What Did Your Brokerage Firm or Investment Adviser Do Wrong With GWG
Published On: July 25, 2016

Last week, Paul Burks was found guilty of masterminding one of the largest ponzi schemes in US history. Burks allegedly bilked more than one million investors worldwide out of $800 million. He was convicted on four counts of fraud and conspiracy. He faces up to 65 years in prison and $1 million in fines. His ponzi scheme was one of the largest ever prosecuted by the US Attorney’s office. Attorneys are still trying to recover an additional $225 million from Burks and ZeekRewards. ZeekRewards was an online marketing scheme that generated hundreds of millions of dollars in 2011-2012. Almost nine out of 10 investors in Burks’ scheme lost money. He and his team promised returns of up to 125 percent, manipulated records and exaggerated ZeekRewards’ cash flow to lure a “staggering” amount of investment.

ZeekRewards was started in 2011 to market an online auction site. It offered a share of profits to investors who promoted Burks’ auctions to other online sites or recruited others to take part. Investments were capped at $10,000 but participants could make payments for spouses, children and other relatives. During the first half of 2012, online users of ZeekRewards grew by more than twentyfold. In the end, ZeekRewards paid out more than half the $939 million it generated. Its actual obligations were more than $3.3 billion.

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