The Bank of Russia publicly warned in January 2022 that ABA Marketing displayed clear characteristics of a pyramid scheme. The crypto investment operation subsequently collapsed, pulling its website and social media presence, only to reboot days later as "7 Flags Club." This pattern of closure and re-launch is common among fraudulent financial schemes.
ABA Marketing operated without disclosing its true ownership or executive leadership. The "aba.marketing" domain, originally registered in November 2014, underwent a private update on June 23, 2021. This lack of transparency about who runs the company often signals a heightened risk for participants.
Corporate registration documents for ABA Marketing Group Inc. list Saint Kitts and Nevis as the jurisdiction. This Caribbean nation is widely recognized as a jurisdiction favorable to financial schemes. It maintains a lax regulatory environment, lacking active multi-level marketing (MLM) oversight. Fraudulent operators frequently establish shell companies there to obscure their activities and evade accountability. Simple incorporation in such locations offers no real assurance of due diligence for investors.
The operation's geographic ties pointed strongly to Eastern Europe. Of the four social media links on ABA Marketing's website, only a vKontakte profile functioned. vKontakte is a Russian social media platform. The website's source code also contained Bulgarian language elements, and marketing documents circulated in Bulgarian. Despite this, the site itself offered only English and Russian language options. Data from Alexa Traffic Rank showed Russia accounted for 95% of all web traffic to aba.marketing.
ABA Marketing offered no retailable products or services. Affiliates could only market membership in the scheme itself. This structure, where income derives solely from recruiting new participants who invest money, defines a pyramid scheme.
The company did not publish compensation details on its public website. A Bulgarian copy of the compensation plan, obtained by ScamTelegraph, proved poorly presented and lacked clear explanations, even after accounting for language translation. The document erratically switched between USD and EUR, with EUR predominating. USD mentions in the plan appeared to be errors.
The plan outlined ten affiliate ranks. Advancement depended on an individual's personal investment and the total investment volume generated by their downline recruits. The plan used a unit of value called "E," calculated by dividing invested funds by 300. For example, a personal investment of 2,000 "E" represents €600,000 EUR, while 100,000 "E" in downline volume means €30 million EUR. These figures indicate the substantial capital required to reach higher tiers.
Rank progression began with Consultant 1 upon signup. Consultant 2 required 100 E in downline volume. Consultant 3 mandated a personal 100 E investment and 700 E in downline volume. Advisor 1 needed 300 E personal and 3,000 E downline. Advisor 2 called for 800 E personal and 10,000 E downline. Structural Director required 1,200 E personal and 25,000 E downline. Regional Director needed 1,700 E personal and 60,000 E downline. International Director demanded 2,000 E personal and 100,000 E downline. Executive Director required 250,000 E downline, and Supervisor, the highest rank, needed 500,000 E downline.
Referral commissions were calculated by converting invested funds into "E" units, then multiplying by a rank-specific factor. Consultant 1 earned E 3.5. Consultant 2 earned E 4.5. Consultant 3 earned E 6.5. Advisor 1 earned E 8.5. Advisor 2 earned E 10.5. Structural Directors received E 12. Regional Directors received E 13.5. International Directors received E 13.7. Executive Directors received E 13.9. Supervisors received E 14. These commissions operated on a coded system, where a 14-multiplier was paid on all new investment, and higher-ranked affiliates collected the difference between their multiplier and that of their lower-ranked downlines.
ABA Marketing also appeared to pay a percentage of returns to personally recruited affiliates. The compensation plan slide detailing this was confusing. It referenced "passive income % of personal profit attracting capital." Percentages correlated with ranks. One example showed €150,000 EUR shrinking to €3,000 EUR, then multiplied by a percentage (e.g., 3% for rank 3). The plan offered no explanation for this significant 98% reduction from the original figure (e.g., €150,000 to €3,000; €700,000 to €14,000). These ROI referral commissions were also coded, with 10% paid out on all ROI payments, allowing higher ranks to collect the difference from lower ranks.
Monthly bonuses commenced at the Structural Director rank, starting at $300 per month. Regional Directors received $600, International Directors $900, Executive Directors $1,200, and Supervisors $1,500 monthly. Rank achievement bonuses rewarded specific "unit" milestones. Generating 500 units in the first month, or 700 units later, earned a personalized watch with one diamond. Achieving 700 units in the first month, or 1,200 later, resulted in another watch with twelve diamonds. These "bonus units" differed from the "E units" used for rank progression, without explanation.
Further bonuses included tickets to a two-day Leadership Program for Advisor 1. Advisor 2 received a three-day program plus a Parker pen. Structural Directors earned another three-day program and a personalized gold watch with twelve diamonds. Regional Directors received €4,000 EUR. International Directors were awarded what appeared to be a golden diamond bracelet. Executive Directors received €10,000 EUR, and Supervisors €20,000 EUR. The "top 20" affiliates also qualified for "leader holidays" with unspecified details.
The fundamental issue with ABA Marketing rested on its business model: it marketed nothing to retail customers. All payments stemmed from funds invested by new recruits. The scheme rewarded those who built the largest downlines. Such a system relies entirely on continuous recruitment of new investors. When recruitment slows, which is inevitable for such operations, the scheme collapses.
ABA Marketing's "roadmap" claimed the company started with travel services around 2017 before pivoting to cryptocurrency. This included vague references to something called iQeon and plans for a cryptocurrency exchange. Another project, Zplex, consisted only of a login form. These ancillary projects often serve as an illusion of legitimate business activity, masking the underlying pyramid scheme.
The Bank of Russia's warning in January 2022 confirmed ABA Marketing's fraudulent nature. By February 1, 2022, the ABA Marketing website had disappeared, and its social media accounts were either deleted or made private. The very next day, ABA Marketing reappeared under the new name, 7 Flags Club.