Source: Npros.com 8/18/2012

Zeek Rewards Shut Down by SEC Assets Frozen

August 18, 2012 -- On Friday, The Securities and Exchange Commission shut down Zeek Rewards and its parent company, Rex Venture Group, filing a complaint in federal court in Charlotte and freezing the approximately $225 million in investor funds in the company's bank accounts.

According to the SEC's complaint, Zeek Rewards affiliates were offered the oppportunity to make money by purchasing securities in the form of investment contracts. These securities were not registered with the SEC as required by federal law. Zeek Rewards affiliates were collectively promised as much as 50% of the company's daily net profits through a system in which they accumulated rewards points that could be exchanged for cash payouts. The SEC complaint alleges that these profit-sharing payouts to affiliates (referred to as investors by the SEC) did not come from the company's profits at all but instead came from the funds of new investors. The SEC also stated that Zeek Rewards' obligations to investors exceeded its cash on hand, which prompted the emergency closure of the company and freezing of its assets.

The SEC has also accused Rex Venture Group head Paul Burks of siphoning off millions in investor funds for himself and members of his family. Burks has agreed to settle the SEC case and relinquish his interest in the firm and its assets, plus pay a $4 million penalty. The SEC can only pursue civil charges against Burks, but he could still face criminal charges from other investigations.

A receiver has been appointed to collect and distribute Rex Venture Group's remaining assets to affected investors.

View ZeekRewards Review

Related News

  • ZeekRewards President Indicted On Federal Charges
    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 preside...  Read More...

  • ZeekRewards Receivership Page Now Up
    The Receiver for ZeekRewards has created a website to communicate with affiliates and the public. Included on the site is the SEC complaint against Rex Venture Group, LLC d/b/a ZeekRewards.com and Paul R. Burks, alleging that the company and Burks fraudulently sold unregistered securities as part...  Read More...
  • ZeekRewards Receiver Wants Affiliate Profits Returned
    Kenneth Bell, the court-appointed receiver for ZeekRewards and Rex Venture Group, said that he intends to recover assets from affiliates who "took more out of Rex Ventures than they put in." In a letter to ZeekRewards affiliates dated September 13, Bell wrote that "Many of you received little or ...  Read More...
  • Receiver Recovers 300 Million in ZeekRewards Assets
    The court-appointed receiver for Rex Venture Group and ZeekRewards has recovered nearly $300 million in assets so far and says that there may be tens of millions of dollars more to secure.Kenneth Bell of the Charlotte law firm McGuireWoods LLP was appointed to recover assets after the SEC shut do...  Read More...

 

ZeekRewards News Archive

New Companies on Npros

Receive News and
Updates from Npros.com

 Send me news updates
 Send me New Companies

RSS Npros News Feed