“It’s gonna blow up; it’s gonna be an ugly blow-up. It’ll probably happen sooner, not later. And it will leave a trail of devastation behind it. And I urge you to not even consider them.” — Comment on Zeek Rewards by Randy Schroeder, president of North America and Europe for Mona Vie, July 16, 2012

UPDATED 7:10 P.M. EDT (U.S.A.) Randy Schroeder, the president of Mona Vie for North America and Europe, has done what few major figures in multilevel marketing have been willing to do: comment about the menace posed by the Zeek Rewards MLM program.

It was a most unexpected and welcome development, something that speaks well of both Schroeder and Mona Vie. But some Zeek apologists immediately (and predictably) accused Schroeder of meddling in North Carolina-based Zeek’s affairs and defaming the company, which suddenly announced on Memorial Day evening (May 28) that it was closing accounts at two U.S. banks and mysteriously claimed that affiliates had to cash or deposit checks drawn on the banks before June 1 or they would bounce.

Just 22 days earlier — on May 6 — Ponzi-forum huckster “DRdave,” also known as “Ken Russo,” claimed on the TalkGold Ponzi forum that he’d received $34,735 from Zeek since Nov. 14, 2011. The Zeek money, according to the post, was delivered largely if not wholly by AlertPay and SolidTrustPay. Both companies are offshore payment-processing firms linked to fraud scheme after fraud scheme promoted online.

Hucksters such as “Ken Russo” and myriad others use “I Got Paid” posts on the Ponzi forums as a means of creating the appearance a scheme is legitimate. Included in “Ken Russo’s” signature at TalkGold today is a link to a “program” known as “NewGNI,” which purports to pay “up to 6% weekly.”

GNI may be a knockoff scam to the collapsed Gold Nugget Invest HYIP Ponzi, which also used the acronym GNI while purporting to pay a Zeek-like 7.5 percent a week. The government of Belize issued a warning about GNI in November 2009. In December 2009 — after the GNI warning by Belize — the “program” nevertheless was pitched (with three others HYIPs) by a member of the “Surf’s Up” forum, which existed to shill for accused AdSurfDaily Ponzi schemer Andy Bowdoin.

Any number of Zeek affiliates, including individuals Zeek has described as “empoyees,” hail from the ranks of ASD’s $110 million Ponzi scheme and various other interconnected fraud schemes. Some Zeek affiliates, for example, also are promoting JSSTripler/JustBeenPaid, which purports to pay 2 percent a day and may have ties to the “sovereign citizens” movement.

Zeek promoters also have been associated with a “program” known as OneX, which U.S. federal prosecutors described in April as a “fraudulent scheme” and pyramid cycling money in ASD-like fashion.

In addition to pushing Zeek, ASD, the NewGNI knockoff and a JSS/JBP knockoff known as JSS Tripler 2 that hatched a companion fraud scheme known as Compound150, “Ken Russo” pushed Club Asteria, which purported to provide a Zeek-like payout of between 3 percent and 8 percent a week before promoters came under the lens of CONSOB, the Italian securities regulator.

Amid these ruinous circumstances that are creating monumentally bizarre PR and legal disasters for the MLM trade, what did certain purported MLM experts do?

Why, boo Mona Vie’s Schroeder, of course — for the apparent high crime of trying to protect his own company and affiliates from these interconnected, international cancers.

Here is hoping that other influential MLM executives and trade groups follow Schroeder’s lead, including the Association of Network Marketing Professionals. Its name is being used to sanitize the Zeek scheme — and if it continues to permit that to happen, it risks a future in the dust bin of irrelevance.

While we’re speaking of hope, here’s hoping that Mona Vie will not shy away from Schroeder’s Zeek comments and actually will join him in the remarks, which he says were made as a concerned individual, not as a Mona Vie executive. Mona Vie should back Schroeder to the hilt.

A ‘Messy Fact’

It’s a “messy fact that periodically a company comes along and sweeps people along into a trail that turns into a trail of devastation,” Schroeder said about Zeek Rewards during a July 16 conference call with Mona Vie distributors.

Schroeder, of course, was alluding to Zeek’s AdSurfDaily-like business model that solicits participants to shell out sums up to $10,000, offers a dubious “product” (or a “product” that is just lipstick on a pig), plants the seed that spectacular returns on the order of 500 percent a year are possible and insists participants who buy into the scheme are neither making an investment nor purchasing a security.

“My own opinion is that that company will come to grief, that it will come to grief in the relatively near future, not farther future,” Schroeder said of Zeek.

If history is any guide — and Schroeder, with considerable justification, suggests that it is — Zeek will encounter a regulatory action that will cause it to crater.

But those words and others — including the use by Schroeder of “pyramid” and “Ponzi” in the context of Zeek — did not sit well with MLM Blogger Troy Dooly. (See PP Blog June 10 editorial.)

Dooly Takes Schroeder To The Woodshed

Dooly wrote Thursday that he “started getting the links and downloads of Randy Schroeder’s call” on July 18, took some time to digest the call and to shoot off a text message to MonaVie founder Dallin Larsen about Dooly’s “concerns” about Schroeder’s remarks.

And then Dooly ventured that Rex Venture Group LLC, the purported parent company of Zeek, just might sue Schroeder and perhaps MonaVie itself. Dooly wrote (italics added):

As the leader of a billion dollar multi-national health and nutrition company in the network marketing community, Schroeder should be very careful what he has to say about any other company. Although he made it clear he was not speaking on behalf of MonaVie, as an officer of the company, he places the company and their distributors in jeopardy if Rex Venture Group LLC were to file some form of civil action.

Good grief. The world is facing the greatest white-collar fraud epidemic in history, much of the money is routed through murky businesses and shell companies with accounts at offshore payment processors such as AlertPay and SolidTrustPay and banks that are asleep at the switch because staying awake is bad for fee revenues, many of the corrupt “programs” use MLM or an MLM-like component — and Troy Dooly, apparently with a straight face, is telling Randy Schroeder that he’d better tread lightly on Paul Burks because Zeek just might sue.

In the same column in which he bizarrely took Schroeder to the woodshed for holding a view about Zeek that is wholly responsible and serves the best interest of the MLM community moving forward, Dooly equally bizarrely extended an olive branch to the subject of his fresh scorn. Indeed, Dooly suggested a bunch of legal messiness could be avoided if Schroeder and Dallin Larsen saddled up Mona Vie’s corporate jet and deposited themselves in North Carolina at Zeek’s next Red Carpet event.

While ensconced in North Carolina as Dooly’s guest, they could hear Zeek boss Paul Burks deliver the good word about the company and could get some extra education from the Zeek “team.”

Dooly wrote (italics added):

I challenge Randy and Dallin to take the corporate jet and travel to N.C. next week as my guests to the Red Carpet Day event. I will introduce you to Paul Burks, and his team and let you better understand their drive and mission for the company.

Dooly did not say whether Burks and Zeek would make their Ponzi-board team available to educate the Mona Vie executives on Zeek’s drive and mission. Nor did he say whether Zeek would make “Ken Russo” available to explain the differences between Zeek and, say, NewGNI or Club Asteria or JSS Tripler 2.

We sincerely hope Schroeder and Larsen decline Dooly’s offer to parachute into North Carolina to break bread with the Zeek pope and the “team.”

Dooly is engaging in pandering of the worst sort. It’s also caustically amateur PR because it raises the specter that an aggrieved Zeek might use legal muscle to silence Schroeder, who, like Larsen, is a prominent figure in MLM circles. Zeek’s Stepfordian cheerleaders will love it, of course, because it gives them a new supply of red meat and raises the prospect that, if Schroeder speaks his mind against Zeek and gets sued, the Bloggers and critics may be next.

History An Appropriate Guide

Intimidation campaigns did not work for AdSurfDaily; they will not work for Zeek, either directly or through proxies. Beyond that, Schroeder has the weight of history on his side: the notoriousness of the ASD Ponzi case, Andy Bowdoin’s guilty plea in that case and the guilty plea of Gregory McKnight in the Legisi HYIP Ponzi case. Of course, Schroeder also could point that accused Pathway To Prosperity HYIP operator Nicholas Smirnow is listed as an international fugitive wanted by INTERPOL. And Schroeder also could point out that Robert Hodgins, an accused international money-launderer for narcotics-traffickers, also has been linked to the HYIP “industry” and also is wanted by INTERPOL.

Just days ago, a federal grand jury returned a 49-count indictment against alleged HYIP purveyor Terrance Osberger, 48, of Genoa, Ohio. In March, a top U.S. Department of Justice official speaking in Mexico City commented on some of the challenges law enforcement is facing in the Internet Age, including bogus libel lawsuits filed to silence critics and protect ventures that engage in organized crime. In May, a top INTERPOL official speaking in Israel said the cost of cybercrime was approaching $1 trillion a year in Europe and that U.S. banks lost $12 billion to cybercrime last year.

Regardless, we have to concede that Zeek/Rex Venture might be stupid enough to try to score points by suing Schroeder and MonaVie. Back in 2008, then-closeted Ponzi schemer Andy Bowdoin of ASD planted the seed that he might just sue “MLM Watchdog” Rod Cook for $40 million. Bowdoin even announced that he’d filled a pot with $750,000 and was going to use it to start suing critics of his 1-percent-a-day “program” back to the Stone Age.

Cook, who is a board member of ANMP and holds the title of chairman emeritus, didn’t blink.

When the Feds noticed the lawsuit threats, they thought them important enough to bring to the attention of a federal judge. They simply called it “GOVERNMENT EXHIBIT 5.”

On Aug. 5, 2008, the U.S. Secret Service raided ASD. What occurred after that from the ASD side left an indelible stain on MLM. Bowdoin compared federal prosecutors and the Secret Service, the agency that guards the life of the President of the United States and has the companion duty of protecting the U.S. financial system from attack, to “Satan.” He further compared the raid to the 9/11 terrorist attacks.

Over time, the ASD case turned into a symphony of the bizarre. “Sovereign citizens” entered the fray. One of them accused a federal judge of “TREASON.” Another allegedly filed bogus liens against five public officials involved in the ASD case, including a federal judge, three federal prosecutors and a special agent of the U.S. Secret Service who led the Ponzi investigation.

These episodes were to the utter humiliation of MLMers who value the reputation of the trade. The ruinous PR fallout continues even to this day.

What did Zeek do? Why, it wrapped what effectively is ASD’s 1-percent-a-day compensation model into its payout plan, thus raising the stench of ASD all over again and adding to the stench by effectively paying out an affiliate-reported average of about 1.4 percent a day. Zeek promptly found favor on the Ponzi boards and benefited from promoters of fraud schemes such as ASD and JSS Tripler/JustBeenPaid (730 percent a year). It also picked up some hucksters from OneX, a “program” in part responsible for the fact ASD’s Bowdoin is now jailed in the District of Columbia.

There can be no doubt that Zeek also attracted promoters of AdViewGlobal (AVG) into its fold. The Feds now have linked Bowdoin to AVG, a 1-percent-a-day “program” that collapsed in 2009 under circumstances both mysterious and bizarre. Before AVG went missing, its braintrust tried to plant the extortive seed that lawyers were going after the critics and that “program” members themselves were at risk of getting sued for sharing negative information. For good measure, AdViewGlobal tried to plant the extortive seed that it would report its own members to their Internet Service Providers if they continued to question the “program” in public.

‘MoneyMakingBrain’ Reemerges In Bid To Chill Critics

Today on the RealScam.com antiscam forum, a notorious cyberstalker and JSSTripler/JustBeenPaid apologist known as “MoneyMakingBrain” is planting the seed that JSS/JBP is going to use its lawyers to come after critics. “MoneyMakingBrain” previously claimed he’d defend Frederick Mann, JSS/JBP’s purported operator, “so help me God.” And then “MoneyMakingBrain” started attacking Lynn Edgington, the chairman of Eagle Research Associates, a California nonprofit entity that works proactively with U.S. law enforcement to educate the public about online financial fraud. Edgington is a longtime contributor to the PP Blog and, like the PP Blog, is a member of RealScam.com, a site that concerns itself with international mass-marketing fraud.

(IMPORTANT NOTE: The PP Blog is providing a link to the RealScam.com thread in which “MoneyMakingBrain” has (for months) been engaging in efforts to intimidate JSS/JBP critics. MoneyMakingBrain has a history of emailing threatening communications to the PP Blog. Among other things, he purports to have an ability to track IP addresses and to be keeping a “dossier” on critics. If these things are true, it could mean that “MoneyMakingBrain” will seek to target you in harassment and intimidation campaigns. [** Caution duly advised. RealScam link. Caution duly advised **])

The PP Blog commends Randy Schroeder for his remarks about Zeek. It encourages Mona Vie to back him. Zeek is awash in the stench of ASD, AVG, JSS/JBP, OneX and the serial scammers who populate the Ponzi boards.

Such “programs” put economic security at risk and thus national security.

Period.

Stories Wouldn’t Sell As Fiction

Thank your lucky stars that Zeek’s apologists and Stepfordians are not the fire department. If they were, they wouldn’t be fighting fires. Instead, they’d be standing in the parking lot, deducing the red glow under the roof of the building to which they’d been dispatched was an optical illusion and that the man on the roof with the gas can wasn’t really there. All the acrid, billowing smoke would be ignored in favor of a theory that smoke doesn’t always mean flame.

“No need to bring out the hoses,” they’d say. “This is nothing.”

And when the cops showed up and observed firefighters standing around watching a blaze and ignoring their duty to put it out, they’d be told to mind their own damned business or get busy hiring a lawyer to defend against a defamation lawsuit.

It wouldn’t sell as fiction — and yet somehow passes the plausibility test with thousands or even hundreds of thousands of individuals who call themselves MLMers.

Bravo to Randy Schroeder for advising the members of his trade to open their eyes and choose to see.