UPDATE FROM THE RECEIVER – May 1, 2014
It has been several weeks since I have given you an update because I wanted to be able to give you accurate numbers and dates you can rely on. I can now do that.
As you know, we have been reviewing approximately 175,000 timely filed claims. By Friday May 9 we will have issued about 160,000 letters of determination regarding those claims. Another 10,000 or so letters of determination will be sent before the end of May. There are a few thousand claims that will require additional time to review, because of conflicting information regarding the amounts claimed. We will send letters to this last group of claimants as quickly as we are able. Bottom line, we will have letters out to more than 95% of the claimants in the next few weeks.
If you have not yet received your letter of determination, please be patient; it is coming. If you have already received a letter, or when you do, I encourage you to respond as soon as you are able.
You also are anxious to know when we will begin making distributions on claims. This month we will file a motion with the Court asking permission to make an interim, partial distribution on claims. Our goal is to distribute now an amount equal to 40% of each reconciled claim using the “rising tide” method of calculation already approved by the Court. My best guess is that we will begin making distributions in mid-summer.
I will also be reserving cash to distribute to holders of claims that have not yet been determined and allowed. When your claim is allowed, you will receive distributions in the same total amount you would have received if your claim was allowed in the first batch of claim determinations.
This first distribution will not be of all the funds I’m confident we will ultimately be able to return to claimant victims. We continue to collect receivership assets from financial institutions and those who took more money out of Zeek Rewards than they put in. We have sued more than 9,000 of these “net winners” in the United States. We will soon sue net winners who live outside the United States. I remain hopeful that we will add tens of millions of dollars to the pool from which we will make final distributions to claimant victims. Unfortunately, these efforts will take quite a long time, maybe years. I will not be permitted to make final payments until all recoverable assets have been collected, but there will be an additional, final distribution at some point.
Also, next week we will send out thousands of amended IRS Forms 1099 for 2011 and 2012. We have determined that Rex Venture Group often miscalculated the amount of money that should have been on the 2011 forms. There also were some errors for 2012 because of inadequate and erroneous records of the company. Thousands of affiliates may have paid taxes for 2011 and/or 2012 that they did not owe because of incorrect 1099s. If you receive an amended 1099 I encourage you to consult with a tax professional.
I know this process has taken longer than you, or I, would have liked. I can only assure you that the receivership team has worked diligently to return as much money as possible, as quickly as possible, to victim claimants. Our efforts on your behalf continue. Thank you for your continued support and patience.
Kenneth D. Bell