For affiliates who invested in TelexFree, the current situation is a bonafied mess.

Little to nothing has been officially communicated to affiliates, with the roadmap of fund recovery a murky minefield of uncertainty.

I’ve tried my best to analyze and cover what’s happened on the legal front, but short of predicting an inevitable Chapter 7 liquidation, at present have no idea how long this is going to take. Or more importantly, what the alternatives are.

We know the court-appointed Trustee isn’t interested in perpetuating the myth that TelexFree was a legitimate business, but he’s been rather quiet of late. And paradoxically representing the best interests of TelexFree as an estate, hasn’t to my knowledge communicated anything formally to the company’s investors.

Quick to file applications demanding millions of dollars be paid to them for services rendered to assist TelexFree in dodging financial liabilities to affiliates via bankruptcy filings, Alvarez & Marsal North America, Greenberg Traurig and Gordon Silver have together requested $5.64 million in expenses.

Not happy with the possibility of funds being released to these firms, a group of ninety-four TelexFree affiliates have formed what they’re calling an “ad hoc committee”.

Led by counsel at Brown Rudnick, these affiliates are now seeking a rejection or temporary suspension of the reimbursement claims. [Continue reading…]

After suing tax attorney Howard Kaplan for legal negligence back in June, the Receivership received a Motion in Opposition a few weeks back.

In it, Kaplan trotted out the familiar “I knew nothing and therefore can’t reasonably be expected to bear any responsibility” argument we’ve come to expect from lawyers in the industry.

Prior to the Zeek Reward’s Receivership’s targeting of legal insiders in the $850M Ponzi case, MLM attorneys have seemingly operated under the assumption that they are untouchable.

Kaplan argues that despite his wrongful conduct he is effectively immune from liability because the court appointed Receiver for the company cannot bring claims against him.

Ignore the fact that even the most basic of due diligence would reveal the company in question to be fraudulent, provide whatever legal services are requested, collect your fees and then get out.

Scheme goes down for being one of the largest MLM Ponzi schemes in history?

Play dumb.

Not having a bar of it though is the Zeek Rewards Receivership. And in his response to Kaplan’s opposition, the Receivership bluntly calls out Kaplan on his professionalism.

Or perhaps more accurately, the lack thereof.

Howard Kaplan is an attorney who was hired by RVG to provide accurate legal advice to RVG concerning tax matters.

Instead of fulfilling this important fiduciary duty, he gave RVG bad legal advice and actively participated in promoting a Ponzi and pyramid scheme that caused RVG enormous harm.

…and that’s just the opening paragraph. [Continue reading…]

5Linx launched in 2001 and operate out of the US state of New York.

Heading up 5Linx are co-founders Craig Jerabeck (President and CEO), Jeb Tyler (Executive Vice-President of Marketing) and Jason Guck (Executive Vice-President of Sales).

5Linx would appear to be Jerabeck’s first venture into network marketing, with his 5Linx corporate bio revealing a history in telecommunications:

Formerly the President/CEO and founder of @Wireless Enterprises (1997 – 2004), a franchisor of wireless retail stores. @Wireless operated 78+ stores in 11 states.

Prior to @Wireless, Mr. Jerabeck founded Cellular Unlimited Corp., which owned and operated 23 shopping mall based retail stores in NY, MA, RI, NJ, DE and FL.

Cellular Unlimited was the largest independent retailer of cellular phones in the Upstate NY region in the 1994 – 1997 period. Jerabeck sold Cellular Unlimited in 1997 to a national wireless retailer.

Earlier professional roles include two years as the General Manager of Cellular One (later Cingular) in Rochester, NY and eight years with AT&T in sales and sales management.

On the regulatory front 5Linx appear to be in the clear (at least publicly), which is notable for an MLM company that launched thirteen years ago.

Read on for a full review of the 5Linx MLM business opportunity. [Continue reading…]

Global Coin Reserve launched in mid 2014 and claim to be located in the US state of Texas.

The company operates in the crypto-currency MLM niche, and is headed up by CEO Robert Corriveau.

Corriveau (right) seems to have been involved in the MLM industry for a number of years. Back in 2010 he launched an affiliate recruiting platform called “3Locity MAX“:

With most MLM compensation plans – in order to make it to the top, they require you to enroll a significant amount of personal recruits in order to make any type of significant income.

With the 3Locity MAX revolutionary computer software program you will end up with multiple personal sponsorships from enrolling ONLY 3 people. The system propels you into 3 revenue streams over the course of your first 30, 60 and 90 days.

MLM Insiders searches the globe – and researches a variety of MLM, direct sales and affiliate marketing programs to find compensation plans that produce the biggest returns – the FASTEST. The group only works with programs that are designed for the masses that will payout FAST.

“In order to have rapid duplication, the average person has to make money within their first 30 days” stated Robert Corriveau.

“What propels this industry into momentum the fastest is when people are making money. It’s that simple.

So what we do is find programs that pay people the most amount of money for the least amount of start-up costs and the least amount of recruiting.

What makes our new program so unique is that from a low ONE-TIME out of pocket start-up cost – marketers can now experience the benefits of 3 streams of income FAST.

3Locity MAX will break sales records and income records like you’ve never seen before”.

3Locity Max appears to have been a downline builder (feeder) for various recruitment-driven schemes Corriveau was in (there’s no mention of retail anywhere in the marketing copy used to advertise 3Locity MAX).

When exactly 3Locity MAX was shutdown is unclear, however the software is no longer for sale.

In early 2011, presumably after 3Locity MAX imploded, Corriveau went on to launch his own recruitment scheme, Fortune 2×2.

Fortune 2×2 saw affiliates receive commissions for recruiting new affiliates into a series of 2×1 and 2×2 matrices. It flopped shortly after launch and was quickly relaunched under the new name FortuneDWB.

Responding to criticism of Fortune 2×2 and Fortune DWB on the RealScam Forum, Corriveau wrote:

My name is Robert Corriveau, CEO of FortuneDWB, and I would like to reply to all the comments on this thread. First and foremost FortuneDWB is NOT A SCAM.

Now, normally I would just overlook all this because it is based on nothing more than someone having too much time on their hands and think they know everything, when in fact, they know nothing.

I know and feel that FortuneDWB is going to be a great company where many lives can be changed for the better and that through FortuneDWB we are going to be able to help thousands of people around the world better their lives with the charities we are working with.

That is all I can say because I’m sure the people that adversely have way too much time on their hands will just see this as a plug to take a better look at FortuneDWB.

Robert Corriveau
CEO/FortuneDWB.

I’ve only quoted an excerpt of Corriveau’s reply above, however at no point did he address the recruitment-driven nature of both his company’s compensation plans.

By mid-2011 FortuneDWB had collapsed.

Corriveau then went on to launch Moringo Organics in 2012. I haven’t reviewed the company in detail but at a glance (mymoringo.com) it appears Moringo Organics might be legitimate. A refreshing change at least from Corriveau’s previous matrix schemes.

Unfortunately website traffic analysis reveals Moringo Organics to be in decline, or possibly stalled. This is likely what has prompted the launch of Global Coin Reserve.

Read on for a full review of the Global Coin Reserve MLM business opportunity. [Continue reading…]

Future Global Vision (commonly abbreviated as FGV) launched in 2013 and appear to be registered in the US state of Nevada.

Credited as the CEO and President of the company on the company’s website is Raul Serrano.

The FGV website domain is registered to Serrano himself through “Future Global Vision Inc.” An address in California is provided, which is likely where FGV is actually being run out of.

Raul Serrano (right) does have a short corporate bio video on the FGV website, however nothing about his MLM history is revealed.

I did a bit of searching myself and turned up nothing. As such, FGV would appear to be Serrano’s first corporate MLM venture.

Read on for a full review of the Future Global Vision MLM business opportunity. [Continue reading…]

RE247365, otherwise known as “Relationship Energy & Services, launched in August and operate out of the US state of Florida.

Identified as the Founder of the company is Peter Jensen (also known as “PJ”).

I haven’t able to identify how Jensen got involved in MLM. His RE247365 corporate bio doesn’t offer up any useful information, and instead reads like a marketing pitch for the company.

Various marketing spiels from other opportunities in the past credit Jensen (right) with being ‘in network marketing for 15 years having sold software to mlm companies as well as been a top producer.‘

The earliest official association with an MLM company I was able to find was Jenson’s involvement as an affiliate in YTB Travel in the mid 2000s.

YTB International still operate today, but it’s a far cry from the company Jensen was involved in.

J. Lloyd “Coach” Tomer, his son Scott Tomer, and Kim Sorensen launched YTB in 2001 in Alton, Illinois.

Growth was slow until 2004, when YTB’s creators bought controlling interest in a related company, REZconnect Technologies, increased their marketing budget, and aggressively recruited new members with videos of successful salespeople.

In 2007, Royal Caribbean stopped doing business with YTB, describing the company as a “card mill”; an industry term for a business that provides perks that are intended for a limited number of travel agents to the general public.

In 2008 the company was sued by California Attorney General Jerry Brown. An out-of-court settlement required changes to the company’s business model, and generated a decrease in membership attributed to bad publicity.

In late 2008, YTB laid off 17 employees, a move that was part of a reorganization.

In 2008 the company’s revenues were $44.8 million. YTB said its independent audit at the end of 2008 expressed “substantial doubt about our company’s ability to continue as a going concern”, a sentiment the company itself later echoed.

In 2009 the company was operating at a loss of $1.9 million for the first three months of the year. Revenue in that quarter dropped 49% to $21.8 million and then to $18 million in the second quarter.

The company’s paying members also declined substantially in number, from a high in April 2008 of 138,000 to 60,414 in mid-2009.

It was around this time that Jensen left YTB. He then went on to launch his own MLM company, AMA Nation (America Approved Energy Services) in mid 2010.

AMA Nation is the marketing arm of Public Power, LLC based in Danbury, Connecticut. Public Power, LLC is a licensed electricity supplier providing service to tens of thousands of residents, businesses and municipalities in several states across America. (AMA affiliate marketing copy, July 2010)

A year later in 2011, AMA stole their affiliate’s customers and shut down their MLM operations.

Confirmed by several (former) top distributors. Seems the company lost $2 million and the management team did not want to put more money into MLM operations.

About 6,200 sign ups, 2,500 active distributors left in the dust. The company will keep the customer base but will not pay the distributors…..

2012 then saw Jensen plead guilty to tax evasion.

As per Jensen’s plea agreement:

During the years 2003 through 2009, Defendant Peter Jensen generated substantial income from his work with various multi-level marketing enterprises which, in turn, resulted in corresponding tax liabilities.

(Jensen) filed Forms 1040 for the years 2003, 2005, 2007, 2008 and 2009, but failed to pay the full tax due and owing for each of those years.

Upon commencement of IRS collection actions, defendant undertook steps to conceal his ownership of assets and his receipt of income by placing title to assets he owned, including real estate and ownership interests in business, in the names of family members and business associates.

(Jensen) used the bank account of a relative, who was an employee of defendant’s company and acted as a personal assistant, to conceal his earnings and pay expenses he owed to third parties.

(Jensen) caused his relative to conceal defendant’s income by converting checks payable to the relative and others from his business to cash.

Portions of the cash would be provided to the defendant and other portions would be deposited into the relative’s bank account in an attempt to conceal defandant’s (sic) income and financial transactions from the IRS.

On or about April 7, 2010, defendant formed a limited liability company; however, defendant concealed his 50% ownership by placing the business solely in the name of his business partner.

The company, America Approved Commercial, LLC, which was owned equally by (Jensen) and his business partner, earned significant income which (Jensen) attempted to conceal by placing his 50% ownership interest in America Approved Commercial, LLC, solely in the name of his business partner.

(Jensen) filed a false and fraudulent 2010 Form 1040 which did not reflect all of (his) income, specifically income earned from America Approved Commercial, LLC.

In February 2013 Jensen was ordered to pay the IRS over $2.1 million and handed down a 31 month prison sentence:

U.S. District Judge John E. Steele today sentenced Peter Jensen to 31 months in federal prison for tax evasion. The court also ordered him to pay restitution to the Internal Revenue Service in the amount of $2,155,133.88. Jensen pleaded guilty to one count of tax evasion on October 23, 2012.

According to court documents, for the years 2003 through 2009, Jensen attempted to evade paying federal income tax, in the amount of approximately $1.8 million.

Jensen attempted to evade paying the taxes by placing real properties in the names of others, and utilizing the bank account of another individual, rather than depositing money he earned in a bank account from which the money could have been seized by the IRS.

By my calculations, whether we use October 2012 (May 2015) or February 2013 (September 2015), Jensen’s original sentence isn’t up yet. I did try to ascertain why Jensen might have been released early, but was unable to find any information on the subject.

One possible explanation is found in the following excerpt from Jensen’s plea agreement:

Cooperation – Substantial Assistance to be Considered

(Peter Jensen) agrees to cooperate fully with the United States in the investigation and prosecution of other persons, and to testify, subject to a prosecution for perjury or making a false statement, fully and truthfully before any federal court proceeding or federal grand jury in connection with the charges in this case and other matters.

If the cooperation is completed subsequent to sentencing, the government agrees to consider whether such cooperation qualifies as “substantial assistance” in accordance with the policy of the United States Attorney for the Middle District of Florida, warranting the filing of a motion for a reduction of sentence.

In his RE247365 corporate bio today, Jensen maintains

we are a company that is built on the highest ethics, character and morality.

Read on for a full review of the RE247365 MLM business opportunity. [Continue reading…]

If you were going to fudge some online testimonials for a global multi-billion dollar MLM empire, you’d think some random names and carefully scripted marketing copy would suffice.

Not for Herbalife affiliate though. When it came to crafting testimonials for his Herbashop marketing website, this Herbalife affiliate in Norway adtoped a “go hard or go home” approach.

What you’re looking at there is the HerbaShop website of Gro Harlem Brundtland. Yada-yada-yada, Brundtland thinks Herbalife is great and wants you to purchase products from her.

Welcome to Gro Harlem Brundtland’s Herbashop.

On the following pages you will be introduced to Herbalife products. For more than 30 years Herbalife has been at the forefront of nutritional and weight management science.

Herbalife is one of the largest companies in network marketing. The goal is to change people’s lives through weight management products, nutritional supplements, and vitality.

“After only three months I had controlled my weight down and changed pant size from 42 to 36”.

Quite the scoop for Herbashop and Herbalife, seeing as Brundtland is a former PrimeMinister of Norway and Director General of the World Health Organization.

Gro Harlem Brundtland is a former Prime Minister of Norway, a current Special Envoy with the United Nations, and the Deputy Chair of The Elders.

Brundtland, MD has served as a physician, a Social Democratic politician and a diplomat, and is now an international leader in sustainable development and public health.

She served three terms as Norway’s Prime Minister: in 1981, in 1986–89, and in 1990–96.

She served as Vice-President of Socialist International.

She served as the Director General of the UN World Health Organization and is now a Special Envoy on Climate Change for the United Nations Secretary-General,Ban Ki-moon.

In 2008 she also became the recipient of the Thomas Jefferson Foundation Medal in Architecture. (Wikipedia)

Imagine trying to flog Herbalife to someone not entirely convinced about the health benefits associated with the product range.

Oh I dunno, I’m still not really sure this stuff is good for me…

Yo check it, we got the ex-Director General of the WHO on board. That the’s World Health Organization bitches. Health is right there in the title, fo’reals.

Oh well in that case… if Gro Harlem Bundtland thinks Herbalife’s the shit, here’s my credit card!

If you manage to snag someone from the WHO, milk that connection for all it’s worth.

One small problem though… Gro Harlem Bundtland claims she’s “never heard of Herbalife”.

Ruhroh… [Continue reading…]

Over the last few weeks I’ve received scattered reports from Unetenet affiliates complaining about payment delays from the company.

That an opportunity which promises annual ROIs of over 350% is having payment issues is hardly surprising. With a recent affiliate email sent out attempting to clarify ongoing affiliate concerns. [Continue reading…]

Where there’s smoke, there’s fire.

The connection between money-laundering and TelexFree has been a long-standing one.

A lot of the time Ponzi schemes launder stolen funds through offshore jurisdictions, that’s par for course. But with TelexFree, it always felt a bit more organised – cartel’esque even.

We first learned of the links above and beyond what you’d normally expect to find in a Ponzi scheme, when back in June 2013 Brazilian police announced they’d

opened an inquiry into whether the management of Telexfree committed crimes against the economy and money laundering.

That was a very specific inquiry that appeared to above and beyond that of TelexFree being an obvious Ponzi scheme.

That same month TelexFree was effectively shut down in Brazil, by way of a crippling injunction granted in the state of Acre. As Acre’s money laundering investigation continued, specific details as to what they’d found remained elusive.

In the interim, the Rwandan government would announce they’d found money laundering links to local cartels. And once TelexFree was shut down in the US, i-Payout then hinted at the scheme’s money laundering ties.

That TelexFree was being investigated for money laundering was frequently mentioned, but we never really knew just what investigators in Acre were up to, or what they’d thus far found.

The recent filing of a police report in Espirito Santo now changes that, with light being shed on the inner-workings of TelexFree’s Brazilian money laundering operations. [Continue reading…]

For his part in stealing $1,971,374.27 from Zeek Rewards affiliate investors, the Receivership initiated clawback litigation against Darryle Douglas back in March.

For reasons unknown (“the money is mine!”), Douglas failed to respond to the clawback litigation served on him, leaving the Receivership no option but to request default judgement.

Default judgement was granted against Douglas in early July, with a Western District Court of North Carolina yesterday specifying the amount the Receivership is now entitled to collect. [Continue reading…]