AP (VIA YAHOO NEWS): Zeek’s Paul Burks Says Participants At Fault For Losing Money In Alleged $600 Million Ponzi Scheme

The Associated Press is reporting that Zeek Rewards operator Paul R. Burks claims that he is not at fault and that Zeek participants are to blame if they lost money.

From the AP (via Yahoo News/italics added):

“I never told anyone to invest more money than they could afford,” Burks snapped. “I didn’t tell them to do that. Never.”

He said if they lost money, “it’s their fault. Not mine. Don’t blame me.”

Read the full story.

recommendedreading1Zeek rose in part through promotions on well-known Ponzi scheme forums such as TalkGold and MoneyMakerGroup. In August, the SEC alleged that Zeek was a $600 million Ponzi- and pyramid scheme operating from Lexington, N.C.  Court records suggest the SEC’s Zeek probe began at least in April 2012.

Serial hucksters on the Ponzi boards often rationalize Ponzi train wrecks by claiming that no one advised participants to spend more than they could afford to lose.

Convicted Ponzi schemer Dennis Bolze — one of the original so-called “mini-Madoffs” — tried a version of the “don’t invest more than you can afford to lose” rationalization in an unsuccessful bid to reduce his 27-year prison sentence for his brick-and-mortar scheme. A judge applied a sentencing enhancement in the Bolze case because senior citizens were among the victims.

As the PP Blog reported on Jan. 12, 2012 (italics added):

Bolze used a similar argument for a sentencing reduction, asserting that his victims invested only “discretionary money.”

He further argued that age alone was  not sufficient to justify the enhancement “and that the present poor financial condition of his victims is not relevant to whether they were unusually vulnerable at the time they invested their money with him,” according to the 6th Circuit.

Meanwhile, Bolze “denied that he forced anyone to invest” and claimed “that he did not know” certain investors “because his associate dealt with them.”

The panel rejected each of those arguments.

Burks, 66, has not been charged criminally. The SEC sued Burks and Zeek parent Rex Venture Group LLC last year.

Ponzi-board hucksters have promoted numerous Internet-aided scams. AdSurfDaily, a $119 million Ponzi scheme opearting from Florida, had a presence on the boards. So did Legisi, a $72 million Ponzi scheme operating from Michigan. So did Pathway to Prosperity, a $70 million scam alleged to have penetrated 120 countries. So did Imperia Invest IBC, a shadowy entity that stole millions of dollars by targeting people with hearing impairments.

The most recent Ponzi-board scam to make major news is Profitable Sunrise, another shadowy entity purportedly operated by “Roman Novak.” Profitable Sunrise purported to pay interest of 2.7 percent a day through its bizarrely named “Long Haul” plan targeted at Christians. Members were due a purported “Easter gift” on Monday, April Fool’s Day.

The Profitable Sunrise website has been missing for more than two weeks. At least 34 U.S. states or provinces in Canada have issued Investor Alerts or cease-and-desist orders against Profitable Sunrise. The United Kingdom and New Zealand also have issued warnings.

Research shows that Profitable Sunrise had members in common with ASD and Zeek.

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2 Responses to “AP (VIA YAHOO NEWS): Zeek’s Paul Burks Says Participants At Fault For Losing Money In Alleged $600 Million Ponzi Scheme”

  1. From the story on Yahoo/AP

    In a Nov. 23, 2011, complaint filed with the North Carolina Attorney General’s office, Wayne Tidderington of Florida called ZeekRewards an “illegal” Ponzi scheme. He said a relative had invested $8,000 and the company guaranteed a return of 125 percent every 90 days.
    The attorney general’s office can ask a judge to shut down a business because of deceptive trade practices. But it forwarded Tidderington’s complaint to the secretary of state’s office because it looked like it might involve securities. The secretary of state’s office, however, declined to take action because it didn’t believe it had the jurisdiction, spokeswoman Liz Proctor said.
    The complaint died.

    It’s disturbing to think how many punters put money into this obvious ponzi scheme while the evilgovernment couldn’t/wouldn’t act.

    There’s another story on Yahoo/AP – a look at the facts

  2. Thanks for that, Tony.