Faith Sloan’s motion for $15,800 to pay lawyer & rent denied

telexfree-logoThe spectacle of the battle between one of the industry’s most prolific Ponzi pimps and the SEC continues.

Hat in hand and convinced that, despite her determination to flout recent court orders against her, Faith Sloan approached the Massachusetts District and demanded $15,800 in frozen funds be made available to her.

faith-sloan-motion-denied-telexfree-sec-caseSloan argued that, despite sinking $18,884 into another Ponzi scheme less than two months prior, without the $15,800 she’d have no money to live on or pay her rent and attorney.

Additionally, the Judge hearing the case ruled on May 7th that “no carve-outs” (of money) would be issued to defendants who did not comply with orders to declare their assets to the SEC.

Without even so much as an explanation, yesterday saw Sloan’s request wholly denied. On a photocopied page from Sloan’s original request, the words “motion denied” are scribbled along with Judge Gorton’s signature. [Continue reading...]


Zeek Receiver sues Howard Kaplan for “legal negligence”

zeekrewardsYesterday saw the Zeek Rewards Receivership file a request for permission to “file separate actions against” two of Zeek’s attorneys.

Explaining the request, the Receiver wrote

After careful analysis of RVG’s written and electronic records, extensive document review and numerous interviews with relevant witnesses, the Receiver has concluded that two attorneys hired by RVG (and their related entities) caused significant damages to RVG by their negligent and other wrongful conduct.

The order was granted on the same day in a North Carolina District Court, after which the Receiver went on to file his actions.

Named as defendants in the actions are attorneys Kevin Grimes and Howard Kaplan and their respective law firms. [Continue reading...]


Zeek Receiver sues Kevin Grimes for “legal malpractice”

zeekrewardsYesterday saw the Zeek Rewards Receivership file a request for permission to “file separate actions against” two of Zeek’s attorneys.

Explaining the request, the Receiver wrote

After careful analysis of RVG’s written and electronic records, extensive document review and numerous interviews with relevant witnesses, the Receiver has concluded that two attorneys hired by RVG (and their related entities) caused significant damages to RVG by their negligent and other wrongful conduct.

The order was granted on the same day in a North Carolina District Court, after which the Receiver went on to file his actions.

Named as defendants in the actions are attorneys Kevin Grimes and Howard Kaplan and their respective law firms.

[Continue reading...]


TelexFree Trustee inches closer to Chapter 7 liquidation

telexfree-logoYesterday saw a hearing for TelexFree Trustee Stephen Darr’s request for permission to subpoena several companies associated with TelexFree. Darr had also requested permission to conduct depositions with individuals from said companies, with the court granting him permission to proceed.

Five such motions were filed by Darr, with three of them granted as proposed. Alvares and Marsal (financial consultants to TelexFree) objected only to having to share emails between the firm and its legal counsel.

Darr agreed to this on condition that he reserves the right to request the emails, if needed, at a later date. A & M consented on condition they retain the right to appeal any such requests.

At the time of publication, no order has been made public regarding Darr’s request to subpoena TelexFree’s law firm Greenberg Traurig, however news reports suggest permission was granted on all five subpoena requests.

Speaking to the Worcester Telegram about why he had to file the requests, Darr remarked [Continue reading...]


Plastic Cash International demand $14.9M in Ponzi funds

zeekrewardsPlastic Cash International LLC, who refer to themselves as one ‘of the prepaid industry’s most prominent players‘, was the credit-card processor for Zeek Rewards.

Plastic Cash International

processed credit card payments from affiliates for (Zeek Rewards).

The processed payments were deposited into an account to be held for the benefit of (Zeek Rewards).

Zeek Rewards, an $850 million Ponzi scheme, was shut down by the SEC back in August of 2012.

In a colossal display of due-diligence failure, Plastic Cash International got on board the Zeek Rewards Ponzi gravy train just two months before the company came crashing down.

Don’t let the short time-span deceive you though, Plastic Cash still collected at least $9.7 million dollars in processor fees and funds from Zeek investors.

That evidently however wasn’t enough, with Plastic Cash filing a claim with the Zeek Rewards Receivership in August of 2013. [Continue reading...]


Brazilian SEC: “No doubt TelexFree is a pyramid scheme”

telexfree-logoAfter a flurry of action these past three months as US regulators took action against TelexFree, things have finally settled into a lull.

One owner, James Merrill, is currently out on bail and awaiting trial. The other, Carlos Wanzeler is on the run in Brazil. Regulators boned his wife’s attempts to flee the US to join him. To date, Wanzeler remains geographically cut off from his family.

The US Trustee is currently investigating TelexFree, with the results expected to lay the foundation for possible bankruptcy fraud charges against the company at a later date.

One could argue that in the grand scheme of things, US regulators should have acted much sooner. Despite there being signs well in advance, I will say that these cases take time to build.

With the speed with which US regulators shutdown TelexFree, raided their offices, threw one owner in jail boned the other owner’s wife’s plans to leave the US, ongoing concerns over the pace of regulatory action in Brazil remain.

James Merrill, recently released on bail, has been left holding the bag after his partner-in-crime fled to Brazil. And at least one top promoter, who earned millions and sees himself as a victim, is also hiding out there.

Earlier this year it was hinted that the criminal case against TelexFree might be “resolved by mid-2014“.

With auditors Ernst & Young recently granted an extension to file their report though (due to the “complexity” of TelexFree’s business operations (read: fraud)), and then time granted for both TelexFree and the Acre Public Prosecutor’s Office to file replies, all of which then must be considered by a Judge before a ruling is made, that the case will be resolved anytime soon seems unlikely.

The end of 2014 might be more realistic, but with the ongoing fluidity of regulatory action against TelexFree in the US, even that might be a stretch.

Not helping the existing impression that regulatory justice in Brazil moves slower than a quadriplegic turtle, comes the revelation that the Brazilian SEC concluded TelexFree was “undoubtedly a pyramid scheme”.

Wait for it… all the way back in January 2013. [Continue reading...]


Herbalife continue to dodge retail in LULAC response

herbalife-logoMid last year saw a number of organisations write to the FTC and ask that they investigate Herbalife. One of those organisations was the League of United Latin American Citizens (LULAC), and they’ve remained at odds with Herbalife ever since.

“I’m mad,” said LULAC’s National Executive Director Brent Wilkes. “I’ve seen Latinos ripped off by banks and others, but this scheme really takes the cake.”

After talking with Herbalife “and not getting the answers I wanted to hear, I concluded they are defrauding upwards of 300,000 Latinos a year,” he said.

Another consumer activist planning to attend the meeting said, “We think the problem is getting worse, and we think that the FTC is really important.”

In attempts to appease LULAC of their concerns, Herbalife have since met with them on three separate occasions. Those meetings however appear to have achieved little, with Herbalife President Dan Walsh now penning an open letter , sounding a little frustrated at the lack of progress, now penning an open letter to Brent Wilkes. [Continue reading...]


Lead System Network Review: Gifting and recruitment

lead-system-network-logoThere is no information on the Lead System Network website indicating who owns or runs the business.

The Lead System Network website domain (“leadsystemnetwork.com”) was registered on the 21st of September 2013, however the domain registration is set to private.

Further research reveals Lead System Network affiliates crediting a Clinten and Ashley Aragona as the founders of the company.

clinton-ashley-aragona-arigona-owners-lead-system-networkAt the time of publication, there is no official Lead System Network marketing material that credits the Aragonas (right) with ownership of the company.

On her personal blog (see comment #4 below) , Ashley Aragona reveals

Clinten and I have always been in business together. He was an entrepreneur when I met him (cute story, but for another time) and it was quickly evident that we made a great team, not only as a couple in love, but a couple of business partners.

We’ve owned multiple businesses including coffee shops, fitness centers, and marketing businesses.

When I met Clinten, he owned multiple coffee shops and a fitness center. I knew of these because they were the brick and mortar businesses that he was known for locally. What I didn’t know was that he was also a network marketing beast and had been in the industry since he was 18, back in the days of ACN.

To keep the length of this down, I’ll fast forward through the next 5 years of marriage. We have been in multiple network marketing companies and have seen vast success, but also disappointment and failure.

Why this information isn’t included on the Lead System Network website is unclear.

In any event, read on for a full review of the Lead System Network MLM business opportunity. [Continue reading...]


Four Corners Alliance Group Compensation Plan v2.0 Review

four-corners-alliance-group-logoWhen TelexFree abandoned its Ponzi scheme business model, Four Corners Alliance Group emerged as a popular contender for affiliates to join.

BehindMLM’s original Four Corners Alliance review was published in early 2013. After launch the opportunity all but died, only to be resurrected when one or more US-based TelexFree affiliates decided to pitch it as a reload scheme.

alexa-stats-four-corners-alliance-group-june-2014

Following a few requests via email to revisit the company, in light of purported compensation plan changes, today I thought we’d take another look at the business.

Read on for an updated review of the Four Corners Alliance Group MLM opportunity. [Continue reading...]


BeepXtra offering affiliates shares. Unregistered securities?

beep-xtra-logoBeepXtra launched in late 2013 and claim to be based (registered) in the British Virgin Islands. The company offers affiliates commissions revolving around fees paid my merchants to access their payment network.

The BehindMLM BeepXtra review was published in November of 2013 and I was contacted by BeepXtra management about it last month.

On May 14th Angelos Hadjiphilippou, BeepXtra’s IT Director, wrote

Hi there,

At first, i would like to thank you for a very honest review of our platform and service.

I have to admit, you got most of the points right, except some pricing and other minor details which we may have missed in the beginning, but overall a spot-on review. I’ve read other reviews about BeepXtra, both negative and positive, but yours pretty much covers comprehensively all the points.

Bottom line, i would like to extend a proposal for a re-visit. Reason being, and as i mentioned above, the minor points you missed or misinterpreted was due to our platform being relatively young when the review was made. I could personally answer certain questions if you wish and provide some further insides… Call it a private interview or whatsoever!

Wishing you all the best.

Angelos Hadjiphilippou
IT Director at Beep Xtra Ltd

Not interested in an interview (we see enough excuses for PR opps in this industry) but interested in making any corrections that needed to be made, I emailed Hadjiphilippou back requesting more information:

Hi Angelos,

Can you send me a copy of the compensation plan in English. I’ll go over it and decide whether a review update needs to be written.

If it’s just minor updates then I can update the original review itself.

-Oz

That was on May 19th and exactly as of today, one month later, I’ve since never heard anything back.

Now news comes that BeepXtra are offering their affiliates shares. Ruhroh… [Continue reading...]