Scammed for ~$500,000! A Blast From The Past…

As mentioned before, I got scammed big time previously. Since there is still a chance to get my right (and money) legally, I won’t disclose name and url of this lowest piece of crap for now.

The Scammer

I have to give him that he is a really good programmer and designer. While being so creative in solving problems or finishing tasks given, he can’t think of anything on his own. He is not able to develop empathy towards others since he is a very narcissistic and self centered person. I would even go as far and say he has a Borderline Personality Disorder and/or Narcissistic Personality Disorder. I guess he would never say something nice about me, simply because his view of the world and reality are completely out of order. He basically creates his own version of reality by twisting facts to his own favor.

How It Started

I contacted him on a public forum because of something I can’t even remember. While talking about this and that, I thought maybe this is the right guy to realize an idea I had for a long time. I never went as far as hiring someone to actually do this. I had always preferred working on my own or work with ‘partners’. Working alone gives you total control over everything. Working with partners has the benefit of two or more people that are equally dedicated to make the project a success. To test his abilities, I worked with him on another smaller idea. This would actually even work today and could be a really good income-stream. Due to the grey area this would have operated in (involving likejacking on a big scale), we ditched it in favor of my real idea I told him about.

Starting The Project

Since the whole concept (from A to Z) including all functions and later fixes was mine, it was pretty similar to what SCLMD is today. There are some features realized in SCLMD already that he refused to implement on the other project though. While the previous project basically stayed the same ever since I left, SCLMD started evolving and there is a whole bunch of features and ideas that’ll be implemented in the future. The development of ‘Project X’ took at least 1 month longer than needed because he wanted every little sh*t to be ‘perfect’ although the basic service was working just fine. Because of this attitude, we lost A LOT of potential income.

After we finally started, it didn’t quite took off as good as it could have. In the meantime other services had started and facebook had cut the reach of Fanpages by a lot. I contacted as many Fanpage admins as possible and slowly but surely the userbase grew. Then in the second month, we had one of the bigger guys sign up. He alone generated several thousand USD of revenue in a short time-span. There were some suspicions raised by me because the traffic looked dodgy in Google Analytics and then we had a huge deduction at the end of the month. But Google doesn’t give you reasons so we couldn’t really nail it on him. We paid him and he never really became active after that anymore.

Gaining Traction

I guess I have to mention that he wanted to get out/stop the project several times, whining that he wasted so much time on developing because he didn’t believe it to become a success anymore. I had to talk him into continuing because handing over the scripts to me wasn’t an option for him either. Thinking about it, that’s where I should have stopped already. But I had also invested a lot of my last money at that time into servers etc. Starting with someone else from scratch or even paying someone wasn’t an option anymore. THIS had to work!

So we continued, I ran facebook ads on the best performing articles and we made top notch ROIs with that. The income from publishers/users also started to grow and some time late 2014, a group of publishers signed up promoting the crap of one single article by posting to facebook groups. We also had some other users running facebook ads with extraordinary results. In December 2014, while paying out $80-90 per 1000 US clicks to our users, we made an additional $120+ per 1000 pure profit for ‘us’.

CPMs dropped starting January 2015 and never came back to those heights. We still had average CPMs of $40-60 on some articles though. Those were the CPMs presented/paid to the users, the real CPMs by Adsense were way higher! And so was the profit…

We Made It

Or so I thought… Because of the company form we(he) had chosen, he had to pay less tax when taking out money as ‘dividends’ at the end of the year. That this didn’t matter to me and that I needed money wasn’t really of interest to him. First I had to beg for a few thousand to even pay my bills while we had $100,000+ profit in the bank already. Later on we came to the agreement of a monthly payment of ~$4,000 per month. Obviously this whole behavior let all alarm bells ring in my head. But trusting as I was, I had left all control in his hands in the beginning.

As you can see in the following screenshot, from October 2014 till October 2015, we made more than $1,200,000 on Adsense. More than 700,000 EURO of that was profit (after all expenses, before tax). The initial agreement we had was 50/50. All in all over the course of 2 years, I received ~$30,000 (after all the upfront investments I made). ~$1,250/month while running a million dollar business… OMG

october 2014 - october 2015 adsense statistics

I Want Out – Now!

After complaining a lot about money, agreements we had and plenty of bullshit answers from his side, I just wanted my share and get out. He then twisted reality upside down. He did that on several occasions before. It was a running gag with my friends when I told them about an idea I have that I have to tell him in a way so that he thinks it’s his own just to get it implemented. If he wasn’t to think it’s his idea, he never wanted to implement them. Now it backfired. Suddenly he really thought ALL of this was his idea, all the features, changes etc. Only he was the reason for the success of the project, I had never done anything…

The Agreement That Was None

After insulting each other for several hours on Skype (I actually tried to calm him down since I seriously had enough and just wanted out), we came to an agreement. 300,000 Euro for me. He’ll keep the rest of profits (~700,000 Euro + the running project). I won’t start any similar project in the next 6-12 months (too lazy to look it up right now) and that’s it.

The next day he paddled back, sending me an email that he had talked to his lawyer:

settlement email

OMG – did I read that right? President / CEO? If I had known before that he is the “CEO”-type of person, I would have NEVER worked with him in the first place!

So what he was basically offering me was 70,000 Euro to shut me up and keep me out of business for half a year. Then he would claim business is shit or that I did something to break the agreement (I know you now man) so he wouldn’t have to pay the additional 70,000. About the third 70,000 we don’t even have to talk about because without me, he is not able to pull those numbers anyway.

Obviously, I didn’t give in on this and so The Journey continues 🙂

A little snack I have before you leave is this neat Alexa graph from February 2016. I left ‘Project X’ in mid November, and this is what he pulled off without me 😉 Justice served partially.

scammed by website owner

The graph shows the position of the (only) landing-domain we used back then and is still used now. Right now it hovers somewhere around the 500,000 mark 😉

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