SEC file for lift of stay in TelexFree civil case
Although the SEC was the first US regulator to move against TelexFree, subsequent criminal proceedings filed by the DOJ saw civil proceedings stayed.
In support of their filing, the SEC state;
On April 20, 2017, DOJ filed a status report disclosing that Merrill has pled guilty and had been sentenced to six years in prison.
At this time, Wanzeler is still a fugitive in Brazil.
On June 23, 2017, DOJ filed a status report disclosing that Merrill has reported to prison.
The Commission has consulted with lead counsel for DOJ and he has no objection to lifting the stay in this case because Merrill has already been sentenced in the criminal case.
Moreover, Wanzeler is still a fugitive from prosecution who appears to be living in Brazil.
Under Brazilian law, because Wanzeler is a Brazilian citizen, DOJ has no present ability to extradite him from that country.
The Commission has also contacted counsel for the remaining defendants as to whether they object to lifting of the stay of discovery.
Counsel for TelexFree, Inc. TelexFree, LLC, TelexFree Financial, Inc., Faith Sloan, James Merrill, and Joseph Craft have no objection to the lifting of the stay of discovery.
Counsel for Wanzeler expressed no opinion.
Counsel for Crosby and De la Rosa provided no response.
A subsequent non-opposition notice by Randy Crosby’s attorney was filed on July 5th.
If the motion is granted, the SEC will be able to resume discovery against named defendants for whom civil proceedings have yet to be resolved.