ZeekRewards founder sentenced to 14 years for role in $850 million Ponzi scheme

In this Thursday, Nov. 13, 2014, file photo, Paul Burks, former president of ZeekRewards and the online penny auction site Zeekler.com., walks in to federal court in Charlotte, N.C. Burks was sentenced to nearly 15 years behind bars Monday, Feb. 13, 2017, for his lead role in an $850 million online Ponzi scheme that bilked nearly a million people in the U.S. and abroad. (Davie Hinshaw/The Charlotte Observer via AP, File)

CHARLOTTE, N.C. (AP) 02/14 — The founder of ZeekRewards has been sentenced to nearly 15 years behind bars for his lead role in an $850 million online Ponzi scheme that bilked nearly a million people in the U.S. and abroad.

Paul Burks, 70, was given three concurrent prison sentences of 14 years and eight months Monday after being convicted in July on four felony fraud charges, news outlets reported.

Burks had been free on bond for the past 4 ½ years and could have been sentenced to up to 59 years under federal sentencing guidelines.

U.S. District Judge Max Cogburn Jr. indicated Burks most likely will spend his final days in prison, given his multiple health issues, including cancer.

“While this sentence is much lower than called for by the sentencing guidelines, it is still a severe punishment, particularly given our client’s age and health,” said Noell Tin, one of Burks’ attorneys. An appeal of Burks’ July conviction is in the works, Tin said.

Burks owned ZeekRewards.com, a Lexington, North Carolina-based website which gave incentives for recruiting new investors to an online auction site Burks also ran called Zeekler. On that site, customers were charged up to $1 to bid for the chance to buy heavily discounted consumer products such as iPads.

The site made fanciful promises of 125 percent returns at a time when the economy limped out of the Great Recession.

The scheme would have needed a miracle on the order of “the loaves and the fishes” to make good on that pledge, Cogburn said.

Investments were capped at $10,000, but people could invest on behalf of their spouses, children or other relatives. Some mortgaged homes to raise their investment and almost 90 percent of the people who bought in to the operation lost money.

“The scheme got out of hand, more than Mr. Burks may have thought was going to happen,” the judge said. “But anyone could have seen what was going to occur outside himself and his (marketing) cheerleaders.”


Posted in: Courts & Trials, Crime & Criminals, Fraud, Judges, Scams, Sentencing, Victims of Crime

Leave a Reply

Your email address will not be published. Required fields are marked *

eleven + 18 =

Terms of Use for Posting Comments

Terms of Use

This site (the “Site”) is operated and maintained by Law Enforcement Education Foundation, Corporation (“Company”). Throughout the Site, the terms “we”, “us” and “our” refer to Company.  The words “user,” “you” and “your” as used herein refer to you.

Please read these terms and conditions of use (“Terms of Use”) carefully before contributing content. If you do not agree to these Terms of Use, please do not contribute content. Your use of the Site is subject to the Terms and Conditions found here .

By contributing content to the Site, you represent and warrant that you are at least eighteen (18) years old and that you have read and understand these Terms of Use and any amendments thereto and agree to be bound by them. If you are not at least eighteen (18) years old or you do not agree and accept these Terms of Use, you are prohibited from contributing content.

From time to time, we may permit users to submit content to the Site.  You hereby acknowledge and agree that by submitting remarks, comments, suggestions, ideas, graphics, feedback, edits, concepts, comments, photographs, illustrations and other materials (other than personal information and/or registration information) through the Site (individually and collectively, “Submissions”), you (i) grant us a nonexclusive, royalty-free, perpetual, transferable, irrevocable and fully sub-licensable right to use, reproduce, modify, adapt, translate, distribute, publish, create derivative works from and publicly display and perform such Submissions throughout the world in any media, now known or hereafter created, without attribution to you; (ii) grant us the right to pursue at law any person or entity that violates your and/or our rights in your Submissions; and (iii) forever waive any and all of your rights, including but not limited to moral rights, if any, in and to your Submissions, including, without limitation, any all rights or requirements of attribution or identification of you as the author of the Submission or any derivative thereof.  We reserve the right to remove any of your Submissions from the Site, in whole or in part, without notice to you, for any reason or no reason.

Submissions are made voluntarily. Any submissions which include personally identifiable information are subject to our Privacy Policy found here .  You may not upload or otherwise publish content on the Site that (i) is confidential to you or any third party; (ii) is untrue, inaccurate, false or other than an original work of your authorship; (iii) that relates to or impersonates any other person; (iv) violates the copyright, trademark, patent or other intellectual property rights of any person or entity; (v) contains any content, personally identifiable information or other information, or materials of any kind that relate or refer to any other person or entity other than the provider of the products, goods or services to which the Submission relates; or (vi) violates any law, or in any manner infringes or interferes with the rights of others, including but not limited to the use of names, information, or materials that (A) libel, defame, or invade the privacy of any third party, (B) are obscene or pornographic, (C) are harmful, threatening, offensive, abusive, harassing, vulgar, false or inaccurate, racially, sexually, ethnically or are otherwise objectionable or otherwise contrary to the laws of any place where such Submissions may be accessed; (D) constitute personal attacks on other individuals; (E) promote criminal, immoral or illegal activity; (F) promote or advertise any person, product or service or solicit funds; or (G) are deemed confidential by any contract or policy.

You are solely responsible for any Submissions you make and their accuracy. We take no responsibility and assume no liability for any Submissions posted by you or any third party.

Unless approved by us in writing in advance, you agree not to: (i) provide or create a link to the Site; or (ii) create any frames at any other sites pertaining to any of the content located on the Site.

We reserve the right, in our discretion, to update, change or replace any part of these Terms of Use for Posting Comments by posting updates and/or changes to our Site.  It is your responsibility to check this page periodically for changes.  Your continued use of, and/or access to the Site, following the posting of any changes to these Terms of Use for Posting Comments, constitutes your acceptance of those changes.