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That's my thought as well (about link-purchasing/black hat), [insert expletive]. Like I said, horrible situation. I'm waiting on somebody to get me the login details, but even so, I suspect whomever was managing it prior to my team taking over a new site design would have actually deleted any notices to cover their tracks. Short of a whole new domain, definitely no 301s, correct? It's going to take Herculean convincing to get somebody to approve a different domain, we are supposed to launch in a few days.

Hi JD, First things first, the site is dancing around in the SERPs so you may be ranking well and it is trying to gain traction, or you may not be ranking well at all and you are getting inflated spikes. Secondly use the Google Adwords keyword tool to search the exact search traffic for the terms you are optimising and let me know what they are. Be sure not to tick "broad" or "phrase" as these will give far larger figures, just make sure only "exact" is ticked. You could optimise as well as you like, but if there is no traffic for the search terms, then that is why you aren't getting any traffic. When you are searching for your rankings, use a different browser, maybe IE and ensure you aren't signed in to any Google account and your browsing history is cleared so you aren't getting any bias towards your own website. Get back to me on the above and we can go from there.