MonaVie President: “Zeek Rewards probably a Ponzi”
One of the more attractive qualities of a Ponzi scheme is that for very little effort, if any at all, members can earn a substantial return on their investments.
Splice this in with a MLM compensation plan and let the word spread virally through the industry and sooner or later you’re bound to attract the attention of other companies operating in the same sector.
With no strings attached membership wise, it’s no secret that many Zeek Rewards affiliates are involved primarily in other MLM opportunities that for some, forbid the cross marketing of any other opportunity to their existing downlines.
The stricter of these affiliate/distributor agreements even prohibit the mere participation in another MLM company altogether.
Nonetheless, as VIP point balances swell those playing the multi-opportunity stakes in Zeek Rewards and other companies are no doubt finding themselves in the challenging position of weighing up their primary MLM business with that of Zeek Rewards.
Simply put, it’s hard to ignore the returns Zeek Rewards pay out daily for what can easily be deemed passive investment income (via purchased customers and ad placing automation).
When you compare this to a traditional sales based MLM opportunity that relies on genuine customers (not harvested email addresses where the owners don’t even know they’ve been signed up and don’t have to actually purchase anything to be counted as customers), it doesn’t take long for the Ponzi’esque returns to overshadow the income derived from a legit opportunity.
With this unfortunately the inevitable happens and Zeek Rewards members look towards their own existing downlines in an effort to grow their Zeek downlines.
There’s no quicker way to boost your own investment returns than to convince people you know to also invest and reap the passive commissions this generates.
Eventually enough members are involved in multiple companies that management can no longer brush aside queries from their field and in the most extreme cases, even find themselves being called on to make a public statement on the opportunity in question.
Two days one such executive was Monavie’s President of their North American and European markets, Randy Schroeder.
Blasting Zeek Rewards on a July 16th Monavie “Leadership Mentoring” call, Schroeder (who credits himself as being “one who has extensive knowledge of the (MLM) industry“) claimed that Zeek Rewards was a company that “comes along and sweeps people into a trail that turns into a trail of devastation“.
Citing numerous requests “over the past several weeks seeking his opinion on Zeek Rewards (presumably from Monavie affiliates), Schroeder (photo above) declared on the 16th that Zeek Rewards is “illegal, a pyramid scheme (and) probably a Ponzi scheme“.
Elaborating on why, Schroeder states that “one of the best ways to predict the future is to carefully and critically study the past“. He then goes on to reason that
companies whose compensation methodology is even remotely similar to the way people are compensation in the program called Zeek Rewards, falls way outside of the FTC guidelines in terms of what’s legitimate in the network marketing or direct selling industry.
I mean way, way, way outside the guidelines.
My hunch is that Schroeder is speaking specifically about internal consumption and that in its current form (and for the past year and a half), Zeek Rewards has operated with near 100% internal consumption by way of affiliates purchasing bids to give away.
Once these bids are given away, or dumped onto customer accounts (created with an email address, and in many cases where the owner of the email address has not signed up themselves or is even aware they are being signed up to Zeekler, Zeek Rewards’ penny auction arm), the Zeek Rewards affiliate who gave the bids they themselves purchased away, then goes on to earn a 90 day ROI on their bid purchase.
The most notable company Schroeder compares Zeek Rewards to would of course be Ad Surf Daily, a Ponzi scheme that offered ridiculous returns claiming its members were purchasing advertising.
In Zeek Rewards, the company claims its members are purchasing penny auction bids and offers similar ridiculous returns, believed to be by and large funded by affiliate money. Zeek Rewards refuse to clarify if this is the case and/or release documentation proving otherwise. CEO Paul Burks claims that the make up of the daily ROI that Zeek Rewards pays out is a “proprietary secret”.
Based on this, Schroeder concludes that Zeek Rewards will “come to grief in the relatively near future, not far into the future“,
I think when people are being asked to invest ten thousand dollars into a program with the idea they need to do no work but will receive exorbitant returns, is screaming out in advance: “Don’t do it, don’t do it, don’t do it, don’t do it!”
And yet so alluring is the idea of fast money for which one need not work that alot of people are getting swept into that trail.
Now I would just to give you all my word of caution, it’s gunna blowup, it’s gunna be an ugly blowup, it’ll probably happen sooner not later and it will leave a trail of devastation behind it.
It’s illegal, it’s a pyramid, it’s probably a Ponzi scheme, it’s going to get shut down – don’t get swept up into it.
Adding even more weight to Schroeder’s words is a brief look at the types of people the MLM penny auction niche has attracted thus far:
- Zeek Rewards – it’s no secret that many of the top earners in Zeek Rewards were top players in the Ponzi scheme Ad Surf Daily. Presumably a fair chunk of the initial investment seed money pumped into Zeek Rewards came directly from Ad Surf Daily
- Bidify – Bidify’s Chief Creative Officer, Frode Jorgensen has a history with being involved in offshore income opportunites that strongly resembled Ponzi schemes. Several other founders exist, however they are shrouded in secrecy with Bidify to date not revealing the exact corporate structure of the company
- Bids That Give – CEO and founder Randy Jeffers has had multiple MLM businesses shut down by US authorities
The most recent MLM penny auction to pop up on my radar is ‘Igobidwin’ (also being marketed as “Global Paradigm Shift”, “Ultimate Power Profits”, “Power Profits”, “Spinfinity” and “MyTurnOnTop”), which is being launched by GlobalOne Companies LLC.
Not much is known at this point (the company is supposed to launch sometime in the next few weeks) but there appears to be potential ties between GlobalOne Companies LLC and the pyramid scheme feeder OneX.
Members of Igobidwin who paid for their membership via credit card, noticed they were being billed by ‘SIGNATURELIFE QLX’, the same company that appeared on OneX member receipts.
OneX was a feeder into QLXChange, which in turn fed members into a world of shady closed-door investment opportunities, with participation only allowed if a non-disclosure agreement was signed.
At the end of the day whichever MLM penny auction you’re considering, they all operate on the fundamental principle idea that members invest $x, get some sort of virtual currency points and then earn an effective ROI >$x based on how many points they have, with the points expiring after a certain period of time.
Members can of course increase their points (and effective ROI) by re-investing the returns the company pays out daily, and/or recruiting new investors (affiliates) and getting them to invest.
Nearly 100% of the revenue generated by these companies is via member purchases (investments in bids with the sole purchasing motivation being to convert them into points for the daily ROI offered) and thus the same is true of where the money these companies are paying out comes from.
This alone is sufficient analysis of the common core business model used by MLM penny auctions (you won’t ever see one of these launch that just pays out standard commissions on the sale of penny auction bids, because there are no genuine retail customers), but when you consider who is involved at the top levels of the companies in the niche, either at a management level or as top earners, the writing is on the wall.
No doubt efforts will be made to simply brush off Schroeder’s comments as “jealousy”, “negativity” or other dismissive labels, however little can be said to refute his claims.
I mean you can do the whole pseudo compliance song and dance and *winkwink nudgenudge* call a wolf in sheep’s clothing a zebra, but functionally this changes nothing.
No matter what front business you attach to it, no matter what you call member investments and no matter how hard you punish your members for using investment terminology under the guise of “compliance”, an income opportunity that pays out returns (guaranteed or not) based on how much seed money a new members injects into the scheme, which is made up of the money new and existing affiliates have both initially invested and continue to re-invest so as to grow their daily returns, is a Ponzi scheme.
How anyone who has been or is involved in the network marketing industry for more than ten minutes and can appreciate the idea of selling products to genuine retail customers and earning a commission on said sales can think otherwise, continues to baffle me.
Ah yes the fireworks are going to be magnificent, tick tick tick.
Anyone care to share their best guess as to which month this will crash I’m picking late september 🙂
Gotta consider the source… Somebody must be tapping into their well..
http://en.wikipedia.org/wiki/MonaVie
Monavie’s own issues aside, I don’t see anything about a Ponzi scheme there.
I think its high time other members of the MLM industry spoke openly about this recent plague. Every Ponzi scheme masquerading behind a MLM business model causes irrevocable damage to the industry when it goes bust.
When, not if.
@Archway — but there’s no denying what what he said.
The “sour grapes” argument only goes so far.
It’s also interesting how the argument changes.
When outsiders (like Oz) analyze ZeekRewards and determine it to be a Ponzi we’re shouted down as “you know nothing about MLM”, “who the heck are you and why should we trust you?”
When an INSIDER like Randy Schroeder analyze ZeekRewards and determine it to be a Ponzi, he’s shouted down, by no less than Troy Dooly “Monavie is sue-happy””I’m sorry to see Randy change” “he should be careful in what he says” blah blah blah.
It seems that Zeek supporters always look at the arguer’s BACKGROUND and make an argument out of that, doesn’t it?
Yes, people will try to counter attack MonaVie by doing a google search and pointing out various lawsuits. I challenge anyone to find a billion dollar company anywhere in the world that hasn’t had it’s legal battles. Those are stupid attacks.
@e
By all means people can Google Monavie and Randy Schroeder, however what you find is not alone enough to automatically dismiss Schroeder’s points and concerns.
It’s no better than people dismissing my own opinions and analysis due to “negativity”. Simply put it’s not good enough.
Nowhere near good enough.
It’s worth noting that in response to Dooly’s criticism of Schroeder’s opinion and analysis, Schroeder stated
Good on him for not getting dragged into the ‘you’re just saying all this because (insert random excuse here)’ Dooly was pushing.
Yes, I agree. I know for a fact in my communications with him that he did do significant research.
Well, as I said, light up the fireworks. This *will* get ugly.
Before any one purchases anything I would hope that they would weigh the risk / reward and do their due diligence… Why would you ever spend money that you are not willing to loose?
What a concept selling a dream… but what if it does materialize… What I find interesting is human nature and it’s ability to justify there ideals which are based on their experience and beliefs, myself included.
I’ve found people in general are selfish and self-seeking, again myself included. Insiders, outsiders there is always a motive… So gentleman what are yours?…
No motive here, just analysis of a business model that fundamentally does not work. This is proven time and time again when a Ponzi scheme runs out of investor money to pay out.
Risk in whether or not you are sinking money into a Ponzi is not equatable to the “will I sell enough products” risk associated in MLM.
Save your derail attempts please and use them elsewhere, this isn’t kindergarten hour.
Philanthropy.
“All that is necessary for the triumph of evil is that good men do nothing.” (Edmund Burke)
“No motive here” – isn’t that interesting…
“There is a principle which is a bar against all information, which is proof against all arguments and which cannot fail to keep a man in everlasting ignorance – that principle is contempt prior to investigation” (Herbert Spencer)
Thank you gentle for your analysis’s. I look forward to following your posts, I would hope that we can count on you to refrain from insults (unless you feel it is necessary to sell copy)
Best regards
Well I just hope the ones that have made tons of money have set it aside to give back to the ones that lost money.
If it is deemed illegal by ponzi, investment without licenses or whatever, They no longer go after just the founder and the board,. They go after people who have made money and ask them to repay it as it was achieved illegally.
So if you have made money with Zeek. Put plenty of it aside as eventually you will be asked to return it or face prosecution…..
If I can dissuade one person from investing in an obvious illegal ponzi scheme, then that’s good enough motivation for me. Or if I can get potential investors or even current investors to open their eyes and think critically about it instead of just dreaming about wealth, then I’ll be happy.
I wouldn’t even be here if it weren’t for people I know being involved in Zeek. I don’t want to see them lose money.
My motive is training. I’m trying to improve my tourist-English “One more beer” to a more usable level. Other than that, experience and insight into different topics is some of my motives. Becoming rich and famous is of course one of the long term motives. 🙂
And it’s always interesting to give meaningful answers to certain kind of questions.
@Archway – keep trying with your derail attempts and questioning “motive” rather than the issue at hand. The motives here are noble, but even if they weren’t, none of the facts presented at BehindMLM or the other popular “critic” sites have been disputed, nor the analysis proven wrong.
When new facts come in that requires updates, Oz and the other “critics” have always updated their information. For example, there was updated information on costs of the Red Carpet Events and K.Chang updated it, and noted the mistake.
On the major issues/facts/analysis, so far the “critic” have been on target and no one has yet provided any evidence to the contrary.
@Archway – And what’s YOUR motive?
Zeek Rewards list their address as 803 W. Center St Lexington, NC. I went by to take a look and there is no way this company is making the money that they pretend to make.
The building is very small and very old. Ponzi for sure.
Technically speaking, it’s an “internet company”, which may not be the FULL HQ. You don’t really know where’s there customer support (could be outsourced to Mauritius), their hosting (somewhere in Miami, I think someone said?) and so on.
“just saying”… 😉
I wouldn’t judge Zeek by its corporate office. They do employ remote workers, and most of the “employees” posting on the support forums are just affiliates volunteering – which is also why they setup all those different gmail accounts for you to send your support info to, and then they package them and send them to “the head office”. They can help escalate some issues. The entire “employee” badge there is confusing.
In general, you can judge a business by its employees and contractors. Zeek’s amazing growth may set some MLM records (because it’s really not an MLM), but you can also contrast Zeek’s growth with its lack of growth in employee & contractor staff.
As of Jan they had 11 employees and as of May 15. Yes, they say they are hiring… but isn’t it strange that a company with 10x growth (or whatever numbers you believe) would have only 1.5x growth in employees?
MLM companies that are poised for growth invest in staff and infrastructure to manage the growth. It’s also worth noting that although it’s near impossible to get a reply to a support ticket now, it was equally impossible to get a reply a support ticket in Feb.
So despite the growth in the last 5 months, regardless of how many new full time employees or customer support contractors they hire, their track record is no different. I had ZERO response for months for tickets in Feb, and I’ve had ZERO response for months for tickets opened in May, June, and July.
Technically, I did get a response for tickets in Feb as Zeek closed them for being “too old”.
Troy claims they are taking 3000 call’s per day. Who’s taking these calls? Did they hire a call center or is that just BS?
A lot of calls go straight to voicemail. They do have a call center but the call center can’t answer most queations. This really is a chicken & egg problem.
If they didn’t lose their credit card processing in Dec 2011 and had to use murky eWallets for compunding bid purchases, there wouldn’t be so many problems.
If their credit card processing for monthly subscriptions and retail bid purchases worked and didn’t utilize strange overseas merchants, there would be fewer questions.
If their bid pruchases from eWallets worked (inbound revenue), there wouldn’t be a need to contact support.
If VIP points and sponsored affiliates didn’t mysteriously disappear, there would be fewer urgent questions.
If cashier’s checks that were deposited by Zeek but not credited for 30+ days got credited quickly, you would have fewer concerns.
If check payments or eWallet payments worked, people wouldn’t be worried.
If support tickets were answered within 3 months, people would feel less of a need to call in.
If IT systems and web servers didn’t fail or give error messages frequently, the web app would “just work” and people wouldn’t need to call in about multiple accounts created without confirmation.
If the site’s and web app security model followed standard best practices, accounts would not get hacked necessitating a need to call in.
If Zeek corporate provided clear information instead of a lot of vague hope & change on ZRN and weekly calls, there would be fewer questions.
The fact that Zeek has so many “problems” and calls into support is much less a function of “growing pains” as it is “bad execution”. They create their own problems.
But regardless of the problems, if you have that much volume and are creating genuine revenue that is not negative margin (an attritbute of a Ponzi), then they could afford to hire all the staff needed to answer questions.
Yes, all just normal growing pains…par for the course.
Before you judge Zeek or any other sites like Zeek please be aware that this meesage is coming from a man who BASHED Dubli and now thinks Dubli is going to be a huge success, go figure.
When one does not know ALL facts one can not fully know the future. In my opinion, Randy needs to step outside the box and see things from another angle other then his old school ways, anyone that listens to him and follows him will never see the fun money making sites online.
Here’s a fact: The majority of daily ROIs paid out by Zeek to their members are in one way or another derived from affiliate money.
Dawn Wright-Olivares confirmed as much when she recently asked members to deposit more money into Zeek Rewards e-wallet accounts so they could pay out members from said acccounts.
Supposedly one Zeekhead posted on his own “blog” that one of the training calls claimed Zeek has hired a call center in Mauritius. Further search shows it’s on Zeek news May 10th update.
Frankly, I don’t take too much stock in other people’s evaluation, esp. when they don’t show their work (as my math teacher said).
Did you take into account facts that we over here at BehindMLM (and elsewhere) dug up though?
Strange.. I’m almost sure it doesn’t mean anything, but, I keep a spreadsheet of my projected daily earnings, and on three of the last fours days, the commission awarded matched my guesses to the penny. (That’s with a ~12k or so point balance)
Humor item, may be offensive to some
BehindMLM troll message generator
Sentence 1: Pick one of the following —
a) Lots of hilarious opinions here
b) I see a lot of speculation and very little fact
c) Bunch of amateur wannabe analysts here.
Sentence 2: Pick one or more of the following
a) Sour grapes fallacy — you must be jealous of our success
b) You’re not in it fallacy — you must be a member to understand us, how it REALLY works
c) It paid me fallacy — it paid me and that’s all that matters
d) appeal to association with authority fallacy — Zeek is associated with these big names, it can’t possibly be a scam!
e) “every thing else is a scam” — social security, federal reserve, IMF, are all scams.
f) anecdotal fallacy — cite personal data, pretend it’s universal
g) “appeal to age” — Zeek/ RVG is 15 years old! They have to know what they’re doing (to have last this long)!
h) “hot hand fallacy” — if it haven’t been declared illegal it’s not going to be ever!
i) “disgruntled fallacy” — you must work for our competitor / you must be bitter from a prior MLM failure
j) Pick some other fallacy from fallacyfiles.org
Sentence 3: Pick one of the following:
a) So go ahead and bash, I’ll be laughing from the bank
b) You are evil and I hope you rot in hell
c) you’re just negative
Who is that? The man who bashed Dubli and now think it’s going to be a huge success?
If it’s Troy Dooly, then he will switch from negative to positive if you hire the right advisors. So he will be very positive to a scam with the right advisors, as long as he’s not 100% sure it’s a scam.
KChang…your pick a statement fallacy list rocks!
KChang…You forgot one for section 1: “If you really did your homework you’d find….”
@KChang well that saves you a lot of typing you can now refer idiots to the above 🙂
One thing I am interested in is whether all ASD affiliates were prosecuted or just the top players ?
Surely not everyone? That would have been a federal nightmare lol
Ponzi schemes aren’t illegal to participate in, like pyramid schemes are. So they will only prosecute the organizers, not the participants.
But Zeek is a combination of both Ponzi and pyramid scheme, they pay out commissions on recruitment (if we ignore the “purchase bids” stuff).
Usually in pyramid and Ponzi schemes there will be some tax evasion involved, too. So top players will be taxed rather than prosecuted. There will usually pop up some tax cases a couple of year after a major pyramid has collapsed.
They announced the move to 803 W. Center last February. For years prior to that they were located at 500 E. Center st. Here is a real estate listing for that property:
http://www.retriad.idxco.com/idx/10047/details.php?idxID=291&listingID=630556
It’s being sold for $108,000 it is listed as “bank owned” and the type of sale is listed as “Foreclosure.”
So much for “15 years of rock solid buisness experience.”
Add to disgruntled fallacy or to sentence three on Chang’s list: You don’t need to own a business or be in MLM
@GlimDropper, that listing shows it had a business in their called Light House America. Is that part of Rex Ventures?
Yes it is.
Yes.
The checks, when they used to send them, came from Lighthouse America.
Lighthouse America => RVG => Zeekler
Lighthouse America => RVG => Zeek Rewards
Lighthouse America => RVG => Free Store Club
Lighthouse America => RVG => New Net Mail
Lighthouse America => RVG => New Net Quest
It’s a dump that’s foreclosed on with a mortgage of $108,000. What’s that, about a $300 a month payment? Regardless, a 15 year successful business…wow.
I think that makes for a good cover story along with a little digging into Burkes background.
Another point, just to be thorough, it says the building “was used as an office for Light House America.” That doesn’t really indicate they owned it does it? Could they have been renting the space?
Why is it Oz and his followers are such fans of old school network marketing companies where 97% of their distributors make absolutely nothing? But you bash programs that are making thousands of people money! Why not leave well enough alone?
Ponzi schemes are nothing new, they’ve been around officially since the 1920s.
Call it a program, call it whatever you want. If you’re not selling a product to genuine retail customers (not email addresses) and earning a commission directly as a result of the sale of that product, you’re mangling the very definition of MLM.
If you’re earning daily ROIs based on how much you yourself initially invested and/or convinced others to invest as well as how much you continue to re-invest, which is paid out of new and existing member’s investments – then whatever you call it you’re participating in a Ponzi scheme.
Percentage numbers regarding “old school network marketing companies” you come up with, backed by nothing are irrelevant. Follow the money.
First, we are NOT fans of “old school” MLM.
Second, the 97% distributor makes nothing is a bit of anti-MLM propaganda.
When you mix the two up, you get nonsense.
So “leave Bernie Madoff alone”, right? He made plenty of people money too (and defrauded many many more).
As long it makes you money you don’t care whether it’s legal or not, sheesh.
Really? What’s the big deal …? If it’s a shitty deal or not if it’s going to crash or not then why is MONAVIE WORRIED?
Is there something to be worried about have u lost to many people to zeek already or maybe valuable people to zeek because perhaps MonaVie income also sucks!!! MonaVie is just another ponzi as well!!
If u ask me hahaha MonaVie lies to distributors about income and makes the “miionairs” lie about their income and if ur not willing to lie then ur cut off! Really !! LIVE AND LET LIVE PEOPLE WOW!! ZEEK REWARDS ROCKS IT PAYS MY BILLS AND MONAVIE JUICE 🙂
I think monavie should stop thier comments about Zeek rewards. Zeek rewards is no more a ponzi then monavie is. I’m with Zeek as well as monavie and I did better with Zeek then with monavie with less effort. But I haven’t given up on monavie.
By saying that one a ponzi they are starting an anti-monavie champagne and more monavie distributors will leave to Join Zeek rewards.
Zeek no product to buy or sell or auto-ship.
@Lisa
Who said they were? Oh wait, you did.
True or not, that doesn’t make something a Ponzi scheme. Your understanding of what exactly a Ponzi scheme is appears to be lacking.
@Roberto
I wasn’t aware I could earn a daily ROI directly proportionate to how much I initially invested in MonaVie and/or recruited and convinced others to invest.
Nor was I aware I was able to compound this daily ROI and increase my effective ROI over time.
Did MonaVie change their business model recently? Do tell.
Thank you for your OPINION.
Care to explain this train of thought? Or is that ANOTHER OPINION not backed up by facts or logic?
Not really relevant, but thank you for your opinion.
Care to explain *that* train of thought? Or is that yet ANOTHER unsupported OPINION?
That will make you OUT OF COMPLIANCE. Zeek’s official story is they sell bids, you buy bids, and you automatically repurchase bids, thus, autoship.
Given that you stated multiple opinions, one irrelevant self-data, AND one outright lie, I’d rate your comment is mostly bullsh__.
Might also want to note that MonaVie didn’t say anything, Randy Schroeder did.
Revised Troll Message Generator, no longer Zeek specific, call it version 1.1
Sentence 1: Pick one of the following –
a) Lots of hilarious opinions here
b) I see a lot of speculation and very little fact
c) Bunch of amateur wannabe analysts here.
d) You guys have no idea what you’re talking about
Sentence 1.5: (scheme name) is not a scam.
Sentence 2: Pick one or more of the following
a) Sour grapes fallacy — you must be jealous of our success
b) You’re not in it fallacy — you must be a member to understand us, how it REALLY works
c) You just don’t understand us / it / whatever. You don’t have the mindset / positive attitude / training.
d) It paid me fallacy — it paid me and that’s all that matters
e) appeal to association with authority fallacy — (scheme name) is associated with big names, it can’t possibly be a scam!
f) “every thing else is a scam” — social security, federal reserve, IMF, are all scams. Why don’t you go after those?
g) anecdotal fallacy — cite personal data, pretend it’s universal, i.e. “It’s not a scam (to me)”.
h) “appeal to age” — (Scheme name) / (Scheme parent company) is X years old! They have to know what they’re doing (to have last this long)!
i) “it ain’t a scam unless it’s convicted” — if it haven’t been declared illegal it’s not going to be ever!
j) “disgruntled fallacy” — you must be bitter from a prior MLM failure
k) “Conspiracy” fallacy — you must work for a competitor / you’re just out to get hits for your blog / you are the 1% out to keep us 99% poor
l) “caveat emptor” fallacy — we know what we’re getting into and we don’t like being lectured to!
m) “appeal to lack of authority” — your evidence is worthless and your logic worthless. You have no reputation and that’s all I care about.
n) “What’s your problem” fallacy — you must have a personal grudge against (Scheme leader) to say bad things about his company
o) faireness fallacy — you’re not being fair! You are biased! I demand you to present facts FAVORABLE to (scheme)!
x) Pick some other fallacy from fallacyfiles.org
Sentence 3: Pick one of the following:
a) So go ahead and bash, I’ll be laughing from the bank
b) you’re just negative
c) why don’t you just leave us alone
So how is that related to Zeek?
Just had a thought.
Zeek’s doing this “compliance course”. It’s one-time only.
Now they’re adding this “video ad” service through USHBB, right? Something about another “subscription” cost?
I was reading through Rod Cook’s MLMWatchdog when I was reminded of why did Jerry Brown went after YTBI/Zamzuu… an audit of their books shows only 10% of their revenue came from actual sales of travel to outside customers, the rest came from membership dues and training.
Now that Zeek’s adding more training and expenses for the affiliates, doesn’t that mean they’re now even MORE in danger of failing the Koscot test?
The Zeek situation is a little trickier because a high level view, they do have retail revenue via customers purchasing bids for Zeekler. Upon closer examination, we see the matching VIP points given the affiliate which encourages affiliates “subsidizing” the cost of the bids for friends/family/fake customer accounts so that they can earn VIP points + 20% commission.
On the compliance course & marketing system, it is currently a total mess.
– Zeek originally said compliance course was mandary and would be ready Mar 1, but took months. This cost $5 and you were supposed to be given 5 VIP points for taking it, but many reported problems getting the VIP points.
Since it “was only 5 points” many just let the issue drop, though Zeek support had a ton of tickets to deal with for that glitch.
– The USHBB videos used to be $5/first month then $15/month but was entirely optional. Now it is mandatory at $29.95 which is annual subscription and includes the compliance course.
– Those that already paid and/or passed the compliance test do not get a discount. They still have to pay the bundled $29.95 price, but they don’t have to take the compliance test again.
– Compliance test is only mandatory for US affiliates or those marketing to US affiliates. But the $29.95 package is still mandatory for affiliates globally. As many “critics” have predicted, there is an uproar in many countries who have free or silver affiliates that are not joining by investing thousands of dollars but a more modest $50 to $100 investment.
In these second/third world countries, the value of $1 is a lot higher and many are investing a large part of their savings. Now they are getting slapped with a $29.95 annual fee that doesn’t even apply to them, and is in a language they don’t even use to promote (which technically is out of compliance).
– Zeek’s huge number of affiliates is largely driven by free/silver members. As of today, to upgrade to silver you don’t just have to pay $10 but also $10 + $29.95.
– Credit card processing is still having problems. When you try to pay the $29.95 (or $39.95 for signing up for silver for the first time), you get an internal web server error 500.
Some claim the transaction goes through you just have to wait and try to login to your back office later, but of course not everyone knows this and you have some people attempting to pay multiple times. This will result in more support tickets.
– Dawn said on the July 16 call that all payment methods would be available to pay for the $29.95 including money accrued within your back office (daily profit share & commissions) but this option is not available. You have to pay with external funds (credit card or eWallet).
This has made many upset, including some affiliates that do not have easy access to a credit card in second/third world countries. Some have modest point balances in the mid hundreds or low thousands and want to pay with accrued money as they think this is their nest egg.
– Some newer affiliates who have had problems getting paid or VIP points credited are very frustrated that they are being asked to put more money into the system when they have money owed them (virtual or actual) that is being delayed. This is raising uncertainty & doubt among many.
Zeek’s own internal problems is causing them more issues and casting more doubt on sustainability than the nature of the Ponzi business model itself. If Zeek could learn to do things right they could continue the Ponzi scheme much longer.
The big test will be what happens with payment delays after ACH is implemented. Right now, all the credit card and eWallet issues are just a distraction. When Zeek implements ACH, and remove are the artificial barriers to the money flow, we’ll have a really good idea about the health of the Ponzi.
Monthly $30 fee only adds to the story that most of their revenue is NOT coming from sales to non-affiliates, doesn’t it?
Thanks for confirming that Zeek is a ponzi/investment scheme.
Zeek has plenty of money left. Nxpay is back, The next nxpay payment is on Monday there isn’t any 2 week delays
Don’t think it’s crashing any time soon.
OMGoodness, my brother will not leave me alone! He called me again tonight to ask if he could put me on a 3-way call with one of his uplines…
I told him no, I did not have the time or interest to question or argue with anyone on the inside, but that he should start asking the hard questions, since he had skin in the game.
I asked him straight up, how much money have you made from commission on retail sales; he answered, “very little.” And yet, the light still won’t come on… go figure.
Thanks again for the time and efforts you all put in here.
T Sharp
If it is legal to participate people really don’t care
There have been some statements made here about Ponzi’s that I want to clarify for all concerned.
First, participating in a Ponzi is not legal. The word Ponzi is used to describe any program that is operating illegally. It’s mere definition means if you participate you are participating in an illegal enterprise.
The word Ponzi comes from Charles POnzi who is credited with running the first Ponzi in the US, but in truth, he was not the first. The first Ponzi run in the US happened in the 1880’s and was run by Ferdinand Ward, who literally bankrupted former president Grant literally overnight.
When a Ponzi is shut down by the authorities, if any charges are filed it is not for running a Ponzi, but for bank fraud or wire fraud or money laundering, or a combination of these charges.
In the CEP case and 12DP, the government did do a clawback against the major recipients of the cash they were paid. So yes they can come after anyone to pay back their ill-gotten gains. You did receive money from an illegal enterprise.
Now I want to address what is considered a legal MLM versus an illegal one. According to the FTC (Federal Trade Commission), who has oversight of the MLM industry, their requirements are that 51% of your income must come from retail sales, and these sales must come from customers.
Members in your downline do not count as retail sales, nor does any products/services you buy. These must be customers that are not members of your program in any fashion. If the majority of your income comes from sign-up fees, downline commissions, etc., then it is an illegal MLM program.
Actually in the Amway case of the mid-70’s, it was stated the income had to be 71% of your income had to come from outside retail sales. Since then the FTC has allowed this percentage to be reduced to the current 51%.
So in regard to Zeek, if the members do not generate income form retail sales of its products/services from non-Zeek members, then it is an illegal MLM.
I believe any business a mlm or a brick and mortar can succeed or go under to bash one company you bash all.
A person who is 3 times 7 has the ability to make there own choices. Some people cant succeed at any business its just the odds of doing business.
when someone high up as a president of a company that also has many losers in it and the biggest producer at that company stole all his down line from another company then who is the pot calling the kettle black now.But then thats my opinion
Thanks Lynn for contributing absolutely zero to what has been posted here hundreds of times already. Insightful as WIki. the 51% and 71% is an old joke.
Quick question: Banks are returning 1% or less yearly interest, Money Markets around 2-4% and a good stock growth fund doing maybe 8-10% per year as a risky yield.
Zeke has been returning 1.4/day, 42%/month and around 500% per year return for what, over a year now?
Where are the Wall Street Journal or Bloomberg articles and recommendations? Why isn’t Berkshire Hathaway investing (sorry- “buying bids”)?
Unless the “business” use ILLEGAL business models like a Ponzi scheme, or pyramid scheme, or otherwise behave ILLEGALLY.
You call posting ONE ad a day a “business”?
Ah, the sour grapes argument. You don’t seem to think that he has OTHER motives to say what he said. So why start with “you bash one business you bash all”? Doesn’t that mean you also agree that a scam in MLM guise hurts all MLMs?
The 71% is a bit of odd interpretation by the anti-MLM folks, actually. The 70% rule in Amway merely says that 70% of products must be sold before new stuff can be ordered. It’s to prevent inventory loading. It doesn’t actually say it must be sold to outside.
The Weber vs. Omnitrition case did clarify that the Koscot test actually means that retail sales are to people who are NOT affiliates, and FTC revised their definition to 51%.
In case of Burnlounge, a mere 10% of their revenue is from sales of music and such to non-members. the remainder came from sales of affiliate membership and “training”. It was shut down as a pyramid scheme.
The Zeek case is interesting, because it is claiming that bids are sold, so “most” of their revenue is from sales of bids, not from affiliate membership fees or “training” (though I’m sure that “mandatory” compliance training and the video ad service added to their bottom line).
But the problem here is… are bids sold to actual non-affiliate customers, or affiliates, and if so, in what ratio?
Given that affiliates start by buying huge amount of bids (up to 10000), and is repurchasing bids every day (remember, 80% repurchase is recommended) it takes no imagination to say that majority of bid “sales” is to affiliates.
As the affiliates then share in the profit of such sales, you have a Ponzi scheme.
Actually, coverage in mainstream media neither proves nor disproves a company’s real or scam. Remember, Madoff’s mentioned for 15-20 years.
The problem is you have a “chicken or the egg first” circular logic.
Let’s work backwards:
a) you accept that Zeek can and have paid this many people
b) then Zeek obviously have this much PROFIT to have paid these many people
with me so far? Here comes the question no affiliate seem to be asking:
c) If Zeek has this much profit from their auctions, why do they need to keep recruiting affiliates?!
The affiliate’s position is Zeek recruit because they want to expand, and they are willing to sacrifice 50% of their profit to do so. “Spread the wealth”, so to speak. By promising 50% of the profits with the affiliates, the affiliates must in turn “buy giveaway bids” and give them out.
So you have a circle, like chicken and the egg:
–Zeek makes profit from bid purchases made by affiliates and others
–Affiliates profit from Zeek’s retail points pool “revenue-sharing”
They’re paying each other, and Zeek took 50% of the cut each time. Add to that Zeek’s mechanism to give variable maturity period and you got people who sees a creature, walks like a duck, quacks like a duck, but insists on being called a chicken.
Exactly!
I am surrounded by people trying to get me into Zeke. Some have persuaded others to invest $10,000. It seems no one is asking anything about the viability of the company or their payouts. It’s really unbelievable.
The main selling point for skeptics seems to be their Alexa ranking, as if that has anything to do at all with the soundness of a business model.
Very interesting phenomenon to watch.
I’ve found this is usually the case with people who get involved in things like this. The more you express skepticism, the more they want you to talk to people involved in it so that you’ll change your mind.
K. Chang you make some good points how ever maybe the whole industry needs to be watched more closely how about this for fairness.
If you join any company from the top one to bottom one and you fail and never reach the dreams you may have had
you can get all your money back now that would be fair.
As far as posting 1 ad a day that is what they call a business. But maybe to clear this up you can explain the definition of work.
But we’re not discussing the whole industry, are we? We’re talking about Zeek.
I’ll disagree with that.
What does a company want *you* for?
Two possibilities: they want your labor, or they want your $$$.
One’s “work”, the other is “investment”.
Which one does Zeek want? Your MONEY.
Just did.
Not really unbelievable. In this crappy economy, here comes a friend of a friend with a great investment, whoops, scratch that, “business opportunity” offering to pay 1.5% interest a day just for giving them money and doing next to nothing.
Then comes the check flashing, the “I’m making $5,000 a week” claims, and the fish take the bait. That, and the “don’t listen to the negativity of the dream stealers” talk blinds people to the fact that it all sounds way too good to be true.
K. Chang your missing the point this has nothing to do with Zeek or any other company let me phrase this different:
What defines work, being a cashier at target being a doctor being a auto mechanic, bus driver, truck driver, or a blogger with multiple number of advertiser on there website that when people go to the sites and click on them the person with the site makes money.
Please tell me I am confused.
BB. find different people to surround yourself with the ones you have now are making you crazy.
MB: You’re welcome. Glad I could be of help to you.
You might want to try reading what the FTC has to say about MLM companies and illegal pyramid schemes before making an assessment of my comments. To make it easy for you, I have taken the most relevant parts:
Here are some important questions to ask your sponsor and distributors at different levels of the organization. Their responses can help you detect false claims about the amount of money you may make and whether the business is a pyramid scheme.
1.What are your annual sales of the product? How much product did you sell to distributors? What percentage of your sales were made to distributors?
One sign of a pyramid scheme is if distributors sell more product to other distributors than they do to the public.
2.What were your expenses last year, including money you spent on training and purchasing products? How much money did you make last year — that is, your income and bonuses minus your expenses?
How much time did you spend last year on the business? How long have you been in the business? How many people are in your downline?
It’s important to get a complete picture of how the plan works: not just how much money distributors make, but also how much time and money they spend on the plan, how long it takes to make money and how big a downline is needed to make money.
3.What percentage of the money you made — income and bonuses minus your expenses — came from recruiting other distributors and selling them inventory or other items to get started?
Another sign of a pyramid scheme is if the money you make depends more on recruiting — getting new distributors to pay for the right to participate in the plan — than on sales to the public.
In the most recent cases brought by the FTC against MLM companies they deemed were operating as an illegal pyramid, the answers to these questions were their benchmark and legal precedent.
Thus the 51% rule: more money must be from retail sales than recruiting, personal sales and distributor sales.
KC was partially right in his summation of the Amway case of 1976, but when the court revisited this in 1996, is when they made the distinction that the sales could not come from their downline/disbributors, or whatever they want to call them, and themselves to be considered retail sales. Thus closing the loop-hole from the 1976 ruling.
But Zeek has far more problems that just being an illegal pyramid scheme as defined by the FTC.
Mr. Schroeder was correct in his assessment that Zeek is the type of company that will leave a trail of devastation. It won’t be long now until everyone will know just how devastating it will be.
Another reason wny I know Zeek is in trouble is because Rod Cook, MLM Watchdog, one of the MLM’s strongest supporters, has had Zeek on his Watch list since February and has been warning people to stay away until they solve all their problems.
A position he has not waivered from since February.
@Jimmy
Perhaps this is Zeek’s way of delaying the inevitable fall. They just found a way to make more money from affiliates by pretty much demanding $29.95 from everyone up front.
Gotta admit. Sure helps with the ol’ cash flow.
Ponzi schemes aren’t automatically illegal to participate in, are they? “Illegal per se” (in itself)?
Pyramid schemes ARE illegal in all aspects, both to organize, market, participate in and recruit others into.
Most often, investors in Ponzi schemes are considered to be victims of a fraud rather than involved in illegal activity.
You do realize you’re WAY OFF topic, right? But to entertain your thought:
Writers capitalize on their writings two ways, by right of resell of the content, and right to allow ADVERTISEMENT with content.
Neither are directly comparable to actual “work” or “job” where you trade labor for pay, unless, you’re a “staff writer” for a news outlet where you need to produce this much writing to get paid.
None of this has anything to do with ZeekRewards. It’s not “work” (as in labor), and it’s not content creation. It also wants your money, so it *is* an investment, yet it insists it’s not investment. Either it’s in denial, or it’s a liar. (Or please, provide a third logical alternative)
The topic of defining work is irrelevant to Zeek Rewards. When the company banned members from 6 countries (falsely attributed to non-existant OFAC regulations), banned members were only refunded their initial investment (what they personally had put into the company).
They were not compensated for the supposed “work” they had done for Zeek Rewards, which in some cases would have been over 12 months owed.
@Lynn
I was being sarcastic because regular skeptics here including myself deemed Zeek a ponzi months ago or longer. There are thousands of comments back to 2011 that cover your comments and more.
While your intentions were good, I was snarky because your entry read to me with the authoritarian tone of a Wiki article that regular bloggers here have read hundreds of times already with greater depth.
A new visitor might see them for the first time, so for that I apologize for being rude.
Poor Bruce on Troys site seems disgruntled. I assume he is upset on not being able to use his cash to pay for the 30 dollar compliance bs from his back office or is still having backlog payment issues.
Zeek news with their lame photos show a zeek debit card half in a wallet and is getting the affiliate masses excited. States nx payment is ready and loaded for bear…. i guess i understand what they are trying to portray, but what business communicates like that.
AS far as MLM Helpdesk, I think that marine might of bumped his head a little hard in training.
I laugh when the Zeek Heads keep thinking this is a long term sustainable business. They are delusional. Look at the facts:
If one person were to start with 10,000 bids and just let it ride, and at the average of 1.4% per day which doubles your money every 90 days.
NOW GET THIS, if you did not pull any out and just left it in there after 7 to 8 years you could pay off the U.S. National debt of 16,000,000,000,000 TRILLION DOLLARS!!! With only a 10,000 dollar investment for just shy of 8 years! Come on people do you really think this thing is sustainable?? Ostriches!
Thanks for the apology, but I did not take your comments as rude, rather as a means to better explain my comments.
I am new here too, so I was not aware of everyone’s history here and what they have and haven’t said. I know that many people are just now finding this thread, and hoped I could contribute something that might be of assistance or help to them.
I just saw it as an opportunity to illutrate how the FTC looks at these programs and what they consider to be illegal versus legal.
It was very gracious of you to offer your apology and I sincerely appreciated it. Keep up the great work in exposing this illegal program. I think I will stick to my area of expertise and let the experts in the MLM world carry the day.
Seems Zeekheads are searching for EVERY last bit of rationalization they can find.
One guy posted on my hub that claims “profit-sharing plan” in the US is legal and and does not fall under the jurisdiction of SEC. The problem is “profit-sharing plan” in the US refers to a retirement fund, not this sort of daily profit share. He didn’t bother addressing the Howey test at all.
Then there’s another guy who agrees that Zeek essentially took a loan from all the affiliates and paid 100% APR interest over 90 days. Somehow, this is “normal” to him.
It’s almost comical to see how they argue like… uh… creationists and anti-vaxxers.
Your point is taken. I meant to compare their “moving goalpost” to, uh… less scientific endeavors. 🙂 And that’s the last thing I’ll say on that topic, promise.
LOL, I was in monavie for awhile and drank the 25 dollar a bottle “miracle” elixir. If zeek is a ponzi scheme then take away the juice and stick bids in their hands and the only difference in the compensation plan is that you get juice instead of a chance to bid on products to get them for chance.
If you don’t sign up a ton of affiliates on autoship to buy the juice, you don’t get paid. I couldn’t sign up anyone to buy this juice because it’s ridiculously overpriced, so I was out several hundred dollars in juice.
No matter what mlm you are in, the down-line always has to buy some kind of product whether it’s pills, juice, exercise equipment or a service to sustain the company. At any moment people could stop buying a product and a company can go out of business leaving investors in the crapper.
With Monavie, you are forced into buying a juice at 100/month that they say “proves to heal all kinds of ailments” Why wouldn’t a company president or leader downgrade another company that they have no clue about if it’s stealing business!
I have no idea how much it costs to make a bottle of acai juice or gel or the real health benefits of them since the company uses paid doctors to promote the stuff. Maybe it costs 50 cents a bottle and they are making a crazy return.
If the company will go under then it will go under, but if it doesn’t then you will all look stupid and a ton of people will make a ton of money for years to come. I have lost money in every mlm company I have ever been in because of the cost to start them, and the product you are forced to buy.
I have tripled my my startup return with zeek in the first five months. You will not find 1 person out there that has lost any money in this venture. If they want to ride it out for years to come, then that’s a risk they will personally take, just as if they bought into any company and hoped for growth.
I got out of Monavie because it was costing me way to much money with only juice in return. ie,. I went to college, I have friends that went to college. We all paid to go to school, they don’t guarantee that you will make a certain amount of money with a degree or that you will ever get a job.
I have a job, and make more money than some people that have “better degrees” than me and I have friends that can’t find employment. Is education a product? If it is, it surely doesn’t guarantee anything more than an ability to argue points. If everyone threw up their hands and quit going, then the school wouldn’t be able to sustain the overhead.
So people now argue that the zeek model is illegal. This is based on speculation and in all reality it is being told this by leaders of top mlm’s that can’t hang. Zeek leaders don’t slam any other company, but are putting their energies in approving inefficiencies and coming up with new ways to improve to sustain long term growth.
Anyone want to buy my left over Monavie juice, I have 10 bottles. I will sell them for a discounted price just so I will recover something. I am now making my own juice for a fraction of the price.
Thanks for all the great information you are providing. Keep it coming
Phyllis
@Duane
So you couldn’t sell MonaVie juice, and as a result you’re going to call them a Ponzi scheme. Yeah, because that’s the same as affiliates making an investment, compounding a daily ROI and increasing their daily ROI over time.
Exactly the same.
One is a Ponzi scheme, paying out affiliates with affiliate money based on how much they personally invest and/or get others to invest, and one is based on product sales with actual sales commissions, minus the whole Ponzi thing.
I’m pretty sure if I join MonaVie, I can’t just buy my own juice and earn an increasing daily commission.
The rest of your rant is irrelevant waffle, your own failure at MLM has nothing to do with Zeek Rewards’ business model.
Come on guys.
First of all, if Zeek is a ponzi scheme, It’d have been disspeared a long time ago not within 15years of business. Zeek offers a tremendous opportunity to invest yout money with low risk and high rewards ratio.
I personally made over 70k after expenses with 4months with Zeek by signing myself 5 accounts with 10k investments each.
Also one of my professor made over 300k within 6months in his total 11 accounts of 10k investment with Zeek. In the meantime, I’m enjoying the uptrend ride with Zeek as long as it follows my risk appetite.
BTW, if you dont like Zeek then just leave it alone for others to join in. Dont pull everyone into the same boat since Zeek is an opportunity for everyone in this turmoil market.
Sorry, Zeekler only existed as of June 2010. Get your own facts straight before offering opinions.
Second, you used the “if authorities didn’t go after it already it’s gotta be legal” fallacy.
Double fail for you.
Clearly, you didn’t read any of the evidence and facts backing up what you called “speculation”. Perhaps you’re the one “speculating”?
Sounds like that includes you. So what exactly does that mean? Nothing, really, except ad hominem attacks, which are irrelevant.
Dont try to influence others since you think Zeek is illegal. People involved in Zeek some of them are highly educated such as my two university economic professors with 20+ years exp.
These guys analyzed and saw the tremendous opportunities to invest in Zeek for a quick scalp profits. just remember, when you critized Zeek, you have to analyze the pro and cons.
The pro seems to overcome cons as long as you have your risks in checks.
Education apparently doesn’t make one smart. You were just lucky to be in early.
Scalp profits? You’ve scalped the people below you…congratulations.
@Johnny
It’s OK if people join and know what they’re doing, “calculated risk” or whatever methods they use to make their decision. They are usually more relaxed than the “true believers”.
Part of the information here IS useful for those who use calculated risk. They just have to find it, and know how to use it, and know when they should avoid using it.
“Pro and cons” — we’re not that type of website. You will usually find that type of analysing on sites that tries to sell something to you or recruit you into something. You can’t expect us to be a copy of some other review sites?
The closest we can offer will be the first review of a company. It contains the factual information about ownership, products, compensation plan, etc.
2h
2d
3c
KC troll cheat sheet works every time.
Saves alot of typing too.
Hey pal didn’t your mom teach you never to tell people what to do, they wont listen to you and you come off as a fool.
Oz didn’t start this site to influence people. Its here to analyze MLM business models. If you don’t see the red flags around Zeek then you are blinded by greed like so many others. Nothing you have said has been any different then the countless other cultists
Not for sure where to post this…
My husband and I are extremely cautious people. My in-laws are completely opposite. They jumped right into Zeek Rewards, no questions asked. Ofcourse, they are looking for us to invest into this as well. (They have been involved in every MLM business out there. So, when they presented their ” New thing,” they got an eye roll.)
Thanks to this website, I have read a few articles and valued everyone’s input and taking notes. They have arranged for a “Q&A” for us to meet with their up line, that only has been involve with Zeek Rewards for a little over 100 days.
Out of courtesy, we agreed to talk to him (I rather be at the dentist). I’m seeking advice of what to ask or say to him. So, if you had the opportunity to talk to someone about Zeek Rewards, what would you say?
Side note: I’m not familiar with all the Zeek Reward lingo (for example, ewallets), putting it all in layman’s terms would be greatly appreciated. Thank you in advance!
@Needing Help…
Ask them where the money comes from? (penny auction retail customers)
Then ask them how many genuine retail customers they have regularly purchasing retail bids with their own money who are not their family and friends, or a dummy customer account created to make the most of referral commissions and matching VIP points.
If they claim to have genuine retail customers regularly buying retail bids with their own money, ask to see proof.
Then announce your concerns about the whole thing being a Ponzi and ask if they can guarantee that no affiliate money is being paid out daily as a 90 day ROI.
Sounds like we’re finally all on the same page?
By the affiliates would indicate the revenue was a byproduct of their efforts. Through the affiliates implies the money passes through them, which it does in that the affiliates are buying and pumping money into Zeek themselves.
This same money is then paid out daily as a 90 day ROI through the point scheme, ie. affiliates paying affiliates with this money able to be re-invested back into the scheme to increase their effective ROI.
My ZeekRewards explanation hub contains a list of questions to ask, a few per section.
These are questions the upline would NOT have answers to, but would be VERY reasonable to ask.
http://kschang.hubpages.com/hub/Analyzing-ZeekRewards-is-it-a-legal-and-viable-business-and-can-it-provide-long-term-income-for-you
I think I’ll even add some potential answers and analyze them as well.
Ask them why they do twice the amount of business from Monday through Thursday than they do on Friday Saturday and Sunday. (You’d think people would spend more time playing a penny auction on the weekends instead of while they’re at work).
Ask them who they bank with.
@Oz — the problem is Troy is fixated on the “profit-sharing” angle, which is all of a sudden all the “smart” debaters are going after. Few of them care about the Howey test, or even the Koscot test.
To get through to Troy we need to point out how this fails the Koscot test (and the Omnitrition case), PLUS the Howey test.
So what? Isaac Newton lost 20000 pounds in investments during his days. That’s like MILLIONS today. He’s a smart guy, right?
How about professor Stephen Greenspan? He WROTE THE BOOK on Gullibility. He is a Madoff victim. Go figure.
Being smart, economics, whatever had NOTHING to do with vulnerability to scams.
More like IGNORE the risks altogether.
It’s been stated on Zeek conference calls and maybe even in one of the corporate videos that profit share comes from all sources of income, including affiliate bid purchases, monthly subscriptions, other fees that Zeek collects for marketing, compliance, etc.
What is unexplained, however, is how the rate has been so steady with so few fluctuations regardless of eWallet issues, Zeekler or Zeek Rewards IT downtime, holidays and other seasonality impacts, etc.
We touched on this issue early in the articles here, but have kind of let this topic slide as there have been much more obvious Ponzi indicators to analyze.
Or use a slightly different approach. Ask Troy what would happen if Zeek’s virtual point business model is indeed NOT an investment and NOT a Ponzi. Wouldn’t this now be the formula that every Ponzi on the planet uses?
Instead of paying on invested money directly, they just convert everything to points. Instead of promising fixed returns, they just claim “daily profit share from all revenue”. Any incoming revenue gets converted to some virtual form and then given away as samples.
I could see carbon offset Ponzi with an MLM compensation plan really take off.
So if you give Zeek every benefit of the doubt and assume their business model is illegal, then Paul Burks’ great invention to the industry is that he just invented the path to make every Ponzi on the planet legal.
Or is it more likely that a Ponzi is still a Ponzi and no matter the window dressing?
Anyone reckon the ponzi has much legs in it I’m thinking of going for a gamble on it just for giggles who knows I might retire LOL
As long as you go in with both eyes wide open and don’t pretend “it’s not a scam”, hey, it’s a free country. 🙂
The problem I have with Zeekheads is not that they act like fools, but remember that quote? They removed all doubt by using FALLACIES to justify Zeek and/or their own involvement. Then when skeptics point that out, they got all offended.
Dion you may be going in with eyes wide open, but lots of people don’t. Are you comfortable with taking other peoples money…basically knowing you would be stealing? What if it was YOUR Mom who lost her retirement?
There wouldn’t be ponzis if nobody participated. Which is why sites like this and KC’s blog are so helpful, education is the only way to maybe someday get the message out…there is no free money to be had.
Old fashion work and effort people, that’s the way to make money. You “usually” won’t get scammed that way, and you can be proud and successful in your own efforts.
Will you be proud of yourself getting rich off a ponzi? Would you be proud to tell your parents how you got all the money?
Seems more like Morals and Ethics perspective type to me.
@Erin — to be fair, there’s a decent chance that Zeek may go before he can turn a profit. 🙂
Very true KC. Then I won’t have to ask what if it was his Mom, I can just ask how he feels at that point 🙂
hi bye Something wrong with morals or ethics? Have you ever lost a large amount of money? It really isn’t that much fun.
I do have mixed feelings, I don’t want to see anybody lose their money, but then again I think, well DUH, if you believe there is free money, you get what you get. Just trying to get people to THINK. Wanting to believe doesn’t make it so.
Just so you know where I’m coming from…lost $25,000 in a ponzi that was running for over 10 years. Knew lots of people who had been in forever and were doing just fine, the business model even made fair sense, way more sense than Zeek.
Nice offices you could visit, fine customer service, still turns out to be a ponzi. No, it wasn’t Madoff.
I am against ponzi participation, and generally hate all MLM
My eyes are completely open I know zeek is a ponzi and they are blatant liars about everything I’m a regular to this blog although I don’t post as often as Oz and K chang.
I wouldn’t recruit I know people in this who are just brainwashed including family members which has caused a divide between myself and them me being against it, I mean if you can’t put two and two together you kind of deserve to lose money that being said I don’t consider myself unethical.
Everyone in zeek will nod and wink but they know what is really going on. When I play poker live I will take rookie players money. Do I feel guilty no, because they know what they are getting into same applies to zeek if lost I would accept that.
I wouldn’t jump up and down and cry out that the sky is falling down because frankly the company reeks of a cheap suit. And Erin I have a real job that makes good money anyway as a google adwords and analytics account manager for major companies so yes I also know the value of earning good money the right way as well.
I know Jimmy was kind of in the same boat himself he even said he was a gambling man yet campaigns against it although I believe he said something about cashing a lot more regularly, I would consider myself in the same boat.
@K Chang yes I myself have wondered this as to whether zeek would turn a profit for my investment before it hits the fan. 🙂
I would be happy to watch the fireworks no matter the outcome.
Just saw your other post now Erin I’m sorry to hear that. That really sucks and I do sympathize.
A lot of people really don’t know it’s a Ponzi. If everyone really did know, then I’d say, heck go for it if you want to take the gamble, why not. Some are putting in what little they do have, that’s bad.
There are big Zeek meetings around these parts, lots of recruiting, these people just don’t have a clue it’s a ponzi. And there are others that refuse to believe it’s not legit, even after being told straight up, as we all have seen over and over on this blog.
Thank you Dion, fortunately I have a nice business that does well, it hurt, but it wasn’t devastating. Lesson learned, now I’m just ticked off that people will do this to each other.
When you think about it, it’s amazing just a handful of people who start ponzis can/will end up screwing over so many, thousands, hundreds of thousands? Unbelievable.
I bet Paul Burke and zeeks other 10 or 11 top executives all have passports. My guess is Brazil is where they will start there next ponzi.
@ K. Chang
When you critize that Zeek is probably a ponzi scheme or may go down soon, please provide the facts. Ask people around you who actually lost money in Zeek or all the Zeekler just enjoyed cash out their profit and laugh all the way to the bank?
There are seemed no RED Flag in the money flow stream in Zeek investments with consistent daily profit share 1.1%-1.4%. If the daily profit drops to .8% for a few days, there are warning signs. However, Zeek became popular MLM since 2011, there are no such complaints about daily profit drop below .8% as my exp and otheres.
Instead of critized Zeek based on few unsuccessed stories, you alr conclude Zeek is probably a ponzi. Why dont just open your eyes while investing and listening to many success stories.
@Tina T — Bernard Madoff didn’t raise any red flags for like 20 years. What makes you think Zeek in its 2nd year in existence would raise any?
There are PLENTY of red flags if you choose to seen them. The secrecy, the amazingly consistent rate of return (that is also impossibly high), and a model that requires you putting in money before you can be compensated.
Let me rephrase the question.
In the history of every investment opportunity or online business in the history of man, whenever one offers a daily ROI of between 1-2%, when has that EVER not proven to be a Ponzi, scam, or both?
In the immortal words of littleroundman at realscam.com:
@ Johnny
I think you had few interested points since Zeek is the investment opportunies but not for everyone. For every investments, there are risks associated. Always ask yourself, is Zeek investment within my risk tolerance or am I fully understanding the business model of Zeek.
Investors should know the basic knowledge of invesments instead of being a trully follower. There is no easy money and Zeek is just the tools to make money but not the ATM to withdraw money whenever you need.
@ Jimmy
For investments at high returns also mean high risks involved. Eventhough Zeek return rates are seemed unsustainable however if there are any Red Flag, then it’s time to get out. Meantime, investors just let their profits run, cut the loss if any doubts.
Also, as K Chang mentioned Zeek may go soon as the theory: what go up must come down eventually. Zeek grows at fast rate and may go down fast as falling knife. just know when it is when it is time to get in and get out.
Tina,
Some investors are truly believer and they are not doing any researchs at all before pouring their money into investments such as Zeek. If they are doing their homework then they’ll feel safe overnight.
Look, I’ve made lots of money on the 2001 internet bubble going up and down, the housing bubble, and even the 2008 financial collapse trading key markets. Most of the people that invested into those bubbles were legitimately warned as to what they had been getting themselves into (risk assessment).
They read the statements and formal documentation before signing up as SUPPOSEDLY well informed due diligence on their own behalf.
ZR on the other hand, when proven to be a ponzie will reveal either ignorance and/or lack of due diligence on the interested party’s behalf. Their excuse will be the wool being pulled over their eyes.
And for some it may be legit. For many others, they knew this was a ponzie and greed incited them to take the risk.
My concern is for those who are legitimately blinded by the FALSE allegations assumed by ZR’s business legitimacy statements to those who are introduced to it. Most accept it as fact without any real DD. And those who have no chair to sit in when the music stops will have their asses hanging in the wind.
No one is looking out for those who are TRULY innocent (very few). Those are the ones who will be financially and emotionally damaged and hurt here. The rest I could care less about.
But honestly… almost any person who undergoes the recruitment, introduction, compliance course, bid purchases, monthly registration, and hands on back office operations will eventually wake up to the fact that “It all seems to good to be true”.
And whether they admit it or not, when this realization occurs, they have just realized it to be as what it is, “a shady operation, ie scam”. But the best of the greed get to almost all of them and will rationalize it out to the very end.
Because of this, this ponzie proliferates until the cash in vs. cash out crossover threshold is reached.
The only way to really determine when this will happen is using a program application software program written in almost in language like C++, or Java that emulates the pyramid structure, size, timelines and average pay ins and pay outs.
Based on a start date of Jan 2011 and given doubling rates of 3 to 4 months with initial buy ins at US $10K, and the psychological/monetary attachment factor of the magical $1,000,000 mark, a large 30% group near the top of the pyramid should reach this by the end of the 2012 year.
If I were in their shoes, like most stock bubbles, I would sell early just before the top and be completely out by the time it peaks.
Again greed will get the best of those before they began to sell or cash out, by then it will be too late. This always happens. This phenomena is known as fleeing for the exits or running with the bulls and slaughtered by the bears.
This should be the mantra, and really all that ever needs to be said.
In case you guys haven’t already seen this crap re: the red carpet thing, here it is if anybody’s interested:
@Al
Oh great, I imagine we can expect a huge influx of ‘but but but my sponsor has been making eleventy bajillion dollars every day for months now, how can this be a Ponzi scheme we’re all getting paid?!’ type comments soon.
*groan*
Ok, on this.. Does that mean Zeek will become a financial institution and function as a bank? It is not clear by what they mean “Zeek will be coming out with it’s own debit card!!!!”
I’m pretty sure they have to have some government regulatory approval for this, unless they’re just going to whitelabel prepaid debit cards?
Any ideas anyone?
@Oz Lol
Well I’m speculating here but the new debit card is going to attract a whole new influx of investors maybe the ponzi will last a bit longer or perhaps make it crash faster when those big withdrawls start happening.
hmmmm what to do lol.
I imagine shortly after the release of the debit card we can expect an announcement from Zeek Rewards informing affiliates that if they actually want to use it, they have to wait for another affiliate to deposit money into the linked account first.
That and it won’t work at McDonalds or Burger King…
I’d be willing to wager more than a few VIP points that when and if zeek really does introduce a debit card it’s going to come with a one time registration fee along with a monthly maintenance fee…
Good point Oz and yes Al you are right they will surely milk the debit card for more external revenue without a doubt.
Hey Al, where did you find the Red Carpet post and who wrote it.
Does anybody know where the 10 story building is?
I was on the ZR Facebook page.
Mr Wallace: the red carpet review was posted on the zeeksupport forum
ASD’s purported debit-card supplier — Robert Hodgins — is an international fugitive wanted by INTERPOL. He is under indictment in Connecticut, amid allegations he helped narcotics traffickers in Medellin, Columbia, launder cash through ATMs.
It perhaps also is worth noting that the now-collapsed AdViewGlobal autosurf started to reference debit cards near the bitter end in 2009. This was after AVG appears to have tried to route money to itself via a Florida shell company that tried to open an account through an offshore service.
The FBI has very publicly shared its concerns about how debit cards can be used to promote money-laundering.
PPBlog
A company can order branded debit cards from MasterCard and Visa, with their own company name on them. A typical range of clients is 5-10,000 or more. They can sell the debit card to their clients.
Banking transactions in connection to the debit card are done by a third party bank (or similar entity with banking rights).
I made a superficial check of that market in early 2010, only to establish whether it was a “normal market” or a new type of scam. The market for branded debit cards is perfectly normal in itself.
Concerns about debit cards are related to the users, not to the card itself. The solution will attract too many users with questionable motives, e.g. tax evasion or money laundering. But the primary function of debit cards is to act as a payment solution.
Just rode by zeeks WORLD HEADQUARTERS, and it looks like after a meeting of the minds at the red carpet event they have finally figured out how to comply.
Someone was outside selling water to the masses lined around the building waiting to give up there money. They are finally selling a product (sarcasm) I was going to stop and buy a bottle, but I was afraid it would turn into 300 bottles by the time I got home.
@ Tina,
I thought all the mumbo-jumbo Zeek has for its affiliates (and prospects) is not to mention it anywhere as an investment scheme, let alone a ponzi. So isn’t what you said contradictory to Zeek’s compliance?
More likely, they’ll white label an eWallet provider’s prepaid debit card… and slap on ANOTHER fee.
Imagine this scenario:
You can now use ZR Debit Card! Money is taken from your eWallat at ( ) and you can choose Zeek logo to show that you are a ZR member!
There is an additional fee from the eWallet provider if you choose this purpose every time you ( ) plus transfer money into it, plus a custom printing fee for that cool logo! And if you rack up any ATM fees, it’s your problem!
I tried to go to your link and it didn’t work. 🙁 Thanks for your help!
Don’t forget the 3~4% fee if you want to move the money from the debit card into your checking account…
zeeks affiliate count has grown very rapidly and there ROI has stayed around 1.4%. it seems to me that there auction count would have to have the same growth.
1.4% DAILY growth? Come on.
It’s really sad that all we can do is talk about the possible downfall of another do anyone watch American Greed even legitimate companies do wrong.
Because it sounds like something doesn’t mean that it is. Do your research or better test it yourself before you judge. We also judge a book by it’s covered and majority of the time we are wrong.
Done and done.
Zeek Rewards is still a Ponzi because of its business model, your anecdotes about books and their covers doesn’t change that.
@NeedingHelp — someone CLAIMING to be representing Rex Venture Group sent a takedown notice to my article host. I am hashing it out with them. It should be resolved shortly.
We have and are, and that’s why we’re here sharing it. Where’s yours?
FWIW, there’s a top level shuffle at Zeek. Dawn moved over to CMO and they hired a new COO. This was at the Red Carpet Event. This was confirmed by Troy Dooly.
I not trying to change anything first off. Secondly I don’t have time to worry about what others do. I have my own businesses to run.
You need to worry about more important things. Like if you work everyday and find yourself without a 401k or maybe no job.
My point is not based on what you think. Mr judgemental my point was that rather its legit or illegal it can turn out to be a scam.
Another thing I have been in other programs similar and I hate to be the one to tell you I never lost penny. So it each its own maybe you were on the wrong end. Anyway I not here to judge I just basically made one point and that is legal or illegal can turn out to a SCAM!!!!
Doesn’t take much research to see right through this ponzi.
Sucks to not see your blog up KC, open up a can on that idiot.
@Riley
What you personally do or don’t have and do is irrelevant to the discussion. As are your comments regarding what other people do or don’t have or do.
Thanks for stating the obvious.
I’m sorry, but have you EVER taken an assertiveness class? Because most of your sentences are “maybe” this and “maybe” that.
Or do you naturally hedge your sentences?
So basically what your saying is that as long as YOU made money it is all good – scam or no scam. And if others lost money then that’s just too bad and that’s your problem. Right?
Now what would you say then, if it was proven to be an illegal scam, the authorities took all the money you made back and even fined you, say $500,000 and a potential jail sentence. However, the people that lost money didn’t face any fines or charges because they didn’t benefit from the illegal scam.
I bet you would be fuming mad and saying that is totally unfair wouldn’t you? You get punished cuz you made money and they don’t cuz they lost money. The tables would then be turned now, right? What you state is an random injustice. What the law states is LEGAL JUSTICE! That’s when you would begin to care then.
It is laws that begin to frame our county’s sense of proper civility. Without it we would revert back to the Darwinistic rule of the “Survial of the fittest” – Financially and Physically.
One thing I was thinking about this morning was that since it’s been reported that there are about 12 people receiving $1 million a month from Zeek, that means that there have to be 1200 new people investing $10,000 every month. This is one reason I don’t think that Zeek will last very much longer.
For one thing, there aren’t a lot of people who have that much money laying around to invest, and secondly, not everyone with that much money laying around is going to invest in Zeek. Even if you figured an investment of $1000, you’d need 12,000 new people each month.
Then you have to take into consideration that these 12 people’s point balances will keep growing, not to mention the thousands of affiliates out there with six-figure points balances. Then there’s also Zeek’s operating expenses.
I know that people are being recruited left and right, but it really makes me wonder if enough people are being brought in to keep it going.
If you check Troy’s comment below his latest blog entry about Zeek he makes mention of a couple of changes they are making to the RPP model. No longer will affiliates be paid simply by placing an ad each day.
Apparent, affiliates will have to have active customers as well who purchase a certain amount of product. How many active customers are required each month and how much volume in sales is not yet defined.
Obviously, this new requirement doesn’t prevent affiliates from setting up fake customer accounts and then purchasing product themselves through those accounts in order to qualify for the RPP.
But it does seem to shift the focus more on creating actual sales volume.
Here is Troy’s blog post: http://mlmhelpdesk.com/seth-godin-shares-explains-what-dallin-larsen-founder-of-monavie-and-paul-burks-founder-of-zeek-rewards-have-in-common/
So if you HAVE to recruit and have active customers could that mean the penny auction isn’t making a gazillion dollars to pay everyone? What! Shocking! Isn’t that supposed to be the backbone of the company plan?
@Erin — it means they are taking the notion that they *may* be judged a pyramid scheme by the FTC seriously, and will be adopted the Amway safeguard rules (or their version of it).
It remains to be seen whether they treat the other notion seriously… that they will be judged an investment by the SEC. Somehow Mr. Dooly was under the impression that the same changes will also take care of that Howey test. That remains to be seen.
With out question, Zeek is a classic ponzi. After all the fancy money maneuvering etc… the money paid to affiliates come from the money paid by new affiliates or affiliate repurchases.
The ride will last as long as everyone continues to bring in new affiliates (“investors”) and affiliates keep buying bids (re-investing).
There will come a time when a “run on the bank ” will take place. It is a very fragile situation.
really? did u account for point retirement? are u sure?
and why do the same people post the same stuff here over and over?
Joe Mama,
Where did you read or hear that there are about 12 people receiving $1 million a month from Zeek?
Hey guys,
I started on June 1st and have since been able to pull out my entire original bid purchase. You guys got a lot of great theories and ideas but truth is nobody does see the books, meaning none of us could really know.
Many people see that as a negative, but in all honesty a lot companies that aren’t public on the market don’t show their books anyway, it’s not really fair to single out Zeek.
Also what I do know is how much of an impressive staff they have. A team of lawyers signing on a few months ago, the top compliance guy, and now just recently adding on the VP of Walmart who has been with Walmart for the past 25 years, as the treasurer.
The FTC coming in telling them to change a few rules but yet NOT shutting them down, hmmm if they were a Ponzi why not raise the red flag then? They are quadrupling their staff, and they are moving into a building three times the size that they’re in now.
I suggest taking some time to learn about retirement, it changes a lot of your numbers drastically. That doesn’t sound like a group of scam artists trying to suck every dollar out of the their employees and customers until the whole thing runs into the ground.
I’ve been following you guys from the beginning, K. Chang, Oz, and Jimmy, I’ve noticed you guys got serious problems with network marketing as a whole. Have a little faith. At the rate you’re going, the governments gonna turn into a “Ponzi” before we know it.
I don’t exactly remember where, but I think it was mentioned on here from official Zeek sources that there are 12 top earners making around or over $1 million a month.
Ah, here it is:
Made on May 25th on this page: https://behindmlm.com/companies/zeek-rewards/fraud-still-rampant-in-zeeklers-penny-auctions/#comment-77270
Apparently that news was from one of Zeek’s past red carpet events.
On Zeeksupport forum there is a thread “Please post your positive experience here-no negativity”.
There’s going to be a lot of dissappointed affiliates when they will be forced to find paying customers to earn RPP.
All this time they only had to post one ad to get RPP. Of course, if they had read this forum, that was not even required. Just post the same link everyday and you qualified. What will it take before they realized they have been Madoffed?
Burks announced this at the red carpet event in May.
Since then I’ve been wondering if these guys have been having the same issues as everybody else with the e-wallets, especially considering that they’d each be receiving at least $232k per week ($1m/4.3weeks)
@Affiliate
Don’t need to see the books, just need to know if the bulk of the daily ROI paid out is affiliate money or not. Based on the evidence we have thus far (complete lack of retail customers), all signs point to yes.
How many genuine retail customers do you have that regularly spend their own money on retail bids and are not your family and friends or accounts you set up yourself for referral commissions and matching VIP points?
As above, you don’t need to go as far as seeing the books when it’s a simple yes or no question.
First I’ve heard of it, going to need a source and specifically what they (the FTC) said if you want to be taken seriously on this.
Yeah these sorts of announcements have been common since late last year and are irrelevant when analysing the business model.
If you’re talking about point retirement, then I suggest you educate yourself on the subject as one of the major fallacies of the Ponzi business model is that if affiliates start with x points and don’t earn a large enough ROI over 90 days to purchase >x points, they’re going to cash out enmasse and nobody new will join.
Boom!
If you’re talking about actual retirement in the physical world, that’s irrelevant.
Irrelevant.
Nope. All we do here is go over business models. I’ve got no problems with MLM companies that focus around the sale of products to actual retail customers. Problem is they’re far and few betwen these days.
@Otis
Because we keep getting new affiliates, fresh from the marketing and compliance videos ZR push onto their members asking us questions like ‘did you account for point retirement’ and ‘OMG GUYS, all the profits come from the auctions!’ and ‘I have no genuine retail customers, neither does any affiliate I know but there are plenty of them out there’ etc.
Of course after being challenged on these points they usually disappear but reading through I can see how it appears to be a bit of a cicular discussion.
Ah well, such is life.
There was discussion from Zeek corporate that one key issue the FTC had was that affiliates were not paid in proportion to “the work” being formed, that is the placement of adds.
So one of the changes Zeek is looking to add with either the Zeebates and/or new PRC requirements is to require an increasing number of “customers” as your daily earnings increase. I think this is what Troy is referring to with regards to the Howey test.
I believe that the revenue from PRC’s and Zeebates will still be so small compared to affiliate investments, but this change would just muddy the waters some more perhaps to throw off the scent of an illegal investment or Ponzi (the analogy here is to roll in the mud to throw off the scent of hunting dogs).
It’s like I said before, if Zeek wanted to go legit, they would make affiliates buy bids and then turn around and sell them to actual customers for a profit, with no increasing VIP points balances to worry about.
This would fit the MLM model better and do away with the ponzi. Of course, they would then actually have to find real customers to sell bids to, and the whole thing would crash because you’d have thousands of affiliates trying to sell bids to probably a dozen customers.
Where did this FTC info come from and what was specifically said?
Everything I’ve read thus far regarding PRC’s from affiliates has been along the lines of worry about recruiting them (I know the big earners can just create dummy accounts from their earnings, but these are average affiliates).
People can’t generate legit free retail customers, and all of a sudden they’re going to attract monthly membership fee paying customers in abundance? Yeah ok then.
As I see it, the introduction of any forced recruitment of retail customers confirms that for the past year and a half there has been a largely insignificant amount of genuine customers resulting in the bulk of money being affiliate money.
Otherwise there’d be no need to change anything. That said, we’ve been hearing about these changes since what? March or April and I’ll believe it when I see it. Not much point discussing the specifics of the proposed changes until they are actually confirmed.
Then of course the most pertinent analysis will be looking at what they changed and what this tells us (as above, forced retail customer recruitment = a complete lack of retail customers and outside money in the system prior to the changes).
Also, as Erin pointed out, that the auctions (as retail vehicles) are not as profitable as made out to be. That of course we already knew when you factor in referral commissions and point liabilities on every bid sold (not used, because whether or not they are used is irrelevant).
I am horrifide but not surprise that an owener would sick up for his own mlm company. It is easy to bash others not your owne.
Not being apart of another mlm company or knowing the hard facts makes it hard to credit ones opinion. Yes ever memebet making money does have to work. If not they make no money. That is with every mlm company.
Some parts of Zeek may fade however they will always trek there memeber making money. Before bashing gets the true facts!!!!
Of course all our analysis includes point retirement. All you have to do is extend Zeek earnings out a few years to prove to yourself it is a Ponzi and is unsustainable:
Including 90-day point retirement,
Assuming 1.43% average daily RPP,
Starting with $10,000, and reinvesting 100%…
Day 1: 10,000
Day 90: 35,384
Day 180: 47,213
Day 365: 139,289 <– 13x return in 1 year!
Day 730: 1,154,300 <– 1.1M in 2 years!
Day 1095: 9,566,012 <– 9.5 million in 3 years, wow, easy money!
Day 1460: 79,276,245
Day 1825: 656,984,681 <– 656M, better than the lotto!
Day 2190: 5,444,617,991 <– in the billions now
Day 2555: 45,121,090,188
Day 2920: 373,931,244,275
Day 3285: 3,098,874,048,949 <– the first trillionaire ever?
Day 3650: 25,681,246,267,229
I have been following this blog for several months. My uncle is heavily involved in Zeek and has been trying (unsuccessfully) to get me to invest 10k. I started with a very open mind, and have been doing significant due diligence for about 3 months. I have come to the following conclusions:
1) If it seems too good to be true, it usually is. How can anyone not see through the 1.2 to 1.5% ROI per day in this economy?….Really?
2) My uncle (a naive but good meaning fellow) believes in Unions, “Free Money” and unfortunately…Unicorns. In my opinion, Zeek takes advantage of people like him with the “money for nothing” proposition. Pasting ONE ad every day (2 mins tops) is not worth thousands of dollars per week in compensation no matter how you slice it.
3) This smells exactly like a Ponzi. Money out is funded by Money in…period.
4) The “corporate office” is nothing more than a 1200sg ft. hole in the wall, located in a warehouse district.
5) The accounts of 10 story buildings, hundreds of service employees, “genius” level executive teams, massive numbers of customers, and 500% ROI in a year, are all…..just fiction.
Please, please, please, look at the facts before you put any cash into this thing. People are hurting. The economy, unemployment, uncertainty in Washington. Things suck right now. Don’t be influenced by those who prey on the vulnerabilities of good people at times like these. Save your cash!
Yet despite all of this genius, credit card processing continues to fail with web server error 500, and affiliates couldn’t log into Zeekler for most of yesterday due to redirection error sending them to “www.” instead of “www.zeekler.com”. Genius at the Wheel (should be a new Carrie Underwood song).
We’re mostly analysing business models, so we will usually not be impressed by staff.
I have analysed some of Zeek’s staff in a couple of comments, just to get a “disturbing” feeling out of my system after I had listened to “June 4th leadership call”. After that I have avoided listening to leadership calls, and I haven’t made more comments about it.
I don’t think you should ask me to evaluate their staff. People will easily be offended by some of my descriptions. 🙂
@Affiliate
Maybe June 2011, no way you got your initial investment back in one month.
It is possible if you refer others you gain commission on their initial investment + daily commissions on profit share.
If you invest without recruiting, it would take 66 days at 1.5% to recover your initial investment plus time to request withdrawal, minus ewallet fees and time to receive monies in your bank account.
I’ll admit I’m still unsure how zeek handles their customers, I’ve only been in for a short time. What I do know is the bids we give away are free bids and if you check the zeekler sight there are specific auctions that are “free bid” auctions. All the VIP auctions are bids purchased by customers playing on the sight.
That’s exactly my point, that we’re NOT making ridiculous amounts of money in the short times that you have all predicted.
So which is it, you think we’re going to rapidly make our money and the company will crash or we’re going to slowly lose our money to poor management with retirement? Also, zeek gives models in the back office on how to properly manage retirement.
Boom.
I apologize, I was wrong to say they “came in” but here is the response I have found to the FTC rule change:
http://mlmnewssite.com/ftc-business-opportunity-rule-takes-effect-zeek-rewards-reeling/
Right, let’s stop trusting people as a whole and decide the whole world is a conspiracy out to get ya!
Reputation does play a key factor in business these days especially with so many Ponzi’s swirling around, I’m going to put a lot more trust in men who throughout their lives have been able to prove their worth and intelligibility, not just a bunch of theories and guys “probably” thinking something, so I find your Irrelevant comment, Irrelavent.
Ummm please name one. Your MonaVie buddy? I hear that didn’t workout too well.
Put in 2,500 and have since grown up to 10,000 due to referring others. And 2,500 of that is sitting in my bank account.
Stop stalling and answer the question:
Once members are withdrawing enough each week such that too little money is being paid out that members cannot grow their point balances over 90 days (retirement can’t keep up with new bids being purchased), the system will crash.
It’s a simple concept to understand, and an unspoken ROI guarantee built into the system in that without it, nobody would invest and the company wouldn’t exist.
Irrelevant.
They’re out there and they’re reviewed on this very website.
What a sad state of affairs it is in the MLM world when affiliates that populate it sarcastically ask what companies exist that revolve around the sale of products to legitimate retail customers. It’s even sadder that this question is used in an attempt to justify their participation in Ponzi schemes.
Fair warning, answer the question asked of you or your next comment will be marked as spam. The only conclusion being that you refuse to answer the question because, like every affilite before you on here, you have no genuine retail customers.
And from the sounds of it, you do indeed have none. Instead of selling products to legitimate retail customers you’ve made your money convincing others to invest in the scheme. Y’know, just like a Ponzi.
I’m sure this is a ponzi scheme. All the signs are there. They always last a max of 2 years.
Seriously? Of everything I’ve had to say you try to make me look like an idiot cause I gave you an honest I don’t know? I know that I have 12 customers that I give bids to everyday that I earn, from that point whether they play or not I am unsure. Honest answer.
Like I said, is your theory that we’re all going to make to much money and watch the company implode, or we’re going to make no money due to retirement? And the math on retirement does not let you get that far ahead especially if you’re trying to pull out money. Even if the interest were 3% retirement would take at a dramatic rate.
Please answer the question. Right, I believe there are plenty of MLM’s that are very successful and believe in them as do some of the top businessmen in the world, my point was you don’t. I’m obviously in one so of course I believe in them.
You guys have a website that bashes most MLM’s. And then you guys hide under the mask of “we want to help people use their money wisely”. Please. You just love a good argument just as much as I do 😀
Right I can use big ugly words like “scheme” and “Ponzi” and “illegal” and convince people too. We don’t “sell” products. We post ads fueled by free bids that we hope will catch the eye of a potential customer.
We’re an advertising team in essence. As far as the bash for doing exactly what an MLM is comment, I don’t understand your point.
What I do know is the bids we give away are free bids and if you check the zeekler sight there are specific auctions that are “free bid” auctions. All the VIP auctions are bids purchased by customers playing on the sight.
Where’s your response?
Can I just add Oz, nothing is a guarantee in this world, business is business. I’m not going to die on the Zeek hill promising to the Lord above it’s a perfect company, it has its faults, as all do.
I weighed the risks, listened to the people I trust, and made an evaluation. I have not personally been offended by any comments that have been made and hope the same is true for you guys!
So you have no genuine retail customers who purchase bids with their own money, just the usual “customers” you dump bids onto.
Another ponzi stastistic to add onto the pile.
It’s not theory, it’s basic mathematics. If affiliates do not get enough of a ROI to replenish the points that expire over a 90 day period then everyone will pull their money out (and no new members are going to sign up and invest either). It’s an inbuilt ROI guarnatee and fallacy of the business model, given that it primarily relies on affiliate money coming in to pay out the daily ROI.
You have no genuine retail customers and this is the case with the vast majority of affiliates (as evidenced by the conistent “I have no genuine retail cusotmers myself” responses we’ve gotten to the question over time).
I reviewed one just a few days ago, YouDazzle – genuine products offered at a retail level with a comp plan that relies on sales of the product to actual customers (the 100% internal consumption that exists in ZR won’t fly there).
MLM isn’t reviewed here, just MLM companies and the business models they use. The ‘you hate/bash MLM’ is just a cop out used by people who are trying to defend companies with dodgy business models.
Yet the advertising you do is supposed to attract retail customers with the idea that they pump non-affiliate money into the system. Yet you yourself and the vast majority of affiliates don’t have any.
Follow the money, specifically where is the money coming into Zeek Rewards.
Answer? Membership fees, initial affiliate bid purchases and re-invest of daily ROIs to increase VIP point balances. Ie. it’s all from the affiliates.
Advertising has nothing to do with it, unless you consider advertising for affiliates to invest money as your downline so you can grow your own point balance faster and increase your daily ROI.
Customers buy retail bids and affiliates buy VIP bids (from memory). Please review the compensation plan of the company before you waste my time arguing it’s not a Ponzi.
Additionally most if not all retail bids purchased through customer accounts are just affiliates doing so in order to earn 20% referral commissions on the purchase price of the bids and matching VIP points (easier than wasting time giving bids away to fake customers).
Oh dear.
Right, you choose the one MLM that is still not on its feet, that’s a great cop out.
What happened to my peace treaty message Oz? Can’t have the affiliates looking like good level-headed guys, heaven forbid.
So retirement doesn’t fail. It fails based on your THEORIES that the company will slowly have a lower interest rate.
I’m still young in the company and I’m not buying the expensive ads to post on the very popular websites, as are most affiliates that get on this sight. I have a buddy here in town who’s the number one guy in my state and he has legitimate customers using his bids and buying more. It’s a step by step process.
But hey keep listening to Oz, one day the curtain will fall and show that the mighty Wizard of Oz is simply a single man with a really big microphone who only has a couple theories and ideas.
Hundreds of companies have been reviewed on BehindMLM with many having legit comp plans that revolve around the sale of actual products to genuine customers, I merely picked one recent one at random.
Stop being a lazy arse bitch and look them up yourself if you’re that adamant they don’t exist and every company has a Ponzi comp plan identical to ZRs. Jesus Christ.
It massively fails in that if affiliates don’t earn a large enough ROI over 90 days to grow their point balance (or at the very least sustain it), the entire thing collapses. Due to the fact that it relies on affiliate money to pay out daily ROIs, money that won’t be coming in if affiliates can’t sustain their point balances.
Whoever’s just joined and invested loses their money in the above scenario, a common theme in all Ponzi schemes.
Yes I’m sure everyone has a buddy who has a bazillion legit retail customers. How many you have is all that’s relevant here. Which is none. Zilch. Nada.
You contribute exactly 0% of non-affiliate money into Zeek Rewards, just like most affiliates out there.
Clearly.
That right there is where the failure in your analysis occurs.
Think about the hundreds of thousands of spam ads posted by Zeek affiliates every day, they are ineffective because:
1. Venue – they are ineffective because they live on spammy classified ads that virtually no one visits, and certainly even fewer than virtually no one would click-through to land on Zeekler. The auction revenue hasn’t grown since January yet the affiliate investment keeps increasing. What does that tell you?
2. Saturation – posting 100 ads to a single classified site is just as effective as posting 1000, or 10000, or 100000. You do not gain 1000x more view or click-throughs if there are 100000 ads today vs. 100 yesterday. Yet Zeek continues to pay out millions in RPP every month – where is the money coming from?
3. Utilization Theory – if these ads were that effective, Zeek would not pay millions a month to affiliates to post them when they can hire ad firms in Ivory towers in NY, Boston, London, and Sydney to place better ads in real venues where people surf and for much less money. If you argue that the classified ads are working fine, then why couldn’t Zeek hire a team of virtual assistants in third world countries to post those ads for a few dollars per day rather than pay affiliates millions per month?
CONCLUSION:
The ads are completely ineffective and are nothing more than “busy work” to justify the Ponzi.
What a wonderful info i got from ‘behind mlm’. I have a friend that has tried to sign me up for zeek rewards but to be honest, i had my doubts.
Thank u so so much for saving me the pain of investing in such a company.
Jimmy just touched on something that’s so obvious I can’t believe people can’t see it. (the utilization theory) plus one step more..if the auction made the money that is proclaimed, why would zeek ever need any affiliate money.
This thing just stinks to high heaven…The greed is what drives this thing, wanting something for nothing. I’m hearing of people going to the bank and borrowing money, cashing in grand childrens college funds.
Its just something old dressed in new clothes and its going to leave alot of people broke and relationships ripped apart.
Troy at mlmhelpdesk posted this. Is Zeek making a major 180 degree turn here with the purchase of RVG by another company? That’s an interesting way for the principals to cash out.
I think there will be a rush to cash out around Aug 22 if Zeek is going to require ZeeBates purchase volume in order to maintain RPP.
Wouldn’t this also mean that Zeek is admitting that the current business model is illegal if they last minute require ZeeBates qualifiers? What happens when most affiliates decide to withdraw at 100% rather than play try and maintain “2-8 active customers per month”?
and thats the end of that, I’m 30 days away from zeroing out…
Whats RVG ?
I’m about a week behind you..
Personally I believe Zeebates will be a flop.
People didn’t join Zeek Rewards to buy anything or promote an affiliate shopping portal. They joined to passively earn a daily 1.5% on their money.
Change that and they’ll simply withdraw and go invest in one of the other emerging penny auctions.
@AnthonyRex Venture Group, parent company of Zeekler and Zeek Rewards.
Take the analysis one step further…
Even if affiliates were willing to play along and managed to get enough active customers to qualify for RPP, how does a few % commission generate millions of revenue to pay off the ever increasing point balances?
If you had a large account balance, wouldn’t you just create 2-8 fake or friend customers and just buy whatever Amazon/Target/Walmart products in order to qualify? So you “qualify” and you keep getting RPP, but this still does not change the revenue picture much.
Does Zeek think by having “real retail customers” that will trick the regulators into thinking Zeek is not a Ponzi? The adsurf industry was 100% fradulent with no external revenue. It seems Zeek is trying to get by with 1-2% of external revenue to justify the Ponzi… “see we have lots of customers”.
It won’t and Zeek Rewards will continue to hide behind “that’s proprietary information” until affiliate money does not make up most of the daily ROI paid out. Then they’ll quickly drop the proprietary charade and be running around shouting from the rooftops about how legit the make up of their daily ROI is.
As you point out, no sales commissions are paid on the purchases through Zeebates. Rather it all just gets pumped into the daily ROI pool to dilute the hoardes of affilate money going into it each day (thus confirming that true retail sales through Zeekler are either non-existant or woefully marginal compared to the affiliate money being used).
The official problem here is “we are just using affiliate money to pay out affiliates a daily ROI” and this is an attempt to combat that, without of course directly confirming that for the past year and a half ZR has functioned as a Ponzi.
Indirectly though it’s easy to see if you look at why this is happening. Zeek Rewards claim to be making bajillions, so why the need to introduce another revenue stream? A financial reason makes no sense (penny auctions are “wildly profitable” remember), with the company already tackling a mountain of issues with their current systems .
The idea with the whole Zeebates thing is that Zeek Rewards affiliates will be able to market the opportunity as an affiliate marketing program. Practically however the mechanics of the daily ROI do not change. That being members invest and earn a daily ROI over 90 days, expecting a return greater than the amount they put in.
It’s funny how any time someone says anything critical about Zeek, the Zeek Stepfordian defenders automatically attack the speaker and never address the content of what was said.
I’m reminded of the time walking in Chicago and my mom chastised me for talking to the vagrants. She said “ignore them”. Then she started walking across the street on a RED LIGHT. A vagrant shouted “MA’AM THE LIGHT IS RED, STEP BACK”. I looked up and grabbed my mom, right as a delivery truck whizzed inches away.
Sorry to go off-topic, but I wanted to illustrate how WHAT IS BEING SAID should firstly be analyzed for its own merits.
I rest my case.
It’s obvious that Schroeder in panic. A lot of people abandon his verbal money machine to take care for themselves.
I think that he shouldn’t speak about ethics. He moved from one company to another for millions of dollars, while people never earn a penny. Stupid people will remain stupid people, following their leader to enrich him, covering by promises and loyalty.
Indeed, Me too skeptical about zeek, but as for now, I think their model is healthy, and no one on earth could predict what will happen next.
My guesses are:
1. Schroeder will leave mona vie for his next company once he’ll get the right offer (you can see the future by the past).
2. It will happen before zeek will be vanish
The pivot is attempting to dilute attention from the RPP by introducing a more traditional MLM model and hope it produce enough revenue to make the RPP portion less significant (i.e. less than 50%) so the FTC don’t go after them as a pyramid scheme.
it doesn’t address the Ponzi angle or the unregistered securities angle.
@Eno
You’re comments about MonaVie are irrelevant.
Uh, MLM compensation plans aren’t magical money boxes. In this particular instance, affiliate money goes in and affiliate money comes out daily as a ROI.
…and you can’t predict what happens next? (“eventually” is a better word than “next”)
You said it son.
heard thru a friend who works at a bank here in lexington that the IRS is investigating zeeks warehouse in colorado where supposedly the merchandise is shipped from.
he also said that the bank he works at turned down doing business with zeek because they deemed it to risky. he also said that Newbridge bank and BB&T did they same thing.
the zeek geeks are saying these banks could not handle the volume or did not have enough cash. the real reason is these banks did not want to take own the risk of doing business with zeek.
does anyone know where they are banking now. is it overseas? does anyone know if zeeks warehouse is in colorado?
why are those numbers relevant? doesnt roi imply that i would actually get paid?
what if i started taking all of my daily earnings out after 90 days? how long would it take me to recoup my 10k plus my monthly expenses. e.g. what would my real roi be?
unless you are using a realistic scenario i dont think your example is relevant at all but it does help to explain why so many on this thread continue to post similar irrelevant opinions over and over again. or does it?
Such as yours?
Getting into an MLM has risk involved and commitment. After putting time and $20000+ in Monavie, I did not make alot of income. Zeek has put more in my wallet in a short time and everyone is getting their money.
For a billion dollar company not promoting the same product feel threatened could demonstrate small thinking. Give it a rest.
If you didn’t read the news, go read it now. Zeek’s attempting a major pivot by Zeebates and required customers. Companies don’t pivot UNLESS they are forced to, either by revenue, or by legal pressures. As it can’t be revenue, it must be legal.
So no, it ain’t healthy, and they KNOW it.
ZeekReward’s plan has variable rate, both in terms of day to day RPP, as well as effects of compounding due to the flexibility of repurchase changes from day to day both within and beyond the 90 days.
If you repurchase less, then your “compounding” changes. For example, if you repurchase 80%, and RPP is 1.5%, then your compound becomes 1.2%.
Your “effective” interest rate is whatever average rate you choose to use (most people use 1.4% or 1.5%), minus 1.1%, compounded daily. The -1.1% takes care of the “expiring points” approximately by my calculations.
I’d show you the spreadsheet, but then, you said you don’t want to see any.
While such info is appreciated, it is hearsay, and can’t be confirmed. IRS won’t make any investigations public.
They claim it’s in the US, but refuse to explain which one.
No idea if they actually ship anything from Colorado. I haven’t personally seen any packages sent by Zeek.
i prefer to use actual retirement points in my xls but at least ur approximations are better than Rodney Irrelevant’s retarded example.
Now, now, I want don’t to hand you some soap for mouthwash… 😉
<blockquote
Because it proves that Zeek Rewards is a Ponzi.
It proves that it is unsustainable.
Even if YOU decide to cash out after 90 days, what if someone else decides to let it ride for a few years at 100%? That would bankrupt the company as the incoming affiliate revenues could not pay out the rising VIP point liability.
Even if a SINGLE person did not decide to let it ride for a few years, the COLLECTIVE actions of all affiliates reinvesting has the same impact.
VIP points are ever increasing – to infinity. Actual revenues cannot keep up. The late comers get screwed. Welcome to Ponzi land.
If you can show me an error in my spreadsheet at 100% reinvestment, 90-day expiration, and 1.43% average daily profit share, I’ll never post on this forum again.
Bet you can’t do it. I’ve been doing this a long time, son.
@K. Chang –
The approximation of minus 1.1% is close but not accurate. Because of the ever increasing VIP point, the % that gets expired over time decreases. In other words, the “effective” interest rate INCREASE over time, as the “effective % of points that are expiration” DECREASE over time.
This is because the gap between each day’s earned interest gets WIDER over time.
If you’re keeping track of income and expenses, always use the actual numbers and amounts.
If you’re making plans or budgets, use realistic numbers and amounts. Both 1.4% and 1.5% are realistic, but it will make a huge difference in 3-6-12 months if you switch from one of them to the other.
Most spreadsheet numbers presented here are neither budgets nor plans, they are only meant to illustrate something. Rodney McKay has probably used 1.43% daily in his example, a number most people will find acceptable.
Well, yes and no.
Yes, the % of the expired points to point balance does increase over time. However, the increase gets so small that it “levels out” into a slightly rising asymptote between days 240 to 290, depending on the average rate.
Also, note that the % due to points expiration approximation (the -1.1% in K. Chang’s example) varies depending on the average daily rate.
If you are going to use basic approximation by doing something like “3650 days at 100% reinvestment, compounded daily, I’ll just use an exponential formula”, you have to first calculate where the asymptote hits.
For example:
– With average RPP of 1.3%, the % of points that expire levels out at about 0.95% around day 298. Effective rate of 1.3 – 0.95 = 0.35% compounded daily, assuming 100% reinvestment.
– With average RPP of 1.4%, the % of points that expire levels out at about 0.87% around day 292. Effective rate is 1.4 – 0.87 = 0.53% compounded daily, assuming 100% reinvestment.
– With average RPP of 1.5%, the % of points that expire levels out at about 0.81% around day 284. Effective rate is 1.5 – 0.81 = 0.69% compounded daily, assuming 100% reinvestment.
– With average RPP of 1.6%, the % of points that expire levels out at about 0.75% around day 240. Effective rate is 1.6 – 0.75 = 0.85% compounded daily, assuming 100% reinvestment.
For the above, “level out” is when the daily change in “% of balance of expiring points” is less than 0.0003%, I consider that “leveled out”. If you graph it, you’ll see a very slightly rising asymptote.
K.Chang was correct in pointing out that it is exceedingly unlikely that an IRS agent would disclose the existence of an active investigation. Stranger things have happened but it’s rather improbable.
But what is clear is that ZR didn’t sever it’s prior banking relationships voluntarily. And the “we’re just too friggen big” argument doesn’t hold water either.
If you recall ZR announced very late in May that in a few days (June 1st) all checks drawn on the existing accounts would be void. Now if they ended those banking relationships by choice or even if by mutual agreement it would not have happened that way. They would have kept enough money in the accounts to cover the outstanding checks and they would have stopped issuing new checks from those accounts.
But that isn’t what happened, the accounts were closed on very short notice and at tremendous inconvenience to the affiliates.
Jay Man’s info may well be hearsay but it does square with the available facts. It also squares with the massive difficulties ZR is having with maintaining a credit card merchant account in any but the furthest backwaters of the banking world. No US based processor will do buisness with them.
As to ZR’s current banking relationships, the only info we have comes from Troy Dooly who insists that he has verified the banks are in place and on American soil. I am not calling him a lair but his account doesn’t square with the facts.
Remember all the Whoppers about Big Macs Dawn was telling us when explaining why if the affiliates didn’t put enough money into NxPay they couldn’t get paid through NxPay?
The reason was they didn’t have a bank in place allowing them to transfer money from one ewallet to another. If Troy is correct and the banks are in place, why hasn’t this problem gone away? I read ZR’s support forum every day and the problem still exists.
Troy, if you’re reading this, why hasn’t the ewallet problem gone away?
This is also hearsay, but my sources tell me it is Citizens Bank in NY.
Those of you following the banking story may recall that Dawn said Zeek’s new banking relationship would be in Hong Kong, but that was at the beginning of the banking issues tumult so lots could have changed from when Dawn said that to what actually happened.
I’m sure Zeek will spin Dawn’s new CMO role as a “promotion” but I think most of us would reason that the “whoppers” Dawn told about how the eWallets work and other major screwups along the way led Paul Burks to look for a new COO.
Also, perhaps this new “50% MLM company investor” wanted their guy in as COO.
I would hope that this new “investor” did their due diligence. It only takes a Google search and the first 3 pages has all of the key critic sites on it (except kschang’s hub pages, but the Google cache is still there if you search for it).
Speaking of Dawn and Zeek execs, if you are an affiliate, don’t you think it is completely unfair that corporate execs can see exactly what the cash flow scenario is and know what the reinvestment % is? They know when to go 100% cash out, have a huge advantage, and likely 6 and 7 figure balances. Talk about conflict of interest.
Most of them built their downlines on the backs of the original illegal investment / Ponzi business model.
Troy has implied, but has not directly gone out and said, that while Zeek could transfer money from their bank accounts into the eWallet accounts, there are “rules & regulations” they have to follow, and therefore, Zeek is at the mercy of anti-money-laundering regulations and can’t just transfer whatever money is needed without vast amounts of paperwork. I have no idea if this is true or not, but it doesn’t square with the spin on “going paperless”.
Remember, Zeek was processing paper checks fine. It’s not like they started slipping a few days or 1-2 weeks and then decided to convert to paperless. Not all affiliates were withdrawing money. If you chart the volume of checks requested vs. the volume of new affiliates, the check volume was still relatively low on the hockey stick curve and manageable.
In addition, there are several strategies to reduce the operational impact of check writing. As I’ve mentioned here, it can be outsourced to payroll/accounting firms that handle 100x the volume. Also, Zeek could increase the minimum required to request a check, even if they do so temporarily, to say $20 or $50 to limit the volume of low dollar checks (this is what Google, Amazon, and Commission Junction do, to name a few examples). Other companies dealing with genuine growth or volume problems will change check distribution frequency – such as switching to every 2 weeks for an interim period while Zeek transforms its operations to deal with the new volume. Zeek chose not to do any of the things in this paragraph, which squares entirely with the “banks terminated Zeek’s relationship” rather than any of the spin around “going paperless” or “too big for the banks” or “huge drive through chute needed for deposits”.
The ACH coming soon will suppose to solve all the logistic problems (obviously, the Ponzi cash flow issue is itself a different animal), but I bet the ACH will not be Zeek sending money directly to you (or you to Zeek), but through yet-another-third-party ACH provider. That means more fees taken out of distributor balances.
Is it safe to join Zeek Rewards or not. Everything I’ve heard is most people, if not all, are making a lot of money from being in Zeek Rewards and I would join, but then I always read what you have to say, and I decide against joining.
How can so many people get away with making a lot of money for years as Zeek Rewards has been in business for years and yet you say Zeek Rewards beware.
Beware of what while other people are getting rich off their membership with Zeek Rewards.
What facts can you provide that I should know so I can decide whether or not to join. Given it’s been around for over 15 years, I highly doubt a Ponzi scheme could survive that long and make numerous people a lot of money if there is something truly wrong with this company.
Please tell me exactly why I shouldn’t join. I want verified facts as to why I shouldn’t join, and I would also like to know if Zeek Rewards is illegal, exactly what are those facts.
I don’t want vague references as to why you feel Zeek Rewards is not a good company to join; I want to know why I should join it as again, people have been making a lot of money for years and it’s still going strong.
@Corinne
If your sole criteria in deciding to join Zeek Rewards is whether or not you or anyone else makes money, then by all means join the company because money is being made.
The discussion and analysis on BehindMLM extends far beyond your hip pocket and those of the members of Zeek Rewards. Whether or not people make money is irrelevant, as all Ponzi schemes will pay out as long as new money is coming in.
Where this money comes from is far more relevant. And for the past year and a half all signs point to it being sourced from affiliates.
1. Nobody seems to have any genuine retail customers purchasing bids with non-affiliate money on a regular basis (“I know a guy who knows a guy” doesn’t count).
2. Dawn Wright-Olivares, Zeek’s COO, warned affiliates they wouldn’t be paid unless they topped up Zeek Reward’s e-wallet accounts with new
investmentsdeposits.3. Zeek Rewards claims that answering the simply yes or no question of whether or not the daily ROIs paid out by the company consist of mostly affiliate money is a “proprietary secret”. Troy Dooly of MLM Helpdesk even went so far as claiming that Zeek Rewards answering this question would put them out of compliance.
Again, if whether or not people make money is your only criteria of assesment then you’re in the wrong place. Proof of payment has nothing to do with the legitimacy of a business model and comp plan, as even the dodgiest of plans will pay out if the required criteria is met.
What is Zeek Rewards’ criteria? All signs point to affiliate money being continously required to be pumped into the system in order for commissions to be paid out.
Finally Zeek Rewards hasn’t been around for fifteen years, and only a court can establish the legality of a business. The discussion here is not about legality but rather analysis of the mechanics behind the compensation plan. ‘Ponzi scheme’ is a practical definition of a compensation structure, not just a legal one.
Invest all you can possibly afford and recruit, recruit and recruit. Fast, man. I won’t regret it.
i’m not doubting you can do basic math and it certainly doesnt take much more than that to project very accurate zeek numbers on an individual basis.
However, your example remains completely irrelevant as I said, bc you dont know how much total cash is actually paid out each day, son.
If I’m following correctly, why is the total cash paid out relevant?
Historically regardless of how many members joined, whether or not the auction site has been up or down or how much affiliate money has been injected into the system, the average ROI has been 1.5% (some people have dropped this to 1.4% recently).
Using those projections, at 100% re-investment of the daily ROI that’s where Rodney’s figures come from.
Again, what does the total actual money paid out each day have to do with anything? Other than ascertaining exactly when the daily ROI % will cause a mass withdrawal panic when it gets too low. The amount paid out per point is the same for every affiliate, regardless of how many points they have.
Yes we all know Zeek Rewards don’t have trillions to pay out as per the mathematical projections, yet under the current compensation plan… this is exactly where we’re headed.
Remember, points aren’t dollars but affiliates have to be paid a rolling 90 day ROI that would enable someone re-investing 100% to grow their point balance. Anything less and the system falls apart, most likely way before the 90 day ROI can’t sustain the point balance via a 100% re-invest as the idea is to withdraw some money and re-invest the rest.
It doesn’t matter Zeek is paying out, or the details of when affiliates decide to switch from 100% reinvestment to something less, such as 80/20.
Rodney’s example, as well as a few of M_Norway’s responses on a few articles here, all point to basic fundamentals of mathematics and economics:
Put simply:
– VIP points increasing to infinity is not sustainable
– The only business models that have this are Ponzi’s and scams
– If you agree that increasing VIP earnings to infinity is not sustainable, but disagree that it is a Ponzi or a scam, the sad reality still is that eventually it will collapse, and those who did not get their money out will be left holding the bag.
Maybe those joining late made a poor choice, i.e. “don’t risk money you can’t afford to lose”. Either way, the people who join last and those who have not yet cashed out when the RPP rate collapses all get screwed. The math says it is inevitable.
I never understood the logic behind this, as I’m sure no one else here does either. How does answering a fact-based question about your business model put you out of compliance? Either you are or you aren’t.
Take an example from a different legal context – a defendant is on trial for murder.
Paul is not the prime mover here, he was eking out a modest existence hawking not ready for prime time pyramid schemes for 15 years until he learned what “be careful what you wish for” really means.
Dawn is the one who personally recruited the Trudy Gilmond type serial scammers to form the nucleus of Zeek Rewards. Perhaps they realize they need a more fluid liar to handle PR but I’d be stunned if what’s happened to Dawn is in any way a demotion.
I beg for clarification here. What I thought I heard is ZR had (or is in the process of) purchasing a MLM company with a 50% customer to distributor ratio with the implication that the soon to be acquired company is so profitable that it will help to sustain the RPP for some time to come.
First off I’ve never seen an MLM company with a 1 to 1 customer to affiliate ratio and if there is one it wouldn’t be profitable. And if a MLM company could be profitable with a 1 to 1 customer to affiliate ratio, why would anyone sell it?
Not only a conflict of interest but also insider trading. There are red letter laws about what sort of trades insiders with access to non public information can make and many disclosure requirements about those trades. But ZR pretends that they aren’t an investment so they can also pretend those regulations do not apply.
But the fact remains, the insiders are wielding advantages over the common affiliates not only in terms of knowing when to cut and run but also, does anyone honestly believe Dawn has to wait for Payza to pay her?
Just moving goalposts. It is true that anti money laundering regulations limit the ability to transfer funds to and from eWallets but that isn’t the issue.
The issue is that no real bank will give ZR the sort of payment privileges which normal companies and their customers are accustomed to. ZR has no better option than to use the same pain in the ass payment possessors as all the other illegal online money game programs.
Long story short, even if ZR has US based banks, those banks don’t trust ZR nearly as much as Troy Dooly does.
Because it’d be on the public record then and ZR affiliates and Troy Dooly wouldn’t be able to run around claiming nobody has all the facts and therefore knows nothing.
As silly as that sounds, that’s pretty much it and as you state, in a court of law that wouldn’t fly.
In the meantime we have the paradox of Zeek Rewards withholding crucial information on their business model and its members dismissing any and all analysis that suggests Zeek Rewards is not just made up of affiliate money because “nobody has all the facts”.
The absurdity of claiming that answering a yes/no question on whether or not affiliate money makes up the bulk of the daily ROI paid out seems lost on most people.
It’s not hard to estimate: about 250000.
In 2011 their income disclosure statement says they paid out 58.5 million total. That’s about 160K a day.
As sales ramp up, the end figure is estimated to be 210K.
So by now it’s 250K a day, and that’s conservative.
Figurative speaking, Zeek has 2 different departments:
A. Handling transactions in real money, IN and OUT
B. Handling transactions in POINTS, internal transactions
Points are absolutely worthless, and most of the “money” people claim to make are only POINTS. They can use the points to pay for worthless sample bids to grow their points balance and their daily payouts in points.
B gives an illusion of the points being real money, so people are mostly talking about an illusion of money being paid each day.
1. You pay money directly in to A when you join as a newly recruited affiliate and make your initial purchase. B then gives you matching VIP points for the money, 1 VIP point for each dollar.
2. After that, you will mostly be dealing with B for 3-6 months. Being paid each day in RPP reward points, reinvesting RPP into more sample bids and growing your VIP balance day by day for 3-6 months with a 100% reinvestment of points.
3. Then you can start to withdraw MONEY, if A still gets enough money in from newly recruited affiliates after 3-6 months. An 80/20 plan will make your point balance continue to grow slowly in B on a daily basis, while A will pay you in real money on a weekly basis.
The trouble is that A can’t pay you in real money if the recruitment slows down, and the money coming in is lower than the money going out. And Zeek has already been drained for lots of its money by other investors, all the ones that joined earlier than you.
Zeek can continue to pay in points for infinity. Any trouble will first come when enough people wants to be paid in money, and they have ran out of enough new investors to support the payouts.
So you can definitely join if you like to exhange your money into points, and you like to get an illusion of being paid each day.
All newly recruited afiliates will mostly show you their backoffice and their virtual points, but they will pretend it’s real money. People who have joined earlier will show you real payouts in money, too. They will be paid from your money coming in.
My “A and B” and “1, 2, 3” example was simplified, but the core of Zeek’s business model works very similar to that example.
what is ur definition of “paid out”?
@Corinne Larimore
The other parts of the business model doesn’t work much better, but I started with the core.
The core of a business is where most of the money comes in, or is being generated indirectly or directly. In Zeek, the core is not the penny auctions, it’s the money coming in from affiliates.
For a manufacturer, it will be the production of goods, the one part that is absolutely needed (indirectly) to generate any revenue in other parts of the business.
Zeek’s core of business is to sell the IDEA of penny auctions being highly profitable to a bunch of investors, willing to invest money into the system in order to earn ROI on their investments, willing to believe that the penny auctions can support payouts to them too. They just CALL IT something else than “investment”.
Other parts of the business do also revolve around the affiliates’ own money.
* Zeek sells retail bids and VIP bids, but most of the “customers” seems to be the affiliates themselves, using this as a method to earn extra commission (through sale of bids to family members, friends, others on the same team — where the affiliates pay for the bids themselves with their own money). It’s a method for being paid some extra.
More than 90% of the money coming into Zeek seems to be the affiliates’ own money. It will also mean that the money paid OUT will be the affiliates’ own money, newly recruited affiliates paying the old ones.
RECRUITMENT METHODS
A typical recruitment method for a newly recruited affiliate will probably be to show his backoffice, show how the virtual points are being generated each day — presenting them as real money or showing how they can be “converted” to real money.
He will probably use some assistance from his upline too, to be able to show some real payouts. More experienced affiliates won’t need assistance from their upline, they will have their own real payouts to show for them.
A related method is to focus on the penny auctions and the daily profit share, pretending the auctions is able to support payouts. People can be willing to BELIEVE in that idea, if they don’t check facts. And the detailed facts is a closely guarded secret, but some facts are available through the affiliates.
If you ask the affiliate trying to recruit you how many retail customers he/she has, specifying “people who pay for retail bids with their own money”, the answer will usually be ZERO.
If you ask the affiliate’s upline, they will usually not have any retail customers either. If you ask 50 affiliates, one or two of them can probably have had a couple of real customers during their time as affiliates.
But don’t ask for proof about customers, ask for information instead. “Proofs” in MLM is only a method to avoid lying directly. Some affiliates may have trained themselves to answer the questions about customers, but most affiliates will try to avoid any questions about it.
IS THE PENNY AUCTIONS PROFITABLE?
Revenue and profit derives from money coming IN, when customers or affiliates pay for something with money. It’s as simple as that.
* Selling the initial sample bids to an affiliate is profitable, when the payment comes in and the affiliate gets sample bids and VIP points in return.
* Giving the sample bids away isn’t profitable, and using them in auctions isn’t. It will possibly become profitable later if some of the free customers turns into becoming paying customers, but that part is covered in another point.
* Selling sample bids where affiliates pay in points isn’t profitable, it’s like giving the sample bids away for free to the affiliate.
* Selling retail bids or VIP bids is profitable in itself, but it isn’t when the bids are sold through an affiliate. The affiliate will earn 20% commission and matching VIP points, making the sale eventually become a loss when he starts to withdraw money.
* Spending retail bids or VIP bids in auctions isn’t very profitable in itself. 1000 bids spent in an auction will raise the price of an item with $10.00 (1 cent per bid), and the winner of the auction will have to pay $10 extra for the item.
So the core arguments for how the money is generated fails miserably when someone like me is analysing them. I’m not a “true believer”, and I will usually check how true an explanation is — even when some of the data isn’t available to me.
I believe you should add THAT into your evaluation too, the impact the non-believers can have on your chances.
Some affiliates seems to feel the non-believers as a problem to them, making it difficult for them to grow their business, e.g. when they are bombarded with difficult questions about retail customers from what seemed to be promising “prospects” in the first place.
The old affiliates are dependant on YOUR money coming in, so if you like to support other affiliates then you’ll have your chances here.
MAKE A BETTER DEAL?
You can use this knowledge to make a better deal if you want to join it anyway, e.g. asking to get half of the commission you’re generating for your upline paid back to you. It won’t make you popular, but they will probably accept it.
The commission is 10% to your sponsor and 5% to his sponsor, if they are on the Diamond level. They are the ones desperate to recruit you, and it’s easier to make a good deal if you know who’s the most desperate ones (and make sure it isn’t yourself). 🙂
if i earn 100 vip, zeek considers (rightfully so) that as 100 earnings regardless of how much of it i take as cash. so lets refer to your estimates as X and therefore “cash out” is an unknown percentage of X.
and we know that X includes revenue from several things including subscription revenue but we also know that X for any given individual does NOT include subscription revenue from anyone downline from that individual.
@otis
You can’t earn “VIP”. You can however effectively invest in VIP points though (invest money & give bids away).
Technically you “take” all of it as cash (not literal notes, but a payout nonetheless). Whether you re-invest this cash is up to you.
The percentage is always given. In projections using 80/20 the percentage taken out is 20%. Rodney’s earlier projections were with 100% re-investment.
How is X unknown???
Uh what? Membership fees from all affiliates are paid back out as a daily ROI, this comes under the “affiliate money” component of the daily ROI paid out – same as bid purchases from affiliates. There are no downline rules in regards to this.
Furthermore using the matrix side of the compensation plan, portions of monthly membership fees from downlines are directly paid out to the recruiting affiliate (irrelevant to the daily ROI paid out, but just thought I’d throw it in there).
But what you’re forgetting is that the bottom line is that you are giving Zeek money in return for points, with the expected guarantee that 1 point = 1 dollar.
There is no such guarantee, and if Zeek wanted to they could just claim that all points are now worth nothing and walk away with your money. If that doesn’t send up warning signs, I don’t know what will.
They can’t reduce the dollar investment value of each point though, otherwise the 90 day rolling repurchase would collapse.
Even if they added 20% to the cost of a point ($1.20 investment per point), that’d push up the ROI needed over 90 days to sustain and grow a point balance. It’d also raise the ‘I can’t replenish my points even with 100% re-investment’ collapse threshhold too, which would be a big problem.
In case you haven’t noticed, some of us are using different logics than others. It’s mostly me using a different logic than the others for what’s really being paid out.
I don’t consider daily RPP to be “paid out”. It’s more similar to a message displayed in the affiliate’s backoffice than to a payout — “You are allowed to withdraw $nnn today, as max withdrawal in cash”. The payout will first happen later, when you withdraw the points as cash on a weekly basis.
If you use the daily RPP to buy more sample bids, it will be like you have got the bids for free. You haven’t paid any money for them, only worthless “points”.
The theory where people feel the RPP points will be “converted” to money when someone spends them on buying sample bids have several flaws.
Worthless points can’t be CONVERTED to money directly, you’ll need to REPLACE the points with real money. You will need a stream of money coming in from somewhere, replacing the points with money when people use the points to buy sample bids.
If a group of affiliates spends $10,000 on buying 10,000 sample bids, and another group of affiliates spends 40,000 points on buying 40,000 sample bids, the value of the 50,000 sample bids in circulation will be diluted to $0.20 per bid.
As long as Zeek claims to NOT be an investment, the daily RPP will be worthless in itself. So theories about LIABILITIES connected to the daily RPP will fail too. Zeek has been careful not to connect any liabilities to the points they “pay out”.
The only affiliates who HAVE TO spend some real money on sample bids are the newly recruited ones. All the other affiliates have the option to pay for sample bids with points rather than money, and that is the most common method to pay for the sample bids.
The sample bids don’t have any “intrinsic value”. The fact that some affiliates pay for them with real money $1 per bid won’t make them “worth” $1 per bid. The $1 per bid is only the PRICE people will have to pay for them if they are using that specific option when they’re buying sample bids.
The other option is to pay for the sample bids with points, and that option is close to get the sample bids for free. And that option seems to be more heavily used than the other option.
“Rightfully so” doesn’t make any sense. You are paid in worthless points, and those points won’t get any value added to them if you use them on buying sample bids. They will get a value if you withdraw them as cash. It’s first in THAT part of the operation where Zeek will have to replace the points with real money.
On the banking issue, I got a wire tranfer from STP when they where having problems and could not do a bank transfer.
The first bank on the list of banks the money went through before it got to me was- The Bank of NewYork Mellon,NY>NY. 1st IBK :/
Same as Zeek’s. Read their income disclosure statement and see for yourself.
We don’t know how much revenue outside the US would change those numbers as IDS was US only.
exactly! and thus the reason why i say that all the rubbish on this board about unstainable cash out is so entirely irrelevant!
Otis is saying Zeek is indefinitely sustainable because the virtual points are inherently worthless and can be arbitrarily devalued at any time. Sounds like Just Been Paid reasoning.
Good point, but you have to start from SOMEWHERE.
However, the IDS did reveal that
“In 2011 64 % of all distributors worldwide received no
income at all. In 2011 65.73% of U.S. Affiliates received no income at all. ”
Then there’s this zinger:
“the median annual income for all Affiliates worldwide in 2011 was $0.”
You do the math. 🙂
As soon as average RPP falls below breakeven (about 1.09%) people will switch to 100% cashout and the whole thing’s doomed.
Median income is due to vast amounts of free affiliates compounding the free bonus points. Then Zeek rolled out the mandatory $29.95 annual marketing package which will drive most of the free affiliates away…. no more “free money”.
@Otis & Jimmy
You need new affiliates to join and invest money and existing ones to continue to re-invest if you want Zeek Rewards to “work”.
Reduce the value of the points and the system collapses. That’s not sustainability.
@otis campbell
Don’t quote whole posts, it makes it easier for you if you use the mouse to highlight what you want to quote (and then click on “Quote”).
Example:
You will probably need “Copy” and “Paste” too, and manual use of blockquote tags.
We’re covering a few different viewpoints here, and it’s not “an organised group of people with exactly the same viewpoints”. Technically, there’s nothing wrong if people tries to calculate payouts or use other methods. It will only add a different viewpoint to the whole picture.
What I don’t agree in is statements about “It’s meaningless to try to analyse it, since you don’t know all the data you’ll need to know”. People are usually able to get “meaningful” answers from only a limited set of data.
“Meaningful” can go in both directions. Some people have found it meaningful that penny auctions can support a nearly unlimited amount in payouts. Viewpoints like that will add to the overall picture, and give the readers some different options to choose from.
We’re NOT in the “100% correct theories” business, the basic idea here is “information sharing” and “balanced between different viewpoints”. Theories will usually gradually be changed or replaced, or combined with other theories.
Some of my viewpoints have been controversial, but that doesn’t prevent me from posting them. I consider them to be “work in progress”, and they don’t HAVE TO be 100% correct. Other people will usually add something or make corrections if they have other insight than me.
I asked this before, if zeek goes down what are the odds top earners go down too ?
That would STP’s bank, not Zeeks.
Thanks Al.Anyone want to take a shot at who these new people are at Zeek, http://zeekrewardsnews.com/2012/07/moves-changes-more/
I’m new to Zeek rewards and am truly trying to figure out if it is a Ponzi, Pyrmid scheme. I am slowly being convinced that it might be one of the above.
One of my main concerns is the fact that when I buy a bid for a dollar and give it away for someone to use they can only use it in the beginner or free bid auctions. In those auctions the price is being bid up way above the retail price.
Since i paid a dollar for the bid why can’t it be used in any of the auctions? If anyone has an answer I would love to know it.
Because Zeekler doesn’t want retail bid purchasers dealing with the massive bid inflation that goes on in the free bid auctions due to the nature of the compensation plan.
Trouble is, seeing as retail bids are mostly purchased by affiliates through dummy customer accounts for the referral commissions and matching VIP points, the retail auctions are usually buggered too (although less so, because not all affiliates can be bothered trying to recoup some money by using the bids and trying to win an auction).
IMHO, relatively low. Burnlounge burned the top earners because they actively recruited members and their comp plan rewards recruiters.
The official story is: Because they want to force users to buy “retail bids” in the future. You’re just giving them a ‘taste’.
The unofficial story you already got from Oz.
So I’m buying “burgers” to give away to my customers and when they go to pick it up all they are getting is the “pickle”
Half a pickle. If they buy retail bids then they get a pickle.
You as an affiliate have to buy pickles at burger prices otherwise the compensation plan falls apart (1.5% daily ROIs).
Technically, you can solve that, but …
The solution is:
1. Sign up a family member or a friend as a customer under yourself.
2. Withdraw money to pay for retail or VIP bids
3. Buy retail or VIP bids through the customer (you will have to pay for the bids yourself)
4. You will earn matching VIP points (1 VIP point per $ spent on bids), 20% commission of the amount spent on bids, and you will also get the bids.
The “but” is:
It will potentially create a tax problem for you, if you’re a U.S. taxpayer. The potential tax problem is currently vague, but the money you withdraw/spend on bids is taxable income — so the 20% commission isn’t THAT lucrative to earn.
I know that several affiliates use methods like that, so you can probably find some better descriptions and variations of the method.
You will “cheat” your upline for 10% and 5% commission, and you will earn 20% commission yourself, (but).
One of the affiliates here can probably tell you more about methods like that. I’m not an affiliate, and I was only repeating the basic parts of the method.
One problem with affiliates buying and spending bids themselves is that they make the auctions become less attractive to real customers. Nearly all the bids spent in auctions are from the affiliates themselves.
Troy Dooly just broke the story that Keith Laggos is no longer a paid consultant for ZR (although is apparently still a Zeek Rewards affiliate making $40,000 a month).
I’ll have an article up later today on it, still going through what I can find and putting it together.
@M_Norway,
Another significant benefit of creating your own customer to buy bids, in addition to what you mentioned (20% commission, matching VIP points, ‘cheating’ your upline out of commissions), is that you can use a credit card to buy VIP bids and you don’t have to pay fees to an eWallet, wait several days for verification, and be limited to a fixed maximum per day.
If you are only looking to spend $1000 or so, credit card is perfect. If you need to invest more than $1000, say $5000 or $10,000, it may be easier just to do a cashier’s check or bankwire then setting up multiple dummy accounts and credit cards.
Some affiliates also want to use a credit card so they can “play the Ponzi” on credit.
One would think $40k/month is more than the consulting fees.
Is that $40k/month with a steady point balance, or 40k VIP points a month?
Also, wouldn’t that bring into question the motives and conflicts of interest behind the NMBJ puff piece talking about the 25:1 customer to affiliate ratio, without even addressing the hard questions such as why there are no real customers, why customers are just random names with digits appended to them off a mailing list, why can people buy customers, why is there no email verification, why is it that affiliates can’t get customer’s email or other contact info, etc.
Feel free to throw this reference in here:
http://amlmskeptic.blogspot.com/2012/07/dirty-little-secret-of-mlm-not.html
Look foward to your findings on the Laggos call. The other site was so vague and lame. Zeek Rewards and their not so epic quest on being compliant.
Zeek seems to think they will be around until November
Zeek seems to think they will be around until November…. Care to elaborate on that
Just an FYI: The original post of KSChang about Zeek is now posted on Eagle Research Associates website. You can find it by clicking on our Warnings, Alerts & Hot Topic link and then click on Zee Rewards – Real or Scam? You Decide.
To me it suggests that they might be planning to disappear no later than October, since tickets are being sold well in advance.
In the call it was announced by Zeek that they have parted ways with Keith Laggos effective immediately. Seems Troy Dooly has information on this new development on his blog.
I have been following the threads in regard to Zeek and other Penny Auctions. I hope you do not mind, but I had to share an interesting email this morning from a concerned friend. This was placed in her Co2 back office.
Looks like some people get it and see the writing on the wall and have chosen to do the right thing.
@golfer
So CO2 Rewards and Kevin Thompson think the whole points investing thing is not only an investment scheme, but also unsustainable.
Wait, this is the same Kevin Thompson working with Bidify isn’t it… they also have a point re-investment business model. Wonder why one is fine but the other isn’t.
Surely Bidify’s mandatory account that forces affiliates to re-invest 20% regardless of how much they make isn’t the difference. It doesn’t change the core of the buisness model (invest $x and receive a daily ROI over a fixed pariod of time >$x) so I wonder why Kevin Thompson signed off on Bidify but not CO2 Rewards.
It looks like to me that Keith Laggos was laying it out there. If you can believe 1/2 of what he says, I think he’s spot on with his remarks about certain companys having the momentum or who’s hot right now.
These companys have a certain following that will jump to the next best thing. History tell’s us that zeeks on its way out and those on top will take there money and run.
Compliance is just a word that is used to string this thing out as if it’s something to aim for. Those in the KNOW, will walk away with there pockets full.
Is it really a surprise that a lawyer will say some something good about a company if he’s being paid by them???
@Oz
Not sure how to answer you regarding the discussions behind closed doors between Kevin Thompson and these other companies. Btw… he has represented C02 longer than Bidify or the others that claim him as legal council on their websites.
My personal take is the management of Co2 decided to call a duck a duck before being forced to be shot in the same duck pond as the others. Lots to be left for speculation with the content of the notice from Co2…
I don’t dare assume what is really going on behind the scenes with these companies but obviously the fire in the oven is heating up.
Just a heads up, “Tina T” and “Johnn” were publishing from the same IP address in this article and have since been marked for spam.
The same person has since tried to leave comments under “Sam”.
Zeek is scam
It’s not just “the critics” who are asking questions about mathematics, sustainability, and whether or not Zeek is a Ponzi.
From the TG forum:
Probably because CO2Rewards doesn’t really SELL anything of substance, while Bidify *does*, to the extent that it only pays if the giveaway bids are “spent”?
But then I think we went through CO2Rewards and found it to be on the iffy side from the very beginning…
That’s what the marketing material says, but Bidify affiliates have confirmed that they’re awarded points on the purchase of bids.
Kinda like how the FSC marketing states its actually credit now, but Bidify still forces affiliates to re-invest 20% of their earnings with it – just like they did with the mandatory account.
I am mightily surprised that in all the accusations that this or that online business is a Ponzi, there is no mention of the biggest of the lot – Banners Broker.
(Ozedit: Banners Broker isn’t MLM, nor does it pretend to be. Discussion about BB is offtopic.)
What no-one seems to mention here is Zeek’s actual real penny auctions which real people participate in – I have some downline members who are JUST retail customers. That legitimizes the whole operation IMO. So why doesn’t it figure in the discussion here?
I came here because an anonymous troll put unsavoury comments on my blog along with a link to this page. The comment was marked spam and any other comment with links to this crap will also be marked spam. Just don’t even bother.
And another thing.
It was suggested that the seed money for Zeek came from Ad Surf Daily. I was under the impression that ALL the funds from that were seized by the US Government and not returned. So how did they get into Zeek?
@Mrsfletch
Retail customers as in they purchase retail bids with their own non-affiliate funds on a regular basis and are not accounts you created?
If the answer to the above question is “yes”. How many affiliates do you have in your downline and what’s the ratio between what they re-invest daily into VIP bids vs. how many retail bids are being bought by your retail customers?
Money in the system might have been seized but what about the money already paid out to investors?
We’ve never denied that there are SOME actual retail customers, it’s just that their numbers are very few and they’re actually hard to find, and from all appearances the actual retail customers putting money into the business by buying bids aren’t doing so in great enough numbers to support the whole Zeek Rewards investment scheme.
Everyone I know who is involved in Zeek is concerned about recruiting other investors and not at all concerned about recruiting actual customers.
My wife has retail customers that she bought, however, they consist of names followed by three or four numbers, and not one of them has ever purchased bids. Same goes for everyone else. They’re just dummy accounts to throw bids into, but there is little external (that is, non-affiliate) money being pumped into the system.
Affiliates are paying affiliates, therefore, a ponzi scheme.
I have been asking affiliates about retail customers since January 2012, and have identified ONE real customer. She spent $260 on 400 retail bids 5 months ago, before she became an affiliate herself.
So if you have real customers the number will now be TWO or more. Real customers are the ones spending their OWN money on retail bids or VIP bids, just to use them in auctions (not because an affiliate earns commission on them, where the affiliate partly or fully pay for the bids).
Normally, we don’t “have” customers in a downline. They are usually independent, only signed up through an affiliate. The ones we “have” in a downline are usually family members or friends, acting as real customers.
They become very common when Zeek introduced PRC customers as qualifiers, so I haven’t counted any of them.
No one here seems to understand that to avoid SEC regulations Zeek cannot Call the money money. It has to be called points or peanuts or whatever for this to Work and it is working.
I know too many people earning lots of $ and taking lits out! If you over analyze you paralyze!
Not one biz I know of pleases everyone 100% of the time. Always you will find doubting Thomas or unfounded critiques. Even the movies have this very scenario going on.
No one believes that because it’s total hogwash.
You obviously haven’t read all 25 articles and 4500 comments, because we’ve covered this in detail with the Howey Test.
The really sad things is, there are people out there who, just like Kdawg, genuinely believe the authorities are so stupid they’d be fooled by Zeek calling a spade a digging implement instead of a spade.
What’s worse is when the little Zeeklers have it pointed out to them (with proof) it takes 12 to 18 months for investigators to gather enough evidence to bring their case to court, they STILL come out with “it’s working, so it can’t be illegal”
@LRM
Gee, do you really think it’ll take 12-18 months?
I meant it TAKES 12 to 18 months, not it WILL take 12 to 18 months from now.
IOW, don’t take the fact it’s just been made public investigations are under way as meaning someone didn’t begin collecting evidence long ago.
“Complaints” doesn’t just mean unhappy members complaining about lack of service.
Anyone involved really should read up on the just concluded AdSurf Daily ponzi prosecution.
Before the prosecution moved to close ASD via court action, they’d been gathering evidence for months.
They had EVERYTHING.
Bank account details, forum postings, web page captures, transcripts of ASD rallies – EVERYTHING necessary to shut them down.
@LRM – Ah ok, thanks for the info.
Actually, they were returned in 2011.
http://www.pcworld.com/businesscenter/article/240601/us_agencies_returning_55_million_from_adsurfdaily_operation.html
Because there ain’t enough of them, and you didn’t read the parts where this was discussed.
Maybe they are people who want you to see the other side.
You sound just like Zeek… “no negativity”. But we allow your comments through… as long as you stay on topic.
Is that an admission that you *know* Zeek is selling unregistered securities?
So as long as it pays you don’t care if it’s illegal or not?
We ain’t talking about pleasing. We’re talking about OBEYING THE LAW.
There are also ostriches who bury their heads in sand pretending NOT to see danger, and those who know things are illegal, yet do it any way. So what exactly does that prove?
Let’s expand that thought.
Do you honestly think “some” is an adequate number to legitimize a fraud masquerading as a MLM ??
Some Zeek members are claiming there’s 1, 2 or even 3 million members.
If the IRS or FBI or SEC come knocking, do you think they’re going to be satisfied with “some of our members are retail” or is it possible they might just ask “exactly how many”
We are analysing how able Zeek WILL BE to pay in the near future, not how able it HAS BEEN or IS.
And we’re not analysing Zeek in the role of “Shall I join it or not?”, so you don’t have to worry about over-analysing here. We’re analysing it so other people don’t need to over-analyse it, making it easier for them to make decisions and avoid being paralysed.
This is an MLM review site, and Zeek is one of the programs we have analysed. And we have made the decision of not joining Zeek long time ago (but half of the people writing here are or have been affiliates). So the paralysing problem has been solved long time ago.
Most of the affiliates have NOT made their money back, and any profit will first start when people have withdrawn enough cash to cover their initial investments and their expenses. Having a VIP balance will be meaningless if Zeek can’t afford to pay you in cash, or if Zeek is being shut down by authorities.
What others have been paid is NOT a positive sign in Zeek. It means it has been drained for money for a long time, and has become less able to meet future payments in cash. Money paid out to others is not in favour of yourself, when you consider it to be a limited supply of money involved.
The major flaw in Zeek’s business model is the part where they accept RPP points as payment for sample bids, with the idea that RPP points will be converted to money if people use them to buy something. The payments in RPP points is then added to next day’s profit pool, so the profit pool will contain more points than money.
And that process goes in a circle:
A: Points being paid out and reinvested
B: Points being added to the profit pool
A: Points being paid out and reinvested
B: Points being added to the profit pool
It can go on forever, with no new money coming in to support the points, only enough money to support the actual payouts in MONEY. That flaw means they have only a tiny little pool of money to support the growing payouts, because the points grow much faster than the pool of money.
The auctions can’t support the growing payouts, so Zeek has become more and more dependant on new affiliates willing to put some fresh money in.
@ K. Chang
In regards to kdawg’s remarks
he never said he gets paid and we all know someone that’s making money.
@Mick get out before you lose it all to include your friends trust.
Are you suggesting that Zeek is going the path of ASD? In that case, it tells the likely future story for the Zeek. Regardless, it totally negates what you posted just above this comment.
I really hope it takes 12-18 months to shut it down if their going to because I’m pulling drover $10k out a week now. By this time next year it will be over $30k a week.
Keep rocking on Zeek.
Oh and I was in monavie for over 4 years and collected more than $350k. So you nay Sayers who complain that it’s too easy to make this happen need to understand myself and my head affiliates work more then 30 hours a week building our empires and your not taking them away.
Keep punching your 9-5 clocks and believing its to good to be true and guys like me will continue to flourish in these MLMs.
Have a great night!!!
So you don’t care that every $1 you earn will result in someone else coming in after you losing that $1, with Zeek keeping some % for their profits?
You don’t care that other people will get screwed as long as Zeek pays you?
Good comments, Jimmy. I find most MLMers that have a following always make money for a while at the expense of others.
Zeek hides everything and there are no ethics at all. I hope when this scam falls apart and goes the way of ASD that the money paid out to people like the guy a few posts above have to pay it back.
@Rodney McKay
You failed to calculate any further
Including 90-day point retirement,
Assuming 1.43% average daily RPP,
Starting with $10,000, and reinvesting 100%…
Day 1: 10,000
Day 90: 35,384
Day 180: 47,213
Day 365: 139,289 <– 13x return in 1 year!
Day 730: 1,154,300 <– 1.1M in 2 years!
Day 1095: 9,566,012 <– 9.5 million in 3 years, wow, easy money!
Day 1460: 79,276,245
Day 1825: 656,984,681 <– 656M, better than the lotto!
Day 2190: 5,444,617,991 <– in the billions now
Day 2555: 45,121,090,188
Day 2920: 373,931,244,275
Day 3285: 3,098,874,048,949 <– the first trillionaire ever?
Day 3650: 25,681,246,267,229
Day 4015: ALL THE MONEY IN THE UNIVERSE!!! BWAAHAAAHAAAHAA! Global domination is imminent! All retailers in the world will fail and goods will ONLY be available through Zeek! Then we will all be sorry….
Seriously though I have family I have been trying to share info with and they aren't getting it or are choosing not to get it. Thanks for the digging and the questions you are answering for those of us interested in the answers (and the math).
No, because they shouldn’t spend what they cannot afford to lose. This goes for anything related to money. Don’t invest, start a business, purchase large item you can’t afford, etc… common sense.
@Henry
The “dont spend what you can’t afford to lose” argument is completely irrelevant when discussing Ponzi schemes.
It’s the same as telling murder victims not to live in the US where guns are freely available. It’s a strawman defence designed to do nothing more than deflect from the central issue. That being the running of a Ponzi scheme.
@ OZ and Mr. Chang
Wow! Maybe there is a God(?) that protects fools. I did not do my “due diligence” and trusted a good long time friend (20 yrs) and a few of his family members that have been involved w/ Zeek for several months.
One family member has a background in marketing, MLM’s, and start-ups … said it looked legit. My friend’s been at it for about 90 days now and has more than doubled his money (in “back office”). I’ve watched this for a few months now and decided, w/o being pressured, to get involved.
It seemed to good to be true. I didn’t really understand how it worked but people were making great money and my friend has always been a “straight arrow” so I went for it and pulled out 10k (Huge chunk of my savings. Work has been very slow for some time now). I was in the process of enrolling, check in hand, last week …. filled out my SS#, CC#, Diamond member, etc. Clicked Send and got “Error – Incorrect Info”.
We tried this 4X over half an hour. My enroller said it’s probably becuz Zeek had such hi traffic and was overloaded given it was evening (Thanks Zeek !). I was instructed to try registering on my own later that evening. I Googled Zeek when I got home and your (OZ) “MonaVie President …” article showed up just below Zeekrewards. Good job on getting BehindMLM to show up under Zeek!
I have spent 3 days reading BehindMLM and Mr. Chang’s Hub and have found it very enlightening … especially the comments. The 10K has been deposited back into my account. There are too many red flags for me. You guys are making a lot of sense while most of the Zeeker’s rebuttals are hilarious.
It does look like a Ponzi when you do the math and I can’t really justify getting involved. I think I would be more OK running guns … no illusions/delusions there ;-D
My upline was supposed to be Troy and below him Gregg. I think I have seen them post here or on Mr. Chang’s Hub. What are their positions to both of your findings ??? I haven’t been able to read all the comments.
I still try to keep an open mind about Zeek although the RED FLAGS are huge and numerous. Many people are gonna get real screwed if this is a Ponzi … from this newbie’s perspective.
Thanks for your insights, everybody.
p.s. – My friend read the “Monavie Pres..” article and was alarmed. He’s been sent BehindMLM and Mr. Chang’s Hub. I will see him later this week and find out where he stands.
Uh, Troy and Gregg who?
Troy Dooly. I don’t know Gregg’s last name. I have seen Troy’s site and heard his perspectives there, but has he responded to your findings?
Hang on what? How was Troy Dooly to be your upline???
Dooly has responded to the analysis here, but largely ignores the Ponzi aspect of the Zeek Rewards business, instead focusing on the Zeekler penny auction side of thins.
From the comments I’ve read on his site, if you ask him whether or not Zeek Rewards pay out the daily ROI using mostly affiliate money, he deflects by asserting it’s not a ROI.
If you then call it RPP share or whatever linguistically compliant verbiage Zeek believe clears them of running a Ponzi, he then states something along the lines of not believing it to be so, and possibly brings up future plans (pegging the unproven success of Zeebates as making a dent on the percentage of affiliate money being used to pay out affiliates each day).
Of course this alone is indirectly adimission that currently there is a problem with how much affiliate money is being used to pay affiliates each day, otherwise there’d be no need for Zeebates or any other “retail money” incentives.
Bringing that up of course will most likely just get you a deflected answer or some nonsense about the penny auctions (from what I’ve read).
In any case, I’m curious how you’ve come to the conclusion Troy Dooly and Gregg (Caldwell?) would be your direct upline?
Pardon me, I did not conclude they would be my “direct upline” as you call it. Rather they were the “affiliates” that turned my friends onto Zeek. So I assumed they are the upline of the “affiliates” I would be downline from if I had joined.
I think it best to change my name, now …. 😀
Anyway, your response is helpful. Thanks.
@SC
You’re saying Troy Dooly and Greg Caldwell are affiliates in Zeek? Have you got anything to back this up?
No more training, recruitment or leadership calls for the next few days while planning is going on. Important announcements coming soon.
Email I got tonight
@OZ
No, I am not saying it is Troy Dooly or Gregg Caldwell. All I recall being told was that a longtime friend named Gregg from Idaho (don’t know his last name) turned my friends onto Zeek and he was turned onto it by a guy that was way up there, very successful, knew the industry well, named Troy.
I saw Troy responses here or on Chang’s site, looked around online and made the assumption it was Troy Dooly, my bad. I really don’t know either guy’s last name.
Why do you ask ?
@OZ
I will find out. If it is either one or both, I will let you know.
@SC
Well Dooly has denied being an affiliate in ZR so I doubt he’s the Troy. Caldwell is Zeek’s new COO so I’d also doubt he is actively recruiting.
That said, if Caldwell did have an affiliate account I wouldn’t at all be surprised, given that other Zeek Rewards executives have affiliate accounts themselves.
Ah, the “caveat emptor” argument… except they were told they are WORKING, not an investment. Thus, it is FRAUD, no matter how you slice it or throw disclaimer on it.
The Zeekhead’s comments illustrate that most of them are “get-rich-quick-ers”, or were recruited by such. Some, a bit more careful, did due diligence, and found the “negative” info trying to show the truth that they did not bother looking at (or was omitted by their recruiter).
Really? I don’t ask for first names. They can use whatever handle they wish… even insulting ones. Try *that* on Zeek websites! 😀
I don’t recall seeing the names Greg and Troy, but I haven’t looked carefully. I doubt they are Greg Caldwell (new COO) and Troy Dooly (MLM advocate). At least I have no evidence pointing that way.
SC’s story can be true, “the ones that directed (not recruited) his friend towards Zeek was Troy (Dooly) and Greg / Gregg (not Caldwell)”.
I can verify that story from memory. Some people have asked for direct advice there on Troy’s website, and Troy will always give relatively neutral and meaningless answers, not telling them anything of importance, so it shouldn’t be any problem recruiting people indirectly there.
Gregg is an affiliate, but Troy isn’t. He’s just an advocate for network marketing, “a helpful tool for any conman”. So Gregg might well be the friend’s upline / direct sponsor, picked up as a sponsor at MlmHelpDesk.
“Helpful tool” was because of different reasons, e.g. his habit of trying to separate Ponzi schemes into different “niches”, like ASD belonging to the “autosurf niche”. 🙂
He’s like “God’s gift to the confidence artists” in some of his thinking. Most people would have identified ASD as a Ponzi scheme, not as a company belonging to the autosurf niche.
Most serious advisors would also have told people about any main concerns about a company, even if they don’t share the same concerns themselves. His vagueness is clearly a gift from God — to all the conmen out there.
I see that Troy Dooly is not very well respected on this site and since I am new to MLM and have just started reading “Behind MLM” and “MLM Helpdesk” I’m just wondering if he has a history of being wrong.
I would also be interested if Oz or Chang can recall any MLM’s that they called wrong. (wrong on being a Ponzi or not) I ask this question because I got into Zeeks after reading alot of Troy Dooly’s articles but I now have doubts in part because of alot of Chang’s and Oz’s comments.
Forget about who’s wrong, instead ask yourself do you honestly believe Zeek Rewards is generating enough retail revenue through Zeekler to pay out a 1.5% ROI a day to hundreds of thousands, if not millions of affiliates?
Or is it all just coming from new affiliate money and being propped up by the vast majority of affiliates re-investing their “earnings”?
Talk to potential uplines about how many genuine retail customers they have, talk to people in the business (don’t listen to their spiels, ask questions!), do as much research as you can and then decide.
Deciding to get into business based on two blogger’s reputations is silly, focus on what is being said instead.
I didn’t join based on two bloggers reputations Oz but thanks for informing me on whats silly. It was an honest question. I’m trying to figure out who’s opinion I should value and who’s I shouldn’t. I can do the math but I don’t pretend that I know ALL the answers as you do.
Value it based on evaluation of the information put forth and your own analysis of it. Ultimately who provides the opinion shouldn’t be a factor in deciding whether or not the information any analysis is legit.
As a Zeek Rewards member how many retail customers do you have, how many does your upline have, how many does their upline have?
Do you really think there’s a mysterious clique of affiliates hidden away somewhere with enough genuine retail customers to offset the affiliate money being poured into the daily ROI paid out to affiliates?
What I know is based on analysis of the information we have at hand, which has been collected, discussed and analysed for months now.
If you’re looking for someone to convince you everything’s ok, you’re probably barking up the wrong tree. That’s not the purpose of the analysis and discussion here.
If this is about “God’s gift to any confidence artist”, that statement was explained in the same post as it was presented, pointing at “specific ways of thinking” and showing “niche-thinking” as an example for it.
I don’t know anything about any “history of being wrong”, since I don’t consider that to be important. I consider that to be “normal” for most people.
“God’s gift to conmen” is clearly my own opinion, and it was figurative speaking rather than literally. At least I hope so. 🙂
He’s well respected in everything EXCEPT his personal position on ZeekRewards.
I respect him for his OTHER stuff. Just not for this.
Don’t believe something just because someone says so. Find out WHY they say so (other than “trust me”). When Oz and I have opinions, we support our opinions with facts and logic.
When MANY of our “opponents” argue, they use fallacies, affirming the consequent (assume their explanation is the only one that matters), red herrings, and other bogus analogies.
With a little critical thinking you can cut through the mess, discount the falsehoods, and analyze what is left. As Sherlock Holmes said, whatever remains, however improbably, must be the truth.
Wasn’t there another Ponzi/pyramid company that Troy backed and was later learned that he was being compensated or had a friend that was running it?
Rather than focus on Troy’s comments, let me ask your questions a different way.
1. Have you ever seen so many “critics” such as Oz, RealScam.com, and Patrick Pretty all collectively be “wrong” when calling out a business as a Ponzi?
2. In the history of the planet, have you ever seen any business offer > 0.85% daily compounded returns and NOT be a Ponzi? (Credit to RealScam for offering this perspective.)
3. Does having foreign credit card processors in countries such as Korea and using credit card factoring (could be illegal), combined with their original two US banks terminating the Zeek relationship worry you?
Was it Global Verge?
Now, don’t rely on the numbers, but the analysis offered at EACH website. It’s not just the numbers, but the logic/evidence presented at EACH website. A good reference (with logic and evidence) is worth more than bazillion baseless opinions, or infinite fallacies.
Now, now, there *could* be something new… but Zeek ain’t it.
Don’t forget Malta, Cyprus, Russia, Puerto Rico, and Panama.
There’s enough warning signs to warn off a herd of elephants. Only the most ardent believers would ignore all those signs… or joined before they became aware of these signs (which means they haven’t done due diligence).
Wonder if Troy will issue a mea culpa to Randy Schroeder?
Seems Randy was right.
Oz was right.
PPBlog was right.
Lynn, LRM, Glim from @RealScam were right.
kschng, MB, e, M_Norway, Joe Mama, Dion, and many others were right.
This feels like Vader telling Luke “you were right, you were right”.
Wow…. Why didn’t I come across this blog sooner. I sent Rex venture group $2,000 last month. Now it looks like I’m never gonna see that money again.
I’m done with this Internet money makin BS for a while. It didn’t put me in the poor house but a week of income lost really stings. Oh well. It just hurts me to know that there are people out there that spent and borrowed more money than they had and lost it.
God Bless and Help us all!!!!!!!
@jonney:
Don’t spend your money yet. There’s something called clawback.
Last post on here was 8/19/2012.I don’t want to open this up again if it died, but would love to hear about how the supporters fared after the explosion.
“QUICK OVERVIEW”
* Scroll to the top of the article
* Click on Zeek Rewards (under the headline of the article)
* That will give you a list of Zeek Rewards articles, “newest first”.
A FEW EXAMPLES
I don’t remember all the details, but …
Dawn Wright-Olivares and Daniel Olivares (Dawn’s stepson) pleaded guilty to 2 and 1 criminal charges, “conspiracy against the United States”. Disgorgement of $8.6 million and $3.1 million.
Troy Dooly was fined $3,000 for violating Section 17 of “Security Act 1933” = failing to disclose to his readers that he had a paid relationship to RVG as a blogger. He also received a restraining order (Section 8A), and disgorgement of $3,000 of the $18,000 he had received in payment from RVG.
It may be easier if you can take a look at the headlines of the articles. I only gave you some quick examples from memory without refreshing any details.