TelexFree lawyer describes company as Ponzi scheme
Earlier this week on Monday TelexFree had their formal appeal unanimously rejected by three judges in Acre’s Civil Court.
Despite the granting of a business crippling injunction and rejection of two appeals filed against it, TelexFree continues to talk up its current legal position. In additional ongoing efforts to appease their Brazilian affiliate investors, the company also routinely has its lawyers publicly reassure everyone that the Acre injunction does not pose a risk to the company’s operations.
Shortly after Monday’s appeal denial was handed down, TelexFree lawyer Djacir Falcão acknowledged the company was “going through a difficult situation” but that it was “not at risk of bankruptcy”.
Fellow lawyer Horst Fuchs later echoed Falcão’s statement, claiming
the new defeat (does not) endanger the survival of the company. There’s no chance of that happening.
The catch 22 here of course being that with little to no retail activity, it’s quite obvious that TelexFree use affiliate investments to pay out existing $20 a week guaranteed ROIs. It would therefore logically follow on that if the company can’t recruit new investors and take in new investments, they’re ROI liabilities would eventually cause bankruptcy.
TelexFree of course can’t admit that, because they’d basically be confirming the company is a Ponzi scheme. Yet that appears to be exactly what happened yesterday.
Quoting the newspaper Rio Branco, Tribune da Bahia reports
According to TelexFree’s lawyer, Djacir Falcão, if the injunction continues the company may enter into bankruptcy.
“Running the company really becomes difficult because of the court decision, so we will appeal,” said Falcão, quoted by the newspaper Rio Branco.
The lawyer tried to appeal to judges on the grounds that should the company spend a few more days being prohibited from signing up new investors, they would have no money to pay the old ones.
The comments by appear to have been made by Falcão at the filing of TelexFree’s injunction against the Acre injunction yesterday.
Whilst I for one applaud TelexFree’s new-found sense of honesty amidst a sea of lies about insurance contracts, approval of said contracts and the general mountain of misinformation being fed affiliates, unfortunately it appears Falcão’s honesty was a once off.
Following the courtroom session in which Falcão made the above comments, he then
called the press to backtrack on the allegations he made on the floor, saying that “this scenario does not have to happen”.
Right you are Mr. Falcão, right you are. Say one thing in court and then when you walk out the door, feed the public and media a completely different story.
In related TelexFree news it appears that, unlike his business partners Carlos Wanzeler and James Merril who are currently MIA, Carlos “hockay?” Costa appeared to testify ‘on the activities of the company‘ after being subpoenaed by Public Prosecutors in Acre.
As the investigation is ongoing however, no information about Costa’s testimony has been made public, nor has any indication as to when the Public Prosecutor’s investigation will conclude.
TelexFree announced yesterday that they’re expecting a preliminary decision on their injunction filing “later this week”.
Will a judge grant TelexFree’s injunction based on Falcão’s argument that should they continue to be prohibited from signing up new investors to pay off existing ones, TelexFree faces bankruptcy?