If you’ve listened to talk radio over the past few months, it’s likely you’ve heard a commercial for Freedom Checks voiced by “Ricky” or “Jack” from Banyan Hill. In the commercial, the voiceover describes how people around the country are getting their share of a $34.6 billion dollar payout — known as Freedom Checks — that sounds vaguely like it’s some kind of government program.
The commercials then urge you to “stake your claim” by a certain date — first it was February 1, then April 1 and now May 1 — to get your share of the cash.
Are Freedom Checks a scam?
If you do a Google search for Freedom Checks you’ll get a whole list of results that promise that Freedom Checks is legit and you can make money from it. These reviews seem to be mostly from people with some sort of financial interest in getting you to sign up.
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One post from the Banyan Hill website even claims it’s like “winning the lottery!”
It looks like a news article, but it’s actually a marketing tactic meant to get you excited about the opportunity. Once you go to the Freedom Checks 2018 website, you see a video from the man behind the idea, Matt Badiali, who runs down the details. There are testimonials in the video from people who got their Freedom Checks to the tune of $24,075, $66,570 and $160,923.
Badiali even holds up a check that looks like it’s from the U.S. Treasury.
The problem? As Affiliate Unguru points out, the photos used in the testimonials are stock photos, meaning they aren’t pictures of real people receiving the checks.
“I won’t go through each and every testimonial, but my guess is that they’re ALL fake,” writes Tim, the man who runs Affiliate Unguru. “I see this kind of thing a lot among scam sites and (in my opinion) it’s highly unethical.”
So, are freedom checks a scam? Technically, no. But it does seem to be a convenient stretch of truth — and you’re not going to get a five-figure check in the mail just for signing up.
What are Freedom Checks?
The name Freedom Checks comes from Badiali, but it’s based on a real investment strategy. With MLPs — or Master Limited Partnerships — investors get paid a return on the money they put into the investment, usually monthly or quarterly.
When you investment in MLPs, you’re buying units of a company and then getting a piece of the yield back based on how the company performs. The companies — typically gas and energy companies — that, according to Investopedia, are a type publicly traded limited partnership where it combines the benefits of a partnership with that of a public company, meaning taxes aren’t paid like typical corporations.
Testimonials featured on the website for Freedom Checks, including one claiming it's "like winning the lottery."
If it sounds a lot like what happens when you trade in the stock market, it is — except the companies must generate 90 percent of their revenue from natural resources in the United States. The idea behind Freedom Checks is that these companies would rather give their profits to those who invest in them, rather than to the government.
Badiali says that 568 companies are a part of these MLPs, but he only recommends five of them that, according to him, own or control over a billion dollars in raw materials like oil, mineral, timber and gas, along with core and precious metals (gold and silver).
As for how much you get back for your investment, Dividends.com says that MLPs typically leads “to some of the highest dividend rates available to investors, typically in the 5 to 9 percent range.” This means that if you only investment $10 like the Freedom Checks commercials say, you’ll get back less than $1 per year.
The big bucks only (possibly) come if you’re investing the big bucks, like millions of dollars per year.
The bottom line on Freedom Checks
Back to Badiali: He’s not technically “selling” Freedom Checks. What he is selling is a membership to his Real Wealth Strategist advisory newsletter. The report he sends on Freedom Checks is just an explainer on the five MLPs he recommends.
So no, Freedom Checks isn’t a scam, but a clever marketing trick to get you to buy into a subscription service. You really can make money from investing in MLPs, but it’s nowhere near as simple as entering your name and address into a website form.