Dawn Wright-Olivares, Zeek Rewards' Chief Operating Officer, stated on a June 25th, 2012 leadership call that the company could not pay affiliate commissions unless new member funds were deposited into its e-wallet accounts. This claim directly contradicted standard e-wallet functionality for corporate payouts.
An e-wallet acts as an electronic fund holder, loaded with real money. Companies use these accounts to send payments globally to people or other businesses. When a payment processes, the recipient withdraws funds, and the e-wallet provider typically charges a fee, either flat or a percentage of the withdrawn amount.
For multi-level marketing firms, paying commissions through e-wallets usually involves a lead time of up to a month. This period allows the company to know exactly how much money members request. Companies then have ample time to fund their e-wallet accounts sufficiently. They send instructions to the e-wallet provider on who to pay and how much, ensuring smooth transactions. This process remains consistent whether a company uses one e-wallet provider or many.
Wright-Olivares, however, presented a different picture. She insisted that Zeek Rewards could not issue commissions via an e-wallet provider unless members first deposited money into that specific e-wallet account. On the June 25th call, she described e-wallet solutions as "lumps of leather" that required filling before any withdrawals could occur.
The typical operation involves an MLM company tracking commission requests, transferring the necessary funds from its bank accounts to the e-wallet provider, and then sending the payment instructions. The e-wallet provider processes these requests and disburses money from the company's designated e-wallet account.
NXPay, an e-wallet service, describes its process clearly. A company establishes an NXPay account and deposits payroll or commission funds via check, wire transfer, or ACH. Each independent representative also sets up an NXPay account. Once accounts are ready, the company creates a spreadsheet within its NXPay account, detailing how to distribute the deposited funds. "Payroll / commission funds" refers to the money the MLM company deposits to cover commissions, and the spreadsheet directs NXPay on specific payouts based on member requests.
This straightforward process was not Zeek Rewards' reality. Wright-Olivares claimed Zeek Rewards could only pay commissions after new and existing members injected enough fresh money into the company's e-wallet accounts to cover pending requests.
On the June 25th leadership call, Wright-Olivares told affiliates, "The issue that we’ve had with NXPay, alright everybody wants to know 'just tu".