For Californians Walsh J. Young Jr. and May Causing, the Zeek Rewards MLM scheme left them “on the verge of financial devastation,” according to a new filing in the Zeek Ponzi scheme case.
The self-written, self-submitted filing by Young and Causing appeared yesterday on the docket of Senior U.S. District Judge Graham C. Mullen of the Western District of North Carolina. Mullen is presiding over the Zeek case brought by the SEC Aug. 17.
Causing plowed $5,000 into the Zeek scheme in April 2012, funding her Zeek account with an “Official Check” from Citibank, according to the filing and an exhibit that accompanied it.
Causing resides in Eagle Rock.
On June 4, Young plowed $2,000 into Zeek, using a cashier’s check from Bank of America, according to the filings. Later — on June 26 — he plowed another $6,000 into Zeek, again using a Bank of America cashier’s check.
Young resides in Bell.
The filing alleges that Zeek business meetings were conducted by affiliates in Rancho Cucamonga, Harbor City, Cerritos and Carson.
Prospects, according to Young and Causing, were told that they could purchase “name brand merchandise at 95% off of retail prices” and that the company had a “long standing track record with 15 years of rock solid business practices.”
The pitch, according to Young and Causing, included references to the business bona fides of Zeek operator Paul Burks and Kevin Grimes, “known to be the best MLM attorney in the industry.”
Prospects also were told that Zeek shared “50% of its daily profits with vested affiliates,” according to the filing.
The filing claims that Zeek pitchman Tom More had acquired “over a million VIP points” and that Dolly Inocencio had acquired “over 250,000 VIP points.”
All in all, the Zeek deal seemed to make sense, given the claims, according to Young and Causing.
“This offer made it difficult to walk away with taking no action and in consideration of the money being received by Mr. Tom More and Ms. Dolly Inonencio, early Zeek members,” Young and Causing wrote.
Then came news of the August SEC action, which alleged Zeek was a $600 million Ponzi- and pyramid scheme and Burks was a securities fraudster. The SEC said last month that its probe was ongoing.
The filing by Young and Causing closed with an assertion that they “have suffered a tremendous financial hardship and are left on the verge of financial devastation” — and it asked the judge and court-appointed receiver Kenneth D. Bell for help in making them whole.
Young and Causing also alluded to a “class” of Zeek members in their filing, but the meaning of that was not immediately clear. The caption of their filing complains of “false business practices, false hopes disguised as lucrative financial business opportunities and ill gotten gain.”
Bell said in court filings Monday that he will “investigate potential claims against professionals and others” involved with Zeek to determine “who may be liable for the role they played in facilitating the operation.”
Claims against the unidentified “professionals” and others will be pursued, if warranted, Bell advised the judge.
Clawback actions against Zeek “net winners” also are contemplated, Bell said.