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  • DEVELOPING STORY: JSS Tripler/JustBeenPaid HYIP Ponzi Scheme Appears To Be Morphing Into Autosurf Ponzi Scheme; Cheerleaders Try To Tame The Troops On Ponzi Boards Amid Reports That Frederick Mann Has ‘Retired’

    "ProfitClicking" claims it has acquired JSS/JBP and that Frederick Mann has retired.

    Just days ago Frederick Mann — the purported operator of the JSS Tripler/JustBeenPaid “program” — was hinting that his fraud scheme that advertised a return of 60 percent a month needed a new name because critics were being entirely too negative. Like the now defunct Zeek Rewards “program,” which last week was described by the SEC as a $600 million Ponzi and pyramid scheme that was selling unregistered securities as investment contracts, JSS/JBP had served up one public-relations disaster after another.

    There was the little matter of an ad for JSS/JBP that appeared on a website known as Vatican Assassins, for instance. And there was “Ping,” a woman who’d claimed she had heart problems, was managing multiple JSS/JBP accounts, that her sister’s home was in trouble — and that JSS/JBP ignored her support tickets for weeks.

    Mann speculated that the company could come under attack by American cruise missiles.

    JSS/JBP found itself wrestling another PR flap in the past 24 hours, amid Ponzi-forum reports that Mann suddenly had “retired” and that the JSS/JBP “program” had been acquired and wrapped into an upstart autosurf known as ProfitClicking.

    A quick analysis of the shell of the ProfitClicking website suggests that the emerging “opportunity” plans to be every bit as disingenuous as the five-alarm fraud scheme it apparently has swallowed. Ponzi-forum pretentiousness on places such as MoneyMakerGroup can be paraphrased as such:

    • I didn’t sign up for no stinkin’ autosurf. Where the hell is the money I gave the JSS/JBP scammers to see if I could profit from the scam?
    • Give these honest scammers a chance to see if they can pull off their new scam.
    • Be patient with the new scammers and don’t make too much noise. Remember, we have to pretend they’re not scammers and we’re not scammers to maximize the effectiveness of the scam.

    Perhaps to make its “sovereign citizen” clientele feel at home, ProfitClicking has adopted all or part of the former JSS/JBP terms, which makes members affirm they are not with the “government.”

    Like the collapsed AdViewGlobal autosurf Ponzi scheme that now has been linked to the collapsed AdSurfDaily Ponzi scheme, ProfitClicking is calling itself a “private association.”

    Similar to the collapsed Zeek scheme, ProfitClicking says it has a “Legal Compliance Department.”

    Like many online fraud schemes these days, ProfitClicking appears to have a plan to scam the public through social-networking sites such as Google +, Twitter and Facebook. And Profit Clicking says it is using at least two of the same offshore payment processors Zeek chose: Payza and SolidTrustPay.

    Mann was a former pitchman for the ASD Ponzi scheme. Zeek and JSS/JBP are known to have members in common.

    One graphic on the current landing page for ProfitClicking features a cartoon image of a bird. The bizarre headline is “Polly Wants A Profit.”

    Naturally, there’s also a picture of a waterfront mansion.

     

  • SEC Takes Down Another Ponzi, Agency Says; Ricardo Bonilla Rojas Faces Civil And Criminal Charges After Allegedly Aiming Puerto Rico-Based Scheme At Evangelical Christians And Factory Workers

    The SEC has gone to federal court in Puerto Rico, alleging that Ricardo Bonilla Rojas was operating a $7 million Ponzi scheme targeted at evangelical Christians and factory workers.

    Victims in the case hail from Puerto Rico, Florida, New York, and North Carolina, the agency said.

    Rojas, 53, is a resident of Arecibo, Puerto Rico. He presided over a company known as Shadai Yire and duped investors by making them believe he was purchasing commodities, the SEC said.

    But “Rojas never actually invested any money in commodities and instead used new contributions to repay earlier investors in classic Ponzi scheme fashion,” the SEC charged. “He stole $700,000 for himself.”

    About 200 investors were affected by the scheme, which began “at least” in August 2005 and continued until February 2009, the SEC said.

    Rojas also has been charged in a parallel criminal action by the U.S. Attorney’s Office for the District of Puerto Rico, the SEC said.

    “Rojas targeted novice investors who were often evangelical Christians, and he touted a long history of successful trading in commodities,” said Eric I. Bustillo, director of the SEC’s Miami Regional Office. “In reality, he was fleecing the flock.”

    Elements of the SEC’s Rojas case are reminiscent of the alleged Commodities Online caper in Florida. The SEC sued to halt that scheme last year.

    “Rojas hired some sales agents to help him solicit investors, and paid commissions based on a percentage of the investor funds they raised,” the SEC said. “Rojas and his sales agents pitched the investment opportunity to individuals as a risk-free way to earn high returns in a short period of time. Rojas also created phony account statements that were sent to investors to hide his misuse of investor money and lead them to believe their investments were growing.”

  • BULLETIN: Zeek Receiver Establishes Website: ZeekRewardsReceivership.com

    “On August 17, 2012, Judge Graham C. Mullen of the U.S. District Court for the Western District of North Carolina, Charlotte Division, entered an order appointing Kenneth D. Bell of McGuireWoods LLP as temporary receiver of ZeekRewards for the purposes of marshaling and preserving all assets of ZeekRewards and those assets (a) held or possessed by ZeekRewards; (b) held in constructive trust for ZeekRewards; and (c) fraudulently transferred by ZeekRewards.” — From a statement by the receiver

    The website URL for the receiver appointed to handle the SEC’s Ponzi- and pyramid-scheme case against Zeek Rewards, Rex Venture Group LLC and Paul R. Burks is ZeekRewardsReceivership.com.

    Kenneth D. Bell, a highly experienced attorney who has served both as a federal prosecutor and as defense counsel, is the receiver.

    Bell rose to national prominence as a recipient of the U.S. Attorney General John Marshall Award for Trial of Litigation. He received that award from the U.S. Department of Justice after successfully prosecuting a Hezbollah terrorist cell operating in North Carolina.

    The receivership website is not yet fully operational. Visit the site.

  • JSS Tripler/JustBeenPaid Hides Behind Zeek-Like Wordplay On Eve Of Zeek Collapse

    Frederick Mann

    On Aug. 17, the SEC filed spectacular allegations of Ponzi- and pyramid-scheme fraud against Zeek Rewards, which claimed it was not selling securities and members were not making an investment. Zeek operator Paul R. Burks was charged with selling unregistered securities as investment contracts.

    Zeek abused the power of the Internet and raised $600 million from more than 1 million participants, the SEC charged

    In August 2008, the U.S. Secret Service filed similar allegations against AdSurfDaily, a company with a 1-percent-a-day “program” similar to Zeek. Like Zeek, ASD claimed it was not selling securities and members were not making an investment. ASD operator Andy Bowdoin was indicted in November 2010 on charges of selling unregistered securities, securities fraud and wire fraud.

    Bowdoin later acknowledged he was presiding over a Ponzi scheme that had gathered at least $110 million.

    On Aug. 16 — just one day before the SEC went to court to halt the operations of Zeek — a “program” known as JSS Tripler/JustBeenPaid was clinging to its Zeek- and ASD-like cover story that it was not selling securities and members were not making an investment. JSS/JBP effectively has advertised a return of 2 percent a day: 730 percent a year.

    “I just want to know — in the amount of money that I do invest . . .  use to buy positions, is that . . . the investment that I’m doing?” a caller quizzed Frederick Mann, JSS/JBP’s purported operator.

    “Dale,” JSS/JBP’s female conference-call host, then sought to set the caller straight on the wordplay of JSS/JBP.

    “Well, first of all, we’re not investing here. We’re purchasing and we’re repurchasing. So, you need to get that verbiage clear.”

    The SEC moved against Zeek the very next day. The U.S. Secret Service also is investigating Zeek.

    Mann was a former pitchman for ASD’s scheme. Any number of Zeek members also promoted JSS/JBP.

    Bowdoin pleaded guilty to wire fraud in May 2012. He is scheduled to be sentenced Aug. 29.

    Like Zeek, JSS/JBP says it has more than 1 million members. Like Legisi, another HYIP scam broken up by the SEC and the Secret Service, JSS/JBP makes members affirm they are not with the government.

    Legisi operator Gregory McKnight pleaded guilty to wire fraud earlier this year. He faces sentencing Sept. 11.

     

  • NORTH CAROLINA ATTORNEY GENERAL WARNS: Watch For ‘Reload Scams’ In Wake Of Zeek Collapse

    UPDATED 4:06 P.M. EDT (U.S.A.) It happened after the collapse of AdSurfDaily in 2008 — and it’s happening now in the aftermath of the collapse of Zeek Rewards amid spectacular allegations by the SEC Friday of Ponzi and pyramid fraud.

    The office of North Carolina Attorney General Roy Cooper issued a warning minutes ago about “reload scams” aimed at taking advantage of Zeek victims.

    Here is the warning in its entirety (italics added):

    Reload scams hit consumers when they’re down, offering to help them make back money they lost to a previous scam or bad business decision. These scams have been popular for years with telemarketing fraud rings but can also follow other types of fraud.

    We’re now seeing reload scams seeking to recruit consumers who were members of Zeekler, a penny auction website headquartered in North Carolina that shut its doors last week and entered into a settlement with the U.S. Securities and Exchange Commission. The SEC determined that Zeekler was a Ponzi scheme, using money from later investors to pay back earlier investors until the scheme started running out of money. The Attorney General’s Office is continuing to investigate Zeekler.

    Blogs, news releases online, and individuals leaving comments in articles about the Zeekler shut down are already touting opportunities “for those that are looking for something that can help them replace the income they were receiving from Zeek Rewards.”  If you’ve been a part of a scheme such as Zeekler that collapsed, or if you lost money to another recent scam, don’t fall for a reload scam.  Better to cut your losses than lose even more.

    The exact phrase quoted by Cooper’s office in the paragraph above appears in a news release for something called TheMayDayReport.

    The SEC called Zeek a $600 million Ponzi- and pyramid scheme that had affected more than 1 million investors. Cooper’s office opened a probe into Zeek in July, and the U.S. Secret Service also is investigating Zeek.

    Over the weekend, the PP Blog received multiple spams aimed at Zeek threads. Purportedly from “Briant,” those spams promoted a “program” called Ultimate Power Profits. Like Zeek, Ultimate Power Profits has a presence on well-known Ponzi scheme forums such as MoneyMakerGroup.

    Zeek’s former head cheerleader at MoneyMakerGroup — “mmgcjm” — also is the head cheerleader for Ultimate Power Profits at the forum.

    On Friday — the same day of the Zeek collapse — an MLM “program” known as Vi-Tel Wireless (Vi-Tel) issued a news release to announce it was sponsoring a “Zeek Rescue Program.” Affiliates busied themselves heralding the purported rescue program across the web.

    Vi-Tel called itself a “safe refuge.” Vi-Tel affiliates aimed sales pitches at websites carrying information on Zeek, leading to questions about whether reps were circling like vultures.  It was remarkably awful PR.

    In other post-Zeek news, an auction “program” known as Bidify now is offine. The company says it is trying to retool itself in the aftermath of the Zeek collapse.

    Like Zeek prior to the collapse, Bidify denies it is an investment program.

    Zeek, Rex Venture Group LLC and operator Paul Burks were charged Friday with selling unregistered securities as investment contracts.

  • POST-ZEEK GUEST COLUMN: Who Are These ‘Experts’ Anyway?

    DISCLOSURE: Gregg Evans, a longtime member of the antiscam community, is a longtime PP Blog contributor. He was not compensated for this column, and his views are not necessarily the views of the PP Blog.

    Who are these “Experts” anyway?

    By Gregg Evans

    Troy Dooly is the latest “expert” to look like an utter fool in the wake of the Zeek Rewards collapse. For months the apparently respected MLM guru has been defending Zeek against all logic, common sense or demonstrated knowledge of mathematics.

    It turns out that — even though in Troy’s “expert opinion” and based upon his “inside knowledge” that he couldn’t share because he wanted to respect a “non disclosure agreement” — Zeek, Zeekler and Rex Venture Group was just another garden-variety Ponzi scheme.

    This one added up to $600 million if you’re keeping score. And you should be. That’s more than half a billion dollars.

    A few years ago, I decided to not actively hide my identity, but not advertise it either when 12DailyPro collapsed in a heap of scandal based solely on the figures being tossed around about how much money Charis Johnson had drawn in. It occurred to me at the time that there are people out there who will in fact kill you for that kind of coin, and more than a few of them I knew were involved in the scam. I had never received a death threat before, or at least not one I took seriously.

    Here we have again a figure that frankly boggles the mind being funneled into a rather transparent Ponzi scheme by a collection of ref whores, financial illiterates and flat-out criminals posting with glee “I got paid” at all the familiar places these kind of folks hang out. As the late Everett Dirksen once said, “A billion here, a billion there, and soon you’re talking real money.”

    And here again we have a list of supposed “experts” whose opinion proved that “this time, it’s legit.” I just have to ask, by what standard are these people experts at anything, beyond herding the suckers to the spend button?

    I, modestly, consider myself an expert in matters of investing, accounting and how money and banking work. Not just because I think so, mind you, I have an earned PhD in International Business, a MSci in Economics, an MBA and a BBA in Finance (with a shared major in Mathematics, btw).

    But honestly, if you’re taking my word for it advice-wise, you’re still a sucker, because anyone can try to impress you with what they say, you have to at least look at the motivation. My motivation is to perhaps save a few people who don’t have my background from falling for the siren song of the pimps like Ken Russo, Troy Dooly and others.

    Longtime HYIP huckster "Ken Russo," also known as "DRdave," helped lead the "I Got Paid" cheers for Zeek on the TalkGold Ponzi forum.

    You see, I’m not asking you to spend your hard-earned money on anything. I’m not encouraging you to inform your friends, relatives and co-workers about the latest sure-fire-get-rich-with-passive-income scheme. I’m just asking you to think a bit, and trying to explain how real money and business works. I happen to some pretty spiffy credentials, but it’s more important that I’m just making common sense.

    You see, some people with credentials as good as or better than mine are blinded by the easy pickings to be had if they sell out their fancy titles and initials after the name. Gerald Nehra is licensed attorney and all indications I have seen are he’s not a bad lawyer, as lawyers go. Gerry’s problem, and potentially yours, is that he’ll suspend his common sense, legal knowledge and objectivity if the check clears

    Hey, I hate to judge the man, and everyone deserves good legal representation, but Mr. Nehra has not impressed me so far. I am only familiar with two companies with which he has been publicly associated with in the last few years: ASD Cash Generator and Zeek. The operator of one is in jail waiting to find out he’s going to serve what is likely going to be a life sentence based upon his age, the other one just got their offices locked up by some combination of the Secret Service, the Securities and Exchange Commission and the North Carolina Attorney General.

    Our “expert” lawyer, one of the best reputations in MLM law around, testified that ASD wasn’t a Ponzi, and from the looks of it told Zeek that if you tell the suckers not to call it an investment, it’s Okie Dokie legally speaking. Good advice there.

    Do I think Gerald Nehra believes this? Well, as much as any lawyer believes the legal theory he’s pursuing he may, but I doubt he had a lot invested in Zeek, if you get my drift. He had, over the years built a reputation, and whether he deserved it or not (and I think not) when ASD needed to show a Federal Judge that paying old investors with new investors money wasn’t a Ponzi scheme, Nehra was right there, willing to lend his expert opinion in a Federal Court that black was white, up was down and Andy Bowdoin of ASD was a business visionary who could somehow pay 1% a day legally.

    If he’s trying to represent a defendant in a court of law, that’s his job and I have no problem with that, but if he believes it, well, a friend I once had used to say it was never a good idea to believe your own bar stories or “smoke your own dope” as he put it.

    ASD was a cheap Ponzi scheme and anyone not blinded by greed with had enough sense to tie his own laces could see that. A few “MLM Experts” and the “All Star Team of Stupid” ASD cheerleaders, sovereign citizen nutcases and Arby’s Indians couldn’t, but that’s just the kind of people loose on the streets since they changed the laws about involuntary mental patient commitment. The Indians, Sovereigns and pimps I won’t comment on here, but the lawyers did it mostly because it paid pretty well. And Ken Russo isn’t doing it because he likes people either, for what it’s worth, he just lacks the credentials to sound like much more than a crooked used car salesman. People like Troy Dooly should know better, and I suspect they do, but they have no trouble overlooking their own knowledge as long as the check clears.

  • URGENT >> BULLETIN >> MOVING: SEC Calls Zeek ‘$600 Million Online Pyramid And Ponzi Scheme’

    URGENT >> BULLETIN >> MOVING: (UPDATED 6:25 P.M. EDT (U.S.A.) The SEC has filed an emergency action in federal court in Charlotte, N.C., that alleges Zeek Rewards is a $600 million Ponzi and pyramid scheme.

    “The obligations to investors drastically exceed the company’s cash on hand, which is why we need to step in quickly, salvage whatever funds remain and ensure an orderly and fair payout to investors,” said Stephen Cohen, an associate director in the SEC’s Division of Enforcement. “ZeekRewards misused the power of the Internet and lured investors by making them believe they were getting an opportunity to cash in on the next big thing. In reality, their cash was just going to the earlier investor.”

    In its emergency filing, the SEC described Zeek as a classic Ponzi scheme. The agency charged that “approximately 98% of ZeekRewards’ total revenues, and correspondingly the purported share of ‘net profits’ paid to current investors, are comprised of funds received from new investors.”

    Records show that the AdSurfDaily Ponzi scheme which, like Zeek, suggested that investors would receive a return on the order of 1 percent a day, also received only about 2 percent of its revenue from sources other than members. Zeek had members in common with ASD.

    Zeek, the SEC alleged, “is teetering on collapse.”

    Zeek CEO Paul R. Burks has been charged with selling unregistered securities as investment contracts, the SEC said. Burks presided over Rex Venture Group LLC, Zeek’s purported parent company. Rex Venture also has been charged. The SEC said it was aided in the probe by the Quebec Autorite des Marches Financiers and the Ontario Securities Commission.

    Burks’ program holds “approximately $225 million in investor funds in approximately 15 foreign and domestic financial institutions, and those funds are at risk of imminent dissipation and depletion,” the SEC charged, noting that the Ponzi potentially could affect more than 1 million people globally.

    A federal judge has ordered an emergency asset freeze and a receiver will the appointed, the SEC said.

    “Through the ZeekRewards program, Defendants offer affiliates several ways to earn money, two of which involve the offer and sale of securities in the form of investment contracts: the ““Retail Profit Pool” and the “Matrix,” the SEC charged.

    And, the agency said, the “compounding” effect has created a condition under which 3 billion Zeek “Profit Points” are outstanding.

    “Based on the ZeekRewards current outstanding Profit Point balance, the company would be obligated to pay out approximately $45 million per day if all Qualified Affiliates elected to receive their daily award in cash,” the agency charged.

    Amid Zeek claims that it paid out 50 percent of its daily net and that its business model was “proprietary,” investigators discovered that Zeek delivered an unusually consistent return of about 1.5 percent a day.

    “In fact, the dividend bears no relation to the company’s net profits,” the SEC charged. “Instead, Burks unilaterally and arbitrarily determines the daily dividend rate so that it averages approximately 1.5% per day, giving investors the false impression that the business is profitable.

    Similar allegations were made in 2008 against ASD operator Andy Bowdoin.

    Zeek’s fabled Zeekler “bids” were described by the SEC as smoke-and-mirrors. From the complaint (italics added):

    Despite encouraging affiliates to purchase and give away VIP Bids to promote and drive traffic to the Zeekler penny auction website, Defendants fail to disclose that almost none of the VIP Bids given away by Qualified investors are actually used on the Zeekler penny auction website. Of approximately 10 billion VIP Bids purchased by or awarded to investors, less than one-quarter of one percent have been actually used in auctions on the Zeekler penny auction website. Thus, the VIP Bids do little or nothing to actually promote the retail business.

    Zeek operator Burks, meanwhile, “has withdrawn approximately $11 million while operating Rex Venture and ZeekRewards, of which approximately $4 million remains in his possession, custody or control.

    Burks “distributed approximately $1 million of the funds garnered from ZeekRewards to family members,” the SEC said.

    Amid high drama and confusing website reports from Zeek yesterday, including the virtual abandonment of its office in Lexington, N.C., and petition drives by Zeek affiliates to demand the return of Zeek, it turns out that “Burks has agreed to settle the SEC’s charges against him without admitting or denying the allegations, and agreed to cooperate with a court-appointed receiver,” the SEC said.

    The U.S. Secret Service also is investigating Zeek, as is the office of North Carolina Attorney General Roy Cooper.

    Read the SEC complaint.

  • URGENT >> BULLETIN >> MOVING: U.S. Secret Service Confirms Probe Of Zeek Under Way

    URGENT >> BULLETIN >> MOVING: Zeek Rewards, the multilevel marketing program married to the penny-auction site Zeekler, is under investigation by the U.S. Secret Service and the Securities and Exchange Commission, the Secret Service confirmed at 4:14 p.m. EDT today.

    “There will be no further comment,” said Max Milien, a spokesman for the U.S. Secret Service in Washington.

    The Secret Service leads a multiagency electronic crimes Task Force in Charlotte, N.C. The Charlotte Task Force is known by the acronym CMECTF.

    Zeek, part of Rex Venture Group LLC, is based in Lexington, N.C. Paul R. Burks is Zeek’s chief executive officer.

    The Zeek probe is not the first investigation of its sort in which the Secret Service and the SEC looked into the business practices of online schemes that suggest or promise outsize investment returns. A probe of the Legisi HYIP began in 2007 with an undercover investigation by the Secret Service and state securities regulators in Michigan.

    That probe later led to civil charges brought by the SEC and criminal charges brought by the Secret Service.

    Legisi operator Gregory McKnight pleaded guilty to wire fraud earlier this year. He is scheduled to be sentenced next month. Legisi gathered more than $72 million.

    The Secret Service also led the AdSurfDaily Ponzi probe. ASD President Andy Bowdoin is scheduled to be sentenced Aug. 29.

    ASD was a 1-percent-a-day Ponzi scheme that gathered at least $110 million. Zeek Rewards has a similar business model.

    See earlier story.

  • UPDATE: North Carolina Investigators Demanded Info From Zeek On July 6; State Says It Has Not Taken Shutdown Action

    UPDATED 10:58 A.M. EDT (U.S.A.) Two new details have emerged in the mysterious shutdown yesterday of the office and websites of Zeekler/Zeek Rewards: The office of North Carolina Attorney General Roy Cooper told the PP Blog this morning that it has taken no action to shut down Zeek, the operator of an MLM and a penny-auction site.

    “We have not taken action to shut the company down and are currently working to get more information so we can pass that along to consumers who may be impacted by this,” said Noelle Talley, a spokeswoman for Cooper.

    But Cooper’s office did say that it had issued a Civil Investigative Demand (CID) to Zeek on July 6. That’s weeks earlier than initially believed and leads to questions about whether Zeek had known for five weeks that it had been under investigation and did not inform participants.

    Without providing details, Zeek announced on its Blog yesterday that it had canceled its Aug. 22 “Red Carpet” event. By early evening, the Zeek Rewards and Zeekler sites began to publish this message: “Zeek Rewards is currently unavailable. More information will be available shortly on this website.”

    Earlier in the week, Zeek announced that “there won’t be any training, recruitment or leadership calls for the next few days while planning is going on.”

    With Zeek leaving affiliates in an information vacuum, many of them took to the Web. At least two petition drives appear to be under way demanding the government to reopen Zeek. As of the time of this post, the PP Blog has been unable to confirm that an action by any government agency — state or federal — was responsible for Zeek’s sudden absence.

    The Blog still is in the process of trying to piece together events in what has emerged as a bizarre and fluid situation. Sensing Zeek affiliates were vulnerable, some MLM opportunists raced to various sites such as The Dispatch newspaper in North Carolina and YouTube with offers to join their “programs.”

    Zeek fans on the MoneyMakerGroup Ponzi forum almost immediately blamed critics for Zeek’s problems, with one poster declaring he’d already mined his profits from Zeek and was confident they could not be attached by prosecutors in the United States.

    The Better Business Bureau said this morning that it was aware of reports that the doors at Zeek’s office in Lexington, N.C., were closed. The BBB added that it would publish more information as it became available.

    Zeek is a purported arm of Rex Venture Group LLC, led by Paul R. Burks.

  • On Heels Of AG Examination, Zeek Blog Says Red Carpet Event For Aug. 22 Is Canceled

    With a headline of “Red Carpet Wednesday – URGENT,” the Zeek Blog is reporting that a Red Carpet event scheduled Aug. 22 has been canceled.

    Zeek, the operator of the Zeek Rewards MLM “program” and the Zeekler penny auction, provided no explanation for calling off the event. Zeek is a purported arm of Rex Venture Group LLC.

    The office of North Carolina Attorney General Roy Cooper said last week that it had opened an “examination” into Zeek’s business practices.

    Zeek has been dogged in recent weeks by PR disasters, including the reported firing of purported MLM expert Keith Laggos as a “consultant.”

    Earlier this week, some members of the AdSurfDaily Ponzi scheme announced a plan to “flood” a federal judge with letters of support for former ASD President Andy Bowdoin, who pleaded guilty to wire fraud in May in the ASD Ponzi case. An email circulating among ASD members that called for the judge to be flooded included two ads for Zeek.

    Some Zeek promoters also are known to have promoted ASD, a 1-percent-a-day Ponzi scheme. Two Zeek promoters — Todd Disner and Dwight Owen Schweitzer — sued the United States in November 2011. As part of the lawsuit, Disner and Schweitzer presented a federal judge an opinion from Laggos that ASD was not a Ponzi scheme.

    Like ASD, Zeek plants the seed that a return of 1 percent or more per day is possible. And like ASD, Zeek denies it is offering an investment program.

    The Dispatch newspaper of Lexington, N.C., published a story today that included a July 31 photograph of Zeek prospects waiting in line, apparently to get a chance to turn over money to the company.

    At least one apparent Zeek supporter left a comment that the newspaper’s website that asserted that The Dispatch had printed untrue things about the company and that the reporter who wrote the story had not gone through Zeek “compliance training.”

    Some Zeek supporters appear to hold the curious belief that reporters are required not to use the word “investment” when describing the Zeek “program.”

    Zeek advises its members not to use the language of investments when describing the “program.” ASD did the same thing.

    The U.S. Secret Service raided ASD in 2008, alleging that ASD has a massive Ponzi scheme that sought to avoid the use of the language of investments to keep its 1-percent-a-day program under the government radar.

    Bowdoin later was indicted on charges of securities fraud, selling unregistered securities as investment contracts and wire fraud. The 77-year-old ASD patriarch pleaded guilty to wire fraud and faces up to 78 months in federal prison.

    Federal prosecutors have asked that Bowdoin be sentenced to the maximum term despite his age, alleging he started a new 1-percent-a-day fraud just two months after the August 2008 Secret Service raid.

    This is the entirety of the Zeek Blog post today (italics added):

    Fine People,

    We regret to inform you that Red Carpet Wednesday, scheduled for Wednesday, August 22, 2012 has been cancelled. Please continue to monitor our websites for more information to be forthcoming.

  • BULLETIN: Prominent Football Coach And TV Commentator Jim Donnan Charged In Alleged $80 Million Ponzi Scheme

    BULLETIN: The SEC has gone to federal court in Atlanta, alleging that Hall of Fame football coach Jim Donnan and a business partner in Ohio conducted a massive Ponzi scheme that sucked in other coaches and caused one of Donnan’s trusting former players to invest $800,000.

    The scheme began in 2007 and collapsed in 2010, the SEC charged. Donnan is a former coach of the University of Georgia and Marshall University. He once worked as a commentator for the ESPN television network.

    Charged along with Donnan, 67, was Gregory Crabtree, 50. Crabtree was an officer of a West Virginia entity known as GLC Limited, promoted as a wholesale liquidation business that bought leftover merchandise and sold it to discount retailers. Donnan was a GLC pitchman.

    GLC also was known as “Global Liquidation Center,” the SEC said.

    Investors were promised “exorbitant rates of return ranging from 50 [percent] to 380 percent” in a scheme that fetched $80 million, the SEC charged.

    But only about $12 million of the $80 million went toward merchandise purchases, with the rest used to make Ponzi payments “or stolen for other uses by Donnan and Crabtree,” the SEC charged.

    “Donnan and Crabtree convinced investors to pour millions of dollars into a purportedly unique and profitable business with huge potential and little risk,” said William P. Hicks, associate director of the SEC’s Atlanta Regional Office. “But they were merely pulling an old page out of the Ponzi scheme playbook, and the clock eventually ran out.”

    One of Donnan’s former players, the SEC charged, plowed $800,000 into the scheme after Donnan told him, “Your Daddy is going to take care of you” and “if you weren’t my son, I wouldn’t be doing this for you.”

    Donnan resides in Athens, Ga. Crabtree is a resident of Proctorville, Ohio.

    Donnan conned at least one investor by telling him, “[Y]ou can’t lose your money; it’s already pumping oil,” the SEC charged.

    And the former coach and commentator took care of himself first, the SEC charged.

    “Donnan invested approximately $5.8 million in the scheme but paid himself back approximately $13.2 million from GLC investor funds,” the SEC charged. “After the scheme collapsed, Donnan used a small percentage of his profits, less than $900,000, to pay other investors.”

    It has been a busy week for the SEC. The agency said yesterday that it had gone to federal court in Denver to halt a $15.7 million Ponzi scheme.

    Charged in that alleged caper were Michael J. Turnock, 68, of Denver and William P. Sullivan II, 45, of Highlands Ranch, Colo.

    Turnock and Sullivan were running a promissory-notes scam through a company known as Bridge Premium Finance LLC, the SEC said.

    On Monday, the SEC charged Ivan Wade Brown, 45, of Alpine, Utah, and two of his companies: Highland Residential LLC  and Avanti Capital Partners LLC.

    That case alleges a $27 million Ponzi scheme and promissory-notes scam.