Clawbacks filed against Zeek insiders & winners
One of the frequent questions we get regarding Ponzi schemes here at BehindMLM is the question of liability for a scheme’s top promoters. Typically these promoters are the “face” of the affiliate-field and the ones who “got in early” and collect the largest returns.
As part of the Zeek Rewards Receivership’s effort to recover funds to pay out those who lost money in the scheme (Zeek was on the verge of going belly-up had the SEC not shut them down), the Receiver has gone after Zeek’s top net-winner affiliates.
In addition to “baiting the hook” by creating a number of net winners, the Insiders operated the scheme with the knowing, reckless or at least negligent assistance and encouragement of a number of managers and advisors that greatly enhanced the perceived legitimacy and resulting success of the scheme.
Thus far some have settled with the Receiver repeatedly issuing statements in his quarterly reports about pending clawback litigation to be filed against those who refuse to return the money they stole. After a long wait and speculation over whether or not the general public would learn who these stubborn thieves are, today we can reveal that on the 28th of February 2014 the Receiver finally began his clawback litigation efforts against them.
Because Zeek’s Insiders “won” or received (the victims’) money in an unlawful Ponzi and pyramid scheme, they are not permitted to keep their winnings and must return the fraudulently transferred winnings back to the Receiver for distribution to Zeek’s victims.
In no particular order, here are the top profiters in Zeek Rewards who, despite Zeek Rewards being a $600M Ponzi scheme, believe they are entitled to keep the money they stole from their victims.
Ladies and gentlemen, the worst of the worst the MLM industry has to offer:
Paul Burks (CEO and owner of Zeek Rewards)
Paul R. Burks is, upon information and belief, a resident of Lexington, North Carolina and the owner and former top executive of RVG. He was the acknowledged leader of Zeek. Paul Burks received in excess of $10 million from RVG.
On information and belief, Burks used investor money to provide cash gifts of more than $250,000 to his son, and more than $30,000 to his daughter.
Burks and the other Insiders were aware that the payouts to Affiliates would be funded by new participants rather than retail profits from the penny auctions.
Burks and the other insiders understood that the compensation plan would be unsustainable in both the short run and the long run because there would not be enough new participants to support full daily cash payments to a growing number of existing Affiliates.
Burks deliberately evaded affiliate questions asking how the RPP was calculated. In a Skype chat with an affiliate, he said: “[a] proprietary system is used to determine the amount of profit sharing that is done each day. We do not divulge the details of how those numbers are determined.”
The alleged “profit percentage” was nothing more than a number made up by Burks or one of the other Insiders. Most days, Burks made up the number.
As Danny Olivares explained to RVG’s internet provider, “Paul [Burks] goes in nightly and opens up adm_displayCompunder3.asp and enters a decimal percentage.”
Sometimes, the number was made up by Dawn Wright-Olivares or Danny Olivares. Often, the company simply used the previous week’s daily RPP percentages.
In a statement issued to reporters in March 2013, Burks defended his role in Zeek Rewards:
“I never told anyone to invest more money than they could afford,” Burks snapped. “I didn’t tell them to do that. Never.”
He said if they lost money, “it’s their fault. Not mine. Don’t blame me.”
Dawn Wright-Olivares (COO and CMO, Paul Burks’ 2nd in command)
Wright-Olivares misappropriated over $7.8 million through the scheme. With these investor funds, she repaid personal loans, renovated her home, purchased an RV, bought multiple vehicles, and engaged in several other suspicious transactions.
In addition, Wright-Olivares looted RVG of significant funds after it had become apparent that the scheme would soon end. In August 2012, she received over $1.7 million from RVG, with most of this sum being paid directly to an account held by her shell corporation, Wandering Phoenix LLC.
Wright-Olivares then redistributed more than $1.2 million of these funds to her personal account and de Brantes’ personal account, as well as to others involved with RVG, including OH Brown, Robert Mecham, Peter Mingils, Aaron Baker, and Barbara Ghent.
Further, Wright-Olivares paid out $150,000 to Jonathan Wright, Suzanne Wright, and Ben Powell Construction on August 17, 2012, the day ZeekRewards was shut down and the freeze order took effect.
Moreover, even a week after the freeze order was in place, Wright-Olivares was still redistributing the illicit funds, paying over $90,000 to Aaron Baker, John Wright, and her own accounts on August 24, 2012.
Peter Mingles at the time was a board member of the Assocation of Network Marketing Professionals.
Wright-Olivares has plead guilty to her involvement in Zeek Rewards. A final judgement was handed down in the SEC’s civil case against Wright-Olivares her on the 28th of February 2014, holding her ‘liable for disgorgement of $7,846,99.95‘.
Taking into account a “pre-judgement interest”, the total amount Wright-Olivares is being held liable for is $8,184,064.94.
Wright-Olivares’ son, Daniel Olivares, had a separate case filed against him, with a $3.2 million liability also handed down on the 28th after he too pleaded guilty.
Wright-Olivares’ husband, Alex de Brantes, was in on the scam too:
Brantes told an affiliate in July 2011:
Our average has been between 1.6–1.8% which would actually be a great deal more than 125%.
The attorneys our [sic] advising us on what we can and can’t say and now it’s our job to figure out how much we need to pay daily to get everyone exactly what we intend to give (it makes it a little tricky but it is our intention to maintain a system that pays 125% without saying it anywhere on the site).
It’s my understanding that to reach 125% we’ll need to pay 1.38% per day.
Our programmers and strategists are working around the clock to land on the right method, percentages, and presentation for all of this. Right now we’re still working on the 125% cap system. We just aren’t saying 125%.
A mountain of evidence against Wright-Olivares has been collected and presented by the SEC, with the Receivership providing some explicit examples in his filing:
(Wright-Olivares was) very clear about the plan, telling Danny Olivares on January 21, 2011: “We’re just going to use bids as currency.” On another occasion, Dawn Wright-Olivares referred to the compounding bids as “Monopoly money.”
In one email, when referring to compounding bids being renamed VIP bids, Wright-Olivares wrote, “wherever you see a (compounding) next to VIP – you will know that these terms are interchangeable,” and she later wrote that “no change has been made in how they operate, qualify or earn.”
Indeed, Wright-Olivares admitted that she thought the name changes were a joke. In a June 15, 2011 email to O.H. Brown, an RVG advisor whose company created marketing videos for ZeekRewards, about a company webinar script, she said: “you’ll see where I started to say Retail Profit Pool (lol) instead of Compounder…. We’re going to call compounding bids – VIP bids.”
As with the Compounder, the Insiders changed the terminology for the Matrix, but they never changed the real essence of the scheme. Dawn Wright-Olivares explained the cosmetic changes to the Matrix this way: “you [will] in effect be paid on levels 5-10”…. “but we can’t SAY that. Deep matrices get shut down.
So instead…we say that you are getting a matching bonus on all of the 2×5’s on your 5th level. It’s semantics, but semantics mean a great deal with regulators.” … “[I] don’t really understand how they can say they have levels 10, 15, etc. when it’s a 2×5, but if we can get away with it this way – then it’s my vote to leave it alone.”
Similarly, Keith Laggos, a Zeek Rewards advisor, emailed Dawn Wright- Olivares (copying Burks) in July 2011: “when talking about matching bonuses, you are showing being paid on 1 to 10, 1 to 15 and 1 to 20 levels. This defeats what we did by going to a 2×5 matrix. You should say a 100% matching on all your 5th, 15th and 20th level affiliates’ 2 x 5 matrixes. I know you want to show they get paid on 20 levels in a 2 by 20 matrix, but that is when you can get a pyramid investigation or charge.””
Whether or not Wright-Olivares found the eight million dollar figure she’s liable for as funny as the psuedo-compliance name-changes she implemented was not immediately clear.
On a Lyoness affiliate recruitment call pitched to his Zeek Rewards downline, Keith Laggos made the following prediction on the 1st of August 2012:
I don’t think it’s (Zeek Rewards) going to last. I think the FTC will take action within 6 months, maybe 3 or less. I don’t think they’ll go a year before they take action.
Sixteen days later the SEC shut Zeek Rewards down and filed charges against the company.
At the time Laggos claimed to be making $40,000 a month as a Zeek Rewards affiliate. His absence from the Receivership’s net-winner clawback filing would indicate he has already settled with the Receivership.
Update 3rd March 2014 – Keith Laggos appears on a recently published list of 9000 Zeek Rewards net-winners who made more than $1000 from the scheme, confirming he hasn’t yet settled and paid back his victims.
Roger Plyler (Affiliate Relations)
Roger Plyler was, upon information and belief, a resident of Charlotte, North Carolina and handled “affiliate relations” for Zeek. Mr. Plyler received more than $2,300,000 from Zeek under one or more usernames, including “roger.”
Not only was Plyler lending a hand to run the scheme, but he was also collecting his ROIs under multiple usernames. Plyler’s accomplices in the scam include Beth C. Plyler and James L. Quick (both co-trustees of Plyler’s estate and trust fund).
Plyler lent money to Burks to keep the Zeekler penny auction site running after it launched to mediocre success (this was before the Zeek Rewards Ponzi scheme was attached to it).
Darryle Douglas (Affiliate Communications & Relations)
Darryle Douglas is, upon information and belief, a resident of Orange, California and was part of Zeek’s senior level management involved with affiliate communications and relations. Prior to Zeek, he worked with Burks in other multi-level marketing businesses. Mr. Douglas received more than $1,975,000 from Zeek under one or more usernames, including “dd.”
As with Roger Plyler, not only was Douglas committing fraud through Zeek Rewards, but he did so using multiple usernames within the system.
Todd Disner (net-winner investor)
Todd Disner is, upon information and belief, a resident of Miami, Florida. He is a former ZeekRewards “affiliate” and was a “net winner” of more than $1,875,000 under one or more usernames, including “tdisner,” using Kestrel Spendthrift Trust as the nominal payee for his payments.
Upon information and belief, Todd Disner is the trustee for the Kestrel Spendthrift Trust.
Trudy Gilmond (net-winner investor)
Trudy Gilmond is, upon information and belief, a resident of St. Albans, Vermont. She is a former “field liaison” in the ZeekRewards’ scheme, a ZeekRewards “affiliate” and a “net winner” of more than $1,750,000 under one or more usernames, including “trudygilmond,” and using Trudy Gilmond, LLC, a shell company, as the nominal payee.
Jerry Napier (net-winner investor)
Jerry Napier is, upon information and belief, a resident of Owosso, Michigan. He is a former ZeekRewards “affiliate” and was a “net winner” of more than $1,745,000 under one or more usernames, including “napier.”
Durant Brockett (net-winner investor)
Durant Brockett is, upon information and belief, a resident of Las Vegas, Nevada. He is a former ZeekRewards “affiliate” and was a “net winner” of more than $1,720,000 under one or more usernames, including “DBA.”
Darren Miller (net-winner investor)
Darren Miller is, upon information and belief, a resident of Coeur d’Alene, Idaho. He is a former ZeekRewards “affiliate” and was a “net winner” of more than $1,635,000 under one or more usernames, including “djmiller742.”
Rhonda Gates (net-winner investor)
Rhonda Gates is, upon information and belief, a resident of Nashville, Tennessee. She is a former ZeekRewards “affiliate” and was a “net winner” of more than $1,425,000 under one or more usernames, including “cybernetcentral.”
Michael Van Leeuwen (net-winner investor)
Michael Van Leeuwen, also known as “CoachVan,” is upon information and belief a resident of Fayetteville, North Carolina. He is a former ZeekRewards “affiliate” and was a “net winner” of more than $1,400,000 under one or more usernames, including “coachvan78” and “coachvan.”
David Sorrells (net-winner investor)
David Sorrells is, upon information and belief, a resident of Scottsdale, Arizona. He is a former ZeekRewards “affiliate” and was a “net winner” of more than $1,000,000 under one or more usernames, including “davidsorrells.”
T. LeMont Silver (Zeek Rewards “field liason” and net-winner investor)
T. Le Mont Silver Sr. is, upon information and belief, a resident of Orlando, Florida. He was a “field liaison” in the ZeekRewards scheme, a former ZeekRewards “affiliate” and “net winner” of more than $773,000 under one or more usernames, including “LKW” and “shnookput.”
Turns out Silver was also double-dipping in his scamming efforts:
Mr. Silver also used Global Internet Formula, Inc., which is, upon information and belief, incorporated in Florida, as a shell company through which he was a ZeekRewards “net winner” of more than $943,000 under one or more usernames, including “mentor.”
Triple-dipping if you include his wife:
Karen Silver is, upon information and belief, T. Le Mont Silver’s wife and resides with him or is a resident of Orlando, Florida. She is a former ZeekRewards “affiliate” and was a “net winner” of more than $600,000 under one or more usernames, including “tlksilver”.
Whether or not the Receivership is aware T. LeMont Silver and his family fled the US to the Dominican Republic late last year is unclear.
Aaron and Shara Andrews (net-winner investors)
Aaron and Shara Andrews are, upon information and belief, residents of Lake Worth, Florida. Innovation Marketing is, upon information and belief, incorporated in Florida, and a shell company through which Aaron and Shara Andrews were ZeekRewards “net winners” of more than $1,000,000 under one or more usernames, including “aaronandshara.”
David and Mary Kettner (net-winner investors)
David and Mary Kettner are, upon information and belief, residents of Peoria, Arizona. They are former ZeekRewards “affiliates” and “net winners” of more than $930,000 under one or more usernames, including “mypennyauctions” and “pennyauctionbids,” using the shell companies named Desert Oasis International Marketing, LLC and Kettner & Associates, LLC as nominal payees.
Lori Jean Webber (net-winner investor)
Lori Jean Weber is, upon information and belief, a resident of Land O’Lakes, Florida. P.A.W.S. Capital Management, LLC is, upon information and belief, incorporated in Florida, and a shell company through which Lori Jean Weber was a ZeekRewards “net winner” of more than $1,940,000 under one or more usernames, including “snook” and “billyboy.”
Charges filed against the insiders and net-winners by the Receivership include
- the fraudulent transfer of RVG Funds in violation of the North Carolina Uniform Fraudulent Transfer Act (both insiders and net-winners)
- Common Law Fraudulent Transfer (both insiders and net-winners)
- Breach of fiduciary duty (insiders only)
- Constructive Trust (both insiders and net-winners)
- Conversion (insiders only)
- Unjust Enrichment (insiders only)
- Constructive Trust (insiders only)
On account of the net-winners, the Receivership has asked a judge
- Enter a declaratory Judgment against the Net Winner Class determining that the net winnings they received were fraudulent transfers from RVG
- Enter Judgment against each of the named Defendants in the amount of their net winnings from the ZeekRewards scheme
- Enter an injunction against the named Defendants and the Net Winner Class prohibiting each of them from dissipating their assets pending satisfaction of the Judgment against them
- Award prejudgment and post-judgment interest, costs and such other and further relief against all Defendants and the Net Winner Class as the Receiver is entitled to recover
Both Zeek Rewards’ insiders and net-winners now have the opportunity to respond and contest the Receivership’s clawback litigation, but let’s face it: the evidence against all involved is nothing short of damning.
Based on the actual average daily “profit” percentage of 1.43% used during the scheme, the daily “profit” award to Affiliates would be over $40,000,000 on 3 billion points. The amount of money paid in to ZeekRewards daily was far less than $40 million.
Therefore, if RVG had been required to pay the daily awards supposedly available to Affiliates in cash, ZeekRewards would have quickly collapsed.
Specifically, during the last month ZeekRewards operated (July 16, 2012 to August 15, 2012) the daily average RPP award was $38,237,036, but the daily receipts (from all sources, not just retail auctions) were much smaller, averaging approximately
$8,850,000.Thus, not only were the ZeekRewards payouts made from the money put in by other participants, but the so-called “profit” awards greatly exceeded total receipts, which, of course, was unsustainable.
Burks and Wright-Olivares, along with the other orchestrators of the scheme, engaged in self-dealing with no regard for the fact that in a matter of months or weeks, ZeekRewards would be unable to pay back those individuals who unwittingly bought into the lie.
In the Receivership’s filing a secret “Sweet 16” scheme is mentioned, something I hadn’t heard of previously. As per the description filed in the Receivership’s clawback litigation, it appears to have been a revenue-sharing pay-to-play scam within a scam:
In addition to the Compounder/RPP and the Matrix, a select group of individuals were allowed an additional revenue source, referred to as the “Sweet 16.”
The Sweet 16 was another means by which RVG made payments on a passive investment. It did not involve the sale of a product, nor did it require a member to recruit other participants into the program.
As RVG advertised in late 2010 or early 2011, the Sweet 16 was a program where participants received “a 1/16 share at the diamond level” on paid subscriptions in the then-2×21 matrix “across the entire width of the matrix.
Participation in the Sweet 16 cost a one-time fee of $999.
Each month, RVG totaled commissions from all subscription renewals for the entire Matrix and divided a portion of those commissions among the Sweet 16 members.
On information and belief, Sweet 16 payments to investors totaled more than $4.7 million over the life of the scheme.
In addition to the Sweet 16, two insiders were allowed payments through a revenue source referred to as the “Row of 16.” Dawn Wright-Olivares and Danny Olivares were the only two members of the Row of 16.
These Row of 16 payments were generally calculated as sixteen times the highest Sweet 16 payment amount. The Row of 16 was nothing more than a gift or bonus to these two individuals.
As with the other “compensation” payments made to Affiliates, these payments were made with money received from Affiliates purchasing VIP bids or subscription renewals, not from a legitimate retail activity.
Dawn Wright-Olivares and Daniel Olivares received more than $5.8 million in Row of 16 payments over the life of the scheme.
Like I said earlier in this article, these people are nothing short of the absolute worst the MLM industry has to offer. Time to pay up kids.
Footnote: My thanks for ASDUpdates for the heads up.
Reading the Burks Complaint was like looking into a garbage can. Very dirty.
I always wondered about that cropped photo of Wright-Olivares. Now I see the full pic. No wonder she is so happy. She’s hugging her shill/fluffer Troy Dooley.
A list of 9000 Zeek Rewards’ net-winners ($1000+) who have not yet settled, is up on the Recievership website: http://www.zeekrewardsreceivership.com/pdf/Net_Winners%203.1.14.pdf
Keith Laggos is on the list!
Craddock and Faith Sloan aren’t on it.
Guess we’re right that he settled. 😉
So are the people who made money in zeek rewards obligated to pay the money back????
Nah, this is all just a game. Don’t worry about it brah, relax. The Receivership has just watched one too many Law and Order episodes…
Not yet, but they will be; they will owe full value, plus interest, plus costs.
Still, its better than being a net loser.
92% of affiliates were net losers.
That list should serve as a warning for everyone participating in obvious frauds like Kingdom777 or whatever it’s called now, Better Living, Lucrazon…the government will come after you for your “earnings”. You can’t play “innocent”. STAY AWAY from this BS
Man.. T Le Mont made bank! Not only in Zeek but GoFun Rewards, & Jubirev… I hope they hunt his a** down and bring him back to face the music!
But Dawn is quite fascinating to me. She is a female, number one. A smart female.
But with an added quality of not being able to stop behavior that is harmful to others or even to herself.
I know someone like her right now. This person has that “flat effect”..
In dire or tragic situations where most people would be visibly distraught, stressed, depressed, a person with a “flat effect” will be carrying on as usual. This is what I see in her.
Of course I haven’t spent time with her, so I am only going by what I have observed… and the ability to open up a restaurant, (a BUSINESS), and post on her Facebook as if she may or may not be mildly annoyed at the trying times she is going through, is enough for me to suggest she may not function mentally like most people.
Just the simple act of starting a business is huge, nerve-wracking, stressful, you name it. But the woman did it like an afterthought.
You will probably never see her either afraid, remorseful, or even break a sweat.
Am I fascinated with her? There is something about her worthy of taking close note of. Would I trust her? Never.
@naabo,
I have a Dawn in my life. “Flat effect?” I’ve never heard of this before. Your description was perfect for this type of person.
Thank you.
Hoss, I haven’t looked at the numbers, but is that 92% figure you mention the actual number? Wow..I’ll bet they’ll be looking at the same numbers when TelexFree International hits the skids!
According to Yelp, Healthy Hog was opened in late 2013. And had no reviews until recently. Since she settled, she may have seen it as an opportunity to do something with the money she stashed away. There are *rumors* that her kids are still highrollers in town over on PatrickPretty.com, but those obviously can’t be verified, could be someone embellishing stories.
However, I don’t think it’s flat effect. It’s more like Kevin Trudeau… inability to see fault in oneself. It’s more narcissistic resilience, IMHO. You can’t get me down, I’ll be laughing later, AFTER I settle the charges.
I saw someone on “auto pilot”, in the last weeks or months before the shutdown. 🙂
What you see in Dawn is probably a reflection of your own ideas rather than the reality. Most people will continue in exactly the same direction they had before when exposed to stress factors.
Starting a business is much easier than you THINK. Most of my friends have probably started some types of businesses one or more times. Some of them have been successful, they have been able to make a living out of it. Some have failed, some have failed miserably.
92% was cited in one of the two recently filed Complaints along with some other statistical information. I do not remember which Complaint contained the information but most likely it was the one filed against the principal insiders, Burks et al.
Someone I personally know is on that list. The wife of the local guy here who was big into recruiting people into it.
Why it’s under her name and not his I’m not sure, because he was the big Zeek pusher around here. I wonder how much he made and how much he’s going to have to pay back.
I’m not on the list… yet.
and depending on how you signed up and if you were actually attached to RVG or your upline, you may never be on the radar (but your upline will be)
Yeah, sounds easy.
For any of you who might be familiar with this stuff, how long do you think until the receiver sends out whatever paperwork it is he must send to the net winners?
@Erin
He will first need to win the case against the 9,000 defendants. Then he will need to send separate claims to each one of them. It can take some time.
Robert Craddock is up to his old games. There was a call a couple of days ago with an SEC attorney and the top 20 Zeek affiliates that got served.
Todd Disner (Craddock’s accomplice) invited Craddock to eavesdrop and at the end of the call, after the attorney left, Craddock told everyone that he had a better attorney at a cheaper price. Apparently, he cut a deal to get a fee for everyone he can get to “his” attorney. Of course, that’s illegal, but Craddock doesn’t seem to care about those things.
Out of curiosity any idea what the attorney said?
Late last week the top net-winners and insiders have been issued with summons to attend a settlement conference on the 14th of April.
Anywhere between a week and two months I would say, but initially you will only receive a Summons and Complaint. That will join you to the action. The action itself and any final judgment could take much longer.
Ok thank you.
@Erin
ZeekDoc172.pdf is the order granting leave to file actions against insiders and net winners.
https://sites.google.com/a/asdupdates.com/files-website/zeek-rewards-sec-case
The order has set a date for an initial conference on January 27 2014. “Initial conference” is about “Preparation for conference” in April.
Thank you, I’ve read the documents, I just have trouble understanding some of the legalese.
You don’t need to understand the details. Your question was about WHEN and HOW, e.g. “When can we expect what to happen?” types of questions.
* There has been an initial meeting, mostly for attorneys, on January 27, deciding a date and some details for the real mediation meeting.
* The order granted an extension of time for all parties.
* Before the mediation meeting, you should probably receive some “paper work” from the Receiver.
* The mediation meeting will probably be held in April. I don’t know the exact date, but April 15 should be relatively close to the correct date.
You should probably read the updates from the Receiver. That’s the “official channel” for updates, and he know more about the process than we do. The last one is from March 3 2014, and is about what you’re asking about.
http://zeekrewardsreceivership.com/
Here’s ONE section of that update:
If you are on that list, you are not required to do anything at this time, but you CAN discuss it with a lawyer.
* Fill out a short contact info form (cert.gardencitygroup.com/zrwContactInfo/fs/home), to help him notify you about important information.
From another section of the update:
You can still settle the case, if you have something significant to offer (normally 50% or more).
NOTE
I haven’t read the whole update, I only browsed quickly through the different parts of it (in 3 minutes) looking for the type of information you asked for.
The active documents are on the Receiver’s website. The Complaint against Disner et al is the one that includes your family, i.e., all Net winners. If you have read that and checked the listing to see if your name is included then you know a lot. What may be unfamiliar to you is the legal theory used to recover funds in this situation.
The complaint states a set of facts, the law that applies and the remedy requested.
In this case the Receiver has requested an “avoidance action” which is to say that the RVG estate seeks to avoid any contractual obligation it has/had with the net winners.(they were invalid illegal contracts) and be permitted to recover funds that were paid out (fraudulent transfers)to those same people.
hoss: What may be unfamiliar to you is the legal theory used to recover funds in this situation.
Yep, that’s it in a nutshell.
Hubby’s name is on the list, his best strategy still is to ignore/pretend nothing is going on. His own “avoidance action”, he just mumbles something about getting a lawyer when the time comes. Might as well lose some more $ on that.
Oh, that lawyer some of the net winners paid $300 to, he sent emails assuring that he does NOT represent you, but certainly would be willing to.
What will happens with Paul Burks??
Will he lost every cent he have? Will he in bankrupt for the rest of your (pathetic) life ? Or better, will he go to jail for the rest of your life? He is old, so if he get 20 or 30 year in jail, maybe he not go back.
What you think?
Would it be okay if you could use 5 small words to get the response you want from him? 🙂
Try those 5 words. “Would it be okay if …” plus some reasonable suggestion. Try it on something easy first, on something where a question like that will be quite natural. Don’t try it on anything where you already know you will meet resistance.
You can find more about it here …
I don’t have any experience with MLM but it just seems that the penalties are not that severe and its not worth taking the risk of being involved in a pyramid scheme.
It seems that you are able to settle with the gov and still keep some of the money.
look at the case below:
http://www.sec.gov/litigation/litreleases/2007/lr20127.htm
Well.. Bernard Madoff get a severe punishment.. But what he did is far worst than Paul Burks.
But I really believe in USA it is more severe than brazil.. No one have more information? What happens with other people that created a ponzi scheme in MLM? I have seen some go in jail.
Now I read the document. Thanks for this link. I already see a news about it but not the original. The same guys are doing it again… They just change the VoiP be prepaid phone card… Will SEC love meet then again?
By the way, when I read this “God wanted the Brazilian community to prosper financially”… I just imaginate Carlos Costas saying it..
You’re correct. Most cases can be settled, a few can’t be settled. You have a civil part of a case, and potentially a criminal one.
Paul Burks settled on a $4 million fine in the civil part. Dawn Wright-Olivares settled the criminal part of her case by pleading guilty to 2 criminal charges, “defrauding the United States”. She had to pay back more than $8 million, more than her net winnings from Zeek Rewards.
@Raffy
I added the relevant info from the link that shows they didn’t keep any money. Look at those figures carefully.
The $1.8 figure is not reduced because the SEC decided they get to keep some of their proceeds. It’s likely the money was gone.
You can look at the recent Zeek Rewards case and Dawn Wright-Olivares’ fine to see how she will wind up keeping nothing.
Burks is going to get bent over too when the time comes.
Oz… So…. Are You ending in the same way you start? What kind of justice is it? If i get a money and physic hidden it, i can get it some time later… No jail time to anyone?
@Rodrigo
Paul Burks will most definitely be facing criminal charges once the civil area of the suit is finalized. Not sure about Wright-Olivares but I wouldn’t be surprised if the SEC followup with criminal proceedings afterward.
It’s a slow process.
You’re not dealing with an ordinary creditor here, you’re dealing with a court. That’s a major difference.
How will you respond to a subpoena DEMANDING you to give a sworn statemment about your finances, including documentation, e.g. bank records 2011-2014, list of luxury purchases you have made, list of income sources, list of transactions over $1,000?
You can see what a subpoena looks like here (page 8, pdf file).
Documents requested are on page 15 or 16. That particular request was overly broad and burdensome, you will not receive so many questions. But you will be asked about the net winnings from Zeek Rewards, and about relevant information about where the money has ended up.
Gimme a break. About 30 people out of 18,000 affiliates received subpoenas in the Zeek case. The chance that Rodrigo and his back yard coffee can stuffed with paper bills will receive a subpoena is highly unlikely.
I think something that’s being overlooked here and is of far more value than Ponzi money is reputation.
The credibility hit these people take pushing such obvious schemes is immeasurable. Money runs out, but getting back the trust of people you lead from one disaster to another will eventually undo itself.
All of these schemes require clueless people at the bottom to feed the serial players at the top. If anything, after Zeek this pool appears to be shrinking. Yes money is still being made but it’s not as lucrative as it was prior.
TelexFree grew beyond Zeek due to its tapping of overseas market. Zeek had international exposure but it was mostly US-based participants sitting at the top. TF hit South America, Europe and, before the SEC got involved, had plans to go after Asia.
The US market for TelexFree that crossed over with Zeek Rewards was relatively minor in comparison (funds wise).
Now that TelexFree are down the path of regulatory oblivion, the reload scams Lucrazon Global and QPay are even smaller again. I don’t believe either will last too long. One only need look at the sharp decline in lifespan for all the smallfry advertising script + revenue share deals that pop up. They’re down to collapsing within a month after launch, sometimes just weeks.
Frustrating perhaps to those who have lost money to these people but the overall theme in these niches is decline. With each generation of scheme the pool of those ripped off shrinks. And this trend is slowly moving its way up the chain of recruitment towards the big players at the top.
That will have far more of a profound affect on these scamsters then clawbacks. What good is it to pay back your winnings and then go off and scam more people? If you can’t convince people to participate in your scams, you’re toast.
That’s the long-term meta game being played out here. One can readily observe this all taking place in the rants of our top-players. In the last year alone I’ve seen more dummy spats in the MLM underbelly community than I have in the four years prior.
Faith Sloan is a good example of this (she knows Lucrazon and QPay are currently shadows of her TF/Zeek heydays), but there are others too. Robert Craddock was another interesting example to watch play out. If only I had the time to cover them all.
The number was 1,200, if we’re talking about the same thing here. I was talking about the 1,200 subpoenas that were sent out around October 30 2012, with a 2 or 3 week deadline for replies.
The main point was about that he’s not dealing with an ordinary creditor here, he’s indirectly dealing with a court.
Rodrigo’s plan was to physically hide the money, “If they can’t find it, they can’t claw it back either”. Other people have tried the same idea before in other cases, and they were ordered by the court to produce information.
Which is something often overlooked by newcomers to the world of internet fraud.
* The HYIP ponzi / pyramid world is finely balanced and depends totally on a continuous supply of “new” money.
* Serial HYIP ponzi “players” disappear at the first sign of regulatory interest.
*The number of gambler / players involved with the HYIP industry should not be discounted. When they withdraw (with their earnings) the HYIPs days are numbered.
* With every regulatory notice released, the amount of new money available is reduced substantially, especially in the more “sophisticated” Google savvy areas.
* IM(very)HO, the US version of TelexFree will collapse of its’ own accord due to the publicity driving off new victims and their money and the “players” withdrawing their money and moving to the next “big thing”
* As Oz points out, a percentage of victims (especially first timers) won’t easily forget how and who got them involved.
Here’s YOUR OWN post telling about 1,200 subpoenas …
Ah yes. You are right. He did say he was sending those out. I wonder how the compliance rate has been or if he ever expected compliance to begin with. I considered then mostly a threat to induce settlement at the time.
There have only been two instances of which I am aware that persons contested the subpoenas, and but a single motion to compel production from anybody (at least so far.) Bell simply does not have time or money to chase down discovery from tens of thousands of people. So? Maybe everyone is voluntarily sending in their bank account numbers? I very much doubt that.
My estimate is that few (maybe as few as 30 will actually be compelled to produce anything. I could be wrong and as you point out many thousands may or have presumablrecieved subpoenas, but I certainly do not think that every net winner, or even those who received a subpoena are going to be compelled to answer questions and produce documents as you suggest.
Rodrigo’s plan was to physically HIDE the money, so it’s probably an amount worth hiding. And then he will most likely receive “something” from the court, and then he will have a very poor defense system.
He should ask a lawyer before attempting to follow a plan like that, to know the risks involved.
* He can be demanded to testify in writings about where the money has ended up, and about his general financial situation. He can be demanded to produce documentation.
* Failing to testify will be contempt of court, and he can be put in judicial custody until he has changed his mind about it.
* A false testimony will be perjury, a criminal offence.
If he want to hide the money, he should hide himself too, just like T LeMont Silver has done. Hiding the money doesn’t make much sense if he can’t hide himself.
I think you are just trying to intimidate Rodrigo. Its the same tactic Bell used when he sent out subpoenas and suggested there were many more to come. You describe the absolute worst case scenario, when in fact the likelihood that discovery will ever be had from the average participant is extremely low.
Silver is by no means an average participant. To the contrary, he is one of “about thirty” who are large net winners and named defendants in the RVG vs Disner action.
Is Rodrigo going to hide $1,000? Forget about it.
Is Rodrigo going to hide $10,0000,000? That is an entirely different matter
Size matters.
Post your own viewpoint about the idea of hiding money from clawbacks, rather than making a comment about how you have interpreted my comment?
My worst case scenario is based on if he handle it in the worst way, and if the amount is high enough. You will consider the risk of disclosure to be extremely low?
You are using hypothetical ideas, e.g. “average participant”. That’s not relevant here. Post your own post rather than attaching it to one of mine, or try to keep it within the same context as my comment? I’m not interested in discussing hypothetical ideas.
My comment was about the idea of physically hiding money from clawback. I assumed it was an amount worth hiding. I pointed out some of the risks.
I have, in part by illustrating how your worst case, “the bogeyman is going to get everyone” scenario is just short of apocalyptic hysteria.
NOW you add the qualifiers.
An economic axiom I have heard comes to mind:
Profit breeds competition.
Extreme profit breeds ruinous competition.
@Hoss
Here’s a better explanation …
1. You quoted a part of my comment, and interpreted it as you saw it. That’s relatively correct in itself, as a statement about how you have interpreted it:
That part of your comment makes some sense. It can be a stand alone viewpoint, or it can be backed up by valid arguments.
2. Then you referred to your own ideas as arguments, rather than to the post you tried to make a comment about. Normal method would have been to refer to my post rather than to your own ideas.
Another normal method would have been to make those arguments unrelated to your initial comment, e.g. posting it as a separate post.
All these arguments have derailed from the context in my post:
* I didn’t mention “average participant”, that idea was your OWN. That idea isn’t relevant if you’re trying to make a comment about my post.
* I didn’t use Silver as an example for an “average participant”, that idea was your OWN. I used him as an example for someone who has hidden both the money and himself. Your idea isn’t relevant in the context of my post.
* I assumed “an amount worth hiding”, within normal range. You used exaggerated examples $1,000 and $100 million. You will need to adjust your examples and make them more relevant to my post. Adjust them to “an amount worth hiding” range, to make them become more relevant?
Your conclusion was based on your OWN ideas, and the arguments you used to support that idea were also based on your OWN ideas, rather than on my post.
Each and every argument you used were actually irrelevant. You derailed completely from the context in the post you were making a comment about, where all the details I have explained here already were explained (in post #48):
I will gladly adjust them if you will tell me what the “amount worth hiding range is.”
That’s not necessary. It wasn’t the main point in that comment, it was a minor detail. You can use ANY realistic range, realistic for a net winner in Zeek Rewards to want to HIDE money physically from clawbacks, and to use the idea “if they can’t find the money, they can’t claw it back either”.
The main point was that all the arguments you used to support your own conclusion were irrelevant for that conclusion.
The discussion was about settlements, e.g. about whether or not net winners and organizers could be able to KEEP a part of the money (they clearly CAN in some cases).
It started in post #34 (Raffy). Rodrigo asked about another type of solution = about physically hiding the money. He received relevant answers, but not in detail.
You tried first to correct one point:
When that argument failed, you tried to question the intentions, and the relevance of the information:
But the arguments you used to support that conclusion were mostly irrelevant or derailed.
The worst case scenario argument was relevant, the ONLY argument I was able to recognize as relevant. You received a reply to that part:
* None of the others had raised any questions about “average net winners” or “average participants in Zeek Rewards”.
* Rodrigo didn’t specify any amount, but it doesn’t make much sense wanting to physically hide money if the amount is very low. I used the vague term “an amount worth hiding” to define a lower limit. You can use your OWN realistic range.
I have no range in mind and even if I did it would be of no value since I do not know if Mr. Rodrigo falls within it.
Likewise, you do not know how much net winnings Mr. Rodrigo has and yet you dare to tell him what he should expect. How can you rightly form an opinion if you don’t even know how much a receiver might be looking to recover?
Partial answer:
Assuming that people have relatively rational ideas is a relatively normal practice. The amount must be WORTH hiding, worth the potential risk.
A settlement is about reducing the risks for a greater loss, but also about reducing personal winnings. Hiding the money is about increasing the risk for a greater loss, but that method can potentially result in higher personal winnings than a settlement.
A general rule should be to focus on the risks and identify them clearly. That’s what I tried to do (I STARTED doing it, but I also mentioned that people would need to ask some professional about the rsiks involved in hiding money).
There fixed it for ya.
The only two things any of us know with any certainty is:
a) what the receiver has said he intends to do,
b) the way the receivership is being executed out is outside what has been “the norm” in similar cases.
IM(very)HO the formation of the Presidents’ Task Force signalled a totally new top to bottom approach to the way the investigation and prosecution of HYIP fraud is handled, and I have thus far seen nothing to indicate the receivership is not part of that new approach.
The receiver has proceeded exactly as he indicated he would, despite all of the Philadelphia lawyers’ prognostications.
I didn’t understand the corrections, since your conclusion were relatively similar to mine (if you have read the whole discussion, from post #34).
Your corrections seemed rather unnecessary. The discussion between me and Hoss started in post #41/#42. I pointed out the risks if people wanted to hide the money from clawbacks. Hoss saw it as a method to intimidate Rodrigo, that I exaggerated the risks. I see it as “relevant info”.
I understood it.
You were not responding to “people” but to a specific individual…Rodrigo.
You assumed that the Receiver would compel this individual to account, and went on to describe in rather lurid detail what Rodrigo could expect at the hands of the Receiver’s Inquisition.
…and you did this with no sense or even the slightest consideration of what the Receiver’s own threshold for such action is, or even if the amount of net winnings that Rodrigo claims are more than a pittance in the big scheme of things.
It costs money to collect money and just because someone like Rodrigo hides some does not automatically, as you imply, mean its worth the effort and cost to pursue it. You well know this. Therefore I conclude that your purpose was not to enlighten “people” but to intimidate Rodrigo.
Own it.
Are you talking about post #41?
From my POV, it can be RELEVANT for others too. You have interpreted it too narrowly.
Are you still talking about post #41?
I focused on whether or not the information was RELEVANT to the discussion about clawbacks / hiding money. What do you focus on?
Are you still talking about post #41?
That post has a question from Rodrigo about hiding money from clawbacks. I gave him a relatively RELEVANT answer about the TYPE of creditor, subpoenas, sworn testimonies, etc.
I have added SOME information to it, but that has been spread over several posts in the derailed part of the discussion. The normal progress was “interrupted”, I had to post some other corrections too.
It could have saved us a lot of time and work if you had attached that explanation to Rodrigo’s question, rather than to my post?
“It costs money to collect money and just because someone like Rodrigo hides some does not automatically, as you imply, mean its worth the effort and cost to pursue it. I believe the risk of being subpoenaed for a sworn statement is relatively low” (or whatever your conclusion was?).
The indirect communication method you’re using is rather complicated. What you believed about my intentions was rather off-topic from the information you had to provide. You could easily have given the answer directly to Rodrigo, rather than indirectly through a reply to my post.
Give a better description yourself, DIRECTLY to Rodrigo?
I simply repeated a short description from memory, but modified the years. The October 30 2012 subpoenas demanded very detailed information.
* I also gave him a link to a subpoena he could look at.
* He got some additional information about “overly broad and burdensome”, that a subpoena wouldn’t be just as detailed as the example.
The INDIRECT communication method you’re using is extremely confusing. If you had important information about subpoenas, the normal method should have been a DIRECT method.
I directly confronted YOU because I believe YOUR post purposely omitted important considerations, which if taken into proper account would have presented a more accurate picture of what Rodrigo (and by extension many others) can realistically expect.
It is not realistic to state (as you did) that all net winners will be subjected to an inquisitorial process. Such an outcome is pure fantasy, so while you may wish for some form of recompense or retribution that applies to every net winner, it will never ever happen. People and dollars are going to slip through the cracks, and to deny that, is to deny reality.
Are you still talking about post #41, the one I copied into my previous post?
Post #41 is rather short, so it clearly can’t contain each and every aspect. It wasn’t meant to cover it either. You could have added some information to it yourself.
I don’t know what you EXPECTED to find in that short post. You have pointed out that I didn’t post anything about “relatively low risk”?
“Relatively low risk” was YOUR idea / viewpoint. I simply posted some information I considered to be relevant. That’s actually the most NORMAL METHOD used by most people.
I didn’t state it either, you will need to check the CORRECTNESS of that statement. Is it YOUR idea or is it mine?
I used the vague definition “an amount worth hiding” to identify the EXISTENCE of a range min..max, rather than using any exact measurements.
“Every net winner” is your own idea. The rest of your post is based on that idea = you’re having a discussion with yourself, introducing a flawed idea and proving that the idea is flawed.
It’s probably time to stop the discussion. 🙂
You said ” if its an amount worth hiding…then he will most likely receive “something” from the court.
Since everyone decides for themselves what is worth hiding Bell would have to subpoena and depose every person in order to determine who was hiding money and who was not. Ridiculous? Of course it is, but that’s your logic.
The fact is that Bell will set a minimum dollar amount that interests him and he will pursue discovery on those persons who meet it. Bell could not care less what Rodrigo hides unless he is also above Bell’s threshhold.
If Rodrigo is hiding money it will be the debt collectors job to find it, not Bell who is only interested in obtaining judgments against net winnings that have not been returned to the estate. He cares nothing for why the money has not come back.
That’s clearly YOUR logic rather than mine (the statements leading up to that conclusion).
I have been talking about that people can be forced to testify about where the money has ended up etc., AFTER they have refused to respond to a claim.
Normally, each individual net winner (of the 9,000) should receive a CLAIM, accompanied by the court order from the class action. They may risk to be subpoenaed to testify (sworn statement, documentation) about their own finances if they refuse to respond to the claim.
YOUR logic goes like this:
“Since everyone decides for themselves what is worth hiding Bell would have to subpoena and depose every person in order to determine who was hiding money and who was not.”
You have reversed and twisted some of the logic. It’s clearly YOUR idea.
NOTE:
I haven’t posted any details about the clawback process. The details I posted now is an attempt to clarify something, to separate between the two different ideas, rather than an exact description of the process.
The receiver has no right to collect anything from anybody at this time. He sent out subpoenas but only three or four people have been compelled to respond. He just filed his clawback action to assert claims but he will not have perfected them and they will not be collectible until he obtains a judgment.
Once he obtains a judgment he may able to use the previously issued subpoenas as you suggest. I do not know. The fact that he spent money to send out so many suggests he thinks they have use beyond their intimidation value. Given there were so few settlements nobody seems to have been much intimidated by them, so what utility can be placed on them I do not know.
Back to the point. Not everyone who thinks they need to hide money is going to be deposed. Its as simple and straightforward as that. A single deposition would probaly cost the estate in the neighborhood of $2500 so Bell simply can not afford to indulge in fishing expeditions. He has to narrow the field. As of now he has a list of about 30 people who are named defendants. He will narrow his focus, subpoena and depose those people because they will make or break his case against everyone.
Deposing every person who might possibly be hiding funds and who was sent a subpoena would cost approximately $2,500 x 12,000 people or roughly $30 Million. This discounts what it costs to process and categorize discovered items, costs involved in compelling production, travel expense, overnight costs, interview room rental, prep time, videographer, stenographer, and the mailing and correcting of transcripts from the deposition session.
But yes, people can be forced to testify.
Oh, and if the person being deposed is willing to lie, then what? Or what if he is telling the truth but Bell thinks he is lying. How long does that persist. Is the judge going set aside thousands hours to listen to Bell complain that people lied? Will the judge throw the liars into already overcrowded jails.
The whole mass deposition scenario is a whirling bowl of crap. It will never happen.
The 20-30 individual’s that are listed in the RVG vs Disner et al Complaint are the affiliates that Bell will concentrate on and, if he can, depose…not the other 12,000 Rodrigos.
Since Bell has been able find and freeze RVG bank accounts, he could probably distribute 40-50% of an affiliate’s net loss back to them right now. Once he gets judgments against all net winners, sells most of them for cash he may be able to distribute another 10-20%.
The return of 40-70% to the net losers in only a little over two years is very good under the circumstances and the net losers WANT their money,now, sooner than later. If Bell is out chasing 12,000 Rodrigos they will have to wait and wait for very little, if any, net benefit. The cost of collection is so high.
Bell can’t stop the Rodrigos from hiding their money, and its too costly to chase them down, so he will obtain a money judgment against them, convert the judgments to cash and distribute the proceeds to the net losers. That’s the way its done. There is no perfect justice.
I must assume that when you say “claim” are talking about a judgment here. Bell is not going to do a debtor’s examination on 12,000 judgment debtors. The judgments will be sold at a big discount to a debt collection company who will pursue the Rodrigos in the manner debt collecton companies do. The RVG estate will be done with them.
No, I actually meant some type of claim.
The class action is about findings of a Ponzi scheme. It’s “Step 1” in a process with more than one step.
“Step 2” should normally be about the individual claims. The AMOUNTS can be disputed or negotiated, so a “Step 2” is necessary.
The individual “I acted in good faith, and provided value in exchange for the money” will have to be resolved individually.
“Bell vs Disner et al” lists 9,000 net winners in the attached list.
I don’t think you should use Rodrigo as an example of a net winner? I don’t think he is, and you used him as an example 3-4 times or more. He hasn’t identified himself as a net winner, he has only asked a question about “What if?”.
“some type of claim” is an empty phrase.
You are talking about disputes that may arise over the net an affiliate claims he received from RVG vs. what Bell claims the affiliate received. That process will take place but it has nothing to do with deposing someone in order to locate hidden money.
Determining the amount owed is one thing. Trying to find out what the individual did with the money once he received it is an entirely a different matter. Don’t confuse the two. Bell won’t.
Once the amount of net winnings are determined Bell will ask the Court for a money judgment in that amount, which I assume he will get.
The likelihood that Bell will THEN attempt to locate and determine what 12,000 people did with their net winnings is virtually non existent. Its too expensive and time consuming unless the amount sought is exceptionally large or must be pursued offshore.
Otherwise, he will sell and assign the right to collect the judgments to a debt collection company. This maximizes the return to the estate in the least amount of time.
Of course, they must all be joined to the case. It does not mean they will all be deposed. That’s folly.
Really Why else would he think it necessary to hide money? Does he live in a bad neighborhood?
This is the King-Gilmond argument. They were shot down as far as I understand it and Bell will assert that it is a settled issue. I assume the court will agree, but in any event, once the defendant class is approved rulings will apply and be binding on all members of the class.
So no, the “I acted in good faith” argument will not be resolved individually. It will be argued once and the decision will apply to everyone in the class….which is to say, all net winners
All net winners that Bell seeks to include in the Class are listed. This by no means indicates he expects to depose all of them.
Really? OK.
This step will allow those who disagree with Bell’s calculation of net winning amounts to prove that he made a mistake and have it rectified. It is not an opportunity for Bell to depose them as to what they did with their winnings. .
Motion to Dissolve the Temporary Receiver wasn’t a class action, and it wasn’t about whether or not Trudy Gilmond and Kellie King had acted in good faith.
“Good faith” in that action CAN have been about building up a defense system against something, rather than about dissolving the Receivership.
That is not the point. The argument that the SEC had no jurisdiction because Gilmond King worked 12 hours a day 10 days a week, acted in good faith, gave fair value (whatever you want to call it) and therefore the SEC had no jurisdiction and the activities of Zeek did not involve securities has already been addressed and ruled upon.
If the issue of “good faith” was not addressed then it will be once the Bell v Disner case commences and once the judge rules on that , the ruling will apply to all class members and can not under res judicata be raised again. Do you really think the judge is going to allow 9,000 people to individually take up the courts time arguing the same exact thing. No not going to happen.
Motion to dissolve wasn’t a class action, and that motion wasn’t about clawbacks.
People may have valid individual claims, e.g. Troy Dooly had valid claim about “good faith, provided value” for $15,000 out of $18,000 he had received as a consultant.
Some individual may clearly have valid counter claims against clawbacks. The fact that Gilmond / King didn’t have valid arguments to support “dissolve the Receivership” has to be interpreted in its correct context.
I predicted that “Motion to unfreeze”, “Motion to dissolve” and the third motion could have been filed for other purposes than what those motions were about, e.g. they could have beeb designed to build up defense arguments. “When I can see some flaws in a case, I’m pretty sure a lawyer will see them too”.
You said that before and I answered you. It does not matter what the Motion to Dissolve was about, that it was by two individuals instead of a class, or that it preceded the commencement of the Bell v Disner Class action. Both the Motion to Dissolve and the BelL v. Disner actions derive from the same action,i.e, the SEC v Burks action. The issues of law are common, the facts are common.
Gilmond King tested whether the SEC has jurisdiction. The ruling on that was yes the SEC did have jurisdiction and that is now the “law of the case.” (It can not be brought up again and it applies to everyone) The same SEC had no jurisdiction issues can not be used as a clawback defense.
Whether or not Gilmond King raised the “good faith” argument I do not know. If not, it can be raised in the Bell v Disner case, but once it is raised and ruled upon, all parties are bound by the court’s decision, and everyone is precluded from raising it again…. and that would be true even if the class were not formed (which it almost certainly will be.)
If your saying that Dooly filed a proof of claim with RVG then I doubt it has been approved since I think it far more likely he will be sued by the estate instead. However he seems to have provided RVG something even if it was of dubious value. If he got to keep all but $3000 in the SEC action against him, that was a compromise settlement and is not conclusive as to the validity of his “claim.”
They may believe so and they will have an opportunity to make their case either before or after the class is formed, but once the issue of law is decided for one person it will apply to all persons. Bell is going to be out to prove that variations in “effort” expended by individuals is inconsequential. If the judge rules that good faith does not apply for one it will preclude any one else from raising that objection.
Bell may have to defeat several theories, but he does not have to defeat thousands of people.
http://about.bloomberglaw.com/practitioner-contributions/what-do-you-mean-i-didnt-take-the-money-in-good-faith-good-faith-as-a-defense-to-the-recovery-of-fraudulent-transfers/
An exhaustive discussion of how net winners might defend on the basis of good faith.
The answer seems to be. It depends. Bell indicated he does not anticipate the need to use bankruptcy tools.
“Good faith / provided value” can be used as an argument in more than one legal action, and by more than one party?
12-cv-519-GCM
Kenneth D. Bell v. Todd Disner, et al., Civil Action No. 3:14-cv-91
The important factor should normally be about whether or not the argument is RELEVANT and VALID.
I identified AMOUNTS and arguments related to it to be INDIVIDUAL.
A valid “provided something of value” argument can be about sale of retail bids, about the 20% commission.
Nope, the net winners didn’t even have legal standing in the SEC vs RVG and Paul Burks. They had to intervene “pro hac vice” or whatever it was called.
“Disner et al” is relatively clearly a separate case with a different case number, with different parties. I’m not familiar with any “derived from” rules, they may or may not exist.
Once the court denies the “good faith” defense as to defendant A it becomes the “law of the case” and also applies to defendant B, C, etc.
This doctrine of res judicata applies to parties in the same or related cases, in other words all actions related to the original SEC v RVG action.
Gilmod-King filed a motion arguing first of all that the SEC had NO jurisdiction and therefore had no authority to bring an action against RVG, and therefore the Receiver should be dismissed and Gilmond King should be permitted to intervene.
In support of this motion, they asserted that the source of their income from Zeekler was payment for work performed, not from investing in and promoting unregistered and illegal securities. Their motion was denied. The judge ruled that the SEC has jurisdiction. That ruling is now the “law of the case.” What does that actually mean?
To me it means that all other parties are precluded from again asserting that their source of income was from work performed. That issue was settled when the judge ruled that the SEC had jurisdiction because the source of income was from illegal investment income not from work performed.
Any one who again attempts to argue that they provided services in return for compensation would be similarly denied so this line of reasoning is precluded from being brought before the court again. The issue is settled and the case moves on.
As to “good faith/provided value defense in the Bell v. Disner case, how does a net winner prevail in making that argument when the judge has already ruled that the income received is from illegal investment income not work performed?
Someone will argue theory A, and another theory B, and another theory C as to why the Receiver can not claw back their, money and Bell will have to deal with those objections one by one but if the judge denies theories A, B, and C those defenses can not be raised again…. by anyone. Eventually the storehouse of theories runs out, and the affiliate’s are left defenseless and Bell obtains his judgments…or not.
Maybe there is a defense that the court will accept, but it does not appear that will be the case given that the judge was not persuaded that Gilmond Kings “work” was the source of their income.
I think res judicata will apply. You can decide for yourself.
http://sparkcharts.sparknotes.com/legal/civilprocedure/section10.php
Or perhaps collateral estoppel
Your entitled to your opinion. Mine is that any person who acts as a broker dealer by offering securities for sale to the public, without permit or exemption is by statute not entitled to charge fees or collect a commission.
That the securities involved were unregistered, illegal and misrepresented is just the cherry on the top of the icing on the cake.
That didn’t clarify anything?
You have probably interpreted “Motion to dissolve” to be about “good faith / provided value”? But the motion was actually about SEC’s jurisdiction / “RVG didn’t sell securities, it was work” / “illegally appointed temporary Receiver”, etc.
* “Disner et al” doesn’t try to dissolve the Receivership? That case is about a completely different legal issue.
* “Good faith / provided value” was used as poorly supported EVIDENCE, it was not the legal issue itself.
The motion clearly had some flaws, it ignored some factual information available (e.g. financial information). I interpreted it early to that also the attorney had seen those flaws, that the motion was filed for other purposes, e.g. to build up a defense strategy.
* All the 3 motions were used to support one MAIN argument = “the net winners haven’t been involved in the scam itself, they were victims of a fraud”. It’s a defense strategy to protect against investigation or too detailed discovery.
“Good faith / provided value” can not be used again in an attempt to dissolve the Receivership, but it can be used as a defense argument against clawback claims if people have VALID arguments.
I identified one valid argument = the 20% commission from sale of retail bids. That commission can be excluded from clawbacks.
You’re looking primarily for legal arguments to SUPPORT your own theories, rather than for RELEVANT arguments.
You clearly are not following this. End.
And therein lies the crux of the problem
Why is there any need to “interpret” anything ??
I don’t know either.
Both of you ignored that it wasn’t about a major point, but about something “additional”. 🙂
The “Motion to dissolve” and the clawbacks against net winners are 2 separate litigations. That was the MAIN argument.
The claim in “Motion to dissolve” was about dissolvment of the Receivership, based on that SEC didn’t have jurisdiction, because ZeekRewards wasn’t an investment scheme.
All those arguments were primarily based on subjective evidence with little or no material facts.
The Motion was denied in an oral hearing = no written arguments for the decision. That makes it hypothetical to apply any of the 2 doctrines.
You ignore that Gilmond King argued that the SEC had no jurisdiction because their income was derived from their own personal efforts and NOT from the essential managerial efforts of someone other than themselves. In short their position was that they were hard working marketers, not investors.
To substantiate this they made declarations attesting to the many hours of work they put in.
Per the Howey Test a security is (1) any investment in (2) a common enterprise (3) with the expectation of profit (4) to be derived through the essential managerial efforts of someone other than the investor.
You can readily discern (I hope) that Gilmond King were attacking item #4 of the Howey Test in hopes that the judge would find that their income was derived from their own promotion efforts rather than from a return on an investment. Had the Judge found in their favor there would have been no securities issue under the Howey Test and therefore the SEC would not have had jurisdiction.
By denying Gilmond and King’s motion the Judge “in effect” ruled that Gilmond and King’s income WAS NOT derived from their own promotional efforts. So…
It is my opinion that net winners are estopped from asserting that “they “provided value in exchange for the money” or that their accountability “will have to be resolved individually. They were all “promoting” in exactly the same way so there is no difference between one and the other except for the $ amount of their net winnings.
Any fair value theories will have to overcome the Court’s implicit view that promotional work performed was not the source of the income derived.
In other words Gilmond and King were arguing that the income they received from RVG was payment for promoting the auctions rather than profit derived from their investment.
They lost and by extension all net winners lost with them. By this ruling every affiliate is construed as an investor not a paid promoter as Gilmond and King asked the court to believe.
Dooley unlike Gilmond, King and all other net winners did not invest money into Zeek Rewards. If he did, or to the extent he did, his compensation was from investment just like every one else and it is subject to clawback under the same terms as all other net winners.
How do you know what’s “valid? If he received $18,000 for his little pimp show then I can see why Bell would be on his ass to return the money, but valid? Why would only $15,000 of his compensation be valid? Why not all of it? On the other hand my guess is that Bell is going to say none of it is “valid.” Dooly may be finished with the SEC but I don’t think he is finished with Bell.
You ignore the first part of your statement, “Gilmond King argued that the SEC had no jurisdiction”?
The motion can have been denied because of legal flaws in the motion itself, e.g. misinterpretation of laws. If the motion was flawed, the evidence wouldn’t have any relevance.
The ORDER denying the motion was based on an oral hearing. We don’t know the reasons for why it was denied. There were several LEGAL reasons to deny the motion itself. It’s much more likely that it was denied because of legal reasons than because of technical ones.
You assume that the evidence actually have been tested in court and have been disproved, that Gilmond/King actually had a valid case but that the evidence they brought before the court was to weak?
@Hoss
I believe it’s time to STOP the discussion about whether or not “good faith / provided value” can be used as a defense argument in clawback litigations. It’s simply not worth the time and effort.
* I have argued that “good faith / provided value” can have a limited use. People CAN have valid defense arguments, but I have only identified some limited usefulness.
I have identified the argument to be INDIVIDUAL, to be about the amount rather than about the clawback itself.
* You have argued that the argument already has been tested in court in the “Motion to dissolve”, and that it can’t be used over again, that some legal doctrines about Res juridicata or Collateral estoppel can be applied.
* My counter argument to the legal doctrines was that “Motion to dissolve” and clawback litigation are two different litigations, about different claims, different legal issues and with different parties.
When it comes to the order denying the “Motion to dissolve”, none of us can realisticly use that to come to any conclusion for WHY it was denied. The order was based on an oral hearing, and it didn’t state any reasons.
It was either denied because of legal reasons or because of technical ones, but not both.
* Legal reasons = the motion itself didn’t hold water.
* Technical reasons = the evidence was too weak.
It could have been.
Not familiar. what are they
I assume the judge ruled according to law. Bell didn’t even refute the evidence. He only cited the law, therefor I conclude that is was a matter of law rather than fact. How much and the type of “work” performed is irrelevant if the judge accepts the fact that the income is from an investment.
Educate me. What is the difference. I do not know.
I never assumed they had a valid case. What is a valid case anyway? Valid is when the judge rules in your favor as far as I am concerned. Whatever it was I thought it was shit from day one. I thought it was a desperation filing with no chance to succeed under current law and I think the attorney filed the motion because he was paid to file it by some Zeeker loonies who were grasping at straws
Remember, thousands of net winners had an opportunity to file motions of their own in support, make declarations, and file joinders, while providing their own evidence. Not ONE did, in part because they knew the law. The facts were never in dispute.
You brought it up zupi. Dooly was a bad pick.
Whatever that means?
That’s JUDICIAL estoppel and yes it applies. If you think it doesn’t than you must believe that its necessary for the judge to rule on the same issue over and over and over and over and over and over and over and over and over and over and over and over and over and over and over…….>>>>
I would say the former. What Zeek did was against the law and no amount irrelevant evidence changes the law.
I wish we had the hearing transcript because there is no way to understand the judge’s thinking without it, unless he publishes an opinion. We are very much watching shadows on the wall here.
Individual = specific to the individual person.
General = the same rule can be applied to the whole group.
A legal action against a whole group can only be about the general issues, e.g. whether or not the net winnings from Zeek were fraudulent transfers from a Ponzi scheme and can legally be clawed back.
The amount that can be clawed back from each net winner will be individual, specific to the individual person. You can’t apply general rules or methods to that part.
For most net winners, it will be unnecessary to be represented by an attorney in the class action. They don’t have any interests to protect there, they have individual interests rather than general.
* The class action might offer a forum to resolve individual claims, but the first part of it is about general issues.
Collateral estoppel. You called it that yourself.
I don’t know how you have applied those two doctrines to your theories. You didn’t include any logic in your arguments, only that they potentially could be applied.
I believe there may be a missing part in your other logic, and that Res judicata / collateral estoppel is meant to fill that missing part?
Your theory is probably that after the findings of a Ponzi scheme, the claims can be directly sold to a debt collector = none of the individual claims will need to be resolved?
I have used the opposite logic. The individual claims are clearly individual, and they will need to be resolved individually. The 2 doctrines will not be relevant to use other than for general issues.
I assume you are talking about the defendant class when you say “whole group.” A class is composed of individuals lumped together by strict commonality and by order of the court.
Those individual’s will have an opportunity to dispute the formation of the class and/or their inclusion in it by arguing that they do no meet the commonality criterion. Note: NOT ALL person’s involved with Zeek are included in the class, only the net winners.
Suppose that Disner or any one is served a Complaint and responds by filing a reply that argues that the class should not be allowed and in any event that person should not be part of it because his income was derived from services rendered that were unique and highly valuable and not from an investment return.
Such a line of reasoning is merely a rephrasing of the Gilmond King argument. Bell would very likely respond that Disner is estopped from raising an objection to class formation on those grounds because the issue was decided when the judge ruled the SEC had jurisdiction.
In this way a ruling made in the SEC v RVG case carries over and into the Bell v Disner action, (and to any and all subsequent and related actions against anyone and everyone involved.)
Your concept is that the Gilmond ruling occurred in the SEC ve RVG case so it has no relevant consequences in the Bell v Disner action. This I believe is incorrect.
Do you ever read yourself?
Surely by now you understand that Bell will ask the Court to approve a method of correcting and reconciling the amount of net winnings attributed to a specific person. This process to take place within the context of the class action. All will be bound by the law of the case and the orders of the Court, but Each will have an opportunity for an accounting.
NOTICE I said accounting.
The defenses against clawback will be asserted by the class on behalf of the class, not individually by individuals that are clearly individuals which will need to be resolved individually as some would say.
I didn’t use that logic?
I identified individual defense arguments to only be useful for the individual claims, the “second part” of the class action (point #4 in “Prayer for relief”).
That point is about the INDIVIDUAL claims against the net winner class members. I called it “the second part” because it’s vaguely described and has to be decided by the court.
* Notify each member about the proposed amount.
* Give them an opportunity to respond.
Obbviously not. Who said you did? Are thinking out loud? Hearing voices?
READ This:
The procedure that Bell will ask the court to approve is about responding to a “CALCULATION,” (RVG’s calculation) of an individual’s net winnings. As much as you want to believe that every Tom Dick and Harry and Rodrigo is going to have a personal sit down or court hearing where he/she can argue they are due an offset for good faith / provided value” or whatever other theory they you dream up is daft.
An attorney will represent the class (providing formation is approved) and he will assert those types of defenses on behalf of the entire class. Whatever applies to the class applies to all members of the class and they are each individually bound by that. They can not individually assert defenses.
Reconciliation of mathematical calculations is not a legal defense it is an accounting procedure.
The opportunity to respond should not be construed as the opportunity to reargue the case or individually assert defenses against clawbacks.
Bell’s calculations will not be entered into the record until AFTER the Court rules on how the amounts are to be calculated. If there is some defense asserted by the class that is approved by the Court then Bell will adjust his calculations in accordance with the courts mandate. Only then will he publish and the affiliate’s be able to compare their calculations with his.
This is when they will have an opportunity to respond and it will be to the arithmetic, not to the law of the case.
I have pointed out that the individual part typically is about the AMOUNT, not about “rearguing the case”.
“….and arguments.” Post #83
Do you ever get tired or your Flip Floppery.
I specified the same thing in both posts, or actually in several posts. Flip Flop is normally a change of position, a U-turn or a backflip.
I have identified retail sales to external customers to be a potentially valid argument. Ponzi clawbacks are about ill-gotten gains, not about legally earned income.
Your idea of a Flip Flop is probably related to your own ideas, e.g. to your own focus on “CALCULATION”. It looks like you have interpreted the calculation to be the part to be decided by the court, rather than the “be given an opportunity to respond … in a fair, efficient and cost-effectively manner to be decided by the court”.
In Post 83 you said “I identified amounts and ARGUMENTS related to it to be INDIVIDUAL.”
I take it as a sign of progress that you have changed your mind.
You are starting to do your hysteric turkey gobble thing. If you have nothing worth saying then just don’t say anything.
That’s related to your OWN ideas.
Whether or not something is legally earned is a matter of law (or common sense) rather than a matter of calculation. People may have valid legal arguments on an individual basis. That doesn’t mean each and everyone will need to have it decided by the court.
It’s easier if you post a correction?
I identified that you had focused solely on CALCULATION in the “to be decided by the court” part. I didn’t see it in the same way.
Point 4 says:
Order that each Net Winner Class member be notified about the proposed amount of their net winnings according to RVG records …
… and be given an opportunity to respond to that calculation in a fair, efficient and cost-effectively manner to be decided by the court.
* The court has to decide something about the METHOD / PROCEDURE for how to notify people and give them the opportunity to respond.
* He doesn’t ask for any decisions about the calculations, other than “according to RVG records” and that the Net Winners should be noticed.
You had a different interpretation:
That is a silly and pointless response.
You wrote it.
You own it.
Lord in heavens man you have quoted Bell’s prayer to the Court. Its HIS position, its what He wants the court to approve. It has not been approved. The defendants have not even filed a response yet! They’ve had NO opportunity to raise their defenses to the formation of the class, or to the legal efficacy of clawbacks.
I don’t know what arguments the defendant’s are going to assert but there is at least the possibility that the judge will order offsets or exclusions be applied to the amount RVG claims it is due. If this occurs Bell will have to recalculate the demands he is making from each net winner.
Did he ask for this? No. Could it happen? Yes.
Don’t assume that just because Bell asks for something he is going to get it.
First the defendants will raise defenses to the formation of class. Assuming the class is formed the class will argue its defensive theories. They could have some success in doing that. I have never seen it happen but the ENTIRE Class might enter a settlement for its members.
If you still think that each individual is going to have an opportunity to challenge NOT ONLY the accuracy of RVGs records (which Bell is willing to do) but also individually assert clawback theories concerning commissions due from selling four bid packs to Aunt Mabel you are way way out in the weeds.
Correct. I analysed how to interpret it, and how you potentially could have interpreted it when you focused heavily on “CALCULATIONS”.
You managed to come to a conclusion there, where Bell first would publish his calculations AFTER the court had decided how to calculate it?
Since we both have looked at the same quote, we can probably try to find the correct interpretation? There’s no need to make it more complicated than that.
Here’s the quote:
Order that each Net Winner Class member be notified about the proposed amount of their net winnings according to RVG records …
… and be given an opportunity to respond to that calculation in a fair, efficient and cost-effectively manner to be decided by the court.
The proposed amount will be “according to RVG records”.
“the proposed amount.” Have you seen a “proposed amount?” No.
Bell just filed a 220 page list of all >$1000 net winners and not one has a “proposed” amount listed next to his/her name. Why do you suppose that is when Bell alreaady knows what the RVG records say?
Here’s my answer to that. The amounts COULD change depending on clawback rulings in the Disner case.
That is why I
Now I do not think for a minute that the court is going to decide “how to calculate it,” but it will make rulings that effect how the numbers are calculated. Bell has already determined the way he thinks it should be done. Now he needs the Court to approve his way or modify it. Until the Court rules one way or the other he will not enter ANY proposed amount into the record.
If you have analyzed this and interepreted it differently I think you will be disappointed.
Bell is dete
It is neither efficient nor cost effective to notify net winners of “proposed amounts” that are subject to change.
Along with the Disner complaint, Bell filed a 220 page exhibit of all >$1000 net winners. No “proposed amounts” were included. Do you understand the reasonwhy? Can you explain it?
That’s why I told you that some of your objections primarily were related to your own ideas and interpretations.
You have probably got the meaning there after I divided the sentence into 2 parts. He’s asking for it even if it will be rather costly and time consuming in itself to notify all the net winners about the individual proposed amount, and give them a fair chance to respond to it.
More empty useless words.
Are you talking about the list of names? That’s simply a list of the unnamed defendants.
No. Its not a list of unnamed defendants. Do you know why?
I used “THE unnamed defendants” = the ones not mentioned by names in the complaint itself, but on a separate list of names.
Why they’re not unnamed is because their names are listed in that list.
That’s correct, so why is there no dollar amount next to their names.
I’m just a troll, but damn, you guys (or gals) argue like an old married couple! Way to hijack a thread!!
Off topic
Unnamed defendants are listed as John/Jane Does 1-100. Here we have 220 pages of named defendants.
Why are there no dollar amounts listed next tor their names?
I’m not the right person to answer that, i.e. I didn’t make the decisions for what to include in that list.
Unless Bell have published or will publish some information about it, it may potentially become “an ancient mystery” why the dollar amounts weren’t included in the first place.
For other than the top net winners, amounts have generally been separated from the names (e.g. in settlements). It can have something to do with normal procedure or specific ones.
Oh come now. Be brave. Take a guess.
If you put up 10k and lost it and the guy you signed up under was listed at a 500k profit and you knew where he lived, I would think there would be a little tension there.:)
Good point. My guess is that some proposed amounts will eventually become part of the record (though because of the situation you just mentioned it might be under seal)
The largest net winners have had an amount attributed to them, but then each is an exemplar and potential class representative so maybe that is the difference.
A short review of Fed Rules of procedure suggests that Bell will ask for non-opt out class certification. Per the Fed Rules, reasonable notice is sufficient for noticing putative class members. Personal service by summons and complaint does not appear to be required.
Even so, The plaintiff can and usually does serve a summons and complaint containing specific allegations to as many potential class representatives as seems prudent. In this case Bell has served a couple of dozen individuals and from that pool will be selected THE class representative. Disner appears to be the frontrunner for that position.
Providing the class is formed, ONLY the selected class representative can argue clawback defenses, the success or failure of which apply to all members.
Accordingly, for now, the thousands of putative class members will receive a letter notifying them they may contest the formation of the class….but not the amounts Bell contends they owe. The judge decides that.
It’s probably easier to look at the class action complaint itself rather than looking at the rules?
Points (page #39 and #40 in the complaint):
1. Declaratory judgment about fraudulent transfers.
2. Judgment against the named defendants.
3. Injunction
4. Notify individual net winners about proposed amount, give them a fair chance to respond.
5. Judgment against individual net winners.
6. Pre- and post-judgment costs, interests, etc.
* Points #1, #3 and #6 are about general judgments, against both named and unnamed defendants, as a whole class.
* Point #2 is about the named defendants only, as individual defendants.
* Points #4 and #5 are about the other class members, as individual defendants.
Bell has chosen to increase the number of Class representatives. This addresses and strengthens the adequacy of representation component mandated by the Federal Rules. It also minimizes the chance of appeal. Apparently these people have already been served Summons and Complaints since they are “already parties.”
44.
The named individual defendants above, who were among the largest net winners of the ZeekRewards scheme and are already parties to this action, should be appointed, without cost to the class or the Receivership, as representatives of the Net Winner Class (the “Class Representatives”).
AND
4.
Order that each Net Winner Class me mber be notified of the proposed amount of their net winnings according to RVG records and be given an opportunity to respond to that calculation in a fair, efficient and cost-effective manner TO BE DETERMINED BY THE COURT.
AND
5.
Enter Judgment against each Net Winner Class member in the amount determined to be their net winnings THROUGH THE PROCESS SET BY THE COURT.”
Rule 23. Defendant class actions are
governed by Rule 23, and thus, as a preliminary matter courts look for
satisfaction of the four Rule 23(a) prerequisites: numerosity, commonality, typicality and adequacy of representation.
….and yes these are related to my own ideas.
Interesting enough but its limited. There is no framework for deeper understanding. Nothing here about the noticing requirements, the difference between an opt in opt out class, the possibility of subclasses,or the role of the class representatives. Without which you have nothing more than a To Do list.
Where? There’s ~19 named defendants and ~9,000 class members listed in the complaint.
LACK OF CONCLUSION?
You’re quoting point #44 in the complaint?
You’re also quoting points #4 and #5 in “Prayer for relief”, two of the 6 points I briefly listed in post #135, the two points I identified as “individual to the unnamed class members” (about the individual amounts).
The use of CapsLock indicates “an ongoing thought process” rather than a conclusion?
Points #4 and #5 are related to each other, so the process “to be determined by the court” and the process “set by the court” are probably about the same process.
Was that the conclusion you tried to point out? “CapsLock logic” can often be interpreted in many different ways.
We have already analysed what that process is about …
* You identified it to be about the calculation method (#108).
* I identified it to be about the legal process (#114), how to give the defendants a fair chance to respond to the individual claims.
I have identified points #1, #3 and #6 to be common to the whole class, point #2 to be common to named defendants only, points #4 and #5 to be common to the unnamed defendants only.
I assumed Bell / Irving M. Brenner already had interpreted which rules to follow before they filed the complaint, i.e. that the correct rules already were INCLUDED in the complaint where it was needed?
“Framework for deeper misunderstanding” will normally make it become more complicated to understand.
From my point of view, a To Do list is quite different, normally only a list of short descriptions. For most people, a 40 pages To Do list will be rather uncommon. 🙂
You must be mentally ill.
You should be careful not to introduce any arguments like that yourself. It might give people the wrong types of ideas if they’re trying to check the rationality of some of your ideas. 🙂
Point #44 doesn’t make much sense when it’s separated from the other points, e.g. point #45. I wasn’t able to identify any rational method or logic there.
That part of the complaint is about the defendants:
39. About Rule 23
40. Definition of “Net Winner”
41. Payments to third parties not included
42. Numerous group of defendants
43. Commonalities, e.g. fraudulent transfers.
44. Named individuals. YOU QUOTED THIS ONE.
45. Unnamed individuals
46. Class representatives
47. Related Motions (Gilmond, Kettner, Sorrells)
48. Why using class action, reason 1
49. Why using class action, reason 2
You then tried to apply some logic from point #44 to the “Prayer for Relief” points #4 and #5:
1. Declaratory judgment about fraudulent transfers.
2. Judgment against the named defendants.
3. Injunction
4. Notify individual unnamed defendants
5. Judgment against the individual unnamed defendants
6. Pre- and post-judgment costs, interests, etc.
Your idea of “mentally ill” is probably related to that you assumed your own ideas reflected a “mentally sound mind”, i.e. that you tested it against your own ideas rather than against the realities (e.g. general rationality).
what’ the fuck? I want my money back!!