To understand how Jim Merrill became ensnared in this mess, one must understand Jim Merrill, the human being.

James Merill’s March 17th sentencing memorandum reads like a list of things someone who heads up a Ponzi scheme stands to lose if they’re caught.

What should be a deterrent to other Ponzi fraudsters is instead presented as compelling reasoning for Merrill to be given a feather-weight sentence.

Merrill’s attorney is seeking a sentence of no longer than one year and one day. That, they deem, is sufficient punishment for heading up the largest and most financially devastating MLM fraud to date.

It is a tragedy that a person like Jim Merrill finds himself facing a prison sentence.

Every person to encounter him for any meaningful moment of time quickly discovers that he is truly an extraordinary human being.

The kind of father who puts family above all else and makes sure he is a full participant in his children’s lives, a husband who is actually a caring and attentive partner to his wife, an uncle who has a significant impact on the lives of his nieces and nephews, the neighbor you watch jog with his rescue dog every day and trust with the key to your home, the coach that every parent wants to coach their child because he treats all his players equally and knows that imparting invaluable life lessons is more important than winning a youth sports game, the friend who lends a genuine ear, who earnestly cares about you and your family, who travels across the country to visit, console and ultimately make a video of a dying, ALS-stricken friend as a gift to his then-young children, who is there to help sift through debris after a fire destroys your home, or makes sure another friend has meals and emotional support while battling a terminal cancer diagnosis, and yet so humble and genuine that he is universally loved by those who know him.

The stories of Jim’s selflessness, humility, generosity, compassion, and his genuine care for family and friends, littered throughout the 50-plus letters of support submitted to the Court, are nothing short of overwhelming.

James Merrill sounds like a swell guy, but none of that changes the fact he was involved in and, along with Carlos Wanzeler, at the center of a $3 billion Ponzi scheme.

One of the key arguments presented by Merrill’s attorney is that he was “the voice of change”.

“[W]hen TelexFree was set up, Mr. Merrill did not intend that TelexFree be a pyramid scheme …”.

Consistent with his character, amply illustrated in the letters submitted to the Court, Jim began TelexFree with the intention of helping people.

Through identifying Carlos Wanzeler and Carlos Costa as “the real decision makers”, Merrill shirks his part in the setting up and operation of TelexFree.

“You ruined my life.”

This is what James Merrill wrote to Carlos Wanzeler after the government executed search warrants at TelexFree.

In late 2013 Merrill “contemplated resigning” (after he’d made millions and TelexFree sped towards collapse), but a MLM attorney Jeff Babner told him

his resignation would not relieve him of any past liability and the better course was to stay on so he could try to “right the ship” going forward.

The problem is TelexFree was a Ponzi since its inception, and ignorance of the law is not an excuse.

Merrill’s sentencing memorandum goes on to describe the plight of his kids, who purportedly are showing signs of depression. The financial status of the family is also brought up.

TelexFree’s motto was “changing lives”, and that it certainly did.

Merrill’s life and that of his family are but one example, contrasted against the hundreds of thousands who also had families destroyed and were left financially ruined.

It’s what Ponzi schemes do. And while my heart goes out to the innocent family members now suffering as a direct result of Merrill’s conduct, that is and always will be on him. It should certainly not be an excuse to spare him a suitable punishment for his crimes.

The phenomena of criminals leading entirely separate lives outside of their criminal activity is not new. The scandal makes for a good news story but in no way should the magnitude of a crime be reduced by unrelated factors.

Certainly a sentence of a year and one day for heading a $3 billion dollar Ponzi scheme is exactly that.

The government has asked Merrill be given a ten years sentence. I don’t envy the judge in determining a medium between that and a year.

Jim Merrill has been punished enough for a lifetime, and will continue to be punished for a lifetime. His restitution obligations—legal or moral—will
hang around his neck like an albatross.

The harm already inflicted upon a true family man like Jim Merrill will remain with him forever.

The Court simply does not need to imprison a person like Jim Merrill to punish him.

For what it’s worth, while I have problem with Merrill being locked away for ten years, I’d think a sentence as low as six years would also be just.

One can simply not have billion dollar Ponzi kingpins being handed down slap on the wrist sentences.

Whatever the Judge decides, within twenty-four hours we’ll have an answer either way.

Stay tuned…


Update 23rd March 2017 – Merrill has been sentenced to six years in prison.