November 13, 2014 - Charlotte, NC -- The founder and former president of ZeekRewards, Paul Burks, was arraigned Thursday on federal charges of wire and mail fraud, conspiracy and tax fraud.
Burks entered a plea of not guilty during the hearing. If convicted, he could face a 65-year sentence and a $1 million fine. He was release on a $25,000 bond.
ZeekRewards was shut down in 2012 by the Securities and Exchange Commission, which accused Burks of fraud in a civil complaint. Burks agreed to pay a $4 million penalty and cooperate with a court-appointed receiver. The receiver has been trying to recoup money from ZeekRewards executives and investors who made money. Since 2012, $320 million has been recovered and investigators have sued 9,000 people to collect about $200 million more. Meanwhile, victims wondered if Burks would ever face criminal prosecution.
After the arraignment, Burks' attorney said Burks "did not commit any crime. We look forward to presenting our case in court."
