URGENT >> BULLETIN >> MOVING: Charles Schwab Accounts Holding Nearly $18.6 Million In Name Of Accused Zeek Operator Paul Ray Burks Or Rex Venture Group Have Been Frozen
URGENT >> BULLETIN >> MOVING: (UPDATED 12:16 P.M. EDT (U.S.A.) The office of the corporate counsel for Charles Schwab in San Francisco has informed a federal judge that it is holding almost $18.6 million in two accounts linked to the alleged Zeek Rewards’ Ponzi scheme.
One of the accounts is in the name of Rex Venture Group LLC and has more than $10.3 million in cash and more than $4.94 million in securities, according to court filings. Rex Venture is Zeek’s purported parent company.
The second Schwab account, meanwhile, holds more than $2.3 million in cash and more than $1.3 million in securities, Schwab informed the court. The second account is in the name of Paul Ray Burks, Zeek’s alleged operator.
Schwab has “frozen” the assets in both accounts under court order, the firm said in a court filing.
Separately, North Carolina-based NewBridge Bank has certified in court filings that it is holding more than $11.64 million in an account under the name of Rex Venture Group LLC, Zeek’s purported parent company. Zeek announced suddenly on May 28 (Memorial Day) that it was closing its NewBridge account and advised members to cash checks before June 1 or they would bounce.
Why so much money remained in the account was not immediately clear.
Other court filings suggest that Rex Venture also had money on deposit at Four Oaks Bank & Trust Co. Inc., a bank in North Carolina. Four Oaks has asked the court to give it until Sept. 3 to comply with an order to specify precisely how much Rex had on deposit at the institution.
Extra time was needed because of the “complexity of the financial information that must be analyzed and the need to obtain relevant information from a third party,” the bank informed the court.
Four Oaks did not identify the third party.
When the U.S. Secret Service brought the AdSurfDaily Ponzi case in 2008, it was discovered ASD President Andy Bowdoin had more than $65.8 million in 10 personal bank accounts.
On Aug. 17, the SEC alleged that Zeek was a massive Ponzi- and pyramid scheme that had gathered about $600 million.
ASD operator Andy Bowdoin is scheduled to be sentenced tomorrow on a charge of wire fraud.
Zeek is known to have members in common with ASD. The U.S. Secret Service also is investigating Zeek.