May 21, 2002                                                         Contact:Lucas Hamilton

Morrison issues cease and desist order against InterGold International pyramid scheme Montanans invested $4 million in similar scheme in 1998


      State Auditor John Morrison today issued a cease and desist order against InterGold International and several of its promoters, alleging that the program is a pyramid scheme in violation of Montana's securities law.
      Morrison's order also alleges the company is falsely using the names of NFL football star Troy Aikman and deceased celebrity chef Justin Wilson to promote the illegal program.
      "IGI is just gearing up to recruit Montanans," said Morrison, Montana's Securities Commissioner. "I am confident this order will prevent thousands of Montanans from being victimized by this illegal pyramid scheme. In these difficult economic times, we want to prevent Montanans from losing their hard-earned income to fraudulent programs."
      The order names Johnny Daniell of Malta, David Waller of Billings, and Warren Shulman, Barry Ackel and Paul Aikman of Texas as promoters of InterGold International. As of May 15, 59 Montanans had invested in the program, which promises returns of up to $780,000 a year earned through the recruitment of participants to the program.
      IGI purports to be a multi-level marketing firm, however, an analysis of the program revealed numerous violations of Montana securities laws, including the state's anti-pyramid scheme law. IGI's promoters solicit participation through the use of promotional materials, audiotapes, recruitment meetings, computer discs and the Internet. Daniell has conducted two recruitment meetings in Billings and one in Malta in the past month. None of the individuals named in the order were registered in any capacity with the Montana Securities Department in the State Auditor's Office.
      The order also alleges that at least one promoter misrepresented material facts to potential participants. Aikman told one individual that he is the cousin of Troy Aikman, former quarterback for the Dallas Cowboys football team. Aikman told the resident that his cousin Troy "had his Super Bowl" and that IGI could be this individual's Super Bowl. Shulman confirmed to the Montana Securities Department that Aikman is Troy Aikman's cousin. However, a statement from Charlene Aikman, Troy's mother, denies that.
      Ackel, Waller and Daniell were involved in 1998 with International Heritage Inc., which the state and Securities and Exchange Commission alleged was a similar pyramid scheme in which thousands of Montanans lost about $4 million. In IHI, 39 participants made $3.25 million while 287 barely broke even. The remaining 3,707 Montanans (92 percent of participants) lost money. IHI was the subject of state and federal administrative proceedings. Daniell made approximately $610,000 through IHI and Waller made about $110,000.
      IGI interests are described as "business centers." One center costs $479, but an investor only has to pay $179 for it. Investors pay the remaining $300 by generating business volume, which is done by recruiting new members to the program.
      Compensation is based primarily on the amount of business volume a participant generates by recruiting other participants to the program. Once a participant's business volume reaches a particular level, the participant no longer can earn money and must begin the cycle again by purchasing a new business center and starting the recruitment cycle all over. Montanans are encouraged to leverage their earnings potential by buying three business centers rather than just one.
      The sale of various products is mentioned briefly in IGI's promotional materials, but promoters emphasize that profit is earned primarily by recruiting people to buy business centers rather than through the sale of any product. IGI does not have the authority to distribute at least one of the products it offers, nor does it have permission to use the name or photograph of Cajun chef Justin Wilson who died last September, according to Wilson's daughter.
      "Montanans should be aware that there are lots of ways to dress up a pyramid scheme," Morrison said. "The introduction of a token product does not legitimize a program in which the recruitment of new members is the primary source of revenue."
      IGI is dependent on the continual recruitment of people to the program. As with all pyramids, the pool of people available for recruitment dries up, the pyramid collapses and the people on the lower pyramid tiers never get their money back, let alone make a profit, Morrison said.
      IGI participants are promised a gold coin for each business center they purchase, but the State Auditor's Office has not received proof that any IGI participants were given coins.
      IGI is a Georgia corporation whose principal office is in Dallas, Texas. Individuals from Montana communities including Malta, Billings, Havre, Big Sandy, Shelby, Anaconda, Missoula, Great Falls, Miles City, Lakeside, Glasgow, Zortman, Scobey and Huntley have joined the program.
      Anyone found in violation of the law prohibiting pyramid promotional schemes could face penalties of up to $10,000 per violation and/or 10 years in prison. Violations of securities anti-fraud and registration laws are punishable by fines of up to $5,000 per violation and/or up to 10 years in prison.
      Individuals found in violation of this cease and desist order, upon conviction, could face penalties of up to $5,000 and/or 10 years in prison.
      The named respondents have 15 days to request a hearing.
      "This program promises minimal start-up costs with virtually unlimited income potential," Morrison said. "We remind consumers that if it sounds too good to be true, it probably is."
      Anyone with information about IGI or questions about other investment opportunities should call the State Auditor's Office at 1-800-332-6148.