Ponzitracker: Victims Recover From Net Winner

Ponzi Victims Successfully Recover $1.4 Million From Net Winner In $100 Million Ponzi Scheme

Victims of the largest Ponzi scheme in Ohio history will now recover at least a small portion of their losses after reaching a settlement to recover $1.4 million in “false profits” received by a more fortunate investor.  Glen Galemmo, a former money manager currently serving a 15-year prison sentence, took in more than $100 million from hundreds of investors who trusted the Ohio man’s promises of above-average returns through investments in undervalued stocks.  While authorities have not sought the appointment of a receiver to collect assets for victims, a pair of Cincinnati attorneys have spearheaded efforts to recover funds that might be used to temper losses.

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Zeek Rewards: Criminal Case, 14-CR-208, USA v. Burks

There have been some additions to the docket in USA v Burks recently and they have been added to the Files website and these are:

  • Motion to Continue – The Defense needs more time to prepare
  • ORDER – Granting Motion to continue; case is moved to the January 2015 Calendar
  • Motion to Appoint Special Master – appoint Special Master with powers of federal Receiver
  • ORDER Appointing Special Master –
    • IT IS, THEREFORE, ORDERED that the government’s Motion to Appoint Special Master (#12) is GRANTED, and Kenneth D. Bell is appointed as Special Master in accordance with 18 U.S.C. §§ 1956(b)(4) and 3664(d)(6), and shall accomplish the following tasks: (1) identify victims; (2) provide notification to such victims pursuant to 18 U.S.C. §§ 3771(b)(1) and 3771(c)(1); (3) fashion a proposed restitution order; and (4) receive restitution payments for appropriate distribution to victims in accordance with the court’s restitution order.

 

Zeek Rewards: Receiver Files Motion Aimed at PCI, and Belsome Files Appeal

There is some recent activity in the original SEC case against RVG, 12-cv-519, with the Receiver trying to get over $8,000,000 from Plastic Cash International (PCI). Below is a portion of ZeekDoc286-main, and with it are 3 Proposed Orders: (These are added to the Files Website)

Kenneth D. Bell, Court-appointed Receiver (“Receiver”) of Rex Venture Group, LLC d/b/a ZeekRewards.com (“RVG” or “Rex Venture Group”), respectfully submits this motion for an order directing Plastic Cash International, LLC (“PCI”) and Brian Newberry (together, the “PCI Parties”) to turn over Receivership assets and/or find them in contempt of the Court’s Agreed Order Appointing Temporary Receiver and Freezing Assets of Defendant Rex Venture Group, LLC.
For the reasons set forth in the supporting Memorandum of Law, the Court should grant this Motion, order the PCI Parties to pay to the Receiver at least $8,323,673 of Receivership Assets they failed to freeze and return to the Receivership Estate and/or find the PCI Parties in contempt for violating the Court’s August 17, 2012 Agreed Order Appointing Temporary Receiver and Freezing Assets of Defendant Rex Venture Group, LLC, as amended on August 30, 2012, (“Agreed Order” or “Freeze Order”).

In the alternative, the Court should order the PCI Parties to deposit at least $8,323,673 with the Receiver to be held in a segregated account pending final resolution of this dispute to safeguard the funds for the protection of all parties and the RVG victims. The Receiver also requests that the Court award the Receivership the costs and fees incurred in having to bring the present Motion.

And true to form, the group known as the “Belsome, et al” has filed an Appeal against the Order striking the Attorney’s Charging Lien from the case Docket.  So far, this case has not appeared on the Appellate Court’s docket. I will add it to the Files website when it does.

BehindMLM: Carlos Costa Lied to Brazilian IRS?

Carlos Costa lied about Brazilian IRS TelexFree approval

telexfree-logoOne of the recurring themes in Carlos Costa’s sweaty TelexFree news updates, was the assertion that the Brazilian IRS had gone over TelexFree’s books and certified the company legitimate.

carlos-costa-angry-telexfree-bankruptcy-youtube-video-feb-2014Costa asserted as much with the knowledge that the IRS would not comment publicly on their report, and that the only other party with a copy was TelexFree.

What he wasn’t planning on however was the report being leaked to media outlet Globo.

And surprise, surprise… turns out Costa has once again been caught out telling porky pies.

[Continue reading…]

 

AP Reports: Paul Burks Pleads NOT GUILTY, Wants Jury Trial

ZeekRewards Founder Released On $25,000 Bond

CHARLOTTE, N.C. — A North Carolina man who prosecutors say masterminded an $850 million Internet-based Ponzi scheme is pleading innocent to charges of wire and mail fraud, conspiracy and tax fraud.

Paul Burks appeared Thursday in federal court in Charlotte, where he was released on $25,000 bond.

Burks was president of ZeekRewards and the online penny auction site Zeekler.com. The company was shut down by the U.S. Securities and Exchange Commission in 2012. Prosecutors say Burks and his conspirators had used the promise of massive profits to lure more than 1 million investors, including nearly 50,000 in North Carolina.

Authorities say Burks diverted more than $10 million to himself. The former nursing-home magician told The Associated Press last year he never asked people to invest more money than they could afford.

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Paul Burks, center, flanked by his attorneys Noell Tin and Melissa Owen

Zeek Rewards: Judge Mullen Denies Attorney Charging Lien!

I kinda thought it would end up like this, and now we have Judge Mullen’s answer:

ORDER

THIS MATTER is before the Court upon Marc Michaud and the law firm of Patrick Miller LLC’s Notice of Attorney’s Charging Liens (Doc No. 258) and the Receiver’s Objection to Counsel’s Notice of Attorney’s Charging Lien and Request for Order in Aid of Distribution (Doc. No. 260). Having considered the filings, and for good cause shown, the Court enters the following Order.

IT IS, THEREFORE, ORDERED, ADJUDGED AND DECREED as follows:

1. The Receiver’s Objection to Counsel’s Notice of Attorney’s Charging Lien and Request for Order in Aid of Distribution is SUSTAINED and GRANTED.

2. Plaintiff Jonny Belsome, et al.’s Notice of Attorney’s Charging Lien (Doc. No. 258) is hereby DENIED and STRICKEN from the Court’s docket; and

3. Marc R. Michaud is ORDERED to immediately and without further delay provide the Receiver with all actual addresses of those Claimants whose Claims currently list the address of Patrick Miller LLC or any other address not related to such claimant. These addresses may be provided directly to the Receiver or through the Claims Portal.

Signed: November 12, 2014

Ponzitracker: Pastor Gets 10 Year Sentence

Pastor Gets 10-Year Sentence For $7 Million Ponzi Scheme

A California pastor was sentenced to serve more than ten years in prison for duping more than 80 victims – many of them low-income families – in a $7 million Ponzi scheme.  Luis Serna, 62, was sentenced to 121 months in federal prison by U.S. District Judge Beverly Reid O’Connell, who also ordered Serna to pay $4.6 million in restitution to his victims.  Serna previously pleaded guilty to wire fraud charges.

Serna was a pastor at Zion Living Word Christian center in San Fernando.  When he was not directing his congregation, Serna was the owner and operator of Architects of the Future Investments (“AFI”), which solicited potential victims by promising annual returns of up to 20% from his prowess as a foreign currency trader. In total, investors entrusted more than $7 million with Serna – of which authorities estimated that $4.6 million was ultimately lost.

However, according to authorities, Serna used very little of the funds raised from investors to trade foreign currency.  Rather, Serna admitted to operating a Ponzi scheme by using new investor funds to pay fictitious returns to existing investors.  The scheme collapsed when Serna was unable to satisfy monthly obligations to investors, many of whom came from low-income backgrounds.  In a statement to the sentencing judge, prosecutors indicated that:

This case involves an egregious fraud that targeted non-wealthy victims who believed in the defendant because he was a pastor.  The effects of this crime on the victims are truly devastating in every way.  In short (Serna) has caused not only financial loss, but the loss of homes, the loss of ability to pay for education for children, the need to declare bankruptcy, psychological damage, physical damage and endless suffering.

Serna’s attorney claimed that Serna had accepted responsibility for his crimes, but sought leniency based on Serna’s immigration from Mexico when he was 16 and a difficult upbringing.

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SEC Charges India-Based HYIP Scheme

11/12/2014 12:15 PM EST

The Securities and Exchange Commission today announced charges against two India-based operators of an alleged high-yield investment scheme seeking to exploit investors through pervasive social media pitches on Facebook, YouTube, and Twitter.

The SEC’s Enforcement Division alleges that Pankaj Srivastava and Nataraj Kavuri offered “guaranteed” daily profits as they anonymously solicited investments for their purported investment management company called Profits Paradise.  They invited investors to deposit funds that supposedly would be pooled with money from other investors and traded on foreign exchanges as well as in stocks and commodities.  They created a Profits Paradise website and related social media sites to describe the profits as “huge,” “lucrative,” and “handsome,” and they characterized the risk as “minimal.”

The SEC’s Enforcement Division alleges that the guaranteed returns were false, and that the investments being offered bore the hallmark of a fraudulent high-yield investment program.  Srivastava and Kavuri attempted to conceal their identities by supplying a fictitious name and contact information when registering Profits Paradise’s website address.  They also communicated under the fake names of “Paul Allen” and “Nathan Jones.”  After the SEC began its investigation into the investment offering, the Profits Paradise website was discontinued.

“Srivastava and Kavuri used excessive secrecy in their effort to swindle investors through social media outreach and a website that attracted as many as 4,000 visitors per day,” said Stephen Cohen, Associate Director of the SEC’s Division of Enforcement.  “Our investigation stopped the constant solicitations once the website disappeared, and successfully tracked down the identities of the perpetrators behind those fraudulent solicitations.”

According to the SEC’s order instituting administrative proceedings, Srivastava and Kavuri used the Profits Paradise website and YouTube videos to detail three investment plans with terms of 120 business days.  The first plan purportedly yielded daily interest of 1.5 percent on investments of $10 to $749.  The second plan purportedly yielded 1.75 percent on investments of $750 to $3,499.  And the third plan purportedly yielded 2 percent on investments of $3,500 and above.  Postings on Profit Paradise’s Facebook page promised investors they could “Enjoy Hassle Free Income” and advertised a “5% Referral Commission.”  The scheme also utilized a Profits Paradise Twitter account to steer potential investors to the Profits Paradise website, and Srivastava and Kavuri created a Google Plus page to promote the investment opportunity.

The SEC’s Enforcement Division alleges that Srivastava and Kavuri violated Sections 17(a)(1) and (3) of the Securities Act of 1933, and will litigate the matter before an administrative law judge.

The SEC’s investigation was conducted by Carolyn Kurr and Daniel Rubenstein, and the case was supervised by C. Joshua Felker.  The SEC’s litigation will be led by Kenneth Donnelly.  The SEC appreciates the assistance of the Securities and Exchange Board of India as well as the Autorité des Marchés Financiers in Quebec, the Ontario Securities Commission, and the Securities and Futures Commission in Hong Kong.

The SEC today updated an investor alert educating investors about how social media may be used to promote so-called high-yield investment programs and other fraudulent investment schemes.

“We urge investors to exercise extreme caution if they are approached to invest in a website promising incredible returns with minimal or no risk.  So-called high-yield investment programs are often frauds,” said Lori J. Schock, Director of the SEC’s Office of Investor Education and Advocacy.

How Ignorant Are We ???

I like to watch Fareed Zakaria’s program on CNN, Global Public Square, to get an idea on what’s going on in our world. He is an Indian-American who holds a PhD in Political Science from Harvard University, is the editor-at-large and a columnist for TIME magazine, a columnist on the Washington Post, the author of “The Post American World” and is a pretty sharp guy.

I was shocked and amazed at this segment, of how uneducated Americans and the rest of the world actually are when it comes to buzzword topics and the actual and accurate numbers that apply, not the numbers we are lead to believe. This misinformation has a direct and horrifying effect on whom we elect to govern us and the policies they hoist upon us.

It is a 4:16 length video well worth viewing:

Here is a link to the actual study.

And here is a link to the Quiz so you can see how well you do….

Zeek Rewards: Preferred Merchants Hearing Delayed

Civil Action No. 3:12 cv 519

This matter is before the Court upon its own motion. A hearing has been set on November 12, 2014 to address the Receiver’s Motion for Temporary Restraining Order Enforcing the Court’s Asset Freeze and non-party Preferred Merchants Solutions, LLC (“Preferred Merchants”) and James Meyer’s Motion to Dissolve Temporary Restraining Order. It appears to the Court that in order to properly address these motions, the Court will also need to consider Preferred Merchant’s Motion to Lift Stay (Doc. No. 230) and the Receiver’s Motion for Contempt (Doc. No. 240). Accordingly, the Court hereby reschedules the hearing set for November 12 to Monday, November 24, 2014 at 10 a.m. in Courtroom 3, where the Court will address all of the above referenced motions.

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