DEVELOPING STORY: Zeek Receiver Seeks Temporary Restraining Order ‘Necessary To Prevent Further Dissipation And Waste Of The Assets At Issue’
DEVELOPING STORY: (Updated 9:44 a.m. EDT Sept 3, U.S.A.) The court-appointed receiver in the Zeek Rewards Ponzi- and pyramid case has asked a federal judge for a Temporary Restraining Order he says is necessary to prevent “further dissipation and waste” of certain assets.
Receiver Kenneth D. Bell asked that the motion be filed under seal. The Zeek-related assets Bell believes could shrink were not specified in a public filing
“The underlying motion and memorandum contain sensitive information regarding Receivership Property,” Bell advised Senior U.S. District Judge Graham C. Mullen of the Western District of North Carolina.
Neither the SEC nor Zeek operator Paul R. Burks objected to the request for the motion to be filed under seal.
From the public portion of a filing by the receiver today (italics added):
The underlying motion and memorandum contain sensitive information regarding Receivership Property. As explained in detail in the memorandum, sealing the Receiver’s motion and memorandum is necessary to prevent further dissipation and waste of the assets at issue. The Receiver seeks to have the underlying motion sealed only temporarily until the Court can consider and rule on the motion.
When Mullen would rule on the motion was not immediately clear. The public portion of Bell’s pleading today is styled, “Receiver’s Motion to Seal Ex Parte Motion for Temporary Restraining Order Enforcing the Court’s Asset Freeze.”
The sealed information contains three exhibits, according to the docket of the case.
Burks and Zeek figures Dawn Wright-Olivares and Daniel Olivares agreed to a $600 million consent judgment “to be satisfied with substantially all of their assets,” according to a filing by Bell in July.
The receiver’s motion for the TRO and to file under seal appears on the docket of the SEC case originally filed against Zeek and Burks in August 2012. The agency sued Wright-Olivares and Olivares in a separate case in December 2013.
Both Wright-Olivares and Olivares have pleaded guilty to criminal charges.
NOTE: Our thanks to the ASD Updates Blog.
IMHO, this is going after the top net winners.
So, WHO is going to jail?
I am completely lost here.
What exactly does the receiver try to do?
What makes you think “going after the top net winners”?
Comprehensive explanation will be appreciated for a layman.
Mike
The documents leading up to that “Motion To Seal Ex Parte” are more likely related to Preferred Merchant Solutions / Plastic Cash.
Doc 230:
MOTION to Lift Stay and for Leave to Commence Lawsuit
Doc 242:
RECEIVER’S MOTION TO SEAL MOTION TO FIND PREFERRED MERCHANTS SOLUTIONS, LLC AND JAYMES MEYER IN CONTEMPT
Doc 243:
RECEIVER’S OPPOSITION TO PREFERRED MERCHANTS SOLUTIONS, LLC’S MOTION TO LIFT STAY AND REQUEST FOR LEAVE TO COMMENCE LAWSUIT AGAINST KENNETH D. BELL
It’s simply that part of the story that most likely leads up to the Ex Parte Motion (Doc 247). The Receiver doesn’t currently have that type of dispute with any of the net winners, but he DOES have it with certain payment processors.
From the second Quarterly Report, Q2 2014, Section F (among other sections, Plastic Cash and Preferred Merchant Solutions are mentioned in more than one section):
“Additionally, the Receiver Team has been investigating the actions of Plastic Cash and Preferred Merchants that appear to have been in direct violation of the Freeze Order. On an aggregate basis, the actions of Plastic Cash and Preferred Merchants appear to have deprived the Receivership Estate and the Affiliate victims of more than $14 million.” (too much to cite it all)