TelexFree abandon USD, now issuing “credits”
In Zeek Rewards, affiliates invested real money which the company then exchanged into “VIP Points”. VIP Points were an inhouse virtual currency that was used to manage affiliate ROIs and re-investment.
1 VIP Point was claimed to equal $1, until the SEC stepped in and shut Zeek Rewards down for being a $600+ Ponzi scheme.
One of ultimate wake-up calls for Zeek Rewards investors who remained in denial about the value of their points, was a statement the court-appointed Receivership issued in March of 2013:
The receiver has determined that because the VIP points aspect of the multi level marketing program did nothing more than redistribute funds between affiliates in Ponzi-scheme fashion, points generated by/or accumulated by affiliates will not be an includable part of an affiliate’s claim for purposes of receiving a distribution from the Receivership Estate.
And just like that, the millions of points Zeek investors had generated via re-investment of their issued points and hoarded away, were reduced in value to $0.
Nothing. Nada. Zilch.
Whether they’re using the Zeek Rewards business model as an instruction manual or not I can’t say, but guess who just started issuing their affiliates “TelexCredits”?
Sometime over the last few days TelexFree removed what was previously a USD amount shown to represent an affiliate’s weekly ROI, and have replaced it with “CR”:
CR stands for credit, with TelexFree converting all not-withdrawn funds to the new credit system. All future AdCentral ROI payouts will also now be issued in credits, as opposed to USD.
Thus far no official announcement has been made, leaving TelexFree’s investors wondering why they’re being subjected to yet another hastily pushed through change they were given no warning about.
As it stands now, apparently 1 TelexFree credit is equal to $1 USD – but as was demonstrated in the Zeek Rewards aftermath, a Ponzi’s inhouse virtual currency is worthless outside of the scheme itself.
And it doesn’t require an SEC Ponzi shutdown of TelexFree to change the value of the issued credits either. There’s nothing stopping TelexFree themselves changing the inhouse value of their credits as the please.
Why would they do that?
Although no official statistics have been released, TelexFree affiliates commonly cite an estimated four million AdCentral investment positions being held with the company.
At $299 each, this represents a raw dollar investment of $1.19 billion USD.
Sounds impressive, until you consider the ROI liability upon maturation of each position collectively is $4.16 billion (4 million * 1024).
Clearly that’s money TelexFree doesn’t have. And, not withstanding any new investment will only add to their liabilities, due to the new compensation plan changes, going forward it’s unlikely they’ll raise anywhere near the required amount either.
Make up some crap about “regulatory requirements” and bingbaddaboom, all credits are now worth 5 cents. And before affiliates with the most to lose chime in with “they’d never do that”, it’s worth noting that up until a few days ago, you were probably running around telling everyone nothing would happen to your existing AdCentral investment positions too.
Simply put, it’d be a much bigger problem for the company going forward if TelexFree were to maintain weekly USD payouts (they can’t manipulate the value of the dollar).
Despite some affiliates claiming the recent changes are the best thing to ever happen to them, and others treating it as a one-time fee to withdraw at the end of a 52 week AdCentral “contract”, the bottom line is TelexFree as a passive investment opportunity is much less attractive now than it was.
This means new affiliate funds by way of investments are going to, if they haven’t already, come to screeching halt.
With affiliates who have large amounts sitting in their backoffices looking to withdraw their funds one way or another (and refrain from re-investing any of it back into the company as they’d previously done), this presents a substantial cash-flow problem for TelexFree going forward.
Top affiliates can bite the bullet and purchase two additional affiliate positions and 30 VOIP accounts to withdraw their money, but for your average passive investor it’s just not viable to pay up the money TelexFree is now asking for.
With full access to their company-wide accounting reports, management know full-well they’re steering TelexFree towards the inevitable “we don’t have enough money to pay everyone out” scenario. And that’s only if US regulators don’t step in first and shut it all down.
Up until this last change I was entertaining the idea that all of these sudden TelexFree changes might be getting pushed through at the behest of private negotiations with the SEC.
I’m throwing that theory out the window now as there’s no way known they’d encourage the company to set up an inhouse currency and follow in the footsteps of Zeek Rewards. TelexCredits is obviously an initiative TelexFree’s own management have come up with (under Gerry Nehra’s legal advice or otherwise).
Why? If I had to guess I’d say it’s little more than a misguided attempt at good will in the face of the ongoing investigation. Misguided in the sense that, to date, pseudo-compliance has failed to get any Ponzi scheme off the hook.
TelexFree abolished the AdCentral contract renewal fee, only to later re-incorporate it under the facade of affiliates selling VOIP packages. I say facade because due to the lack of competitiveness of TelexFree VOIP, quite clearly it is expected that affiliates buy the newly required additional affiliate accounts and packages.
I haven’t done the exact math, but I suspect if one were to tally up the cost of funding all the new withdrawal requirements oneself and compare it to the previous 20% ROI tax, they wouldn’t be much of a difference.
With that going down like a lead zeppelin, they’ve now pushed through the converting of real money to TelexCredits. The real money invested (that hasn’t been paid out to top affiliates) is still there of course, it’s just now sitting out of reach in TelexFree’s bank accounts.
It’s much harder to argue TelexFree stole your money, or isn’t paying you what you are owed when they only issue TelexCredits. Nobody outside of the respective scheme itself ever treats or seeks to represent Ponzi points credits as actual money.
I am sure “investors”/affiliates will be overjoyed by this news (sarcasm). How many steps are left before self-implosion?
Possible excuses/steps in unrelated order.
DOS-Attacks.
We left on vacation for couple of weeks.
Looking for new payment processor because he have too much money.
New opportunities that you can not lose money.
Church of TelexFree?
Great writing oz! You got some stuff wrong, but it was a good writing. I told my leader that the game is over and he insisted that I am wrong.
However, the Brazilian community (backbone) in framingham, Marlboro and other towns knows that is over and nobody is going in anymore.
@ Boris, funny you said that because my brother did leave for two weeks and while he’s been gone the news have been the most interesting ever…bam, bam and bam!
I feel bad for him in a way because I’d really hate to see him getting in trouble with the authorities but at the same time I have warned him and listen to this, My mom told me he was complaining about me because I was wishing him bad instead of being proud of his success with the “company”.
I’m not saying anything anymore. But I really wish he is not so high up the food change so he walks out of this one untouched.
He simply need more TIME to adjust to the reality. He must first go through the process of 42 hour hunger strike etc. before he’s completely adjusted.
Some of them will join “reload scams” / other programs, just to keep their downlines intact. That idea will usually not work very well, those programs will usually be short lived recruitment schemes or plain frauds (just to separate between different TYPES of frauds).
So, how do they get their money back? What’s the transaction to change the credit to cash?
Transaction back to cash is done at TelexFree’s end, but only pending a withdrawal request.
This way affiliates can’t say “waah TelexFree owe me money” when they lodge complaints at their local Attorney General’s Office. No AG will take them seriously if they complain about monopoly money credit points they are owed.
I believe that’s the reason behind this change. TF fires off “we only gave them points, they can convert points to dollars but they have to get qualified first” replies to the authorities, and hope that will shield them from the inevitable barrage of complaints from their passive investors.
They can also claim credit points have no value, which is of benefit to them as well. Let’s face it, right now the only value pegged to a TelexFree credit point is “*wink wink, nudge nudge* 1 credit is equal to $1”. Good luck getting that in writing from them.
TelexFree can’t even put out official compensation plan documentation for a plan they released nearly a month ago now.
So really, it’s a way to stop the cash bleeding out?
Since this is such an un original idea I think the SEC would see right through it. Brining this baby down is going to be a fabulous feather in Galvin’s hat.
I still have faith in the IRS coming in as back up singers. 🙂
The required 5 customers plus 2 downlines with 5 customers:
Doesn’t that translate to 15 VOIP X $49 = $735 in order to withdraw the money at $1000 a day?
TelexFlop affiliates will no doubt claim yet another victory for their scheme. This will hopefully get the feds off their backs for good.
Fortunately, I don’t think so.
I thought all of you will be met big issue in the future when it will have shut it down. How is be able to go on forward ….
how can it be able to run it down?
What about TelexFree 1099 tax statements to US citizens?
@ HS
According to the video of the disgruntled affiliates that mobbed the headquarters in Mass. they still hadn’t received them. Of course in Telex style they gave them an email address to contact about it. Apparently the site is out of order since they’ve been giving that out for weeks now.
Tax deadline 5 1/2 weeks away. Tick, Tick, Tick
You said:
Yes, believe you are 100% correct in this. Telexfree management said because SEC, and this was repeated by affiliates.
More likely, because they are running out of money IMO. Because nobody wants the new plan as they gobbled up old plan before it closed on March 9, 2014, meaning nobody requesting to be paid for long time, instead using credits to buy more. Then after March 9 – old plan deadline – everyone requests payment and shortly afterward Telexfree effectively blocks almost all payments.
It’s the money (or lack there of).
My contracts where almost at their year end and expected every pay week to be the last. I watched in amazement many horde more old contracts, wondering why it didn’t occur to them where the funds would come from to pay their contracts?
Thank’s Dorothy, but the final day was 04/04/2014 (Steve Labriola said)!!
I stand corrected. : )
hmmmm I wonder if the Telexfree office is open on Saturday’s? Hopefully not for their sake. This news may instigate another visit from the locals. Then again there’s always Monday.
Give some time over the weekend to paint those protest posters. May be time to use up some of those vacations days Steve and the 7 employees.
It has been discussed here a few times between mid January and now. You can search (on this website) for “Howard Kaplan” to find some of the TelexFree threads (he has also been mentioned in Zeek Rewards).
Here’s 3 of the articles I found:
1. behindmlm.com/companies/telexfree/telexfree-lose-2nd-bankruptcy-case-costa-rages/
2. behindmlm.com/companies/telexfree/telexfree-acknowledge-sec-investigation/
3. behindmlm.com/companies/telexfree/telexfree-affiliates-storm-office-staff-trapped/
(From memory)
#1 was about that we expected some problems (January), an early warning about the upcoming problem.
#2 has most details about correct tax method (based on Zeek Rewards). Early March 2014.
#3 is from late March 2014.
If you haven’t received a 1099 until now, you probably won’t receive any either. But you will still be responsible for reporting your taxable income (if it’s more than $600).
SHORT SUMMARY
* taxable income = money paid OUT from Telexfree in 2013.
* potential deductions = money paid IN to TelexFree in 2013.
* internal transactions to/from back office isn’t about money
* transactions to/from e-Wallets are about money
Steve Labriola apparently is “very excited”. See if you can keep your face straight while watching his latest update:
I just saw the English news update… too bad it’s little more than a rehash of those spammy eRelease “press releases”.
In summary,
“Hay guys, last month we forced our affiliates to buy VOIP packages if they want access to their money. ZOMG so now we have eleventy billion customers! Totally legit!”
Let’s hope future English updates are a bit more useful.
OMG!!!!! lol. That video is going to blow up this blog…lol Way to many things to talk about. : )
Let’s start with there were 23 views on it. Ok, so minus me because I”m not a Texie so that makes 22.
Probably more of us BehindMLM loyalist’s watched it then the Texie’s did. lol.
Hahahah, around the 5 minute mark he goes on about “media articles” being printed by “the media”.
Lol! TelexFree pay a PR company to spin some BS articles, absoltuely spamfuck the internet with them (by uploading them to every conceivable press-release spam site they can find), and now that’s being sold as “the media are writing about us”?
Cmon Labriola… that’s such a blatant misrepresentation of what those articles actually are, who wrote them and why they wrote them.
I’m not going to do a separate writeup because it’s too short, but this is the key thing to take away from the Labriola video:
The SEC are now presumably going over this information, while TelexFree do everything they can that they believe will soften the eventual blow.
I still maintain that when the SEC are done investigating and going over the “documentation”, TelexFree are going to get nailed for the Ponzi scheme they’ve been running since 2012.
How long before the SEC pull the trigger is the million dollar question, but in the meantime it’s clear that there’s no negotiation going on between the two parties. Nor has the investigation concluded.
The latest changes to TelexFree’s comp plan have nothing to do with the SEC, the company is being proactive in areas they know they are going to get nailed in.
They are waiting to see what the SEC do, just like the rest of us are.
Oh and they just uploaded an English version of the Costa “best investment strategy” video too:
And they’re gonna PR spin this by saying “Costas is not in the US and thus not subject to US laws”, IMHO, of course.
What is IMHO?
In My Humble Opinion
I am aware the value earned turned into credit today; however, can’t the AG still be bothered with this issue from investors? I mean, can they actually show convert true money owed into virtual credits?
They have probably changed legal advisor, and are trying to “neutralize” investment terms rather than trying to avoid them.
We may potentially use the same method as part of a legal defense system. WORDS are not illegal in themselves, i.e. the use of the word “investment” doesn’t make a business model becomme illegal. It’s about HOW you use it rather than about the word itself.
How you use it can be about quite normal uses, or it can be about intentions to deceive, intentions to defraud, defamatory intentions.
Active use of a word is a far better strategy than trying to avoid using it, e.g. the word “pyramid scheme” have been used here so often that it can’t be considered to be defamatory.
“Defamatory intentions” is not the normal use here for any of the words and expressions SOME people may feel are defamatory. It’s simply about “normal words and expressions, commonly used in normal communication when people are discussing MLM programs”.
I’m pretty sure someone have pointed out that Gerald Nehra’s pseudo compliance ideas often sound like “constructed defense ideas”, that they sound like something from his personal belief system rather than something that can be used in court to defend a company. I have pointed it out several times. 🙂
The thing is that before 1 credit = 1 dollar because instead of credits they used dollars as their currency. That means that if you complained that they owe you x amounts of dollars it was easy to prove.
Now they use “credits”, credits does not imply any monetary value. It’s an inhouse currency that can mean whatever TF wants it to mean.
It may be 1 dollar today, it could be worth less tomorrow or they could even convert it into something that can only be used to buy VOIP.
What?
I don’t see how this placates either the enforcement agencies or the affilites. Its too dopey.
It doesn’t at least I hope it doesn’t.
It just makes things more confusing and tries to hide the fact that they’ve been passively paying real money for not real reason.
Renaming it to “Credit” doesn’t change anything in itself. Payouts to the back office has always been about “monopoly money” / “non-monetary transactions of internal currency”.
The important part is about how the “monopoly money” has been used, e.g. if it always have been an internal reward system that ONLY could be used internally, or if it could be withdrawn as cash.
People can complain, e.g. “My initial contract promised effectively $20 per week per AdCentral (through the constructed system described). I was able to withdraw the payouts to my e-Wallet account, and from there to my bank account via wire transfer or check (etc.). That system have now dramatically changed (describe the details). I’m not satisfied with those changes, and want … (describe what you want)”.
The idea is simply to DESCRIBE how the contract have been enforced, describe the changes, tell them why you’re dissatisfied with the changes, ask for it to be corrected back to how it was, ask for an explanation, mention refund as a potential solution.
Dollar for dollar affiliates might have a claim when a Receivership tries to work out what everyone is owed. Credits will just be dismissed as being worth nothing, just as they were in Zeek Rewards.
I think somebody at TelexFree HO has it in their head that this money might be coming out of their backpocket.
Complain to whom ??
I certainly hope you don’t mean the ponzi / pyramid operators themselves.
The only hope victims have now is that law enforcement DOES become involved and a receiver is appointed, otherwise the money is long gone, never to be recovered.
Payouts to the back office have NEVER been about real money. TelexFree isn’t a BANK, and the back office isn’t a bank account. It won’t BECOME a bank either even if they put currency signs in front of some digits.
Your own brain have tricked you. It will believe what the eyes can SEE, and it will fill in most of the missing details from previous experience and knowledge. Around 90% of the information used to interpret what the eyes can see comes from the brain itself.
Ponzi schemes are about ILLUSIONS, about illusions people can be willing to believe in. If you add some “bank like” or “merchant like” functions to the back office, most people will BELIEVE they’re looking at real money.
If you add a “work like” function to the investment (e.g. posting 1 ad per day), people will believe they’re being paid for the work.
I did mean that, but for a different purpose than you thought it was about.
As a consumer, you will first need to complain directly to the other party. You will need to INFORM the other party about the problem and ask for a correction to it. The other party has the right to offer corrections (e.g. refund).
It’s simply a NECESSARY “initial step”. It should be used to give a factual description of your side of the story with all important details, and to ask for a RESPONSE within reasonable time.
@ Dorothy
How about 1099 for the 95% of the affiliates that are illegals in US? That will not fill any tax anyway?
Why on earth would anyone use normal consumer complaint protocols when “the other party” is a billion dollar plus fraudulent operation which has been labelled as such by multiple agencies in multiple jurisdictions ??
As M_Norway said. Until TF has been declared as a scam and gets shut down, affiliates and clients must follow the proper channels to file a complaint.
If they refuse to comply, then you can raise your complaint to a higher level which at the same time will make it more apparent for regulators that TF is a scam.
There’s a difference between understanding that TF is a scam and having enough proof and information to shut it down. And these complaints may serve as a reference of how things used to be.
But things were never “as they used to be”
Things may have “appeared” to be as Telexfree said they were, but, they sure as h*** weren’t.
Dear Telex, My VOIP does not work as advertised is a consumer complaint.
Dear Telex, Ponzi dollars in my ponzi back office have been converted to mud pies and I want a refund on my ponzi investment is not.
Talk about an illusion!
I applaud your methodical approach to this but as a practical matter it seems merely ritualistic. Telexfree is 1.) not going to read your letter 2.) not going to make a meaningful response, and 3.) the enforcement agencies are already in the building.
What value does another complaint have under such circumstances? Tekexfree is already on the radar. The SEC inquiry, the Brazilian injunction, Rwanda, the rule changes, the mob scene all point in the same direction.
I thought Labriola had lots to talk about getting a hair implant or new hairpiece on his head with all that TeleFluke money he’s getting.
None of that relieves Telexfree from its responsibility.
Hair loss is no laughing matter. Sunburn is for real.
I have already identified it to be for a different purpose than you believe it is. It’s a necessary legal step.
The party must identify the dispute correctly to the other party, e.g. that there IS a dispute and what the dispute is about. It’s a method to identify the facts in the case, to summarize and organize the facts.
Check what the posts were about before derailing into details. We have already had way too many derailed discussions about details. Check posts #27, #29, #33, #36 to get the context.
Post #27:
Post #29:
Respond DIRECTLY to one of those 2 posts, rather than derailing into some details? If you want to respond to details, then you must first identify the correct context.
Post #33 (first part of it):
Post #33 was my response to post #29. You may find something to add to the context yourself. Respond to what the discussion was about rather than derailing from that context.
“People can complain …” was mentioned in that post, vaguely describing a complaint method.
Post #36 (first part of it), a reply to post #27:
Regretfully it can relieve it from some of their responsibility. US GOV Reciver may underestimate size of the ponzi is sizable portion of victims choose not to report it.
Also if a lot of “investment” came from Brazilians opening US accounts illegally, it is possible they will not be eligible for refund.
Please identify the correct context first before derailing into details.
Post #33:
Post #33 has a vague description of a consumer type of complaint. “Consumer type” is about what you can expect from a consumer, they should first contact the other party directly before trying other types of legal actions.
You guys at it again? (Hoss vs. M_Norway)
There are two different narratives here:
a) assume TelexFree’s previous agreement is valid and should be honored
b) assume TelexFree is a scam and previous argument is not worth the paper they’re printed on
The two viewpoints are mutually exclusive, but both should result in shutdown of TelexFree if you take each to their obvious conclusion.
I know exactly what your purpose was, and the steps you described make sense in a garden variety consumer dispute…which this is not…so if you want to haggle over refunds you should go to Macy’s.
You find a need to document and demonstrate that “the consumer” has made a good faith effort to resolve his dispute prior to making a legal demand. That is a waste of time in this case for one or both of the two following reasons.
1. The Telexfreeconsumer/investor is never going to be in a position to enforce his interpretation of the contract regardless of how he feels about it, and
2. The terms of the contracts are moot if the enforcement agencies shuts this thing down under security laws.
Guys forget about Consumer Complains. It works only if you paid recently by credit card or other payment company that can enforce charge-back or if you are dealing with legitimate company that has something to loose. Obviously not the case with ponzies.
So your only recourse to save all proof that you send real money to Telexfree and wait until SEC start the process.
Right.
If the SEC finds this is an illegal scheme the provisions of the affiliate’s contracts are 100% irrelevant and moot. Nobody will need to prove they made a good faith effort to resolve the contract issues under such circumstances.
Amen. Consumer complaints have nothing to do with this. As an aside, you may recall that Telexfree in Brazil was issued an injunction based on an initial assumption that it was a consumer issue, but the judge ruled that it was not.
It seems Telexfree isn’t the only one getting a public relations face lift. Steve Labriola is too.
Gone are the sweater vest and khakis and the off the top of his head gibberish replaced with suit and tie complete with a pre written organized speech delivered in a controled methodical tone. Like his Brazilian counter part Carlos Costa he too gets paper props to shuffle about as he speaks.
The backdrop of our staged video is a snappy office complete with strategically placed awards Steve presented to himself from himself. The costume was poorly chosen. I feel the tie would have been more appropriate and cheery if it was Telexfree blue.
The shade of green tie that was chosen conjures images of sourness and pea soup. Not to mention the never ending Kermit challenge for a bald guy who if we painted him green….well you get the picture.
Last but not least, in the spirit of Telexfree’s history in visual manipulation and propoganda. On the side of the video is streamed logo’s from what is to represent legitimate news outlets while Steve talks about positive articles that have been written about Telexfree. What he neglects to tell his listeners is that the company paid for those articles to be written and spammed all over the internet.
Does any one else see the irony in the affiliates money going to pay a company to produce propaganda designed to brainwash them?
Nope, I’m trying to PREVENT it from derailing.
I used the idea “LEGALLY assume” rather than “realisticly assume”. I didn’t specify it, but I actually used that idea.
Realisticly speaking, TelexFree is a Ponzi scheme and will most likely be shut down by authorities. But you can’t use that logic e.g. to avoid reporting taxable income or to avoid acting correctly yourself.
Legally speaking, TelexFree hasn’t been shut down yet. Predictions about the future may become true, but you can’t base a legal action on predictions.
You can LEGALLY assume what you’re able to identify as facts. You can’t include any predictions. You must act like a consumer trying to handle a consumer situation rather than as a Ponzi scheme victim trying to handle a Ponzi scheme situation.
The context of Labriola’s video is to say the least…. disturbing, but I found two issues that particularly stood out for me.
One, he spoke of just having returned from Hong Kong.
Second, his obviouse, careless and idotic downplay of 97% of all 1099’s being delivered. It was probably a random number pulled out of his a** but in his widsom does he realize for every 100,000 of his sub contractors that means 3,000 1099’s have not been delivered?
So, let’s get this straight, he and the brains behind choosing the content of the script thought announcing publicly that thousands of 1099’s have not been delivered as though saying 97%went out was acceptible and his industries standard?
I can hear it now… “Well Mr. IRS agent. 97% went out. What are you looking for, Perfection?”
The total disregard for law that these guys display is incomprehensible.
You should probably have addressed that issue DIRECTLY to comment #27 or #29, e.g. “I believe a consumer type of complaint will be the wrong type of action. I believe the right type will be …”.
My suggestion focused on identifying the situation as it currently IS and HAVE BEEN. I identified it as an immediate dispute about changes in terms and conditions, which negatively will affect the individual consumer. A refund is one of the options.
The MAIN PURPOSE was to establish the facts in the case, e.g. identify that there actually is a dispute about the changes. I also identified it to be a necessary legal step, necessary in case people want to file other types of complaints.
Your suggestion have focused on that TelexFree offered illegal investment contracts, and that “wait and see” will be the best method? In your scenario, an upcoming shutdown will establish the facts (other types of facts). You didn’t identify any immediate dispute about the changes.
Nobody suggested that persons should not report income.
That’s correct, this has nothing to do with consumer warranties and by all appearances Telexfree does not have the wherewithal to meet their obligations under the investment contracts.
I don’t think this is something that indivual’s are going to be able to sort out on their own.
I dont know what all those people were complainting about at the Telexfree office, they all knew what they were getting into before they sign up for telexfree.
i just cant believe that with so much information out there anyone can say that they did not know it was a pyramid squeme. Shame on those so called Cristians and church leaders that were using their churchs to sign up people.
Silvia, i am an investor myself and not complaing, just tired of the on-going manure these people at TF are throwing around.
1. 1099’s will be forth-coming
2. ROIs to be paid according to initial sign-up contract
3. Dollars in TF are now represented in credits.
Eventhough I was making money every week, prior to the new plan being forced onto every investor, I was at a crossroads where I still preferred to have the SEC shutdown TF just plainly to having been manipulated.
@haste…. Even tho SEC shutdown means they can take back the money you got?
Right.
Have you ever seen the contract these people entered? Based one’s I’ve seen these “companies” reserve full discretion to themselves, which includes the suspension of payouts and changes to the comp plan.
@Kevin. Sure. All $800 is frozen in telefree acct since it wasn’t transferred to eWallet.
@Hoss
There are some other types of legal actions people can use, e.g. complain directly to the SEC. But the correct method is normally to complain to local state authorities before complaining to federal ones.
I have suggested a consumer type of complaint as one of the options. People can skip “Step 1” if they like to and go directly to other legal actions, but I’m not able to identify what those actions should be about.
People have already tried to meet up at TelexFree’s office to complain directly. That resulted in the police being called to order them off the property. “You can’t meet up here directly as a group of individuals to complain about something. You will need to get organized and find more proper channels”.
The policeman suggested using a lawyer to represent them. My suggestion was relatively similar to what a lawyer can be expected to do as a “Step 1” in a legal action.
People must identify the problem correctly before they can find solutions to it. That’s where most people will fail, they will identify it how they see it themselves rather than how it really is.
You suggest to identify the issue right from the beginning as something they can’t resolve personally (or contribute to), they will need to wait for regulators to resolve it for them?
“The regulators will come up with solutions to it”. I’m simply using different types of ideas than you use.
“The correct method” ???
According to whom ??
“normally ???”
What is “normal” about a billion plus dollar international fraud ??
For goodness’ sakes, man, it’s a billion dollar international fraudalready under investigation by the SEC, why on earth would anyone go to a local authority ???
I picked it up on one of the official government websites, or maybe on a lawyer’s website.
There’s two levels of regulators, STATE or FEDERAL. Most individual consumer disputes belongs to the STATE level. People should look for methods LOCALLY first.
The post wasn’t about the fraud as a whole, but about a specific part of it.
Note that I have used a much wider definition for “consumer dispute” than Hoss did. I have identified the current issue to be a consumer type of dispute.
Actually tons of sake. As soon as one state AG calls scheme a fraud, other would follow withing week or two. This causes SEC too speedup investigation and divert more resources to it.
Their contract states that they can change the terms as they wish. No use crying, read the terms.
I have only vaguely identified “correct method”, and I can’t guarantee that is the correct logic either. People will need to involve their OWN brains when looking for methods.
* I identified the TYPE OF DISPUTE to be a consumer type, and tried to identify the first legal step for that type of dispute.
* Hoss identified the TYPE OF CONTRACTS to be about investment contracts = not a consumer type of dispute according to his definitions.
* You identified the TYPE OF FRAUD to be about a billion dollar international fraud already under investigation by the SEC.
The discussion was probably about how the people affected by the recent changes should respond to those changes.
* should they handle it as consumers?
* should they handle it as investors?
* should they handle it as victims of an international fraud?
The terms “correct method” and “normal” were of course related to the definitions I used.
That has already been brought up in another thread by Rod Cook.
Contracts are regulated by contract laws and other laws. You can’t include terms that are illegal in themselves, or use terms that are legal in themselves in an illegal way.
A “general clause” can only be used to regulate minor issues. You can’t use it to change the meaning of the contract.
There’s HUGE differences in how people will interpret the realities, e.g. “Should we look at the contract or should we look at something else?”. If I had been negatively affected by changes in a contract, I would normally have looked at “something else”. I looked at consumer disputes as a potential method.
Well, we know that at least one state AG has already questioned Telexfree’s activities MORE that a couple of weeks ago (Massachusetts where the company is domeciled,) and the SEC is already involved. We also know that the Brazilian Prosecutors Office has been in contact with US Federal authorities.
I don’t know about you, but it appears to me that this has already been escalated.
Conceptually I do not get how filing a complaint with a local BBB, or consumer ombudsman, or even an assistant DA at this point is going to induce the SEC to work faster and allocate more assets to its current investigative efforts. This is already national if the SEC is involved, and heck, for that matter its already international.
However, if someone feels the need to go down tomorrow morning and file a complaint with the Better Business Bureau it won’t do any harm.
Silvia, i am an investor myself and not complaing, just tired of the on-going manure these people at TF are throwing around.
1. 1099′s will be forth-coming
2. ROIs to be paid according to initial sign-up contract
3. Dollars in TF are now represented in credits.
Eventhough I was making money every week, prior to the new plan being forced onto every investor, I was at a crossroads where I still preferred to have the SEC shutdown TF just plainly to having been manipulated.
You knew it was a pyramid scheme before you give them your money, all telexfree managers knew that it was a pyramid scheme, now it is just time to deal with the true you can only lie to yourself for so long you know.
the truth is the money is gone, all those tf managers are going to get out of this rich and u if u made money good if not too bad. Everyone knew the risks
@Silvia?
That’s what I said… Although risks were high, there was much hype and I bought into it; regardless, it’s the people that make it frustrating to me. I have asked if they feel bad of having people join, most say they do not, because they tell them ‘make sure you perform research and this is what you want’.
So I ask, you don’t tell them the truth about it being a pyramid and SEC/IRS intervention? They state I just tell them what they want to hear… It’s an investment that will triple your money in a year, you must disclose earnings on your annual tax returns, you may deduct any expenses (meetings, dinners, vehicle, etc…) because it’s a job, and you have to post ads’
These people are out there to make a quick buck and many of times, take advantage of friends, family, neighbors, etc… I do get told that if one does everything morally correct, that one will never get financially ahead in country.
All is based on lies so they go with what works. Although this seems true, I rather be good with the one above.
I had mentioned these investments to several friends, but then told them to back-up and explained it all to them. Once I told them of what I knew, neither joined and they thanked me for telling what I knew even if they didn’t ask of all ramifications revolving TF.
So I have no remorse, I did manage to barely get my investment back, with losses currently in my TF acct since I do not plan on re-investing to keep them alive and get 10% back of what was already mine per initial contract.
Well I have a “friend” Telexfree promoter that didn’t really promote anything for months, she’s in it with alot of money. With the recent changes now she is promoting (has to) but telling anyone who wants to listen that they don’t have to sell anything, literally saying “the franchise price includes all the software the company forces you to buy” ¡¡¡!!!
Clearly, she know this is a Ponzi, doesn’t care.
Will all of the Telex credits disappear in the US bankruptcy?
There is no US bankruptcy and until the owners have sucked every penny they can out of this business and into their own personal accounts they will not voluntarily file for it.
Whether TFree enters bankruptcy or receivership involuntarily or voluntarily the outcome will be about the same. Telex credits will not be recognized.
Yes, all payouts to the back office will disappear. All money paid from TelexFree to e-Wallets will be frozen. All money stored in TelexFree debit cards will be frozen.
Your friend is a Scammer.
Then she’s an accomplice, instead of merely a participant/victim.