Zeek Rewards: Judge Orders “Final Judgments”

Based on Kenneth Bell’s Motion for Final Judgments for a group of “Net Winners”, Judge Mullen has issued an Order as follows:

THIS MATTER comes before the Court on the Receiver’s Motion to Enter Judgment and to Confirm Judgments as Final.

 
For good cause shown, the Motion is hereby GRANTED and the Final Judgments requested shall be entered as filed.

So far, three (3) Final Judgments have been entered today:

  • Final Judgment is hereby entered against Defendants David Kettner, Mary Kettner, Kettner & Associates, LLC and Desert Oasis International Marketing, LLC (The Kettner Defendants) jointly and severally, in the amount of $1,259,114.65 which is comprised of $937,529.27 in net winnings from the ZeekRewards scheme and $321,585.38 in prejudgment interest
  • Final Judgment is hereby entered against Defendants T. Lemont Silver, Sr., Karen Silver, and Global Internet Formula, Inc., (The Silver Defendants) jointly and severally, in the amount of $3,141,668.09, which is comprised of $2,339,267.35 in net winnings from the ZeekRewards scheme and $802,400.74 in prejudgment interest
  • Final Judgment is hereby entered against Defendant Durant Brockett in the amount of $2,312,129.25, which is comprised of $1,721,597.67 in net winnings from the ZeekRewards scheme and $590,531.58 in prejudgment interest

Zeek Rewards: Judge Mullen Grants Default Judgement in ‘Bell v Disner et al’

zeekrewardsIn case filed by the Zeek Receiver, Kenneth Bell, the receivership filed  civil suit against what were called “Net Winners” in the Zeek scam which garnered $1000 or more from the scheme. The list of Defendants included a large number of serial promoters of this type of pyramid/Ponzi scheme such as:

Todd Disner, Trudy Gilmond, Jerry Napier, Daren Miller, Rhonda Gates, David Sorrells, Aaron and Shara Andrews, T. Lemont Silver, Karen Silver, Michael Van Leeuwen, Duran Brockett, David and Mary Kettner and a “Defendant Class of Net Winners”.

Several of the individuals above were involved in ASD and other scams prior to promoting Zeek and bilking thousands of people on the false hopes of becoming rich with little or no effort. The majority of these defendants have already received judgments which resulted in them having to return monies to the receivership to be distributed to the victims.

The problem with scams like Zeek is the money was actually made from recruiting others, not from sales of products of services. Sadly, a new one pops up almost every day.

You can read the 27 page order, wherein the Judge details the reasons for his decision and a background on the scam by clicking the link. There is also a list of the “Net Winners” on the site.

Zeek Rewards: Receiver Replies to Class Defendants

zeekrewardsJust filed today, Kenneth Bell has replied to the Class Defendant’s (Rhonda Gates, Innovation Marketing, LLC, Aaron Andrews, Shara Andrews, and Durant Brockett) response to his initial Motion for Summary Judgment and Partial Summary Judgment against the Net Winner Class. It seems that Jerry Napier, Darren Miller, T. Le Mont Silver, Global Internet Formula, Inc., Karen Silver, and Dave and Mary Kettner did not respond to the Receiver’s motion.

Under “Summary of Argument”, the Reply states that after more than a year and considerable cost to the Receivership engaging a defense expert to investigate the question of whether or not Zeek operated as a Ponzi that the

Defendants have conceded—without a single reference to their own expert—that ZeekRewards was a Ponzi scheme which intentionally defrauded hundreds of thousands of victims out of hundreds of millions of dollars. Indeed, since the filing of the Receiver’s motion Paul Burks, the mastermind of the ZeekRewards scheme, has been found guilty by a Federal court jury of three counts of securities fraud and one count of tax fraud related to the Ponzi scheme. So, the fact that ZeekRewards was a Ponzi scheme has now been established as a matter of undisputed facts and law.

Despite this concession that Zeek was a Ponzi, the Defendants argue that they can avoid returning their “net winnings” based upon the TOS (Terms of Service) which

can limit the Receiver’s rights to assert claims and that they should be given credit for recruiting victims to the scheme. Defendants still act as if Zeek was a legitimate business and Defendants were “internet marketing specialists” entitled to be paid as employees rather than investors in the scheme, all of which is of course pure fiction.

The Court should resist Defendants’ invitation to create the dangerous loophole of allowing a fraudster to use the terms implementing a Ponzi scheme to limit the right of a subsequently appointed Receiver to recover funds paid to the winners of the fraudulent scheme. While such a rule would be a great recruiting tool for future Ponzi scheme operators, it is surely an unacceptable legal rule and public policy.

The Defendants urge the Court to rule that purchasing bids, posting online advertisements (which only took 5 minutes a day) and recruiting thousands of victims somehow means they provided “reasonable equivalent value” such that they get to keep the victim’s money.

Bell goes on to eviscerate the Defendant’s attempt to legitimize their actions:

In other words, Defendants claim that those Defendants who spent the most time successfully promoting the scheme and multiplying the number of its victims should be given the most credit against the Receiver’s claims to recover their fraudulently transferred winnings. In fact, in arguing that they were supposedly rightly paid for their “services,” Defendants stretch to compare themselves to the utility company, which among many other differences does not invest money in their customers’ businesses hoping to share in compounding profits of 125% every ninety days. Whether or not innocent third-party trade creditors of a Ponzi scheme could be subject to a clawback action is not at issue in this case. Here, Defendants—all active participants and investors in the scheme—provided no value to ZeekRewards as a matter of law and fact; instead, as a result of their efforts the company became liable for hundreds of millions of dollars in losses incurred by the victims they recruited to the scheme.

You can read the full Response, the Zeek Terms Of Service and the Purchase/Subscription Agreement here.

Zeek Rewards: Defendant Darren Miller Responds to Bell’s Questions

In a response filed  on May 19th, co-defendant Darren Miller answered questions posed to him by the Receiver, Kenneth Bell.  Much like other answers from co-defendants, it was a boiler plate reply with no substance.

For example, here is Question 1 and its response:

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All subsequent questions (2 thru 14) are met with the same reply, with the exception of the question number changing. Other than that, no difference.

Next we have his reply to Requests for the Production of Documents. And, guess what? He uses the same response to each of those 27 questions.

Zeek Rewards: Receiver Announcement for March 28th

ANNOUNCEMENT FROM THE RECEIVER – March 28, 2016

On March 16, 2016 the U.S. District Court approved a settlement between the receivership and NewBridge Bank in the amount of $10,000,000. The settlement arose out of claims the receivership had against NewBridge Bank for its continuing to provide banking services to Rex Venture Group after mid-April 2012, by which time the receivership alleged that the bank and its executives knew or should have known that Paul Burks and RVG were using their accounts to conduct an illegal Ponzi and pyramid scheme.

Details of the receivership’s potential claims and the settlement may be accessed and reviewed by clicking on the highlighted links below:

Motion to Approve Settlement and Settlement Agreement
Court’s Order

On behalf of the victims of RVG and Zeek Rewards the receivership team continues to pursue and collect assets that will be paid to those with recognized claims. We hope to bring to a conclusion in 2016 our class action against more than 9,000 net winners, which will be a significant milestone.

I have written many times encouraging tens of thousands of claimants with recognized claims who have not yet received a distribution check to log into the claims portal and electronically sign the Court required Release and OFAC Certification. At some point, I will be required to distribute the funds that have been reserved for these claimants to other Affiliates who have completed the process and, therefore, hold Allowed Claims. I don’t want any claimant with a recognized claim to lose out on receiving a distribution simply because they did not complete all of the steps required by the Court’s Orders.

Thank you for your support as we continue to work on your behalf.

Zeek Rewards: Jaymes Meyer, Preferred Merchant Solutions, Enters Into Plea Agreement

On March 10th, the Department of Justice files criminal charges against Jaymes Meyer, of Preferred Merchant Solutions. The criminal Counts charged in this case are 18USC 1503(a) INFLUENCE/INJURING OFFICER/JUROR/WITNESS (1). and 18USC 2 (accessory to a crime).

The Bill of Information charges that Meyers engaged in an elaborate obstruction of justice to conceal millions of dollars from the Government using a series of foreign and domestic banking and brokerage accounts.

“In or about July 2012, RVG and Meyer, through Preferred Merchants, executed a Declaration of Trust establishing the RVG Corporate Trust”. It goes on to say that “On or about August 1, 2012, approximately $20 million of RVG assets was deposited into the RVG Trust account. The next day, Meyer contacted Bay Area Escrow and directed approximately $2.6 million to be transferred to Preferred Merchants.”

But wait, it gets better….  after an Assistant Director of the SEC contacted Meyer (by phone) on August 16, 2012 of a securities fraud investigation and a Court order freezing RVG’s assets, within about 20 minutes of this call from the SEC, Meyer directed another transfer from the RVG Trust in the amount of $4.8 million.

The list goes on and on, the full document is available here 1-Bill of Information

Meyer entered a guilty plea on March 8 or 9, prior to the case being filed. This Order of Forfeiture adds to the assets garnered by the Zeek receiver.

Zeek Rewards: Receiver Files Motion to Freeze $13 Million


RECEIVER FILES MOTION TO RECOVER AND SECURES INTERIM FREEZE OF $13 MILLION IN OUTSTANDING RECEIVERSHIP ASSETS

On February 11, the Receiver filed a Motion seeking to recover $13,174,015.48 in outstanding Receivership Assets from Payza, Payment World, VictoriaBank (a Moldovan financial institution), and their affiliates or, alternatively, to hold these entities 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 (“Freeze Order”). On February 12, the Court ordered an immediate interim freeze of $13,174,015.48 at a United States correspondent bank account for VictoriaBank pending resolution of the Receiver’s Motion on the merits.

These funds are outstanding Receivership Assets from the payment processing relationship between Rex Ventures Group LLC, Payza, and PaymentWorld, for which a percentage of the processed funds were held on reserve at VictoriaBank in Moldova. For the past 3.5 years, the Receiver Team has worked diligently and devoted significant time and resources in its investigation, analysis, and various other efforts to reconcile and recover these outstanding funds, including negotiations with Payza, PaymentWorld, and VictoriaBank (collectively, “Respondents”) and coordination with United States and Moldovan government authorities. In direct violation of the Court’s Freeze Order, and despite the Receiver’s repeated requests, the Respondents refused to pay the Receivership Estate the outstanding assets. Each of the Respondents has had some role in failing to freeze and or return the outstanding Receivership Assets from this payment processing relationship.

With the Respondents’ failure to comply with the Court’s Freeze Order and increased risk of dissipation of funds, the Receiver, after exhausting a myriad of other options, filed the above-referenced Motion. Pending resolution of the Motion on the merits, the Court issued an immediate interim freeze of the full $13,174,015.48 at VictoriaBank’s correspondent bank account at a United States bank. The Receiver anticipates the Court will set a briefing schedule and hearing date to facilitate the resolution of this Motion on the merits. The Receiver will work diligently in pursuing a successful resolution of the Motion in hopes of securing the recovery of these funds for the benefit of ZeekRewards’ victims.

The Receiver’s legal filings and the Court’s order freezing the funds pending resolution of the Receiver’s motion are available at the links below:

The Receiver’s Motion for an Order Directing Payza, Payment World, and VictoriaBank to Turn Over Receivership Assets and/or Find Them in Contempt of the Court’s Order Freezing and Preserving Receivership Assets

Memorandum in Support of the Receiver’s Motion for an Order Directing Payza, Payment World, and VictoriaBank to Turn Over Receivership Assets and/or Find Them in Contempt of the Court’s Order Freezing and Preserving Receivership Assets

Order Freezing Funds Pending Resolution of Receiver’s Motion

Zeek Rewards Updates

zeekrewardsHere are the latest activities in the Zeek Rewards federal lawsuits:

12-cv-519 (SEC Case)  On February 1st, Kenneth Bell filed is Status Report for the Fourth Quarter of 2015.  I have uploaded it onto the Files Website, click here for that document.

12-cv-519 (SEC Case) Kenneth Bell continues to go after Zeek receivership assets by getting an Order directing Sooper Credit Union to turn over the sum of $2,200.00 that represents proceeds of Cashier’s Checks within 30 days.

14-cv-91 (Bell v Disner) The attorney representing the “Defendant Class of Net Winners”, Kevin Edmundson,  has filed his first application for reimbursement of professional fees and expenses, which are: (a) Berkeley Research Group $ 70,775.78, (b) Edmundson PLLC $ 2,800.00, and (c) Kelly Hart & Hallman LLP $ 6,976.70

14-cv-91 (Bell v Disner)  William R. Terpening and Jefferson A. Moors filed a Motion to allow
them to withdraw as counsel for any and all parties in this case, including Rhonda Gates;
Innovation Marketing LLC; Aaron Andrews; Shara Andrews, who are part of the Defendant Class.

 

 

 

Zeek Rewards: Judge Mullen Approves Receiver’s Settlement with NXSystems for $3.5 Million

ZeekThis is hot off the docket:

This matter is before the Court upon the Receiver’s Motion to Approve Settlement Agreement with NxSystems, Inc. filed December 11, 2015. The Court has reviewed the motion and proposed settlement and finds that the proposed settlement is fair and equitable and is in the best interests of the Zeek victims. Accordingly, the Court will grant the motion.

ORDER
IT IS, THEREFORE, ORDERED, ADJUDGED, AND DECREED that:

1. the Receiver’s Motion to Approve Settlement Agreement with NxSystems, Inc. is hereby GRANTED; and

2. the Settlement Agreement attached to the motion is approved, and the Receiver is hereby authorized to perform according to the terms of that Settlement Agreement.

Signed: December 16, 2015

Zeek Rewards: Canadian “Net Winner” Sandra Gavel Files Similar “Pro Se Letter”

ZeekAlmost identical to the letter sent to Clerk of the Court Frank Johns, we have a Pro Se letter which mimics the one sent in by Katherine Parker, also “a private person”. Both letters begin with “Dear Frank” as if they are personally acquainted with the Clerk. Perhaps it is just their attempt to be personable? Probably not…..

Gavels letter starts out with notifying the Clerk that she believes this to be a fraudulent process, and also mentions the “Fraudulent/Non-existent Court Name and Undefined Status of Respondent”. And, there are the same versions of the name of the District Court, capitalized and not. And, the claim that these names “do not  appear to exist in law anywhere”. Plus, there is the “discrepancy/change in the entire style of cause used in the various court documents which created confusion and ambiguity”. There is also a mention of the “common law court” and changing the case into some “undeclared jurisdiction”. Ms. Gavel does not consent to the “change in jurisdiction out of common law court” or “the diminution of private rights”.

Gavel also claims that she “did not receive the invitation in time to attend the conference”; she refers to the Initial Attorneys Conference held on January 26, 2015. Gavel claims she mailed correspondence to the Clerk and Attorneys but they failed to respond to her questions and for clarification as to why the have proceeded in what she believes is a fraudulent process.

There is more nonsense similar to Parker’s letter, so I will not go into it further. You can read the filing by clicking here.