First Zeek Rewards payments to go out September 30th
On the 28th of May, the Zeek Rewards Receivership filed a Motion to “authorize first interim distribution” of payments to Zeek Rewards victims.
The Motion is specifically limited to payments being made under what the Receivership refers to as “Class 3” claims, which the Receivership defines as
the Claims of Affiliate Investors and subrogees of Affiliate Investors on account of losses based on the investments they made in the ZeekRewards Scheme.
As I understand it, if you lost money in Zeek Rewards and there was no disputes or discrepancies over the amount, your claim is classified as a Class 3.
Payments will naturally vary from affiliate to affiliate, but these first payments are claimed to guarantee a payout of ‘at least 40% of the amount of their Class 3 Allowed Claim‘.
Note that this isn’t a definitive payout, with expected payments to be made at a later date. The Receivership does note however that a 100% recovery is “unlikely”:
The Receiver anticipates that future recoveries will allow for further distributions to holders of Class 3 Allowed Claims, but it remains unlikely that there will be sufficient funds to pay all Allowed Claims in full.
For those curious as to how many claims fall under Class 3,
As of the date of this Motion, approximately 150,000 Claim Determinations have been issued by the Receivership Team for Claims in Class 3.
Around 175,000 claims in total were submitted to the Receivership, with 25,000 still under review.
500 of the 150,000 Class 3 claims (0.003%) were initially objected to, with those claims having either been since resolved or still under review.
Note that not all of the 150,000 claims will be receiving payouts at this stage. Thus far only
83,000 have provided the required Release and OFAC Certification. These 83,000 Allowed Claims represent the aggregate sum of approximately $305 million paid into the ZeekRewards Scheme.
The other 67,000 Class 3 Claimants that have not provided Releases and OFAC Certifications paid approximately $157 million into the ZeekRewards Scheme.
These Class 3 Claims will become Allowed Claims if the Class 3 Claimants that hold those Claims agree to the Claim Determination, or fail to timely object, and submit the required Release and OFAC Certification.
If you’ve come this far as a Zeek Rewards victim, it would appear to be rather silly to miss out on your payment because you failed to file the required forms.
To that end the Zeek Receivership requested the date August 15th be set as the “First Interim Distribution Record Date”. This date is the final date for the 67,000 claimants who have yet not provided the Receivership with the required documentation to do so.
If you miss this date your claim will not be part of the initial run of payouts.
September 30th has then been proposed as the date the Receivership will send out checks to Class 3 Claimants with approved claims.
If an affiliate misses the August 15th deadline to provide the release and OFAC certification, after September they then have until December 31st to provide these forms.
Judge Mullen granted the Receivership’s order on the day it was filed, so for those of you with approved claims, expect those 40% or more checks in the mail come September.
To those of you who haven’t yet provided the required documentation, get cracking!
Footnote: Our thanks to Don @ ASDUpdates for providing the latest Receivership filings.
I don’t know if there is any tax consultants here but I got a 1099-misc for money i didn’t recieved from Zeek in 2012. I have Bank Statements for that year proving this. I wondering where Bell is getting this info from ( money from zeek to payment processor ( Nxpay )? even though it never reached my personal bank account. Confused.
This is a question: Why the telexfree guys were arrest (one now and the other is fugitive) and the Zeek Reward not? This was luck? Was because Zeek was smaller in size or the zeek guys was smart?
Paul Burks basically gave up Zeek Rewards and handed it over to the SEC. TelexFree dudes appear to be trying to get away with the ill-gotten gains while fighting the SEC tooth and nail. That could be one reason.
Secondly, Paul Burks is not off the hook. He’s still facing criminal charges. And Dawn Wright-Olveras pleaded to fraud charges not long ago.
Zeek got caught and Paul Burks, on advice of his lawyer Noell Tin chose to throw in the towel immediately, rather than play legal shenanigans like “bankruptcy” by TelexFree.
SEC is generally pretty lenient on those who capitulate. it’s those who fight (like Ad Surf Daily’s Andy Bowdoin) that gets the full wrath of the Feds, and now, TelexFree.
Also keep in mind that Paul Burks have a sick wife, and is not really ready to flee the country even then, from what I heard. He’s not off the hook just yet, as no criminal charges had been filed… yet. But it may not look good for the Feds if they want to put an old man with sick old wife at home, to jail. SEC already squeezed out of him what he had, no point to make him a martyr to the media.
TelexFree also had the “misfortune” (and public’s good fortune) that it’s close to Boston, where Bill Galvin is, and there’s even a SEC office in Boston. Lexington, NC (Zeek HQ) is kinda far away from it all.
There’s no tax consultants here, but I know what you’re talking about. Money frozen in e-Wallets were initially reported in tax forms for 2012 as income. It was later corrected by the receiver.
You can find out about that correction by searching the search string “mx58 zeekrewards site:moneymakergroup.com” (without the “”), or use this disabled link:
moneymakergroup.com/Zeekrewards-Zeekrewards-t398669.html&st=9975
From that post:
Thanks Norway. =)
Hi, I’m hoping someone can help me, I have a claim in with Zeek & have been emailing the receivers with no reply, I just want to know where I find the release & OFAC certification, I don’t see any mention of this on my portal.
My claim status is “Final Determination Accepted” & there is a note that says “no further action is required at the present time”, so perhaps I have it covered, I just keep seeing reference to “the required release and OFAC certification” & I don’t recall doing any of that.
If no further action is currently required, I’d probably wait and see.
No doubt the Receivership is receiving thousands of emails from affiliates so they might be discarding those that don’t warrant an urgent reply.
I was a class 3 claimant and I recieved my first interim of 40% on October 7 2014. But they withheald almost 30% tx from it.
Does anybody know when the 2nd interim would be made or how much more percentage should I hope for?
In other words I invested 10,000 dollars and hsve only receieved 3120 dollars back so far. And when I file tax if my income is 25,000 dollars a year. Would I get some of that federal whitheld money back?
Thank you.
I think it depends on what is collected going forward and the status of other claims.
Probably want to ask an accountant tax questions like that.
Can anyone tell me if I can get back the 30% tax as a non U.S. Citizen.
I receive my first payment on October 22, 2014 and is unsure if the second payment will be tax 30% as well.
Might have to talk to an accountant about that Troja, US tax matters aren’t my strong suit.
There is new information on the Receiver website concerning the withholding.
Thanks for pointing that out Hoss. Given the amount of chatter about this withholding I’ll probably do a separate writeup. That way we can just point people asking about it there (if they haven’t already checked the Receivership’s website).
Update – https://behindmlm.com/companies/zeek-rewards/zeek-receiver-addresses-30-tax-withheld-from-payouts/
To avoid confusion and multiple discussions about it, let’s try to keep tax inquiries together in that article.
I think zeekrewards Receivership has recovered 300 some million dollars already so they will more definately send another check to affiliate for about 30 some %. Plus if u r USA resident than fillout ur tax info to get the With held money back as well. Thanks all
And I forgot to mention, receivership is paying affiliate from about 130 some million so they will have some more on hand to pay a latter date.
“I think zeekrewards Receivership has recovered 300 some million dollars already so they will more definately send another check to affiliate for about 30 some %. Plus if u r USA resident than fillout ur tax info to get the With held money back as well.”
I think you might be a little confused. I might not have my numbers 100% accurate. There were 175,000 people who filed claims. Out of all those people filing claims, the total amount came $550 million. The receiver had about $325 million. So as you can see, there is not enough money to pay everyone back 100% who filed claims.
Out of the $325 million, I suspect the receiver is going to keep some in the bank for ongoing expenses and some was ordered by a judge to be set aside pending a case by a vendor who is claiming they are owed money.
A little more than half of those who filed claims 90,000 were recently sent out. The remaining ones who did not get checks will get checks sometime early next year from the sound of it.
After all those claims are paid, there is not going to be a whole lot left. There is also an ongoing effort through negotiation and litigation by the receiver to recover as much money as they can. I imagine that sometime down the road there will be another payment but no one knows when that will be nor how much.
My personal opinion is we have seen the best so far. Money will be recovered, but I would be personally surprised if it were more than an additional 10% that we would get back. And who knows how long that it will before we see it.
In breaking news, Zeek Rewards founder Paul Burks has been indicted on charges of wire and mail fraud, conspiracy and tax fraud.
NO LINK:startribune.com/business/280347122.html
On it, I’ll have a report out shortly.
He will likely go the way of Andy Bowdoin, jail
and we’re live – https://behindmlm.com/companies/zeek-rewards/paul-burks-indicted-for-operating-zeek-rewards/