Plastic Cash International LLC, a credit card processor that handled payments for the Zeek Rewards Ponzi scheme, now seeks $14.9 million from the fraud's receivership. The company began processing for Zeek in June 2012, just two months before the SEC shut down the $850 million operation in August 2012.
Plastic Cash International processed credit card payments for Zeek Rewards affiliates. These funds went into accounts meant for the company. The Securities and Exchange Commission later exposed Zeek Rewards as an $850 million fraud, shutting it down in August 2012.
During its two months of operation with Zeek, PCI collected at least $9.7 million in fees and investor funds. The processor filed a claim with the Receivership in August 2013, a year after Zeek's collapse. It demanded damages for an alleged breach of contract, though it did not specify the amount owed.
The Receivership first learned of PCI's existence when this claim arrived. Investigators reviewed Zeek's financial records for evidence of a direct business relationship. They found none. PCI never paid Zeek a single dollar during its two-month period. Nor did PCI turn over any funds when the Receivership took control of Zeek's assets.
PCI did not deal directly with Zeek. The processor ran money through a bank account held by SecureNet, an unrelated third-party payment processor. This hidden pathway changed the investigation.
Following the money trail, investigators found a connection between SecureNet and PCI. It led to an Eagle Bank account. The account sat in SecureNet's name, but held approximately $812,433.96 in Receivership assets. These funds should have been seized when Zeek went under.
The United States Secret Service secured a seizure warrant and took all the money. After losing the Eagle Bank account, PCI told the Receivership it had no other accounts connected to the Zeek transactions. The processor claimed it held no additional Receivership assets.
The claim now being litigated demands $14.9 million. PCI argues it either holds a security interest in the funds collected for Zeek or owns them outright under its contracts with the company. The Receivership's position is clear: those funds belong to Zeek's victims, not to a processor that handled payments for one of the largest Ponzi schemes in recent history.