With the dire US economy being the bust that it is and the banks paying low interest on standard investments, folks are turning to alternative methods for entrusting their savings with hopes of a healthier return on their cash. Inside the past decade, more and more people have gravitated to forms of business ventures that involve the internet. Many of these expenditure opportunities offer a range of products that involve direct marketing and pyramid schemes. They all vow the same thing; long term legal and viable income. For many this is true but others are setting people up for failure.
Chances are, if you are on the scene of internet investing you have heard of ZeekRewards.
August 18, 2012, the Securities Exchange Commission (SEC) shut down the entire operation claiming that it is a $600 million dollar Ponzi scheme. This alleged scam took money from more than a million customers from all over the globe. What originated as a complaint in North Carolina District Court began an undercover investigation by the SEC into Zeekler and ZeekRewards, the parent company known as Rex Venture Group and the CEO himself, Paul Burks. In one Reuters’ report, the SEC declares that ZeekRewards took $160 million from their customers and in turn, provided them with an imaginary vestige of “extreme profitability.” The company strongly encouraged investors to keep reinvesting their money back into the company. The thing is, if they cashed out at the same rate prior to the SEC stepping in, the company would have became insolvent and that house of cards would have collapsed. According to the SEC enforcement director, Stephen Cohen, he quoted, “Zeek Rewards misused the power of the internet and lured investors by making them believe they were getting an opportunity to cash in on the next big thing.”
If you did have the destructive hit to your portfolio from these crooks, retrospectively, let’s take a look at what some potential flags could have been and where you can turn for help with this.
When you opened the actual investment, they did not give you many details to go on as to the structure of your asset and exactly how you would be accumulating money. Flag number one right there. The facts themselves were vague and nonexistent; evidence began to mount from the affiliates regarding the dynamics of ZeekRewards payouts and the tracking of the commissions to thousands of partners. Claims were made on a regular basis that ZeekRewards was using new affiliate cash flow to pay out their daily ROI (Return on Investment). They have been pinned regularly with inquiries about this exact issue, and the retort? “The Information is Proprietary.”
Proprietary? As in you take my money and what you do with it is none of my business?! What?! Another flag!
Dawn Wright-Olivares, Zeek’s COO would answer questions of this nature stating that if details were disclosed ZeekRewards would be “out of compliance”. She also made the claim in late June of this year that unless ZeekRewards makes more deposits into their e-wallet accounts, the company would be unable to pay commissions, stating what can go in can come back out. Wright-Olivares vanished from the public eye altogether soon after this and was replaced by Greg Caldwell in July as COO.
This investigation is in the very young stages and new developments are going to be unraveling as time keeps ticking. Thus far, Charlotte, NC based attorney, Kenneth Bell with McGuire Woods has secured a URL for the investors that have been impacted. www.zeekrewardsreceiver.com.This URL will serve as a source of centralized information, status updates and how they will start the process of getting their money back. Bell is in charge of collecting, managing and disbursing the frozen funds to the victimized investors. The amount of the frozen assets according to the SEC currently is at approximately $225 million. The site is not active yet, but may be running in as little as a few days. This is where you would need to go should you have unsettled transactions with ZeekRewards.
Remember, it is always important, especially in these troublesome times to question and investigate everything. Last year alone this nation clocked in $997 billion dollars in corporate fraud. Guess what? Investment gimmicks and fraud does not exist only in the sector of pyramid schemes, direct and affiliate marketing. Companies like ZeekRewards give hard working direct sellers a bad name. It is actually a small percentage in comparison to what is really out there. There is actually honest ways of really making money using these types of products. You have to do your homework and research who you are doing business with. Deception costs money, trust and morale, and comes in many disguises such as the mortgage crisis, banks manipulating Libor, Enron, Madoff, pharmaceuticals, etc. The list goes on.
We have to nip this greed in the bud by not being greedy ourselves. There is no free lunch. If you want it, you have to put some sweat equity into it. If it sounds too good to be true, it is. There is no way to get rich quick if you are doing something legal or moral. You get out of something what you put into it and anything worthwhile requires work, bottom line.