Zeek Receiver’s Status Report for 1st Quarter 2015
Feels like only yesterday we went through the Zeek Receiver’s 4th quarter 2014 fees and expenses report, with new updates now provided in the Receiver’s First Quarter Status Report for 2015.
Most of the information we’ve already covered in our ongoing coverage throughout 2015, which can be accessed via BehindMLM’s Zeek Rewards archives (articles written between Jan 01 and March 31st, 2015).
Below you’ll find a breakdown of new information and updates provided in the Receiver’s latest report.
Funds collected by the Receiver
During the first quarter of 2015, the Zeek Receivership collected $1,577,043.06 ‘from settlements with non-affiliate third parties‘.
As to net-winner affiliates, no additional funds were collected (via litigated settlements or otherwise), however the Receiver did have ‘discussions with various Affiliates regarding pending netwinner litigation.‘
As to net-winners who haven’t yet been sued and think they might have gotten away with it, bad news:
The Receiver expects to file lawsuits against foreign net winners in additional countries during the second quarter of 2015.
Which countries the Receiver decides to target have yet to be disclosed, but we’ll be sure to cover it as additional clawback litigation is filed.
Net-winners aside, funds were recovered from financial institutions who had incorrectly cancelled checks made out to RVG post SEC shutdown.
$520,250.00 into the Affiliate Account from payments from various financial institutions relating to previously dishonored cashier’s checks, teller’s checks, official checks, and bank money orders.
Four additional claims are in the process of being resolved, and EBCM anticipates that this will result in a recovery of $74,941.00 during the second quarter.
As to financial institutions who are refusing to cooperate, the Receiver has reports that litigation against these institutions is expected to be filed this quarter.
As of March 31, 2015, EBCM was working thirty-one active claims against financial institutions currently valued at $310,261. The thirty-one remaining claims are at an impasse and require litigation activity for collection.
EBCM filed a motion seeking an order to show cause or turnover Receivership Assets against the financial institution with the largest outstanding claim, and it anticipates this claim being resolved during the second quarter.
Similar proceedings on remaining claims relating to outstanding and dishonored cashier’s checks and other instruments are planned for the second quarter.
Issues with Payza, Payment World, Solid Trust Pay and Cyber Profit have continued throughout the first quarter of 2015, with litigation looking to be the likely solution.
The Receiver Team is continuing its investigation and pursuit of outstanding funds from Payza, Payment World, Solid Trust Pay, and Cyber Profit.
With regard to the outstanding Receivership Assets from Payza and/or Payment World, the Receiver Team issued a demand to Payza, Payment World, and VictoriaBank in Moldova.
The Receiver Team also continues to pursue options to recover assets directly from VictoriaBank in Moldova. The Receiver Team will continue to explore all available options, including litigation, to recover the outstanding funds.
With respect to Solid Trust Pay, the Receiver Team has issued a demand to Solid Trust Pay for approximately $1.6 million in outstanding Receivership Assets and is awaiting additional information from Solid Trust Pay to evaluate its response to the Receiver’s Demand.
My take is that if these processors were interested in settling with the Receiver, they would have done so by now. That the Receiver is/will pursue legal action against them now has been a long time coming.
Update on Kevin Grimes and Howard Kaplan lawsuits
Both Kevin Grimes and Howard Kaplan have filed motions to dismiss the lawsuits brought against them by the Receiver.
Whilst not much appears to be happening between Kaplan and the Receiver, there are currently ongoing settlement negotiations taking place with Grimes.
To that end, pending a possible resolution, a decision on Howard Kaplan’s motion to dismiss was ‘recently stayed … pending the Receiver’s mediation efforts in the case against the Grimes defendants.‘
I’m guessing whatever settlement terms (if any) are agreed on in Grimes’ case, will pretty much dictate what happens with Kaplan.
My gut tells me we might see one of those hokey “I don’t admit anything but will return all the stolen Ponzi money I was paid” settlements reached.
As it stands,
as of March 31, 2015, the Receivership Estate held approximately $91.3 million in the Affiliate Account, approximately $89.3 million in the Seized Asset Account, approximately $293,000 in the Pre-Filing Account, approximately $6.3 million in the Settlement Account, $0 in the Withholding Account, and approximately $1.1 million in the Holdback Account.
Of note is that the task of sifting through Zeek Rewards’ electronic and financial data appears to be mostly complete.
Testament to that is that in the first quarter of 2015, no additional data was received by the Receiver’s forensic team.
Therefore, the validation of the Receivership Defendant’s financial data is complete and the Receivership now has a complete accounting of the Receivership Defendant’s financial records for the data and information received to date.
Naturally if anything else pops up it’ll be analyzed and cataloged appropriately, but for now they’re up to date.
Which means the Zeek Receiver has all this information readily accessible and at their disposal. Should come in handy in the upcoming and ongoing lawsuits, which from the sounds of it are likely to be resolved either this quarter or the next.
It’ll also be interesting to see which countries’ net-winner investors the Receiver targets next.
Footnote: Our thanks to Don@ASDUpdates for providing a copy of the Zeek Receiver’s First Quarter Status Report for 2015.