telexfree-logoA settlement with Fidelity Cooperative Bank has seen some $2.9 million returned to TelexFree investors.

The investors in question are from Massachusetts, with the $2.9 million figure carved out of a $3.5 million dollar settlement.

Long-time followers of the TelexFree saga might recall¬†Fidelity Cooperative Bank is run by John Merrill, the brother of James Merrill, one of TelexFree’s co-founders.

The bank was one of several that held deposits for TelexFree.

Its executives denied any knowledge of the fraud but agreed to settle allegations that they should have reviewed the operation more thoroughly.

What with John Merrill’s reputation tainted by his brother’s Ponzi empire, one imagines future family gatherings between the Merrill’s might be somewhat frosty.

In addition to the $2.9 million paid out last week, mostly to Brazilian immigrants living in Massachusetts,

The rest of the settlement money will be distributed to a second and third group of Massachusetts claimants, Secretary of State William F. Galvin said, after more work is done to verify their claims.

The state victims could still possibly recoup more of their losses, Galvin said, depending how much money the bankruptcy trustee ultimately has to distribute.

The recent payments made thus far equate to about $250 per investor. Outside of the bank settlement, further payments to TelexFree victims are on hold until criminal proceedings against Merrill and Carlos Wanzeler have concluded.

Those proceedings are currently in the discovery phase, with a trial penciled in for sometime next year.