ASDUpdates.com

My Journal of Internet Schemes/Scams and things that really annoy me

PatrickPretty: Newspaper Story About TelexFree in Brazil

Posted by ASDUpdates on July 28th, 2014

This is a translated story originating from Mikaella Campos, an economics reporter for A Gazeta Newspaper, as posted by her on patrickpretty.com:

 

Telexfree: the big Brazilian fraud

Known as Orion, an investigation by the Federal Police against Telexfree in Espírito Santo (ES) – situated on southeastern of Brazil – was close the company’s headquarters in Vitoria, after concluding that, in addition to pyramid financial, the network acted fraudulently, committing crimes against the financial system and the public economy.

The action was based on determination of the Federal Court for the fulfillment nine search warrants and seizure organization’s offices and the home of its owners.

In injunction, the 1st Criminal Court of Federal Vitoria / ES has decided to suspend all activities Telexfree, registered in Brazil under the name of Ympactus Comercial. Also decreed the sequestration of assets, breach of banking secrecy and tax those involved in the business and the owners were prohibited from leaving the country. Yesterday, in the operation, luxury cars were seized.

The blocking of assets of the company and owners extends to their families. It is the third freezing of assets of those involved. In addition to the accounts being blocked by Justice of Acre, the 4th Court of Tax Enforcement, the ES, a month ago, had already seized the funds for payment of tax debts totaling more than US$ 80 million.

The decision to block the assets of Telexfree and the federal judge was involved Aylton Bonomo Junior. The injunction reaches beyond the Brazilian company partners, six people involved, as American James Mathew Merrill; Jozelia Mirian Sangali, wife of Carlos Costa; Katia Helia Barbosa Wanzeler, Feber Vanzeler de Almeida and Souza, Lyvia Mara Camper Wanzeler and Marilza Wanzeler Machado, Carlos Wanzeler family. These people, according to Justice, participate in Ympactus.

The judge also blocked the assets of the daughter of Carlos Costa, Leticia. “Although initially (Leticia Costa) is not on the quality of investigation, it has been demonstrated, on the topic” II.7.1 “(Das searches and seizures), is reason to suspect that your parent is using your bank account for moving illicit funds. therefore, the corresponding removal of confidentiality must be upheld”, the judge said.

Operation Orion is the result of a joint effort of the federal police, federal prosecutors and the IRS. Investigations are in the final phase and is therefore the union of two investigations which dealt with the ES group can still be accused of acting as a financial agent, commanding a grand scheme to money laundering, tax evasion and conspiracy to promote. If proven irregularities, the sentence may still exceed 10 years imprisonment.

The operation name was chosen because the Egyptian pyramids have been made ??toward three stars of Orion.

At first, the survey evaluates the conduct of two members, but will be considered if other people would also be important parts in the scheme. Criminal investigations began early last year and was in charge of the Civil Police of ES. In August 2013, the investigation was transferred to the PF.

There are more than six months at the request of federal prosecutors, the PF began a new procedure to check the collective sale of securities without the authorization of the Brazilian Securities Commission (CVM), which is equivalent to U.S. SEC.

According to the sheriff for Combating Organized Crime of PF in SSc, Rodrigo De Lucca, were analyzed thousands of documents that prove Telexfree exerted a public company activities.

“The Telexfree created a system for capturing features of securities and created a kind of financial pyramid. She managed to June last year raised more than R$ 1.2 billion only in Brazil”, said the delegate.

In megaoperation worked 50 federal police officers and 18 IRS agents to gather evidence. Besides the offices of Telexfree, searches occurred at the headquarters of Disk Will, a company that was owned by Wanzeler, and also had arms in the United States. Also hit accounting firms. USB sticks, laptops, smartphones and several boxes of documents were seized.

Fraud involving Telexfree has roots in Vitória / ES, but the extent of the damage exceeded the borders of Brazil reaching over one million people worldwide. In Massachusetts, USA, where the company also had headquarters, three charges, and administrative, civil and criminal, against the members of the company on American soil, Carlos Wanzeler (Espirito Santo) and James Merrill (American).

The Federal Court allowed the ES to evidence collected in the USA are used in Brazil to incriminate the owners.

According to the sheriff, Rodrigo De Lucca, with the loan of evidence, the intention is to find out how many people were registered on the network after the blockade in Brazil, occurred on June 18, 2013.

There will also be lending evidence to the Justice of Acre, which is processing a civil action, which paralyzed the activities of Telexfree. The action of Acre has no relation whatsoever with Operation Orion, but was crucial to the collection of materials to support criminal investigations.
To take evidence with the United States, Brazil want to determine the amounts handled by the company after the blockage in Brazil. Possibly, too much money left Brazil illegally.

Estimates of the Securities and Exchange Commission (SEC) Massachusetts – equivalent to the Securities Commission in Brazil – show revenues of almost US$ 1.2 billion from February 2012 until April 2014, when the Telexfree had its prohibited operating in the United States.

“There was the first exchange of information with the United States. We now only awaits the formal request for the evidence to come from there to Brazil. The conclusion of the investigation is very transparent and coincides with U.S. foundations”, said the delegate.

The company’s activities in the U.S. started after June 2013. But even with the ban on registering people in Brazil, representatives of the company inscribed enrolled, issuing contracts with a second Telexfree, based in Nevada.

Both here and in the U.S., the activities are characterized as hybrid Ponzi pyramid. “The company used the VoiP to attract advisers who paid fee to be part of the business. They had an obligation to make daily announcements on free pre-formulated with the promise of profit up to 200% per annum sites”, he adds.

Although federal prosecutors have requested the arrest of Carlos Wanzeler and Carlos Costa, owners of Telexfree, the restrictive measures taken by the Federal Court in the ES were alternatives. They will have to submit monthly Justice ES. However, Espirito Santo was accused Wanzeler in Federal Court in the United States being one of the masterminds of the scheme and can be arrested in Brazil.

A grand jury in the United States denounced Wednesday for nine counts of fraud. A federal detention order was issued in Massachusetts. If the U.S. court ask the Brazil, the arrest may be executed by the Brazilian PF.

Last May, Fantastico, Rede Globo TV’s show, showed that Telexfree continued to work in Brazil. According to lawyer Antonio Carlos de Almeida Castro, also known as “Kakay”, the operation performed yesterday was unnecessary because the company did not work. “MPF did what it thought was necessary, but I do not agree. We want to expedite the investigation and we can not accept this amount of claims against the company. Ideally, everything is in one place. The people who worked at the headquarters of Telexfree preparing documentation for the bankruptcy filing”, said Kakay. At the time of the reportage on Fantastico, Carlos Costa, director of the company, said the employees worked for Telexfree money back for advisers.

Read the rest of this entry »

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Posted in HYIP, MLM, Money Laundering, Online Marketing, Other Ponzi Scams, Pyramid Schemes, Scams, TelexFree, TelexFree Brazilian Actions, TelexFree Criminal Case | No Comments »

TelexFree: A Picture is Worth 1000 Words

Posted by ASDUpdates on July 26th, 2014

 

Telexfree_founder_jamesmerrill

Distancing yourself from your Ponzi/Pyramid scheme (TelexFree) does not lessen your culpability, Mr. Merrill. 

Ask Andy Bowdoin (ASD/AdSurfDaily), who now sits in a federal prison.

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Posted in HYIP, MLM, Money Laundering, Online Marketing, Pyramid Schemes, Scams, TelexFree, TelexFree Bankruptcy, TelexFree Criminal Case | 2 Comments »

TelexFree: Brazilian Authorities Search Headquarters and Executives Homes

Posted by ASDUpdates on July 25th, 2014

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Zeek Rewards: Todd Disner Files Motion to Strike Plaintiff’s Affidavit and Entry of Default Judgement

Posted by ASDUpdates on July 25th, 2014

True to form, Todd Disner is filing more Pro Se motions to get some form of “do-over” based on the self-professed “lack of knowledge” that he was supposed to reply by a certain date. But then, this is not his first rodeo; he was a prominent figue in the ASD case and he is no stranger to the legal system. He and his suspended lawyer friend, Dwight Schweitzer, inserted themselves into the ASD case numerous times.

Now, as what many call a “serial promoter”, Disner now find himself neck deep in Zeek.  His motion today espouses the following:

  • The Affidavit of Michael Busen is both false and misleading… that the total sums received by the Defendant were not in fact received by him either personally or as a trustee of Kestrel Spendthrift Trust.
  • The Defendant has no knowledge of how the sums alleged in the Plaintiff’s Affidavit were arrived at.
  • Under the business agreement with Zeek rewards, the Defendant was entitled to be paid as a result of performing certain activities he was required to engage in on that day..

What utter nonsense.  Let us not forget that Disner made it a point to showcase his large, new Condo on YouTube, a Condo he bought with proceeds from Zeek Rewards.

Secondarily, Disner filed a “Counter-Affidavit in Opposition to the Plaintiff’s Motion that a Default judgement be Entered Against the Defendant and in Support of the Defendant’s Motion to Strike the Plaintiff’s Supporting Affidavit”.  Holy crap, the title is as long as the rest of the filing!

Disner goes on to say he does not believe the sums mentioned by the Plaintiff are accurate and that because there is “no listing by date, amount, check number and payee” that they are not his??

I have uploaded this filing to the Files website.

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Posted in HYIP, MLM, Online Marketing, Other Ponzi Scams, Pyramid Schemes, Scams, Zeek Clawbacks, Zeek Rewards Federal Court Cases, Zeek Rewards Suits | No Comments »

TelexFree: James Merrill Files Supplement for Release of Funds

Posted by ASDUpdates on July 24th, 2014

telexfree-logoIt seems I was right; Merrill will definitely need that $4 Million he requested to fund his defense against 9 Felony counts. So far, there has been no ruling on the request; I am definitely watching for the Judge’s Order.


James Merrill’s First Supplemental Memorandum In Support of Motion For Release of Funds Necessary For Legal Defense

At the hearing on July 22, 2014, the Court ruled that, prior to ordering an evidentiary hearing, it would hold the defendant to a burden of producing sufficient evidence to demonstrate (1) other than the seized funds, Mr. Merrill does not possess sufficient assets to fund his legal defense and (2) some doubt as to whether the seized funds are traceable to the charged offense. For the reasons discussed infra (Sections A and B) and during the hearing, and based on the exhibits submitted herewith as well as those exhibits submitted during the evidentiary hearing convened before Judge Hillman on the issue of pretrial release, Mr. Merrill respectfully submits that he demonstrably satisfies any such burden of production. As noted during the hearing, however, and for the reasons detailed herein (Section C), Mr. Merrill objects to the imposition of any such burden upon the defense.

Merrill’s supplemental filing goes on to say that the “government has seized 400 terabytes of electronic information” and that “This startling figure alone demonstrates that Mr. Merrill needs access to the restrained funds to fully fund his legal defense.” The next paragraph sites an article that states ” the 2.5 terabytes at issue in that case contained enough information to store “War and Peace” 330,000 times.”

In a case of this magnitude, a citizen with unlimited financial resources could assuredly spend well more than $500,000.00 on defense-related expenses alone, independent of attorneys’ fees. Such expenses include forensic accounting services, electronic discovery services, experts, and investigators.

Second, in cases with a far smaller universe of relevant materials, the cost of the defense has significantly exceeded $500,000.00.

Third, the Court has received Mr. Merrill’s application for Court-appointed counsel, filed prior to undersigned counsel’s appearance in this matter. The Court reviewed the original application and a supplemental submission and determined that Mr. Merrill qualified for Court-appointed counsel.

Fourth, the government’s reliance upon the approximately $300,000 released in the related SEC litigation is seriously misplaced. As noted supra, expenses alone in a case of this nature can easily, and vastly, exceed $500,000. Moreover, the accounts containing the approximately $300,000 are largely retirement accounts and, therefore, if accessed by Mr. Merrill would result in far less than $300,000.

Fifth, defendants with the available resources routinely hire more than one attorney to defend them in cases of this magnitude.

Sixth, according to the government itself, this case is of unmatched complexity and volume.

Farther down the filing, Merrill questions if the Government can actually trace these funds as the proceeds of criminal activity; Merrill also asserts that

“the government’s questioning of Agent Melican during the bail hearing before Judge Hillman confirms the government, at least at that time, did not yet possess an understanding of TelexFree or its operations.”

and

“that Agent Soares’ affidavit in support of the criminal complaint is inaccurate in many significant respects.”

I have uploaded this filing (Doc 80) onto the Files website.

 

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Posted in HYIP, MLM, Money Laundering, Other Ponzi Scams, Pyramid Schemes, TelexFree, TelexFree Criminal Case | 2 Comments »

TelexFree: Translated Story from GLOBO

Posted by ASDUpdates on July 24th, 2014

Thanks to PatrickPretty.com for providing this link:

Federal Police meets search and seizure warrant at the headquarters of Telexfree in Victoria

24/07/2014 – 9:42 a.m. – Updated 24/07/2014 – 15h19

“Operation Orion” broke out on the morning of Thursday (24)

The Federal Police carried nine search warrants and seizure addresses in Greater Victoria linked to Commercial Ympactus, Telexfree company representing the brand in Brazil. “Operation Orion” broke out on the morning of Thursday (24). The warrants were issued by the 1st Federal Criminal Court of Victoria, which also banned the owners and shareholders of the company from leaving the country, besides having to attend monthly to the Federal Court.

Sequestration of assets as current accounts and also properties of the group and people connected to the company was also determined. The investigation began six months ago at the request of the Federal Public Ministry (MPF).
The findings were the responsibility of the Bureau for Combating Organized Crime, Federal Police, with the intention of finding evidence of activities without authorization from the Securities Commission (CVM). This survey incorporated another who was walking in the Federal Police, which apurava financial pyramid crimes.
Besides blocked by Justice of Acre money, more assets on behalf of those involved and also others related to Telexfree companies were found. The new fact of this operation is that the evidence gathered by Brazil will be sent to the United States, which also receive data on that country’s ongoing investigations carried out on American soil.
Besides the action of federal police, the court authorized the participation of Tax auditors Internal Revenue Service of Brazil in the overt phase of the operation. Those responsible for the company can answer for the crimes referred to in Articles 7 and 16 of Law 7492/86, which defines crimes against the national financial system, besides the crime under Article 2, Paragraph IX of Law 1.521/51, which defines crimes and misdemeanors against the economy (financial pyramid).
Altogether, participated in the action 50 federal police officers and 18 auditors Federal.O Revenue operation name alludes to the Great Pyramids of Giza in Egypt Plain, considering that the Egyptian pyramids are perfectly aligned with the constellation Orion.
Employees were working in the company
According to the Federal Police, officers were found in the central office of the company, which might not be working. Some denied that they were working. The general in charge of the building where the works Telexfree followed the work of the Federal Police. He and an employee of the company were heard by the agents. The officials declined to speak.

 

 

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Posted in HYIP, MLM, Money Laundering, Online Marketing, Other Ponzi Scams, Pyramid Schemes, TelexFree, TelexFree Brazilian Actions | No Comments »

BehindMLM: Brazilians Launch Operation Against TelexFree!!

Posted by ASDUpdates on July 24th, 2014

BREAKING NEWS from BehindMLM.com

Brazilian feds launch “Operation Orion” against TelexFree

telexfree-logoLess than 24 hours after indictments were handed down against owners Carlos Wanzeler and James Merrill, Brazilian federal police have launched a new operation against TelexFree.

Codenamed operation Orion, supposedly because the constellation Orion aligns with “the three largest pyramids of the Giza pyramid complex” in Egypt (Wikipedia), the operation has thus far resulted in nine search warrants.

office-raid-brazil-ympactus-telexfree-espirito-santoIssued by the 1st Federal Criminal Court in the Brazilian state of Vitória in the Brazilian state of Espírito Santo, the warrants were executed on properties linked to Ympactus.

Formally Ympactus International, the company serves as a money laundering front for TelexFree’s Brazilian operations.

In addition to the warrants, the court also

prohibited Ympactus’ owners from leaving the country under penalty of imprisonment, (ordered the) monthly attendance (of the owners) at the Federal Court, as well as the seizing of real estate as a precautionary measure, (along with) the freezing of bank accounts and the suspension of economic activities Telexfree in Brazil.

In addition, the Federal Court authorized the participation of tax auditors (from the) Internal Revenue Service of Brazil (as part of an) overt phase of the operation.

One TelexFree owner, James Merrill,  is currently under house arrest in the US and is facing charges in both a civil and criminal case against him. The other two, Carlos Costa (a defacto silent partner through Ympactus) and Carlos Wanzeler, are currently both residing in Espírito Santo.

Costa is currently trying to run for office in the hope he will escape criminal charges and Wanzeler is hiding from US authorities. Wanzeler is a wanted fugitive in the US, with prosecutors issuing a federal arrest warrant against him yesterday.

I believe Costa and Wanzeler were, at least on paper, the legal owners of Ympactus.

Under Operation Orion and as owners of Ympactus, Wanzeler and Costa may have to

answer for crimes referred to in Articles 7 and 16 of Law 7492/86, which defines crimes against the national financial system, besides the crime under Article 2, Paragraph IX of Law 1.521/51, which defines crimes and misdemeanors against the economy.

Currently Operation Orion has 50 federal police officers and 18 auditors from the IRS working the case.

My take?

I’m not too sure what there might be left to find given that by all accounts Costa shut down Ympactus’ offices months ago, but they might find something yet. As for freezing bank accounts and suspending the activities of TelexFree in Brazil, that seems wholly redundant.

The introduction of tax auditors might signal irregularities found by Ernst & Young, who had been charged to audit Ympactus as part of the Acre case.

Ernst & Young were due to hand in their audit report but, citing the “complexity” of TelexFree’s business operations, requested an extension. Whether or not Ernst & Young are cooperating or working with the IRS though is unclear.

Meanwhile, given the timing of Operation Orion, I’m having a hard time believing this is anything but the direct co-operation of US and Brazilian regulators.

We haven’t heard anything for a while now on the criminal side of things in Brazil. And then all of a sudden early morning the day after Merrill and Wanzeler are indicted for fraud and conspiracy in the US, Brazilian federal police launch their own crackdown operation?

As I understand it Ympactus/TelexFree has been under criminal investigation in Brazil for some time now. With this latest action appearing to coincide with the indictments in the US.

That noose is getting tighter, can you feel it Mr. Wanzeler? 

And pray that Carlos Costa is using towels, not tissues, to keep himself dry. Lord knows there aren’t enough trees in the Amazon to keep that man from sweating at the best of times.

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Posted in HYIP, MLM, Money Laundering, Other Ponzi Scams, Pyramid Schemes, Scams, TelexFree, TelexFree Brazilian Actions | No Comments »

TelexFree: Federal Arrest Warrant Issued for Carlos Wanzeler

Posted by ASDUpdates on July 23rd, 2014

From the Wall Street Journal: (emphasis added)

“The defendants devised, and intended to devise, a scheme to defraud, the purpose of which was to obtain money and property by means of materially false and fraudulent pretenses, promises and omissions,” reads the indictment, filed in the U.S. District Court in Worcester, Mass.

Lawyers for Messrs. Merrill and Wanzeler couldn’t immediately be reached for comment Wednesday. However, the men have maintained their innocence since the original charges were filed. And in court papers, Mr. Merrill has specifically denied prosecutors’ claims that TelexFree illegally raked in hundreds of millions of dollars from a global network of investors.

Arrested in May, Mr. Merrill, 53 years old, was released on bail last month, on such conditions that he surrender his passport and wear an electronic monitoring bracelet. Mr. Wanzeler, 45, fled to Brazil before he could be arrested, but prosecutors on Wednesday issued a federal arrest warrant for him.

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BREAKING NEWS: TelexFree’s Merrill and Wanzeler Indicted!!!

Posted by ASDUpdates on July 23rd, 2014

carlos-wanzeler-and-james-merrill-telexfree-management-criminals

Photo courtesy of BehindMLM. Wanzeler (l) and Merrill (r)

Today, the Grand jury indicted James Merrill and Carlos Wanzeler on 9 Felony counts each:

  • Count 1
    • 18:1349 CONSPIRACY TO COMMIT WIRE FRAUD
  • Counts 2-9
    • 18:1343 WIRE FRAUD

The document (70) also contains a “Forfeiture Allegation” which, if convicted on one or more of the charges, will forfeit any and all property, real or personal, that is traceable to the offenses. The list of assets that could be subject to forfeiture is quite literally staggering.

I started to add them all up, but it was over 7 pages of items listed, from “Item a”, to “Item rrr”. Reports are the seized accounts and checks total around $140 Million, not counting all properties in their “real estate empire”, all of which are thought to be the proceeds of criminal activity.  It looks like Merrill will need that $4 million to pay his lawyers after all.

I have added this Grand Jury Indictment onto the Files website, click here.

For an in depth story, visit BehindMLM here.

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Posted in HYIP, MLM, Money Laundering, Online Marketing, Other Ponzi Scams, Pyramid Schemes, Scams, TelexFree, TelexFree Criminal Case | 1 Comment »

TelexFree: Clerk’s Notes for Merrill’s Hearing to Release $4 Million

Posted by ASDUpdates on July 22nd, 2014

07/22/2014 68 ELECTRONIC Clerk’s Notes for proceedings held before Magistrate Judge David H. Hennessy:Motion Hearing as to James Matthew Merrill held on 7/22/2014 re 55 MOTION for Release of Funds filed by James Matthew Merrill. Case called, Counsel & Defendant appear, Counsel argue motion, Matter taken under advisement, Order to issue. (Attorneys present: Lelling, Murane, Goldstein.) Court Reporter: Digital Recording – 9:30 for transcripts/CDs contact Deborah Scalfani (deborah_scalfani@mad.uscourts.gov). (Belpedio, Lisa) (Entered: 07/22/2014)

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Posted in HYIP, MLM, Money Laundering, Online Marketing, Other Ponzi Scams, Pyramid Schemes, Scams, TelexFree, TelexFree Criminal Case | No Comments »