Posted on August 17, 2012.
Here is the press release directly to the SEC:
The Securities and Exchange Commission today in Washington, DC, August 17, 2012 – announced an emergency asset freeze to halt Lugovoi and 600 million dollars in a Ponzi scheme-the system is on the brink of collapse. Urgent action to assure the victims can get more money back and possibly avoid disastrous.
The SEC alleges that the online marketer Paul Burks in Lexington, NC and his company Rex Venture Group raised money for more than a million Internet customers nationwide and foreign ZeekRewards.com, which they began in January 2011-through the site.
The SEC's complaint filed in Federal Court in Charlotte, n.c., according to the customers were offered a number of ways to earn money through the ZeekRewards program, two of which are engaged in the purchase of investment agreements as collateral. The provision of these securities are not registered with the SEC, as the case may be, in accordance with the provisions of the federal securities laws.
The SEC alleges investors were promised, along with up to 50% of the net profits of the company on a daily basis, where they accumulate rewards points that they can use the cash withdrawals through profit sharing system. However, the website of fraudulently conveyed the false impression that the company was extremely profitable, in fact, the profits of the company's net income for the investors did not join. The most and the ZeekRewards ' total revenue and "net profits" paid investors with money from new investors, is composed of a classic Ponzi scheme fashion.
"The obligations of the company to investors dramatically exceed the on hand, and that is why we need to step in quickly, to save funds it manages, and to ensure a proper and fair profit for investors," said Stephen Cohen, Associate Director of the SEC's Division of enforcement. "ZeekRewards abused the power of the Internet and lured investors by making them believe that they will get a chance to cash in on the next big thing. In reality, the money was just going to investors. "
The SEC's complaint alleges that the system is teetering investors ' funds in the event of an emergency enforcement action without its degradation of in danger of collapse. Last month, the ZeekRewards brought in about $ 162 million in total investor cash withdrawals was about $ 160 million. If customers wish to receive profits continues to instead invest their money for a higher Rewards points at the end of the day, ZeekRewards ' cash flows exceeds its total revenue.
Burks has agreed to settle the SEC's charges without having to admit or deny the allegations, and agreed to cooperate in the court-appointed receiver.
The SEC's complaint against the ZeekRewards has paid out almost $ 375 million to date and is owned by investors with about $ 225 million in investors ' funds to 15 foreign and domestic financial institutions. These funds frozen in the event of an emergency, depending on the freezing of assets, the Court granted the SEC's request. At the same time, Burks has personally siphoned a multi-million dollar Venture funds investors operate in the Rex and the ZeekRewards, and he shared at least a million dollars to the family members. Burks has agreed to give up his interest in the company and its assets, as well as pay a $ 4 million fine. In addition, the Court has appointed a receiver to collect, organize, manage, and distribute the remaining assets to the detriment of investors to return.
The SEC's investigation was carried out by Brian m. Privor and Alfred c. Tierney of the SEC's Enforcement Division in Washington, DC with the SEC to grant Quebec the Autorité des marches financiers and, with the assistance of the Ontario Securities Commission.
Here is a copy of Zeek prizes SEC complaint (lawsuit) against the
Ty is an Internet marketer, Blogger and social marketing entrepreneur
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