The U.S. Department of Justice issued a year-end warning to Ponzi scheme operators, citing the case of Zeek Rewards, which defrauded hundreds of thousands of victims out of $850 million between January 2010 and August 2012. This came as some public observers questioned the pace of regulatory intervention in such schemes.

Many investors in these operations sometimes interpret a lack of immediate regulatory action as proof of legitimacy. Others argue that non-action translates to an endorsement of the business model. Regulatory bodies, however, typically conduct extensive, often covert, investigations before taking public enforcement steps.

These investigations primarily follow the money trail. They examine how revenue is generated and how commissions are paid out. When major schemes face legal action, the core concerns often align with earlier independent analyses of the financial structure.

The DOJ's warning laid out specific facts regarding Zeek Rewards. Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina, stated, "ZeekRewards used the enormous power of the Internet to rip off $850 million from hundreds of thousands of victims in less than two years."

The scheme operated from January 2010 through August 2012. Dawn Wright Olivares, her step-son Daniel Olivares, and an unindicted co-conspirator identified as "P.B." (owner of RVG) were central figures. They raised over $850 million through a sham internet-based penny auction company named "Zeekler" and its advertising division "ZeekRewards."

The defendants lured investors with false claims that ZeekRewards generated massive profits from its penny auctions. They promised substantial returns, some as high as 125 percent, on investments. Zeekler’s purported profits were fictitious.

ZeekRewards functioned as a fraudulent Ponzi scheme. The conspirators used new money from victim-investors to pay promised returns to earlier investors, while also personally enriching themselves. This led to worldwide losses of at least $750 million. Over 1,500 victims resided in the Charlotte, N.C., area alone. Dawn Wright Olivares was deeply involved in the scheme's strategic operation.