Zeek Rewards Legal Alert: Letter from the Rex Venture Group LLC Receiver Kenneth Bell

August 27, 2012

On August 17, 2012, United States District Judge Graham Mullen issued an order naming
me as the receiver of ZeekRewards’ recovered assets. According to the Securities and
Exchange Commission, approximately one million people have been victimized by this
scheme, although our early investigation shows that the number of victims could be
double that. The SEC also estimates that the scheme involved $600 million. By sheer
number of victims, this is one of the largest, if not the largest, Ponzi scheme to go into
receivership in U.S. history.
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I have received thousands of emails and voice messages from victims of the scheme.
Some of those have shared heartbreaking stories. Rest assured I have heard your concerns
and my team and I are committed to recouping and dispersing as much money as possible
to the victims. To be sure, this will be an immense undertaking that will require careful
consideration and time.

As receiver, my first task has been to locate and lock down known assets. This means
seizing both electronic and physical assets from ZeekRewards, as well as making sure
those who had access to those funds no longer do. We are also tracking payments
transferred across financial institutions both in the U.S. and abroad. The larger the pool of
resources we can collect now, the more funds each victim will receive later.

I know many of you have two simple questions. When will I be refunded the money I
invested and how much will I receive? While we are in the early stages of tracking and
locking down assets, it is difficult to predict with certainty the timeframe in which
monies will be returned to the victims. However, we are committed to communicating
with the victims so they are informed throughout the investigation.

As you may have read in the news, I recently gave a press conference updating the media
about the beginning steps we have taken over the past week as receiver. We will continue
to provide updates on the investigation to the media and to the victims directly via
www.ZeekRewardsReceivership.com over the coming weeks and months.

This website also serves as a forum for victims to voice their questions and concerns to
my team and me. Due to the sheer volume of messages I have received from victims, I
am unable to respond to individual questions so I encourage those affected to email
questions as well as relevant account information to info@zeekrewardsreceivership.com.
There, every message received will be read and catalogued. An official claim form will
also soon be made available on this site and each filed claim will be considered at the
time the assets are allocated back to the victims.

We understand that many victims have suffered significant financial losses and we are
dedicated to working over the coming months to recover as much of the funds as
possible. We appreciate your patience throughout the process and will keep you apprised
of future developments.

Thank you,
Ken Bell
Receiver

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14 thoughts on “Zeek Rewards Legal Alert: Letter from the Rex Venture Group LLC Receiver Kenneth Bell”

  1. Thus, by Zeek Rewards CEO Paul Burk’s own admission, Zeek Rewards was a Ponzi scheme for the entire duration of the 20 months it was active.

  2. Troy,

    You make a good point… why would Paul even except a $4 million dollar fine instead of fighting for his company if he really cared and had nothing to hide? I believe the answer is he took the easy way out. That tells me a lot about what was going on and what kind of man he is.

    It also amazes me that you don't see penny auctions as gambling as this is purely a game of chance. Online gambling is illegal in the US… this in itself makes me question your integrity when your okay with this and supported this company so strongly.

    So this leads me to my next question Troy… are you or have you ever gotten compensated from anyone affiliated with Zeek in any way?

    Thanks for your thoughts.

    Brian

  3. I read an interseting artcle last night on CNN about the President of the United States Barack Obama stating that he wants to defend Internet freedom and rights. It states clearly in the article that President Obama wants to suppot those wanting to start a business on the Intermet. I Dont know if it applys to Zeek Affiliates, but it did say anyone who wants to START their own BUSINESS over the Internet. Anyways, I would recommend it to everybody. http://www.cnn.com/2012/08/29/tech/web/obama-redd

    Also, i had no idea that Zeeks business was worth over 1 billion dollars. Where was that info received from? If thats true, the SEC has got some issues to deal with because the truth is not coming from them.

  4. @BrianMcCoy1,

    Thank you for taking time to share your heart. Having read your words I have a couple of things that come to mind.

    1. I still stand that Zeek was legit. Not without flaws and weaknesses in the comp plan, which I was very public on. Sadly, if all you did was watch a video and not read the editorials and comment threads, you would only get part of the story. Under the US Constitution we are guaranteed two very important Rights… We are innocent until proven guilty, and we are guaranteed a public trial with a jury of our peers. So until this takes place I will withhold judgement on all parties.

    Unlike you I do not take the SEC Complaint, as the truth. Without a public trial where ALL the facts and the ability of the corporate legal team to defend their opinions, then we may never know the truth. And already publicly the Receiver has stated what I stated when the complaint first came out… The numbers are wrong. One such example is the amount of affiliates who joined. I made it clear if you watch my videos that there was closer to 1.8 million affiliates who had joined. The SEC said 1 million. The Receiver has now said close to 2 million.

    I respect your opinion to be disappointed, but if one HUGE number in the complaint is wrong, what else is wrong?

    2. The $600 million mentioned in the Complaint is really closer to $1.2 billion dollars. You are right my videos along with the names of Kevin Grimes, Keith Laggos, Gerry Nehra, and Greg Caldwell were used to show folks that Zeek was a legit business model. And you know what? All of us still feel that given the opportunity to defend it in open court, that a Judge and Jury would also see it was legit. Not without weaknesses but legit.

    3. Brian, I do know the math, and I had added up everything. As a matter of fact I did this in April, and made it very clear what needed to be done. And if you watched the videos then you know that I was leading the charge on the cash back/shopping mall and the customer qualifiers (which were to go into affect August 22nd. But the SEC moved one week prior.) Those qualifiers would have STOPPED growth, and the majority of affiliates would have fallen out of qualification of the RPP until they have gathered 2,4,6,8,10 retail customers (non in the comp plan) spending around $7 to $10 per transaction to qualify as a retail customer. And since this number would be continually growing, and with some unannounced other changes… Well you do the math. Makes one wonder since the was so public why the SEC moved in one week to the day before these changes went live.

    4. You are 100% correct that this has hurt so many people. All you and others see is the folks inside the comp plan. But there are folks who NEVER purchased a bid, and SEC has frozen their funds. The hotels lost hundreds of thousands of dollars when the red carpet day was canceled and employees went without pay. One or two small venders are facing bankruptcy and thousands of affiliates lost tens of not hundreds of thousands of dollars in just plane tickets when the Red Carpet Day was cancelled. I truly wish the SEC realized what harm they are doing to the folks who uploaded funds to their eWallets, but had never bought any bids period and would let them have those funds. What is happening is wrong to these folks.

    5. Brian, although, I have learned much from this saga, my stance has not changed at all. If My Government is allowed to cut backroom deals with an owner of a company, and take possession of their assets by just filing a complaint then we have far bigger issues than Zeek. Do you realize that the SEC did not ask Paul Burks for a pea of guilty? Instead they allowed him to NOT admit anything and only slapped him on the hand with a $4 million dollar fine? Why? If a man masterminds a $600 million dollar ponzi and is fined less than 1% of the total amount, and if my figures are closer to the truth at $1.2 Billion, then we have issues.

    Again, thank you for sharing your thoughts, and I respect your opinion.

    Living An Epic Adventure,

    Troy

  5. Thus, by Zeek Rewards CEO Paul Burk’s own admission, Zeek Rewards was a Ponzi scheme for the entire duration of the 20 months it was active.

  6. Troy,

    I gotta be honest. I’m really disappointed in you. I had all kinds of people sending me your videos as enticement to join Zeek Rewards and making statements saying you were backing it and legitimizing it. And make no mistake about it , your videos seem to make this very apparent… this is why I believe so many people involved with Zeek were using your videos to recruit. At what appears will be around $600 million invested, this could go down as one of the largest ponzi schemes in US history.

    I’m really disappointed you didn’t add up the #’s of the proposed payouts showing in people’s backoffices to the amounts they were “investing” into the company. To me, it was common sense that the actual auction site was generating very little simply because of the quality (lack thereof) of the site and items up for bid compared to the other penny auction sites on the internet. There website for a company that supposedly was generating enormous amounts of cash daily from it was very, very poor.

    People look up to you Troy and I do believe you are a great person who really loves helping people. This has really caused a black eye though and much tears/heartache of good people who have gotten hurt. I know people that “invested” everything they had in Zeek and for now, have little to nothing left because they kept “reinvesting” into the scheme.

    My sincere hope is that you will learn from this situation and retain your position as a trusted resource for our great profession because many people including myself really do appreciate you!

    Sincerely,
    Brian

  7. @Paul,

    The US victims as the SEC calls them will get their funds back. How much is a good question. And since the SEC only protects US Citizens, not sure where this leaves international affiliates.
    <p.
    And if all the lawsuits eats up all the funds, which I estimate to be around $500 million, then (or if the Receiver decided to cash all the checks where this leaves everyone.

    We will not more as this moves along

    I do know that if you do nothing but wait, you have just as good a shot as anyone else at getting any money owed.

  8. Hey Troy, I am a little confused. From reading this it seems like the “victims” will be getting their some money back eventually. But there is a group out there saying this will never happen if we do not do something quick before the receiver and team have used up the remaining cash. Who should I believe? They are even asking for donations for the retainer fee for a top notch law farm.

  9. Pingback: Zeek Rewards Legal Alert: Letter from the Rex Venture Group LLC Receiver Kenneth Bell | Ethan, The Marketing Pro.
  10. Hi Troy, firstly let me say you are doing a great job in keeping your followers and the general public informed on all issues and updates. I would be interested in getting you thoughts on this website I have seen with alot of zeek information. It appears to me that the writer is highly educated in the mechanics of Zeek and the maths behind it.
    Would also be interested to get an educated lawyers views on it also.

    Here is the website and article: http://investamerica.biz/counter
    My recent post Contact Links

  11. what's so wrong if an victim canceles a deposit that can be canceled and saves some efforts of refunding?

  12. please dont forget also to keep and maintain the zeek database with the details of all the affiliates

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