SWATcash Declares Bankruptcy! | Major GPT Website Shuts Down

2 Dec 2008

BREAKING NEWS: SWATcash.com GPT Goes Down, Declares Bankruptcy

Author: Jim | Filed under: GPT Insider

Bad news for the get-paid-to (GPT) community earlier this morning as one of the top names in the industry, SWATcash, filed for bankruptcy. SWATcash was one of my biggest money makers here at theNetFool.com, so it is going to hurt seeing them out of the picture. However, I have thoroughly analyzed the problem and have talked to a few of the employees in upper-management at SWATcash… and as it turns out it was simply poor business planning that got the best of them.

The Story of SWATcash

SWATcash was formed in 2006 by a couple of average joes pictured below. I was always on good terms with the members, namely “SWAT AP” and “SWAT Brian” (the owner), and they definitely had all the competitors beat on customer service hands down. It’s kind of funny how fates reversed here, as they seemed to be on top of the world giving out an Xbox a day… until it all blew up in their faces. Clearly, the recession has made an impact on far reaches of the markets, even where many people thought they were safe.

The problem? Amusingly enough, it was exactly the same problem that caused the economic crash… risk management. Just like the greedy investors that bought, packaged and sold junk-status investments, pretending that everything was rosy, and individuals that took out huge loans (that were backed on literally nothing), they had it coming. What SWATcash was doing was trying to grow too fast… in effect, they were a victim of their own success. Rather than keeping a nice reserve of cash into the future like other companies did, they forced money outbound to fuel growth with extravagant contests and high payouts.

Owner’s Confession: Risk Management Problems

This was great while it lasted, but on the morning of December 1st… thousands of users were blind-sighted as Brian, the owner, revealed:

“Due to all of the recent events I am sad to say that SWATcash will be shutting down effective December 1st, 2008. We will strive to do all we can to get payments out in a timely manner. Unfortunately if all goes well we will only be able to pay out Offer Earnings, Referral Commission, Shopping Earnings, and Click Earnings. With shutting down we have to end our contracts with the company that runs our servers which is really putting the strain on the company’s wallet and possibly charging us more than we will have coming in, in which case we will have to file for bankruptcy. We hope that they will be glad to work with us and get that number down so we can payout all of the members who have made payout through December 1st.

We know this sucks, you don’t have to tell me twice. We are still waiting on checks that are now almost 2 months late to us. I have been told recently that a check was over-nighted Wednesday only to find out today that it still hasn’t even been sent. That is just how it has been going lately for us. We are doing everything in our power to get what is owed to us so we can get what is owed to you. We realize that this is a terrible time for this to happen as Christmas is just around the corner, but believe me that this is hurting us just as much as it is hurting you. A lot of you may think that we have a mound of money in the company that we are sitting on but the truth of the matter is, is that it’s just not true. With paying to keep the site up, paying our employees the money is going down just as fast as it is coming in because every lead is being scrutinized more closely than ever and it is taking a longer time for payments to be processed. Now days all a advertiser has to do is say “I think we have some fraud here” whether it be one lead or 100 and your full payment is held till it is figured out which can take months.

Like I’ve answered before, “Why don’t you have an emergency fund?”, we did but it got taken out when we paid out in August and we later received word of fraud from the month of July and August. That’s just how it goes in this industry and for a long time we took small hits here and there but never one this big. We always put the members first throughout this whole 2 year run that the company has been around and don’t intend on changing now.

We really appreciated working with all of the truthful members that stuck around on the site and forums from the very beginning. Without you guys we would have never made it anywhere. The forums were always active and fun to be around and it truly made my job a little bit easier with all the helpful members answering questions when a mod or admin wasn’t around to answer them. I want to thank all the mods for doing a great job around here keeping the forums clean and informative. I’d love to thank Jeremy and Will for doing an excellent job keep the site new with cool features and making the site as unique as it was. Thanks to Soylagringaloca who did a great job handling support and making sure it was done in a timely manner and keeping it as upbeat as possible. And also thanks to SWATAP for providing us with pictures for visual representation of topics and posts. He kept the forums lively and bursting with activity. I hope I didn’t miss anyone but thanks to everyone involved with SWATcash it was like one giant family even though sometimes it got a bit out of hand.

The site will go down sometime tonight or tomorrow morning. I apologize for how everything went down and how this ended up, but I give you my word that we will try to payout members what they deserve and rightfully earned.”
- SWAT Brian (Former Owner, SWATcash.com)

So what happened here? They were blind sighted by a rush of fraud within their major affiliate suppliers (the guys that pay SWATcash) and are now unable to pay out anything to their users. After having missed payment for two months, they have now officially filed for bankruptcy… and will more than likely not be paying their members. Since the consumers are always the bottom rung of the bankruptcy-payout, I’m a giving “reimbursement” a 15% possibility.

Jimvesting’s Take on the Crash

Okay, so this obviously begs the question… Jim, why are you recommending a GPT website that is going to crash and not pay me. First, I want you to realize that SWATcash was a great company. The guys that worked there were top-notch, and their promo offers and high payouts gave you a high high margin. Assuming that you have used SWATcash for even a few months, you would know that you get 3x the payout on 1/2 the work with this website. I made about $2500 with SWATcash.com, whereas I would have made less than $750 equivalent with any other alternative.

“SWATcash was, in effect, a victim of its own success”

Is it over for the GPT industry? Heck no. This is a business that actually IS recession proofed (in a sense)… and the only mistake here was an over-confident investment approach by management. I know that competitor Treasure Trooper has a 3-month repository account that it doesn’t tap into unless there is an emergency. Cash Crate has a similar deal going on within their system. Neither Treasure Trooper nor Cash Crate has much of a liquidity problem as they don’t offer as many crazy prizes as SWATcash did. I’d still judge the whole arena safe as a whole.

Where Do I Go Now!?

The get-paid-to (GPT) industry as a whole is a great way to make money on your own to get a secondary income if you have some spare time after work. These sites present great opportunities to users who can casually pick up cash, and I have a new recommended base of websites that I will be evaluating over the next few days. I don’t want to declare a new recommendation lineup so soon, but it will be different. Rest assured, you can stay in GPT to make money for the holidays.

Hopefully, this crash won’t send major shock waves through the online space. They had a great loyal following, and were very much tied down to social media… creating almost a “cult” of users. Because they took so little profit, they gave so many people lots of money… very generous guys. If you were a member of SWATcash.com, I invite you to express your thoughts in the comment space here. So stick around, because I want to get everyone effected back on their feet and into the next-best-thing on the net!