Telexfree Finds a Home in Canada

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Telexfree Finds a Home in Canada

Postby Burnaby49 » Sat Apr 26, 2014 9:08 am

In Richmond British Columbia, to be exact, a half-hour drive from my house. This "alleged pyramid scheme" started in Brazil, moved to the US when things got too hot but got kicked out there and has now found a home just across the border. Our regulators are "monitoring the situation carefully" meaning that they plan to take action in less than a decade, give or take.

According to the U.S. Securities and Exchange Commission, in the U.S., TelexFREE's "pyramid scheme" was to sell so-called "memberships that promised annual returns of 200 per cent or more for those who promoted TelexFREE by recruiting new members and placing TelexFREE advertisements on free internet ad sites."

TelexFREE allegedly uses money garnered from new recruits to pay older investors. (CBC)
Memberships cost between $300 US and $1,400 US, and investors — called "promoters" — who placed the ads for TelexFREE's voice over internet service were promised returns in the form of monthly payments.



http://www.cbc.ca/news/canada/british-c ... -1.2622163
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Re: Telexfree Finds a Home in Canada

Postby Pottapaug1938 » Sat Apr 26, 2014 2:49 pm

Here's a Boston Globe story about this scam. My favorite part is the one about the person trying to flee with cashiers' checks for $38 million.

http://www.bostonglobe.com/business/201 ... story.html
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Re: Telexfree Finds a Home in Canada

Postby Pottapaug1938 » Sat Apr 26, 2014 2:54 pm

Today's Globe is also reporting that investors are now getting 1099s showing that they received income which they never got. One woman got hers for $35,072, which includes the $15,000 which she initially invested.
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Re: Telexfree Finds a Home in Canada

Postby GlimDropper » Mon Apr 28, 2014 6:06 pm

Funny, I was just coming here to start a TelexFree Fallout topic. When Zeek rewards went down in August of 2012 it was believed to be the largest fraud of it's kind with a reported 850 million dollar take. Sadly it appears it was only to hold that title less than two years. The SEC Complaint alleges that TelexFree took in over a Billion (with about 1.3 million in real product sales). The details are pretty much what you'd expect from a scheme like this, with a few interesting twists. One being that TelexFree has already been shut down in it's native Brazil since June of last year, Peru banned it last December as did Rwanda last month. So the US was a little late to the table here. But the thing that blows me away is Telex trying to save themselves in the US by filing for bankruptcy.

On Saturday April 13th three TelexFree subsidiaries filed for Chapter 11 protection in Nevada. In January the Massachusetts Securities Division started asking uncomfortable questions, TelexFree's primary rent an office in the US is in Marlborough Mass. February found them hiring MLM consultants and legal representation and a plan was made to change the compensation plan. Comp plan 2.0 was rolled out in March and was greeted by an uproar by the affiliates with the police being called to clear the crowd from the rent an office. Worse still for Telex, word that the affiliates my actually need to sell products to earn a commission sent sales of "AdCentrals" plummeting. This triggered the hatching of April's bankruptcy scheme.

Word of the bankruptcy filing forced the Massachusetts Securities division and the SEC into action, Monday the 15th the office was raided. Joesph Craft, TelexFree's CFO (or interim CFO, or "just a consultant" depending on when he was asked) was caught trying to walk 38 million in cashiers checks out of the office. I think it's important to note that Joe Craft, until the multimillion dollar gym bag incident was a widely respected MLM consultant and is not the only "respected MLM industry" figure who lent and perhaps spent their reputations to this fraud. From here, a flurry of court documents follow. For the Nevada bankruptcy case Kurtzman Carson Consultants are making those documents available. Don Ryan's ASD Updates blog is doing the same for the SEC/Massachusetts files.

A beautiful example of the cognitive dissonance and outright dishonesty of TelexFree's leadership is how they announced the bankruptcy filing to the affiliates verses what those filings actually ask for. Marketing Director Steve Labriola told the affiliates that the bankruptcy was "the most awesome thing," where I can only assume Steve was using some heretofore unknown definition of "awesome." What they were asking the court to do is to eliminate any obligations they had to repay their affiliates:

12. By this motion, the Debtors respectfully request entry of an order, substantially in the form attached hereto, authorizing and approving the Debtors' rejection of all previous agreements between the Debtors and the Promoters under both the Original Comp Plan and the Revised Comp Plan.


You know, because relieved of all their ponzi obligations TelexFree could reorganize and go on to what they really wanted to do ever since they found out they were being investigated, running something other than an illegal scheme.

But that isn't the height of their chutzpah, that would have to be the Motion for an Order Determining that: (I) Portions of the Temporary Restraining Order Entered at the Request of the Securities and Exchange Commission Violate the Automatic Stay of 11 U.S.C. § 362(a); (II) Portions of the Temporary Restraining Order are Void; and (III) the Debtors are Entitled to Use their Assets in the Ordinary Course of their Business. I am not even going to attempt characterizing the argument made there other than to say I've never seen "neener neener we filed first now go away" being offered as a defense to a securities complaint. Are Chapter 11 protections viable in this situation? Well, one very high priced law firm is arguing they are.



Oh, I would be remiss if I ended this post without mentioning Faith Sloan. She has been one of the most proficient and prolific ponzi pimps in the country for years now and she's finally getting the recognition she so richly deserves.

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Re: Telexfree Finds a Home in Canada

Postby notorial dissent » Tue Apr 29, 2014 4:03 am

Just fabulous, you always find something with lots of crunchy goodness as several people I know are want to say.

Unless things have changed dramatically since last I worked in securities, filing bankruptcy to avoid an SEC action either state or local will get you exactly bupkis. All the SEC has to do is walk and say that the bankruptcy is essentially done in bad faith(fraud) and is part of an ongoing fraud, and good bye bankruptcy. Filing bankruptcy when you're a corp and going down for the third time isn't an issue, but when you are doing it to try and evade either your shareholders, debtors, or the law, is a big no no. Tax cheats try it all the time, and almost universally lose. I can't say I remember, at least in recent history of a securities bankruptcy like this, most of the ones I was familiar with just packed their bags and slunk away in the night, knowing a silent departure is better than a pointless public spectacle, and that they had a better chance of getting away before they got caught. Some people, apparently aren't that smart. I think the old poker line about knowing when to hold 'em, and when to fold 'em really applies here.

I think it is a safe and certain bet that the bankruptcy will shortly be dismissed WITH PREJUDICE, and that the company's assets will be in the hand of the SEC receiver in very short order.
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Re: Telexfree Finds a Home in Canada

Postby JamesVincent » Tue Apr 29, 2014 9:04 am

Just as I saw this thread getting started I got this:
http://www.npros.com/press/2014/4/27/3203/telexfree-sets-up-in-canada.htm

TelexFREE, which was shut down recently by regulators in the U.S., has registered as a business in Richmond, British Columbia. James Merrill and Carlos Wanzeler, who are charged with running a pyramid scheme in the United States, are listed as two of the company's directors in the Canadian business registration.
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Re: Telexfree Finds a Home in Canada

Postby bankalchemist » Tue May 06, 2014 7:51 pm

an ISAACS ALERT you have to see it to believe it; google "joseph isaacs telexfree" he is filing in multiple states for use of the name and business permit to set up an internet based phone company. using his understanding of CLEC networks and filings for telecommunication networks. The filing for Alabama was 99 pages in length. In Wisconsin the application was denied as he could not present the proof of income he stated in the application. There is a picture in Ma with Homeland Security officers in sales office for Telexfree (local provider) along with the FBI gathering up all the records. (can you fathom these folks dropping in on Joseph Isaacs) :naughty: :haha: Some people just never learn when it comes to running scams or promoting the never work but get rich quick business.

Isaacs also just launch SmartandHandyRenos.com to rehab homes and solicit investors. Yes Joseph soliciting investors and dabbling in Florida real estate. He also uses his aliases to provide his own references. :beatinghorse:

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Re: Telexfree Finds a Home in Canada

Postby JamesVincent » Sun May 11, 2014 5:02 am

Got this in my mail today.

http://www.npros.com/press/2014/5/10/3216/telexfree-owner-arrested.htm

May 10, 2014 -- The owners of TelexFree were criminally charged in federal court Friday with conspiracy to commit wire fraud. James Merrill was arrested Friday afternoon in Worcester, MA. An arrest warrant was also issued for Carlos Wanzeler, who is believed to have fled to Brazil and is now considered a fugitive.
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Re: Telexfree Finds a Home in Canada

Postby notorial dissent » Fri May 16, 2014 1:33 am

According to an AP report, Katia Wanzeler was arrested trying to leave through JFK airport Wed evening.
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Re: Telexfree Finds a Home in Canada

Postby JamesVincent » Sun May 18, 2014 8:42 am

http://www.npros.com/press/2014/5/17/3221/wife-of-telexfree-co-owner-arrested-while-trying-to-flee-country.htm

May 15, 2014 -- Federal Agents arrested TelexFree co-owner Carlos Wanzeler's wife, Katia, at JFK International Airport as she was about to board a flight with a one-way ticket to Brazil on Wednesday night.

Carlos Wanzeler drove into Canada as agents raided the TelexFree offices in April and flew to Brazil two days later.

A court document released on Thursday alleged that Ms. Wanzeler misled investigators about her husband's whereabouts and participated in moving huge sums of money out of TelexFree bank accounts.
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Re: Telexfree Finds a Home in Canada

Postby JamesVincent » Mon Jun 02, 2014 6:45 am

http://www.npros.com/press/2014/5/25/3227/telexfree-co-owner-denied-bail.htm


James Merrill, co-owner of TelexFree Inc., was denied bail by a federal judge in Worcester, MA, pending trial for allegedly committing fraud and operating a pyramid scheme.

Prosecutors said Merrill has access to hundreds of millions of dollars in accounts around the world and motivation to flee because, at age 53, he could in effect be facing life in prison. Merrill's lawyer argued he was not a flight risk and planned to appeal.
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Re: Telexfree Finds a Home in Canada

Postby JamesVincent » Wed Jun 11, 2014 12:09 am

http://www.mlmrankings.com/telexfree/news.htm#News1

Boston, MA -- Stephen B. Darr, Senior Managing Director of Mesirow Financial Consulting in Boston, has been appointed the Chapter 11 trustee for TelexFREE. Darr will take over management of TelexFREE through the company's bankruptcy.

Meanwhile, three class-action lawsuits seeking in excess of $10 billion have been filed against TelexFREE on behalf of plaintiffs in North Carolina, Massachusetts, and Nevada.


How does this affect the Canadian side of the company? Or is that even an issue yet.
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Re: Telexfree Finds a Home in Canada

Postby Burnaby49 » Wed Jun 11, 2014 1:31 am

JamesVincent wrote:http://www.mlmrankings.com/telexfree/news.htm#News1

Boston, MA -- Stephen B. Darr, Senior Managing Director of Mesirow Financial Consulting in Boston, has been appointed the Chapter 11 trustee for TelexFREE. Darr will take over management of TelexFREE through the company's bankruptcy.

Meanwhile, three class-action lawsuits seeking in excess of $10 billion have been filed against TelexFREE on behalf of plaintiffs in North Carolina, Massachusetts, and Nevada.


How does this affect the Canadian side of the company? Or is that even an issue yet.


No idea. I assume Canadian authorities are following the situation but I've seen nothing reported since my original posting.
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Re: Telexfree Finds a Home in Canada

Postby Fmotlgroupie » Mon Jun 16, 2014 9:06 pm

Nice long article in the Boston Globe, if anyone's interested http://www.bostonglobe.com/business/201 ... story.html

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Re: Telexfree Finds a Home in Canada

Postby JamesVincent » Wed Jun 25, 2014 3:08 am

http://www.npros.com/press/2014/6/18/3235/judge-allows-bail-for-telexfree-co-owner.htm

June 17, 2014 Worcester, MA -- A federal judge ordered that TelexFree co-owner James Merrill be released on bail while awaiting trial for fraud, saying that prosecutors had not proven that he would flee if released. Merrill has been held in a Rhode Island detention center for the past five weeks. His business partner, Carlos Wanzeler, fled to his native Brazil shortly after federal agents raided TelexFree's offices in April. Under Brazilian law, he cannot be extradited to the U.S.

The judge cited Merrill's "strong family and community ties" in his decision, noting that Merrill and his wife have been married for 23 years, have lived in Ashland, MA since 1997, and have three children. In addition, he cited Merrill's record of coaching youth sports and his lack of a prior arrest record.

Merrill will be required to wear a GPS ankle bracelet and be placed in his wife's custody. He must remain in his house every day from 8 PM to 8 AM and must relinquish his passport.
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Re: Telexfree Finds a Home in Canada

Postby Skapegoat13 » Wed Jul 02, 2014 12:19 pm

One again the king of slander - BankAlchemist aka Dan "the fudge packer" Hudson blows his BS all over everyone here. He claims to understand what he is spouting about but really has no clue whatsoever. When are you going to get a life and pull your head out of Isaacs ass you clueless son of a bitch? :evil: :haha:

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Re: Telexfree Finds a Home in Canada

Postby webhick » Wed Jul 02, 2014 7:57 pm

Lay off the homophobic insults or suffer the consequences, Joe.
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Re: Telexfree Finds a Home in Canada

Postby EagleOne » Wed Jul 02, 2014 11:14 pm

Well, Merrill is asking the judge to release $4 Million so he can pay for his attorney. His attorney is claiming the government should release the funds because it can't be proven if the funds came from TelexFree or other sources. Yeah right. Good grief, how dumb do they think people and the judge truly are?
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Re: Telexfree Finds a Home in Canada

Postby notorial dissent » Thu Jul 03, 2014 7:29 am

EagleOne wrote: Good grief, how dumb do they think people and the judge truly are?

Based on their business model, pretty damn, oh wait, that was rhetorical, wasn't it????? My mistake, or maybe not.

As to Jerky Joe, go back under your rock, the slime mold misses you, it has to have something to look down on.
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Re: Telexfree Finds a Home in Canada

Postby bankalchemist » Wed Jul 16, 2014 7:55 pm

webhick wrote:Lay off the homophobic insults or suffer the consequences, Joe.
Thanks but we have to consider the source which is having an identity crisis coming out so he uses catch phrases and metaphors in an attempt to disguise his personal standing.

Isaacs is having some luck these days as he is listed in connectedinvestors seeking "marks" who will buy into his 8% ROI promise when flipping Florida real estate with him managing the funds. No luggage included. He has his new remodeling enterprise smartandhandyrenos with bathrooms and toilets being his summer launch special.


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