALLY the ONLY thing they're guilty of?

And, by the way investors, read your contract, that 'insurance' policy does NOT pay YOU, it ONLY pays to NASI, that's a not-too-subtle difference (if that policy even actually exists)...

[Arthur Rubin]

I also couldn't figure out why Joel needed my SSN (my family member tried to get me involved and Joel sent a contract to me). And, by the way, that contract is only about 10 pages long in total which includes a cover letter, the 'purchase' contract, the 'lease' contract, and the single-page 'addendum' that guarantees the buy-back option. It is NOT 30 pages long as SomeYuppie asserted...

If he were to report the payments to the IRS, as he probably would be required to do if it were legitimate, he would need your SSN, but not on the contract itself. He should send a W-9 for you to fill out.

[worried]

Interesting... see how much I don't know about this stuff?... So, that's an interesting angle to this: taxes. So, I wonder what else might be missing from the stack of initiation paperwork? I guess Joel/Ed would HAVE to report everything and everyone to the IRS, because you'd have to assume that all the investors reported their 'investments' and 'income' as well, right? There would have to be finalization paperwork for those like Boardwalk John who took the buyout as well, right?

Was Joel just going to do me the service of filling out the W9 for me with my SSN? Is that legal?

[webhick]

Joel has succeeded for this long by staying under the radar for many years. You don't stay under the radar by involving yourself in high-risk activity like keeping a contact in place at a legitimate organization and using that organization's resources to falsify data for your scam FOR 10+ years.

Past posts in this thread make it sound like there's a summary report issued, not a detailed transaction report, and it is grouped by ATM. So, my idea of checking for an individual transaction is moot. Probably the best we can do is verify 1) that an ATM exists at every single location on the report 2) verify that it matches the one on the report (SN, make, model). Perhaps James can let us know whether or not that data is easily visible on an ATM. I really don't use them and when I do I'm not exactly looking to hard at the equipment.

But here's the thing: If I was operating a scam like this and wanted a bit of an insurance policy against being found out quickly, all the ATMs would be real and owned by me. At $.50 per transaction payout, I would need to make sure that no more than four investors would own the same ATM, just in case one had a bad month. I would receive a totally legitimate report from my processor each month. I would forge a copy of it in Word or Excel or some such. Then, for each investor I would simply omit information for ATMs they weren't under contract for. I know me pretty well, and I'm lazy, so I would slap together a simple MS Access database so I wouldn't have to go through the work of manually doing anything except keying in new numbers each month and printing off the reports. I would forge the mailing envelope so it looked like it came from the processor. Of course, if I sucked at computers there's always a pair of scissors and a copier.

And to be extra careful, I would make sure that if one investor was referred to by another, had the same financial adviser, CPA or other common contact who might see the report, their reports would not have any ATMs in common. Of course that might mean having to own more ATMs than the largest investor but it's a small price to pay to not get turned in.

So, if an investor checked on the ATM, it would be there. If they sat outside and counted transactions every day for the whole month it would match the report. If they showed their report to the person who referred them or if two investors had the same financial adviser, they would not see the same ATMs on multiple reports. Their returns would rise and fall with the economy or any other circumstances surrounding the business where the ATM is parked (like road construction, etc). If an investor called the processor to verify their account information they would be told that the account was under NASI's name.

Running it this way might allow the scam to operate for an extremely long time without having to force growth, but that would assume that the money I get from them covers the guaranteed return for each investor who owns that ATM. And it would still be illegal (unregistered securities, guaranteed returns, multiple investors on one security, fraud, etc).

But of course, if I got greedy and had 8+ investors per ATM and used new investor funds to cover any payouts not covered by the fee income I make each month, the scam would be desperate for new investors and you could add Ponzi scheme to the list of offenses.

So, let's assume that Joel isn't being too greedy. How do we bust it scam operating the way I outlined? I'm thinking that the first step would be to cross-reference as many investor reports as possible and look for duplicate ATMs, anything fishey, etc. If any investors are willing to give me unredacted copies of their reports and the mailing envelope, please PM me. I won't disclose your information to other investors, NASI or anyone without your express permission. I'll post my findings to the forum but not your information. At this stage, I wouldn't try to verify the ATMs either, but if we get to that point, I'll ask before doing anything.

[webhick]

Was Joel just going to do me the service of filling out the W9 for me with my SSN? Is that legal?

The IRS allows for substitute W-9s. You can read more about the requirements here.

But it's unlikely that he's reporting anything to the IRS considering he hands out bonuses and advises investors not to report it on their income tax return.

[JamesVincent]

Perhaps James can let us know whether or not that data is easily visible on an ATM. I really don't use them and when I do I'm not exactly looking to hard at the equipment.

Everyone single one should have a serial number plate which will have the serial number, manufacturer name, probably date built, lot number, etc. just like any other piece of equipment. It may/ may not be easily visible to someone walking up to it. Some I have seen on the back, some on the sides, some on the top. Date built would be another good thing to know. If he claims to only buy new machines and you find one built 10 years ago, might let you know somethings hinky. In addition, any state that requires them to be licensed, AFAIK, they will have a license tag. In every state I am familiar with requires that license tag to be in plain sight. You can also track the license tag number to see who owns and/or operates the machine since it may be different people. Once you can get the serial number you can go online and find any of the websites that will help you decipher them, just like a car's VIN, if there are any more questions about that particular machine. Again, I operated in Md, DC, Va, and De and sometimes Pa so I can't speak for all the states.

[JamesVincent]

That was one of the things I kept dancing around with SomeYuppie, the fact that there is no guarantee that the ATM you own... is actually yours. Even if you did go to the machine, which a couple of people said they did, that only means that particular ATM is where it is supposed to be, not that you are the only one "owning" it. Without going back through the numbers again I would think that, with a $.50 payout, you could have up to 4 or so people "owning" that machine without a serious loss of income to you, especially at a $4 charge with a high count machine. Maybe they diversified their machines, like I had said was more profitable, and are paying off people with the other machines that they bought instead of your ATM, IDK.

[worried]

Well, now I'm a little confused about the numbers. MarvinGardens reports, through a believable internet source, that on average, privately run ATMs provide 7% ROI (annually?). Sure, there can be some machines as you've reported from your own experience placed in bars that get stupendous returns, but will an 'empire' of thousands (up to 20k) of ATMs spread across the country all be good enough to average better than 20% annual ROI (have to consider all the ongoing service, license, maintenance, replacement costs)? How does that reconcile with the TremontCapital report of the average 7% ROI? ... There's no way to bridge the gap between 7% and 20% without Ponzi behavior..??.. am I missing something?

Can 1 or 2 guys in their 70s realistically run/manage an empire like that?

Say NASI really is somehow amazingly averaging 20-30% ROI on 20k+ ATMs across the country. For the last 18+ years. Since NASI is so large (number 4 or 5 in size somebody said?), their performance would HAVE to be included in the TremontCapital report, which would then mean for the AVERAGE to only be 7%, there would have to be a LOT of TERRIBLE returns out there. Now, generally when college-educated beancounters start talking statistics, they take notice when there is an anomaly that might be skewing results. For instance, financial analysts don't like to get caught making investment decisions buying what they THINK is going to be a 7% ROI, when it turns out that one particularly BIG company skewed that number due to magically being the ONLY stellar performers at 20+%, the rest are in the 4-5% range. That analyst will get fired for probably faking his college diploma because he doesn't understand the significance of the 'outlier' in a statistical distribution..... Also, since NASI is so SPECIAL and so BIG... wouldn't they have been mentioned in the TremontCapital report?...

This is from the abstract for Tremont's 2010 whitepaper (which costs $1000 for non-members of ATMIA)
"...U.S. deployers have spent billions of dollars building a network of 401,500 ATMs to allow consumers convenient access to cash. Independent deployers typically only make 6-7% margins after paying all expenses...."

First of all, at over 20k+ ATMs, that means NASI makes up 5% of that market (sure it's 2014 now and that number is from 2010, still... think about the implications). For smart guys to report those numbers and NOT point out an outlier like NASI skewing the results would be considered criminally negligent when people started suing for losing money in investments based on their advice. On the flip side, wouldn't Tremont Capital just advise their customers: "don't bother with the other guys, OR trying to run your own ATM empire at 6-7% ROI...invest in NASI, they're AWESOME! and YOU don't have to DO ANYTHING!!...

So... I wonder if all of NASI's 20k+ ATMs are upgraded to Win7...?... how many ATMs COULDN'T be upgraded and had to be replaced? Can't be letting hackers exploit your old WinXP OS that isn't getting bug fixes anymore from MS and start sucking money out of your ATMs.

Strange that such a large and successful company as NASI isn't even mentioned on the ATMIA website:
https://www.atmia.com/directory-of-atm-services/

[worried]

Perhaps James can let us know whether or not that data is easily visible on an ATM. I really don't use them and when I do I'm not exactly looking to hard at the equipment.

Everyone single one should have a serial number plate which will have the serial number, manufacturer name, probably date built, lot number, etc. just like any other piece of equipment. It may/ may not be easily visible to someone walking up to it. Some I have seen on the back, some on the sides, some on the top. Date built would be another good thing to know. If he claims to only buy new machines and you find one built 10 years ago, might let you know somethings hinky. In addition, any state that requires them to be licensed, AFAIK, they will have a license tag. In every state I am familiar with requires that license tag to be in plain sight. You can also track the license tag number to see who owns and/or operates the machine since it may be different people. Once you can get the serial number you can go online and find any of the websites that will help you decipher them, just like a car's VIN, if there are any more questions about that particular machine. Again, I operated in Md, DC, Va, and De and sometimes Pa so I can't speak for all the states.

So... really what's needed is a list of serial numbers AND license tag numbers from investors. Are they given the license tag numbers to "their" ATMs? Can any current investors answer that? If you don't have it, ASK Joel specifically for that so you can see for yourself who the registered owners and operators of YOUR machines are? A refusal to provide such info would be pretty revealing I think. Maybe I should have bought into at least one "ATM" when I had the chance to do just that...

The thing is, something has to be faked somewhere. Hopefully somebody will respond to webhick and provide information that can be crosschecked against other investors looking for duplicates. There may be some real machines but the disparity between the real-world complexities of the ATM business apparent on the ATMIA.com site and the magical 20-30% returns of NASI's machines (with no mention of NASI ANYWHERE in any legitimate ATM literature that I can find) means something is faked somewhere. Maybe even just one transaction report could be routed BACK to the processing company to check with THEM to make sure that WE got it from the RIGHT PLACE.

I don't know, but from looking at some of the other clearly legitimate ATM provider websites, if NASI was any larger than just a few machines outside one local area, SURELY they'd have a lot larger web presence than one pathetic website and a blogsite hidden somewhere that I can't even find right now. There are just too many complexities to the business for them to be magically running an entire EMPIRE in the year 2014 using ONLY paper mail! I think there's a LOT of faking going on. Come on, surely there are a couple of brave current investors out there who can voluntarily post their sanitized information at least privately to someone like webhick and can ASK Joel for licensing information on THEIR ATMs. The more the better, there may be a handful of legitimately owned and operated machines, but there can't be many, and all it takes is finding ONE fake.

[JamesVincent]

Well, now I'm a little confused about the numbers. MarvinGardens reports, through a believable internet source, that on average, privately run ATMs provide 7% ROI (annually?). Sure, there can be some machines as you've reported from your own experience placed in bars that get stupendous returns, but will an 'empire' of thousands (up to 20k) of ATMs spread across the country all be good enough to average better than 20% annual ROI (have to consider all the ongoing service, license, maintenance, replacement costs)? How does that reconcile with the TremontCapital report of the average 7% ROI? ... There's no way to bridge the gap between 7% and 20% without Ponzi behavior..??.. am I missing something?

I don't think you're missing anything. Let me break it down a little bit.

The reported average is just that, an average. So you will have higher and lower. IIRC, in the Tremont report the average transaction fee was like $2 or so, NASI is charging $4- $4.50 per, according to sources, so would have been almost double the average. A small, independent company, or individual, would hire a service company to maintain their ATMs, which would cut the bottom line. Yearly service contract fees, maintenance fees, a fee to refill the cash, etc. would eat away at their profits. According to NASIs website they have their own maintenance company which means they can better control their costs. A lot cheaper to pay someone $10 an hour to drive here and there refilling the cashbox then to call someone to do it for them and maybe get charged $10. For 5 minutes. They may also not be really maintaining their machines but rolling them over when they get old enough to start having real issues.

You also have the actual processing fee, which was 1.9% when I was actively working with ATMs. According to SomeYuppie NASI had a special deal with the agency they used and got a lower rate, further cutting costs. If you send enough business their way I can see a credit agency giving you a good deal.

If you figure in the lower rate they probably pay for the machines themselves I can see it being a very high return. Then add in the fact that we don't think they are really using all the money that they bring from "investors" to buy new machines and that that money could be used to actually invest or payoff "investors" then I could see them paying 20% to several people from the same machine. If they took $12k from 4 different people for one machine they could pay out $300 a month to all 4 for quite awhile without even touching the money from the machine. The $19k number and you would barely need to touch the money at all for the 5 years it was guaranteed. If they pay off one of the 4 from the machine itself then the remaining 3 could be paid off from the initial for over 4 years without touching anything else.

[worried]

I think I came up with a way to bust the scam quickly:

Anybody who 'owns' NASI ATM's can just go in and SEIZE one of their own ATM's and see what happens... you can even tell the store owner where you're taking YOUR ATM, show them your NASI paperwork and everything. When the cops show up, tell them your story and how YOU OWN the ATM... they're going to be VERY INTERESTED I think...

There are flaws in this idea I know... but think about it, you "OWN" an ATM for which you paid at least twice what it's worth. Why would you WANT to seize it? If you sell it you take a loss.

Sure, it's possible that some ATM's listed on some investor's report are legitimate. But, how are you going to seize YOUR ATM if NASI stops sending you your lease payments and PROVE to the responding authorities that it's really YOURS? How do you know for sure you are the only person who thinks they "own" that machine?

There are so many ways this scam looks ridiculous when you're not blinded by the desire to believe...

Really, I would think it would be a lot easier to get the licensing information and do some calling/emailing to find out who REALLY owns 'your' ATMs. Send your ATM 'portfolio' info to webhick by private message for comparison with others... Wouldn't you rather NOT be the LAST person to be convinced it's a scam? Isn't all that money you've invested worth that much effort? .... OR... back to my old exhortation: use some of your new riches from your ATM payouts and go pay a REAL financial professional for their assessment of your brilliant investment (because I KNOW you didn't get professional advice BEFORE buying into NASI ) and FOLLOW THEIR ADVICE.

[webhick]

Well, I haven't got any takers yet.

To the investors who may be hesitant to do so....

I promise you that I won't release your personal information, including your name, to anyone nor will I post the statements online for anyone to see. I'm a bookkeeper in real life, so I know how to keep my trap shut about other people's finances. I will also do my damnedest to make sure that any conclusions posted here will be sanitized to the point where NAS will not be able to identify who is cooperating. I want to keep you as anonymous as humanly possible while we try to nail this down. But I will also warn you that I will cooperate with any government subpoenas - I'm not in the business of helping to hide scams from the authorities.

I plan on investigating this in phases. Firstly, I need the reports to compile the data. If I find that more than one investor "owns" an ATM, then I will contact you via PM or other private means to let you know which ATM I found on someone else's report. But I will not disclose investor names to each other prior to receiving permission to do so.

Second phase would be attempting to physically verify the ATMs and their license information. I will not even attempt to do this without permission from all investors I'm aware of who "own" that ATM. Since I don't have money to travel and I work several jobs I can't verify them all myself. I'll verify anything local enough to me, but may solicit long-term, trusted board members for ATMs further away. They will not know your name or any other personal information. Just the ATM location. I'll then contact whichever government agency holds the license information and get the details on each ATM.

I'm here, offering to do like 95% of the leg work on this and all I need from you, the investor, are reports and continued contact. Please PM me so we can get this ball rolling.

[worried]

Amazing.... hundreds of views of this discussion in a few days, some of them HAVE to be investors in NASI, but not one of them wants to volunteer info? .... I guess Joel and Ed are safe as long as they can keep the scam going which is their plan .... wow

[Tednewsom]

There's an obvious hang-up to investigating one aspect of the con.

As pointed out above, most (or all) identical cousins to this company sold single ATMs multiple times. It'd be virtually impossible to discover that with the help of only a single investor's information, without comparison (and overlapping information) of at least one other investor. The odds of those two persons (out of dozens or hundreds) having paper on the same machine are pretty high.

I've never had any luck getting this information, but perhaps someone else can. Does the Mariott hotel chain use the company's services? That's one of their big, relatively recent, accomplishments, according to their sales pitches. And their classic prestige claim is that they supply & oversee the ATMs in NYC's Waldorf Astoria. As I mentioned, I've never been able to get them to confirm or deny this.

[webhick]

BeverlyHillsMan said that NASI has the contract with Hilton and claimed to have vetted that.

[Tednewsom]

I claim to have an autographed photo of George Washington with the Sharpie-pen inscription, "To Ted, who taught me everything I know. Love, Honest Abe."

And there are some who doubt me.

[webhick]

Exactly.