TelexFree @ BehindMLM

Early last month the Department of Justice, who are currently handling criminal proceedings against TelexFree owners James Merrill and Carlos Wanzeler, asked the District Court of Massachusetts to order a stay of discovery in the SEC’s civil case. The DOJ argued that Without a stay, Merrill and perhaps Wanzeler – charged in both actions – would use the [Continue reading…]

It was always a bit ridiculous that the owner of a billion dollar Ponzi scheme fancied himself a viable candidate for Federal Deputy… but it was one we had to watch play out nonetheless. Widely seen as an attempt (miscalculated or otherwise) to dodge legal responsibility for his role in TelexFree, over the last few [Continue reading…]

As part of our continued coverage of the aftermath of the TelexFree Ponzi shutdown, today we again focus in on the claims of defendant Faith Sloan. Sloan, along with several other top investors is currently being sued by the SEC for her involvement in TelexFree, a billion dollar Ponzi scheme.

Following a request that a proposed order be drafted up and sent a court email address, an actual order on the Trustee’s motion for privilege waiver was posted yesterday. The short of it is the order was approved, with any client-attorney privilege TelexFree might have otherwise enjoyed waived in connection with the prosecution by the [Continue reading…]

During the raid on TelexFree’s Massachusetts offices, federal law enforcement seized various assets of TelexFree, including servers used by TelexFree, about 38 boxes of documents, and about two dozen computer drives. The electronic data alone is believed to be over 400 terabytes of material. As regulators continue to build their respective cases against TelexFree, the [Continue reading…]

This isn’t shaping up to be a good week for Fidelity bank or its President John F. Merrill. Not even a day after it was announced that the bank had settled with the Massachusetts Securities Division for $3.5 million, now the Chapter 11 Trustee has indicated he’s looking for a piece of the action too. [Continue reading…]

Over two years of operations, TelexFree has employed multiple financial accounts, including domestic and international bank accounts and various online payment processors, to facilitate the fraudulent offer or sale of securities in Massachusetts. Almost all financial institutions have terminated their relationship with TelexFree after only a few months of business. Recently, frantic emails between TelexFree [Continue reading…]

To the best of my knowledge there are four claims and allowances matters that are going to be heard next Tuesday. Alvarez and Marsal initially wanted $876,463.72, Greenberg and Traurig initially wanted $1,044,813.95, Gordon Silver want $230,000 and Stuart MacMillan (interim CEO) is demanding he be paid $107,089.45 for expenses and services rendered. Following negotiations with the [Continue reading…]

In an effort to strengthen the criminal case against TelexFree’s owners, the Department of Justice requested a stay on discovery in the SEC’s civil case. The DOJ reasoned that without a stay, Merrill and perhaps Wanzeler – charged in both actions – would use the civil discovery process in a manner that impairs proper administration of [Continue reading…]

As Carlos Wanzeler fled the US and his partner James Merrill prepared for another day of denying TelexFree was a Ponzi scheme, the FBI, Department of Justice and Homeland Security raided TelexFree’s offices and ‘a local business that maintained TelexFree’s servers‘. Federal law enforcement seized various assets of TelexFree, including servers used by TelexFree, about [Continue reading…]