“It is the biggest announcement I’ve ever made in my career.” — MLM attorney Kevin Thompson on the hiring of Kevin Grimes, Jan. 9, 2015.
2nd UPDATE 5:35 p.m. ET U.S.A. Zeek Rewards receiver Kenneth D. Bell accused Idaho MLM attorney Kevin Grimes last year of providing “substantial assistance” to Zeek’s Ponzi scheme and, in effect, attempting “to put lipstick on the ZeekRewards pig.”
Grimes, formerly of the now-defunct Grimes & Reese law firm, is battling Bell’s contentions that he engaged in legal malpractice, created a “bogus ‘compliance course’” and participated in “leadership calls” that helped sanitize Zeek.
It is against this backdrop that Grimes, whom Bell is suing for $100 million, has landed at suburban Nashville’s Thompson Burton as a new partner after being flown in to discuss joining the firm. The announcement was made by managing partner Kevin Thompson in both text and video forms. The news appears first to have been published elsewhere on the MLMHelpDesk Blog of Troy Dooly.
Thompson appears only to make an allusion to Zeek in the 4:28 YouTube video announcing the hire. But he mentions it directly in a Blog post at the Thompson Burton site.
Grimes, whose qualities include experience and depth, is a good person and good lawyer who fosters at-risk teens and is “very open about his faith” and “very passionate about serving people,” Thompson said.
A well-known MLM lawyer in a field often associated with PR blunders, Thompson appears not to be concerned that his 16-member firm whose practice isn’t limited to MLM could take a hit by bringing on Grimes with Zeek matters still unresolved. Three Zeek executives were charged with federal crimes in the aftermath of SEC civil actions in 2012 and 2013.
“I’m excited for what this means,” Thompson said of the hiring of Grimes. “I think in the industry, iron sharpens iron. He can make me better; I can make him better. There’s some things that he’s not doing very well, such as communicating. He’s hasn’t communicated at all. Most of you don’t even know who he is. We’ve got to fix that. So, you’re going to get to know him better. He’s going through some issues right now, and he’s dealing with them. And there going to be a day when he’s not dealing with them and he can focus on doing what he does best. He’s been practicing for close to 25 years without any single bar complaints. So, he knows what he’s doing.”
Grimes has not been named a defendant in the SEC’s civil actions and has not been charged with a crime. But Bell, the Zeek receiver, has alleged in court filings that Grimes missed important clues that something was seriously amiss at Zeek.
The SEC has described Zeek as a combined Ponzi- and pyramid scheme that gathered hundreds of millions of dollars. Zeek insiders Paul Burks, Dawn-Wright-Olivares and Daniel Olivares have been charged criminally, with Wright-Olivares and Olivares already entering guilty pleas.
UPDATED 7:36 P.M. ET (U.S.A.) Let’s say you’re out there feverishly flogging the TelexFree MLM even as the pyramid-scheme probe moves forward in Brazil, a judge and prosecutor have been threatened with death and TelexFree executive Carlos Costa is pulling an Andy Bowdoin and telling the world that God used him to bring the purported opportunity to the flock.
There’s always risk associated with HYIP schemes. Now, however, it seems those risks are becoming even greater.
Here is a key fact: The sender used an IP based in France that has been associated by Project Honeypot with comment-spamming — pitches for porn sites and sites that purport to give you a good price on designer goods in advance of a predicted “downturn,” for example. (Basic message: You can look wealthy even if you’re not, even after the economy tanks. Buy your knockoffs now and look good when the sky is falling on your life.)
The sender, now adding HYIP schemes to the porn and designer-good mix from that specific IP, used a handle that incorporated the word “Silver” within its overall handle and sought to plant a URL at the PP Blog to a Panamanian venture that advertises a custody service for precious metals. The PP Blog is declining to publish the URL and the name of the enterprise which, among other things, reproduces on its website the logos of an internationally famous insurer based in London and an internationally famous accounting firm based in Chicago. The site also publishes various contact phone numbers in the United States, Panama, New Zealand, Australia, Switzerland, the United Kingdom and Hong Kong. Although there is a chance that the service is legitimate, the PP Blog questions why someone or some thing is spamming links to the precious-metals site and loading them up further with links to “positive” coverage of seemingly unrelated HYIPs.
For the purposes of this PP Blog post, the Panamanian venture is a sidebar tidbit. Far more interesting was the body content of the spam, which appears to be a compendium of gushing affiliate pitches for TelexFree that appear on the net. The spam appears to have been cobbled together by a human scraper or scraping device of some sort that had visited one or more TelexFree-related websites. Links embedded in the spam are the “real story” in the context of this PP Blog post.
So, for starters, TelexFree’s name is being used as part of a bid to drive traffic to a precious-metals website on which visitors curiously are told they must provide 15 days’ notice if they wish to visit the office in Panama City. The PP Blog likely was targeted by the spammer simply because the word “TelexFree” appears here many times in reports about TelexFree-related events in Brazil and the United States.
The spammer — be it bot or human — appears to have made the calculation that TelexFree members might be the perfect customers for the precious-metals venture. Contained within the spam were three links: One to a site styled TelexFreeUnitedStates and two to a URL-shortening service that redirected visitors to Photobucket, the popular image-hosting and story-sharing website.
Here’s where the story really begins . . .
One of the picture stories told at at the Photobucket site was told inside a subfolder of a folder labeled “aaronsharazeek.” (Emphasis added.) The subfolder was slugged “First Zeek Red Carpet Event April 18th 2012.” Zeek conducted a Red Carpet event on that date.
The SEC moved against Zeek on Aug. 17, 2012. On the same date, the Secret Service said it also was investigating Zeek. Court records suggest the SEC began the Zeek probe at least by April 17, 2012, one day before the April 18 Zeek Red Carpet event highlighted within the “aaronsharazeek” folder on Photobucket.
On April 17, 2012, according to court filings, the SEC tasked an IT specialist to “conduct Website/video capture” of ZeekRewards.com.
Paul Burks appears to have been in deep thought on April 18, 2012, one day after the SEC tasked an IT specialist to capture content from Zeek Rewards.com. This is a slice of a photo from a larger photo that appears on Photobucket in a folder labeled “First Zeek Red Carpet Event April 18 2012.”
Precisely when Zeek operator Paul R. Burks found out about the SEC probe remains unclear. But photos inside the “First Zeek Red Carpet Event April 18th 2012” subfolder at the Photobucket site show a Burks who appears to be in deep thought. One can only wonder what 66-year-old Burks was thinking about on that date. His health? His wife’s stress level, given the noise Zeek was creating in the small town of Lexington, N.C.? His ability to keep Zeek going? The prospect that investigators were closing in?
There are 18 other photos in the Red Carpet event subfolder, some showing Zeek luminaries such as former SEC defendant Keith Laggos, former Zeek COO Dawn Wright-Olivares, former Zeek videographer OH Brown (looking happy), former Zeek trainer Peter Mingils (identified in one photo as the “V.P. of the Association of Network Marketing Professionals”). Other photos of Zeek personalities/staffers appear in the folder, as do photos showing attendees.
Absent the “Silver”/TelexFree spammer, the PP Blog likely never would have seen these photos.
Also within the “aaronsharazeek” folder at Photobucket is a subfolder slugged “Zeek Trip,” and subfolders slugged “Banners Broker” and “telexfree.” The “Zeek Trip” folder appears to contain four photos of Zeek-related real estate in Lexington, N.C. (In the ASD Ponzi case, affiliates suggested that ASD couldn’t possibly be illegitimate because ASD had an office. The same thing has been asserted by TelexFree promoters.)
Meanwhile, the “Banners Brokers” folder contains a video of a sales pitch, and the “telexfree” folder contains images of government documents from the state of Massachusetts and the country of Brazil that appear to have been designed to plant the seed that TelexFree couldn’t possibly be a scam.
Taken as a whole, the various folders and photos demonstrate the interconnectivity of MLM HYIP schemes, regardless of who actually controls the Photobucket site. It is known from other sources that some Zeekers also were in the JSSTripler/JustBeenPaid scam and the exceptionally murky Profitable Sunrise scam shut down by the SEC and various state regulators earlier this year.
Banners Broker is an uber-bizarre Ponzi-board program. On July 2, 2013, the PP Blog reported that MLM attorney Kevin Thompson said that the name of his law firm had been used by scammers in a bid to dupe members of Banners Broker and Profit Clicking, the JSS/JBP-associated “program” linked to Frederick Mann that may have ties to the extremist “sovereign citizens” movement. The July 2 PP Blog post was titled, “Law Firm’s Name Used In Bid To Dupe Members Of Banners Broker, Profit Clicking, MLM Attorney Says.”
Within the July 2 post, the PP Blog reported that it had received menacing messages in apparent “defense” of Banners Broker. As the Blog reported at the time (italics added):
WARNING: The next paragraph includes quoted material from one of the Jan. 18, 2013, spams, and the PP Blog is reproducing it to illustrate the bizarre and often menacing nature of the HYIP sphere. Indeed, the apparent Banner’s Broker supporter wrote (italics added):
” . . . I am Big Bob’s cock meat sandwich. Your mom ate me and made me do press ups until I threw up . . . I am gonna report you. When you make false accusations, you can get done. Maybe you will be seen in court soon . . .”
It is as ugly today as it was on the January date the PP Blog received the communication.
Why “programs” such as TelexFree, Zeek Rewards, BannersBroker and ProfitClicking become popular with people of faith is one of the head-scratching mysteries of current times. Gold fever, of course, is nothing new; it’s been around for centuries. What’s at least relatively new in the Internet Age is that the gold- and silver-sellers appear to be piggybacking off HYIP pitchmen, apparently hoping to rope in customers for shiny-object schemes.
This “comment” sent to the PP Blog on Nov. 22 sought to drive traffic to a precious-metals site by planting a link to the site and also planting links related to TelexFree.
On Oct. 25, the PP Blog reported that an alleged shiny-object scheme had taken root in Zeek’s back yard in North Carolina. On June 19, the PP Blog reported that the receiver in the Legisi HYIP Ponzi case was going after assets linked to E-Bullion, a collapsed payment processor with shiny-object woo. James Fayed, E-Bullion’s operator, is sitting on death row in California after a jury found him guilty of arranging the brutal contract slaying of his own wife.
The Legisi scheme was targeted at Christians, and E-Bullion’s cheerleaders included the Canadian clergyman Brian David Anderson, who was sent to U.S. federal prison in 2010 for the Frontier Assets Ponzi scheme. Anderson also was linked to the Flat Electronic Data Interchange (FEDI) HYIP scheme that put Abdul Tawala Ibn Ali Alishtari, also known as “Michael Mixon,” in federal prison after his September 2009 convictions for financing terrorism and fleecing FEDI investors.
Yes, financing terrorism.
Alishtari traded on his purported ties to prominent politicians, just like ASD’s Andy Bowdoin. At least one of the schemes linked to Alishtari and Anderson used the term “rebates,” just like ASD. The narrative surrounding FEDI read like impossibly outrageous fiction, a mind-bending example of a shiny-object scheme. Ten members of purported “Royal families” in the Middle East were said to have set aside “50 Billion in Gold” ($5 billion each) to advance the scheme. Another entity in the Middle East was said to have supplied a “total of 100 Billion in Gold.” Still another entity was said to have put up “500 Million dollars in liquid gold assets.”
FEDI marks were solicited to purchase what effectively were trading desks that somehow would enable them to profit on the coattails of Middle East royals interested in escrowing huge sums to fund worldwide construction projects, with money purportedly flowing to the “labor” force. If that weren’t enough, the scheme purportedly was married to a venture that purportedly would put vending machines in at least 50,000 locations. The vending machines purportedly would sell debit cards, and were purportedly backed by $150 billion in gold and an insurance policy in Canada.
In March 2012, the PP Blog reported on FTC allegations that three Florida companies and a Florida man had roped customers into a shiny-object scam, a precious-metals boondoogle allegedly carried out by telemarketers.
Imagine what would happen if a scamming telemarketing firm had the customer lists for TelexFree, Zeek, Banners Broker, Profit Clicking, AdSurfDaily, Legisi and others.
If the MLM industry seeks to win favor on Main Street and stop being the brunt of jokes, it needs to act forcefully to eradicate these schemes. MLM attorneys need to stop permitting schemes to trade on their names, thus potentially setting the stage for prospects to believe that no scam could be occurring because no lawyer would permit his name to be used in this fashion.
But even today, what does one get when one visits the website of TelexFree? A pitch in which the alleged TelexFree pyramid scheme announces its pride at having MLM lawyer Gerald Nehra on board.
Zeek traded on the name of MLM attorney Kevin Grimes, who comes off in Red Carpet Day shots as a Zeek crowd prop, and also the name of Nehra. Bidify traded on Kevin Thompson’s name. The lawyers should not permit this to happen. And they should stop making personal appearances at “opportunity” events and start questioning why so many of these “programs” are targeted at people of faith and promise or suggest the likelihood of absurd returns.
Profitable Sunrise — perhaps recognizing that an MLM scheme can be made to appear legitimate if affiliates simply are provided the name of a purported lawyer — appears to have conjured up an attorney’s name out of thin air. It then allegedly proceeded to run off with millions and millions of dollars. When ASD’s Bowdoin switched from the two scams that eventually put him in prison (ASD and AdViewGlobal) and began pitching the alleged OneX pyramid scheme, one of the first things he did was assure the former ASD members he was pitching in a webinar that OneX had an “attorney,” adding that the venture was a great fit for college students. Bowdoin, mixing in God talk during the October 2011 webinar, never identified the purported lawyer by name. Neither did a former ASD pitchwoman pitching the OneX scheme alongside Bowdoin.
In the absence of self-imposed, self-regulatory restraints in the MLM industry — lawyers restraining themselves from becoming accidental or purposeful stage props and sanitizers of “programs,” for example — MLM prospects may be well-advised to view any MLM “program” with the highest degree of skepticism, regardless of the programs’ wares.
Every single one of the “programs” referenced in this story has ridden on the coattails of a deity and lawyers. It did not matter whether the lawyers were real or imagined.
And it did not matter that the Gods of many faiths were observing it all, perhaps mournfully wondering how the precious Children of the Earth had come to view MLM money as the maximum deity.
UPDATED 11:28 P.M. EDT (U.S.A.) Scammers have used the names of government agencies and famous businesses in bids to dupe the public. Now, the name of a well-known MLM law firm appears to have been used for the same purpose.
Attorney Kevin Thompson published a Blog post today that warns of a bogus Banners Broker/Profit Clicking “Claim Form” on the Web. Thompson is with Thompson Burton PLLC in Tennessee.
“DO NOT FILL OUT THIS FORM,” Thompson warned in the post. “It’s fraudulent. We did not create this form, or anything like it. We are not representing Banners Brokers or Profit Clicking participants.”
And, Thompson noted, “The form is requiring highly sensitive information, such as your usernames and passwords for Payza and Solid Trust Pay accounts. It’s also asking for credit card information. If you filled out the form, we strongly suggest you change your passwords and cancel your credit cards immediately.”
Such events have been associated with phishing schemes and identity-theft schemes.
Banners Broker is a bizarre “program” that, like many HYIPs, purports to be in the “advertising” business. Promoters have claimed that sending money to Banners Broker results in a doubling of the cash.
ProfitClicking is a scam that rose up to replace the JSSTripler/JustBeenPaid scam purportedly operated by Frederick Mann. Mann, a former pitchman for the AdSurfDaily Ponzi scheme, may have links to the “sovereign citizens movement.” “Sovereign citizens” may express an irrational belief that laws do not apply to them.
Among other things, ProfitClicking became known — like JSS/JBP before it — for publishing Terms that read like an invitation to join an international financial conspiracy. Here is Item 6 from the ProfitClicking Terms, as published on Sept. 3, 2012 (italics added):
6. I affirm that I am not an employee or official of any government agency, nor am I acting on behalf of or collecting information for or on behalf of any government agency.
Regulators in Italy and the Philippines have issued warnings about JSS/JBP or ProfitClicking, both of which featured Terms similar to those of Legisi, a $72 million HYIP fraud scheme broken up by the SEC and the U.S. Secret Service in May 2008, about three months before the AdSurfDaily Ponzi scheme ($119 million) was exposed.
The PP Blog has been subjected to various bids to chill its reporting on the JSS/JPB/ProfitClicking scams, including one from an individual who claimed he’d defend Mann “so help me God.”
Meanwhile, the PP Blog has received bizarre and menacing spam apparently in support of Banners Broker. (Like JSS/JBP/ProfitClicking, AdSurfDaily, Legisi and Zeek Rewards, Banners Broker has a presence on well-known Ponzi-scheme forums such as TalkGold and MoneyMakerGroup.)
WARNING: The next paragraph includes quoted material from one of the Jan. 18, 2013, spams, and the PP Blog is reproducing it to illustrate the bizarre and often menacing nature of the HYIP sphere. Indeed, the apparent Banner’s Broker supporter wrote (italics added):
” . . . I am Big Bob’s cock meat sandwich. Your mom ate me and made me do press ups until I threw up . . . I am gonna report you. When you make false accusations, you can get done. Maybe you will be seen in court soon . . .”
In August 2012, the SEC described Zeek Rewards as a $600 million Ponzi- and pyramid scheme. A number of reload scams have surfaced in its wake. At least one appears to have been a bid to dupe people into sending money to an entity that was posing as a U.S. government agency while claiming to be a recovery vessel for Zeek members who lost money.
Thompson is encouraging people who may have information about the purported Banners Broker/Profit Clicking “Claim Form” to contact him here.
