That took longer than expected. But I feel redeemed. Now to see how my prediction about BitCoin MLMs stepping in to fill the void left by the Penny Auction scams pans out...

Here you go: http://www.npros.com/press/2014/10/28/3307/zeekrewards-president-indicted-on-federal-charges.htm

X

I'm still watching for additional fallout on the Zeek Rewards ponzi scheme. I'm surprised no criminal charges have been filed yet, and I'm wondering if there was some kind of deal cut beween CEO Paul Burks and the feds to streamline asset recovery and keep the founder out of jail.

Anderson Cooper 360 was expected to air a segment on Zeek Rewards this month, but it didn't seem to make the broadcast and may be broadcast next monday.

360º Monday - One of the biggest financial schemes in U.S. history went down in a small North Carolina town with many losing their life savings. Watch AC360° at 8 and 10 p.m. ET.

The PONZIES keep coming. Especially now with the internet millions of people can be scammed in seconds.

Now some contries are banning together to stop this abuse. Especially here in the US.

US regulatory and law-enforcement authorities are engaged in discussions about how to stop the worldwide spread of Internet pyramid schemes, following criminal indictments in Massachusetts against the owners of TelexFree Inc., who allegedly conducted a $1 billion global fraud.

The talks involve creating a coalition of federal and state securities regulators, as well as law-enforcement agencies, who would in turn reach out to their counterparts abroad, according to two US officials with knowledge of the effort. The Department of Justice is among the parties participating in the process.

Read more here: http://www.bostonglobe.com/business/2014/08/29/regulators-and-law-enforcement-talks-tackle-rapidly-growing-internet-ponzi-schemes/01vDzz4tOzBSc9ps63fKgP/story.html

Then to make matters worst we also have the Keylogger cyber criminals robbing biilions per year.

Most people have no clue that more than $550 billion dollars was stolen last year through the Internet. http://stopallkeyloggers.com

Just so you know this is the only company that owns the patent that ha been proven to STOP keyloggers from stealing your data. Over 1.6 BILLION Internet Users AND Over 5.5 BILLION Smart Phone Users Need Our Patented Software!

I invite you to take a look at this patented software to protect all of your devices.

Robert

http://www.npros.com/press/2014/10/28/3307/zeekrewards-president-indicted-on-federal-charges.htm

ZeekRewards President Indicted On Federal Charges For Operating $850 Million Internet Ponzi Scheme

FOR IMMEDIATE RELEASE

October 24, 2014

United States Attorney Anne M. Tompkins Western District of North Carolina

CHARLOTTE, N.C. – The president of ZeekRewards, Paul Burks, has been indicted on federal charges for operating an Internet Ponzi scheme that took in more than $850 million dollars, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. The criminal indictment was returned today by a federal grand jury sitting in Charlotte, charging Burks, 67, of Lexington, N.C., with wire and mail fraud conspiracy, wire and mail fraud, and tax fraud conspiracy.

Russell F. Nelson, Special Agent in Charge of the United States Secret Service, Charlotte Field Division and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI) join U.S. Attorney Tompkins in making today’s announcement.

According to allegations contained in the indictment, from January 2010 through August 2012, Paul Burks was the owner of Rex Venture Group, LLC (RVG), through which he owned and operated Zeekler, a sham Internet-based penny auction company, and its purported advertising division, ZeekRewards (collectively “Zeek”). The indictment alleges that Burks and his conspirators induced victims – including over 1,500 victims in the Charlotte area – to invest in their fraudulent scheme, by falsely representing that Zeekler was generating massive retail profits from its penny auctions, and that the public could share in such profits through investment in ZeekRewards. Indeed, the indictment alleges that Burks and others claimed, at one point, that investors would be guaranteed a 125% return on their investment.

The indictment alleges that Burks and his conspirators represented that victim-investors in ZeekRewards could participate in the Retail Profit Pool (RPP), which supposedly allowed victims collectively to share 50% of Zeek’s daily net profits. The indictment alleges that Burks and his conspirators did not keep books and records needed to calculate such daily figures, and that Burks simply made up the daily “profit” numbers. The indictment further alleges that, contrary to the conspirators’ claims, the true revenue from the scheme did not come from the penny auction’s “massive profits.” Instead, approximately 98% of all incoming funds came from victim-investors, which were then used to make Ponzi-style payments to earlier victim investors.

In addition to promising massive returns on investments, the indictment alleges that the conspirators also used a number of ways to promote Zeek to current and potential investors. For example, according to the indictment, the conspirators hosted weekly conference calls and leadership calls, where participants could call in listen to Burks and others make false representations intended to encourage victim-investors to continue to invest money and to recruit others to invest in Zeek. The indictment further alleges that Burks also organized and attended “Red Carpet Events,” where victim investors came to hear details of the scheme in person. During these events, according to the indictment, Burks and his conspirators made false representations about the massive retail profits generated by Zeek. The conspirators also used electronic and print media, including websites, emails and journals, to make false and misleading statements about the success of Zeekler to recruit victim investors.

The indictment alleges that as the Ponzi scheme grew in size and scope, it began to unravel as the outstanding liability resulting from the bogus 125% return on investment continued to rise beyond control. According to the indictment, by August 2012, the conspirators fraudulently represented to the collective victims that their investments were worth approximately $2.8 billion, but had no accurate books and records to even determine how much cash on hand was available to pay such liability. According to the indictment, by August 17, 2012, Burks and his conspirators had only $320 million (or approximately 11% of $2.8 billion) available to pay out investors. The indictment alleges that over the course of the scheme, Burks diverted approximately $10.1 million to himself.

Burks is also charged with tax fraud conspiracy for failing to file corporate tax returns or to make corporate tax payments for his companies, among other things. In addition, the indictment alleges, for tax year 2011, Burks issued fraudulent IRS Forms 1099s, causing victim-investors to file inaccurate tax returns for phantom income they never actually received.

The court has issued a summons against Burks and he is expected to appear in federal court for his initial appearance in the coming days. The wire and mail fraud conspiracy charge, the mail fraud charge and wire fraud charge each carry a maximum prison term of 20 years and a $250,000 fine. The tax fraud conspiracy charge carries a maximum prison term of five years and a $250,000 fine.

The details contained in this indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

Two of Burks’ conspirators, Dawn Wright Olivares, Zeek’s Chief Operating Officer, and her step-son and Zeek’s Senior Technology Officer, Daniel C. Olivares, pleaded guilty in December 2013 to investment fraud conspiracy. Dawn Wright Olivares also pleaded guilty to tax fraud conspiracy. Both defendants await sentencing.

In making today’s announcement, U.S. Attorney Tompkins thanked the U.S. Secret Service and IRS-CI for investigating the case, and the U.S. Securities & Exchange Commission, Division of Enforcement for its assistance with the investigation.

The prosecution is handled by Assistant United States Attorneys Jenny Grus Sugar, Corey Ellis and Mark T. Odulio of the U.S. Attorney’s Office in Charlotte.

Additional information and updated court filings about this and related cases filings can be accessed at the district’s website: www.justice.gov/usao/ncw/ncwvwa.html.

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This is not Paul Burks first time launching an auction site. ZeekRewards may be the evolution of an earlier try with his other company gogohub. This was from a marketing promotion for FSC2.com ( FreeStoreClub2? )

The URL is now dead.  

GOGOHUB IS BRINGING YOU THE MOST POWERFUL VIRAL PHENOMENON THAT HAS HIT THE WEB IN MORE THAN A DECADE.

GoGoHub is introducing a NEW concept called "penny auctions."

In penny auctions you can WIN... NEW, NAME BRAND items. Names like Sony, Apple, Black and Decker, Skill, Pioneer, Motorola, Burlington, Ford, BMW, for PENNIES ON THE DOLLAR...shall I go on?

The items can range from iPods to laptops and from big screen TV's to automobiles, and again all NEW!!!

The prestigious business website Forbes.com said recently "On-line auctioning is hot. ... It's competitive shopping, and Web users are a competitive bunch."

According to PennyAuctionWatch.com, "Swoopo [the largest Penny Auction site] made a profit on revenue of $32 million just last year. Swoopo came to the US in September of last year and they’ve been around since 2005 in the European market. They have over 2 million members on their US site...and an Alexa traffic ranking (8,124) that I’m sure many penny auction/e-business owners would covet!"

The penny auction is not a regular auction. As a matter of fact people regularly are getting from 65% to 95% off the blah blah blah

ZeekRewards Review

ZeekRewards is the network marketing division that promotes Zeekler.com, and Zeekler's "Penny Auction" site.

ZeekRewards is helmed by Paul Burks, under parent company Lighthouse America, a 14 year old entity that appears to have been in continuous operation for that entire period. However, continuous operation does not necessarily mean successful operation.

Lighthouse America was also the parent company of FreeStore Club, an online buy and selling MLM that never really seemed to reach momentum. Some reviews claim that FreeStore Club went under, but the ZeekRewards site states that FreeStore Club has been incorporated into the back end of ZeekRewards. The FreeStore Club website ( freestoreclub.com ) now goes to an under-construction website.

ZeekRewards was launched when Lighthouse America took over defunct ( some say bankrupt ) penny auction site iTicketBid, with a commitment to honor outstanding prizes owed iTicketBid members. Some iTicketBid members have claimed in online forums that those commitments have not been honored.

ZeekRewards members purchase and promote "bid packs" for commission. To share in at least one segment of the commission pool, members must also post one online ad for Zeekler.com *every day*. Hence the level of Zeekler online advertising spam I have been noticing. This is a very curious requirement, and while it seems to have launched brand awareness, my suspicion is that the URL will be banned from many advertising sites very soon, just as it has for other companies like MyLeadCompany.com.

The exact requirement reads: 
"* A Qualified Affiliate" is a Preferred Customer or Representative who is currently enrolled in one of our monthly Premium Business Center subscription plans (Silver, Gold or Diamond), has enrolled Retail Customers or joined the Customer Co-op, has given away a minimum of 10 VIP Bids as samples, and has placed a qualifying advertisement for Zeekler.com for the current 24 hour period and submitted it through his or her ZeekRewards back office.  "

The Zeekler.com site has two Penny Auction "certification seals", which these days are almost meaningless as anyone with a website and an image editor can create their own certification seal in about five minutes. I have been trying to find an archived web copy of iTicketBid, to see if that Penny Auction site was ALSO certified by these same self-made penny auction authorities.

Qualification for certification is not very rigorous. When the seal is clicked for one certification, it takes you to an ad promoting Penny Auction software and consulting services - which leads me to wonder if they are the back-end software provider. Which would be like Microsoft giving my business a certification seal because I use Office 2010 to read my email.

The other seal leads to a site with these simple requirements for ZeekRewards to be featured in their directory:

Must have 2 out of 3: phone number, physical address, or email

Must have terms of use that are easily accessible and do not employ shill bidding...

( My favorite ): Must verify their legitimacy through a testimonial page or user confirmation.

There is no way to validate testimonials. They are used everywhere with first names and last initials and every one I have read on the most obviously illegitimate sites have read like they were written by the owners friends and family.

I find all the hype objectionable - it's rather disingenuous to use Alexa ratings as a measure of company success, when a requirement of your company is to have members create links in order to get paid. Also, the last time I checked, the 'business journal' they are using as an example of being named the '#1 network marketing company' is an advertorial publication. I.E. you pay to be company of the month.

Does this mean that my ZeekRewards review is branding this company as a scam? Not necessarily. Other penny auction sites and reverse auction sites have done very well. Most notably Dubli. But there are a few dings in Paul Burks business history, and several complaints to be found - enough to make the warning light go off and make me suggest considerable due diligence and not to over invest or have unreasonable expectations.

With a company like ZeekRewards promoting so heavily, saturation is a key issue. The requirements for purchase and use of Bid Packs may be considered "front loading" by some experts, and may raise the eyebrow of regulators in the future.