On Monday, August 18th, the government filed a motion (Doc 105) which contains these points:
The government hereby moves to have this matter treated as a complex case pursuant to 18 U.S.C. § 3161(h)(7)(B)(ii) and to have the Court enter an interim order of excludable delay pursuant to 18 U.S.C. ‘3161(h)(7)(A).1 As grounds therefore, the government states that this case is sufficiently unusual and complex that it is unreasonable to expect adequate preparation for trial within the time limits established by 18 U.S.C. § 3161:
1. The Indictment in this case says in part that the defendants operated a company, TelexFree, Inc., and related entities (“TelexFree”), that sold telephone service based on a voiceover-internet (“VOIP”) protocol, but alleges that TelexFree was in fact a pyramid scheme. The company was global, with approximately 785,000 participants in dozens of countries. Telexfree also operated out of countries besides the United States, most prominently Brazil, where a TelexFree owner and several employees live.
5. Because the evidence underlying this case is closely tied to certain foreign countries, especially Brazil, it is likely that the parties will need to review evidence in foreign countries and arrange for foreign witnesses and/or law enforcement officers to travel to the United States to testify at trial. If the parties require authenticated evidence from foreign countries, the process for securing that evidence by formal request is extremely time-consuming, including review of the request by U.S. authorities (locally and at the Office of International Affairs), review by authorities in the host country, collection and transmittal of the evidence, and certified translation.
WHEREFORE, the government respectfully moves the Court
a. To treat this case as a complex case pursuant to 18 U.S.C. § 3161(h)(7)(B)(ii), for purposes of Speedy Trial Act calculations; and
b. Pursuant to 18 U.S.C. § 3161(h)(7)(A), to enter an order of excludable delay of 90 days, commencing on September 10, 2014, after which either party may seek a further extension of the tolling period depending on their progress on the above issues.
So far, that Order has not been issued by the Court. I will keep an eye on this situation.
In today’s Zeek Rewards filings, we have several Defendants/affiliates who have responded to the original Complaint and filed a Counterclaim against Kenneth Bell, the court-appointed Receiver.
The first of three (3) Counterclaims was filed by one Durant Brockett, in which he asserts the following five (5) Claims For Relief:
Breach of Contract
RVG and Brockett had an enforceable contract pursuant to which Brockett performed services for the benefit of RVG. In return, RVG was obligated to compensate Brockett as RVG had promised for the services Brockett performed.
The Receiver, acting as RVG, and by confiscating the funds in Brockett’s RVG NXpay account, has failed and refused to pay Brockett for the services that Brockett performed.
The conduct of the Receiver, acting as RVG, constitutes a breach of contract. Brockett has been damaged in an amount to be determined at trial for the Receiver’s/RVG’s breach of contract.
A valid contract existed between Brockett and NXpay relating to Brockett’s RVG NXpay account. That contract gave Brockett the exclusive right to withdraw funds from his RVG NXpay account.
On information and belief, the Receiver had knowledge of Brockett’s contractual relationship with NXpay.
The Receiver intentionally induced NXpay not to perform its contract with Brockett and, in violation of the contractual agreement between NXpay and Brockett, either (i) to deliver the funds in Brockett’s RVG NXpay account to the Receiver or (ii) not to pay the funds to Brockett as NXpay’s contract with Brockett obligated it to do.
The Receiver’s conduct described above was willful and undertaken on behalf of RVG. Brockett is entitled to punitive damages against the Receiver and RVG in accordance with N.C. GEN. STAT. § 1D-1, et seq.
Money Had and Received
The Receiver is in receipt of funds which do not in equity and good conscience belong to him.
Brockett is the rightful owner of the funds the Receiver received from Brockett’s RVG NXpay account.
Brockett is entitled to an order compelling the Receiver to turn over to Brockett all funds the Receiver received from Brockett’s RVG NXpay account.
Civil Action Pursuant to 42 USC Section 1983 for Deprivation of Constitutional Rights, or, Alternatively Common-Law Claim for Violation of Fourth Amendment Rights
The Receiver was acting under the color of law when he caused NXPay to refuse to honor the terms of its contract with Brockett and when he caused NXPay to turn over to the Receiver Brockett’s funds in his RVG NXpay account.
As a result of the Receiver’s conduct, Brockett has been wholly deprived of the value, use and benefit of the funds in his RVG NXpay account.
Pursuant to 42 U.S.C. § 1983 and the Fourth Amendment of the United States Constitution, the Receiver is liable to Brockett for redress for Brockett’s damages resulting from the loss of use of his funds.
Unfair Trade Practices
RVG’s and the Receiver’s conduct described above and in the Complaint constitutes unfair methods of competition, unfair trade practices, and deceptive trade practices in violation of the North Carolina Unfair and Deceptive Trade Practices Act, N.C. GEN. STAT. § 75-1.1, et seq.
The conduct was illegal, offends public policy and is immoral, unethical, oppressive, unscrupulous, and deceptive.
As a result of the conduct, Brockett has suffered damages.
The use by RVG and the Receiver of unfair methods of competition and unfair and deceptive trade practices entitles Brockett to recover (a) three times his actual damages and (b) attorneys’ fees and costs pursuant to N.C. GEN. STAT. § 75-16.1.
The almost identical Counterclaims have been brought by Innovation Marketing LLC, Shara Andrews, Aaron Andrews and Rhonda Gates. Mr. Brockett is using noted legal mouthpiece Rodney Alexander.
As some of you will recall, Rodney Alexander was previously retained by Robert Craddock, of “Fun Club USA” and “Zteambiz” infamy, in a half-hearted and highly questionable attempt to intervene in the RVG case (it didn’t work out as he planned, of course). Craddock accepted donations of which no one is sure how or where they were used, similar to the “ASD Justice” group of Todd Disner and Dwight Schweitzer who gathered money for a legal bid to intervene in the ASD/AdSurfDaily federal civil case, which also amounted to absolutely nothing.
Mr. Alexander also filed a “Motion to Dismiss for Failure to State a Claim / MOTION to Dismiss for Lack of Jurisdiction” for Defendants Aaron Andrews, Shara Andrews, Durant Brockett, Rhonda Gates, Trudy Gilmond, Innovation Marketing LLC, Darren Miller, Jerry Napier, and Trudy Gilmond, LLC.
The other two “Answers to Complaint/Counterclaims” were filed by attorney James Edmundson on behalf of Defendants Innovation Marketing LLC, Shara Andrews, Aaron Andrews and Rhonda Gates.
I will keep an eye on these filings; it will be interesting to see how the Judge deals with them. Mr. Bell filed in every Federal District in the land so that he DID have jurisdiction to pursue clawbacks; how the Defendants now believe Bell does not have jurisdiction to sue them is likely just a matter of legal posturing and trying to get out of a bad situation.
I suppose it is a sort of milestone, 1, 111 posts since I started the Blog to detail the events in the ASD/AdSurfDaily Ponzi scam. Since that time, there seems to be a proliferation of crooks and scams resulting in literal piles of money leaving the victims and ending up in the bank accounts of serial scam artists and promoters.
Until the worldwide public realizes that no legitimate program can pay them an RIO 100’s of time greater than any other method is nothing but a scam, these “opportunities” will continue to pillage the public and separate them from their money.
On May 1, 2014 I told you that I would file a motion with the Court asking permission to make an interim, partial distribution on allowed claims. Yesterday, May 28, 2014, we filed a motion seeking to make distributions at an amount equal to 40% of each affiliate’s allowed claim using the “rising tide” method of calculation previously approved by the Court. If the Court approves this motion affiliates with allowed claims will initially receive 40% of their investment in Zeek Rewards, minus any money received from Zeek Rewards prior to my appointment as receiver. We anticipate that this motion will be addressed by the Court in June. You can read the motion here.
Let me emphasize that this is only a first distribution. I am entirely confident that we will make another distribution once we have recovered all assets possible. As you know, we have sued the former insiders (Paul Burks, Dawn Wright-Olivares and others) and more than 9,000 individuals in the United States who took more money out of Zeek Rewards than they put in. This money rightfully belongs to affiliates with allowed claims. We will also sue foreign net winners in the near future. Also, I believe we will recover several millions of dollars more from financial institutions still holding receivership assets.
Despite our best efforts to make a distribution in mid-summer, logistical issues regarding the payment to what may be more than 150,000 affiliates required us to ask permission of the Court to make the first interim, partial distributions on allowed claims on September 30, 2014. We also asked that August 15, 2014 be the date for determining whether a claim is allowed and payable on September 30, 2014. This means that if you have an allowed claim on August 15, 2014, and your distribution would be in excess of $100.00, the first interim, partial distribution will be mailed to you on September 30, 2014.
In order for your claim to be allowed, you must have received your claim determination, agreed to that claim determination (or resolved any objection you made to such claim determination and agreed to a claim determination), and provided the required release and OFAC certification requested on the claim portal. If you have received your claim determination, but have not agreed to the determination or have not provided the required release and OFAC certification, your claim is not yet allowed. Please submit this information as soon as possible. Without it, we are not permitted by the Court’s orders to include you in the September 30, 2014 interim, partial distribution.
If your claim is not allowed or has not been determined before August 15, 2014, you will be eligible to receive your first interim, partial distribution on a later distribution date after your claim has been allowed. These later distribution dates will occur quarterly. You will receive distributions in the same total amount you would have received if your claim was allowed on August 15, 2014.
If you have not received your claim determination, please be patient; it is coming. If you have already received a claim determination, or when you do, I encourage you to respond as soon as you are able so that we can provide you with your first interim, partial distribution.
Our efforts on your behalf continue. Thank you for your continued support and patience.
On today’s docket, we have this new Motion, which opens with this:
The Receiver,1 by and through his undersigned counsel, files this motion (the “Motion”)
seeking an order of this Court authorizing the Receiver to pay an interim distribution to certain
victims of the Zeek Rewards Scheme (defined below) who hold Class 3 2 Allowed Claims and
establishing related record and distribution dates to fairly implement this distribution.
Specifically, as described below, the Receiver seeks an order (i) authorizing an interim
distribution on account of Class 3 Allowed Claims (the “First Interim Distribution”), (ii)
establishing a record date for eligibility to receive the First Interim Distribution on the First Interim Distribution Date, (iii) setting the First Interim Distribution Date, and (iv) establishing
Subsequent Record Dates and Subsequent Distribution Dates for making the First Interim
Distribution to Class 3 Claimants whose Claims are allowed prior to a Subsequent Record Date.
For the reasons discussed below and in the best interests of the Receivership Estate, the Receiver
respectfully submits that the Motion should be granted.
1 Capitalized terms used, but not defined herein, shall have the meanings ascribed them in the Receiver’s Motion for an Order Approving Distribution Procedures and Certain Other Related Relief (the “Distribution Plan Motion”) [ECF No. 170].
2 Claims classified in Class 3 are the Claims of Affiliate Investors and subrogees of Affiliate Investors on account of losses based on the investments they made in the ZeekRewards Scheme. All descriptions of the Classes of Claims in this Motion are for descriptive purposes only and are qualified in their entireties by the Distribution Plan Motion and the Distribution Plan.
As most of you recall, around November 13, 2013 or so, Zteambiz.net had posted their “last update”. Well, that has all changed with this post that was found today:
Zteambiz has gone through a lot of changes in the last 18 months now, the content has come under attack from regulators and critics that want to just publish false and negative opinions. The one glaring fact is these so called people in the know have consistently gotten it wrong and most people do not know what to believe.
For this reason we will start once again sending updating emails, and doing a better job of filtering out the ongoing negative people that haunt everyone in the industry.
If you would like to be on our mailing list you can register here and if you at any time wish to be off the list you can also request and be removed as well.
As we know Zeek is never coming back, we will from time to time provide you with updates of companies that we feel will meet, or exceed the income potential that Zeek provided. And at the same time also help you learn about ones, that may be only interested in taking your hard earned money.
We would like to also address the amateur hour on the web; I’m referencing the flood of inaccurate information that seems to flood everyone computer with so called experts wanting to tear down any program you may want to join. If you can keep one thought in mind. These people writing the stories most likely have never experienced the success you have seen and only want to steal your dreams and ambitions. There is a phrase I feel best describes the average person that has subscribed to our list. “If you’re willing to do the things most people won’t, you can have the things most people can’t!”
So if you know someone that wanted to and never did we are opening up the ability to register to Zteambiz.net to provide updates and assistance as we all move forward to better and more profitable ventures.
Providing information to help everyone move forward
What utter nonsense!! All of the above comes from a website ran by a man who tried to copyright the word “Scam”, so that he could control who used the word, I suppose. And just as you would think, his application was denied. One of the last posts on Zteambiz was Craddock telling people to contact him if they needed their Used ID information, as he had the member database; apparently, the Receiver took a dim view of Craddock circumventing and subverting the claims process approve by a Federal Court. Perhaps the Receiver and the Court are the people characterized thus, “the content as come under attack from regulators and critics that want to just publish false and negative opinions”.
Apparently, Craddock and Zteambiz put forth the only opinions or information that have any validity, is you believe what Craddock says. And I don’t !
Yesterday, Kenneth D. Bell filed his 4th Quarter Status Report for 2013. Within this report are some mentions of “Pursuing Fraudulently Transferred Funds”, better known as Clawbacks. Many of us had hoped those cases would be filed by now, but it looks like they are still on the horizon.
Here is a snippet from the filing:
E. Description of Claims Held by the Receivership Estate
1. Identifying and Pursuing Fraudulently Transferred Funds Held by Net-Winner Affiliate-Investors
The Receiver incorporates by reference his previously filed Quarterly Status Reports discussing the total value of fraudulently transferred funds and the litigation methods for pursuing those funds.
The Receiver filed a Request for Leave to Institute Actions and For Order Setting Initial Conference on December 11, 2013 (Doc. No. 169). The Court granted the Receiver leave to
institute clawback actions on December 19, 2013 (Doc. No. 172), allowing the Receiver to file
clawback actions at an appropriate time in the coming weeks.
2. Settlements with Net Winner Affiliate-Investors
The Receiver entered into settlements with 10 additional net winners during the fourth
quarter, bringing the total number of settlements to 179. These additional 10 settlements total
$545,300 on $892,549 in net winnings (61.09%). Overall promised settlement payments to-date
total approximately $2,527,238 on winnings of $4,457,418, an approximate 56.70% return.
3. Investigating Claims against Receivership Defendant Insiders and Third-Party Advisors
The Receiver Team continued its investigation into potential claims against RVG insiders and third-party advisers as a part of its ongoing fact investigation, continuing its analysis of documentary evidence that will be used in proving such claims. The Receiver Team also responded to requests for assistance and information from the U.S. Attorney’s Office that aided
the government in obtaining plea agreements from both Dawn Wright-Olivares and Daniel
At this time, the Receiver recommends the continuation of the Receivership for the following reasons:
1. The continuing efforts of the Receiver to investigate and marshal assets of the Receivership Estate;
2. The continuing efforts of the Receiver to implement the claims and distribution processes in order to distribute proceeds to injured claimants;
3. The carrying out of any other legal and/or appointed duties of the Receiver as identified in the Receiver Orders or as the Court deems necessary.
I have uploaded these filings onto the Files website.
On December 30th, 2013, Senior District Judge Graham Mullen issued an Order denying Johnny Belsome’s “Motion to Lift Stay” for the following reasons:
This purported class action was originally filed in the Eastern District of Louisiana on August 24, 2012 and transferred to this Court on December 3, 2012.
When considering whether to lift a stay of litigation, courts often consider the factors set forth in SEC v. Wencke. These factors include: (1) whether allowing the stay to remain in place preserves the status quo, or whether the moving party will suffer substantial injury if not allowed to proceed; (2) the time in the course of the receivership at which the motion to lift stay occurs; and (3) the merit of the moving party’s underlying claims. 742 F.2d 1230, 1231 (9th Cir. 1984).
While factor three would appear to weigh in favor of lifting the stay, the Court finds that the
other two factors, as well as other considerations, weight heavily against granting Plaintiffs’
motion at this time.
Many of the Plaintiffs herein have already filed claims through the Receiver’s claims process and will be compensated, to the extent they have valid claims, along will all other net-loser claimants. Thus, the only “injury” that may flow from a continued stay of this action is preventing Plaintiffs from being allowed to jump ahead of the rest of the net losers in the claims process.
Allowing Plaintiffs’ purported class action to proceed will open the floodgates to a multiplicity of competing actions seeking to enrich individual plaintiffs and their counsel. This will cause a massive burden and expense on the assets of the Receivership and will ultimately work to the detriment of all other Rex Venture victims who will, through the Receiver, bear the ultimate cost of the increased inefficiency and litigation chaos.
I really like Judge Mullen; he is direct, logical and fair. He is fast becoming my second most favorite Federal District Judge, with Judge Rosemary M Collyer maintaining the #1 spot.
It is amazing how history continues to repeat itself in Ponzi scams and their bastard offspring; there are always people jumping the line to get back their own money and without any consideration for anyone but themselves.
But isn’t that the whole idea behind these pyramid/Ponzi scams? “As long as I get my money, I really don’t care who gets hurt in the process?”
That says a lot about our society. This is not “free enterprise” or “capitalism”, it is theft by deception.
“All that is necessary for the triumph of evil is that good men do nothing.” (Edmund Burke)