TelexFree: Sann Rodrigues Arrested!!

It seems this guy is once again on the wrong side of the USDOJ.
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He was arrested for “.FRAUD AND MISUSE OF VISAS, PERMITS, AND OTHER DOCUMENTS”

I have added the case to the Files website.  Check out BehindMLM.com for more info….

 

Zeek Rewards: Receiver Adds 10 New Defendants in British Virgin Islands “Winners” Suit

The original complaint, filed on February 13th, listed 5 alleged “winners”, all of which are in the British Virgin Islands;

  • Agnita Solomon, “net winner” of $2,057,355.61
  • Marguerite D. Hodge, “net winner” of $115,776.29
  •  Susan Forbes “net winner” of $603,288.30
  • Marcus Drigo,  “net winner” of $70,262.52
  • Patrice Harewood, “net winner” of $59,940.74

The Amended Complaint filed today lists 10 more Defendants:

  • Vernon Lettsome, “net winner” of $2,036,742.37
  • Trevor Potter, “net winner” of $293,221.85
  • Simon Potter,  “net winner” of $230,570.61
  • Esther Potter, “net winner” of $187,990.96
  • Elcina Frett, “net winner” of $148,000.22
  • Hercules Fraser, “net winner” of $67, 201.35
  • Kishma Reefe, “net winner” of $55,149.26
  • Ruth Matthew,  “net winner” of $136,277.95
  • Wesley Legair, “net winner” of $117,079.49
  • Sophia Richards, “net winner” of $96,238.79

The new Defendants raise the amount of claw-backs in this civil suit to $ 6,275,096.31

Zeek Rewards: Joint Motion to Continue And For Status Hearing

On May 7th, Paul Burks, through his attorney Noel Tin, filed the above Joint Motion which has the following points:

1. Mr. Burks was named in a four-count indictment returned on October 24, 2014. He made his initial appearance on November 13, 2014, at which time he was arraigned. The Court has continued docket call in this matter three times. [Docs. 11, 24, 27]
2. Docket call is currently scheduled for May 18, 2015.
3. The parties agree a further continuance is appropriate for reasons outlined in previous motions to continue. To date, the government has produced over 7.9 million documents to the defense. The government is also in the process of producing an additional 11 terabytes of data. Potential witnesses are numerous and spread over a wide geographic area which includes other countries.
4. Given the amount of discovery involved, the degree of preparation necessary for trial, witness travel and document management issues, the parties further agree that a peremptorily set trial date is necessary.
5. While the parties agree a peremptory setting is necessary, they also disagree on the appropriate length of continuance and trial date. The parties are therefore asking the Court to set this matter for a status hearing which will allow the parties to present their respective positions, after which the Court can peremptorily set this matter for trial.

Not at all surprising, the delays are multiplying; 11 TB of information is extremely mind boggling, especially when one considers how shabby scammers keep records of their miscreant ways. I look forward to the trial, no telling what will be revealed.

 

Zeek Rewards: Orders Granting Defaults and Order to Show Cause

Today we have 2 Orders from Senior Judge Graham C.Mullen, in which he Grants the receiver’s Motionzeekrewards for Default Judgments against Jerry Napier and Trudy Gilmond, and also Orders both individuals to appear and Show Cause why judgment should not be entered. I would guess that neither one will show for this either.


 

ORDER
THIS MATTER is before the Court on the Receiver’s Motion for Default Judgment for Failure to Defend or, in the Alternative, Motion for Order Requiring Jerry Napier to Personally Appear and Show Cause.
For good cause shown, it is ORDERED that the Receiver’s Motion is GRANTED and Defendant Jerry Napier is hereby ORDERED to personally appear in court in the Western District of North Carolina on May 27, 2015 at 11:00 AM and SHOW CAUSE as to why judgment should not be entered against him as requested by the Receiver. If Defendant does not personally appear at such hearing, judgment will be immediately entered against him in the amount of $$2,041,356.19.
SO ORDERED.


ORDER
THIS MATTER is before the Court on the Receiver’s Motion for Default Judgment for Failure to Defend or, in the Alternative, Motion for Order Requiring Trudy Gilmond to Personally Appear and Show Cause.
For good cause shown, it is ORDERED that the Receiver’s Motion is GRANTED and Defendant Trudy Gilmond is hereby ORDERED to personally appear in court in the Western District of North Carolina on May 27, 2015 at 11:00 AM and show cause as to why judgment should not be entered against her as requested by the Receiver. If Defendant does not personally appear at such hearing, judgment will be immediately entered against her and Trudy Gilmond, LLC in the amount of $2,129,522.27.
SO ORDERED.


USDOJ: Ripple Labs Resolves Criminal Ingestigation

Department of Justice
Office of Public Affairs

FOR IMMEDIATE RELEASE
Tuesday, May 5, 2015
Ripple Labs Inc. Resolves Criminal Investigation

Ripple Labs Inc. and its wholly-owned subsidiary, XRP II LLC, formerly XRP Fund II LLC, have agreed to resolve a criminal investigation in exchange for a settlement agreement calling for a series of substantial remedial measures, including a migration of a portion of Ripple’s virtual currency business to a separate entity, the company’s ongoing cooperation in other investigations, an extensive remedial framework to ensure future compliance with federal laws and forfeiture and penalties totaling $700,000, announced U.S. Attorney Melinda Haag of the Northern District of California, Director Jennifer Shasky Calvery of the U.S. Treasury Department Financial Crimes Enforcement Network (FinCEN) and Chief Richard Weber of the Internal Revenue Service (IRS) Criminal Investigation Division.  The agreement will resolve allegations that Ripple and its subsidiary failed to follow the law while engaging in the exchange of virtual currency and that the entities failed to establish and maintain an appropriate anti-money laundering program.

Ripple Labs Inc. is headquartered in San Francisco, California, and developed and sold virtual currency known as “XRP.”  As of 2015, the currency of the Ripple network, XRP, is the second-largest digital currency by market capitalization.

The agreement formalizes the steps Ripple and its subsidiary must take to bring its virtual currency operation within the existing regulatory framework for money services businesses.  The agreement consists of a settlement agreement, an agreed statement of facts, and a remedial framework for the company going forward.  Aside from monetary penalties in the form of forfeiture, the remedial framework requires the migration of any component of Ripple’s business that is engaged in the exchange of virtual currency into an entity registered with FinCEN.  In addition, the agreement calls for continued enhancements to the company’s anti-money laundering (AML) controls and training program.  Further, the remedial framework calls for external audits through the year 2020, enhancements to the ripple protocol, increased transaction monitoring and an extensive review of historical activity.

“By these agreements, we demonstrate again that we will remain vigilant to ensure the security of and prevent the misuse of the financial markets,” said U.S. Attorney Haag.  “Ripple Labs Inc. and its wholly-owned subsidiary both have acknowledged that digital currency providers have an obligation not only to refrain from illegal activity, but also to ensure they are not profiting by creating products that allow would-be criminals to avoid detection.  We hope that this sets an industry standard in the important new space of digital currency.”

The agreement is the culmination of a criminal investigation conducted by U.S. Attorney’s Office and the Internal Revenue Service’s Criminal Investigation Division.  FinCEN joined the investigation with a parallel civil enforcement action.  In that action, Ripple Labs and XRP II have agreed to pay a $700,000 civil penalty, $450,000 of which will be designated a forfeiture to settle issues raised in the U.S. Attorney’s investigation.

“Virtual currency exchangers must bring products to market that comply with our anti-money laundering laws,” said Director Calvery for FinCEN.  “Innovation is laudable but only as long as it does not unreasonably expose our financial system to tech-smart criminals eager to abuse the latest and most complex products.”

“Federal laws that regulate the reporting of financial transactions are in place to detect and stop illegal activities, including those in the virtual currency arena,” said Chief Weber of the IRS Criminal Investigation Division.  “Unregulated, virtual currency opens the door for criminals to anonymously conduct illegal activities online, eroding our financial systems and creating a Wild West environment where following the law is a choice rather than a requirement.”

Ripple described itself as an exchanger of virtual currency in a December 2013 filing made in San Francisco, California, federal court in an unrelated case.  As an exchanger, Ripple was required to register with FinCEN and to comply with applicable federal laws and regulations.  Yet Ripple sold XRP even though it had not registered with FinCEN, effectuating sales of over approximately $1.3 million in April 2013 alone.  Ripple also failed to establish and maintain an appropriate AML program and failed to have policies, procedures and internal controls to ensure compliance with the Bank Secrecy Act and anti-money laundering laws.  In July 2013, Ripple incorporated a subsidiary, now known as XRP II, that replaced Ripple as the seller of XRP.  Although XRP II registered with FinCEN, it failed to have an effective AML program or to file appropriate suspicious activity reports.  In late 2013, for example, it negotiated a $250,000 transaction with an individual who had prior felony convictions for dealing in explosive devices and had been sentenced to prison, failing to follow its own internal “know your customer” requirements.

Assistant U.S. Attorneys Kathryn R. Haun and Arvon J. Perteet handled the matter on behalf of the U.S. Attorney’s Office with the assistance of Daniel Charlier-Smith and Leslie Cook.  The settlement agreement with Ripple Labs was the result of a coordinated effort by the U.S. Attorney’s Office and IRS Criminal Investigation, working in tandem with FinCEN.

USAO – California, Northern District                                          Ripple Labs Inc. Settlement Agreement
Updated May 5, 2015

Zeek Rewards: Receiver Issues First Quarter Status Report for 2015

RECEIVER’S STATUS REPORT FOR THE FIRST QUARTER OF 2015

Here are a few of the high points, you can see the full Report here:

The Receiver currently maintains six bank accounts on behalf of the Receivership Estate for holding Receivership Assets: the “Affiliate Account,” the “Seized Asset Account,” the “Pre-Filing Account,” the “Settlement Account,” the “Withholding Account,” and the “Holdback Account.”

Excluding earned interest and transfers between accounts, the Receiver made the following deposits into these accounts during the first quarter of 2015:

  •  $1,577,043.06 into the Settlement Account from settlements with non-affiliate third parties;
  •  $520,250.00 into the Affiliate Account from payments from various financial institutions relating to previously dishonored cashier’s checks, teller’s checks, official checks, and bank money orders.

As of March 31, 2015, the Receivership Estate held approximately $91.3 million in the Affiliate Account, approximately $89.3 million in the Seized Asset Account, approximately $293,000 in the Pre-Filing Account, approximately $6.3 million in the Settlement Account, $0 in the Withholding Account, and approximately $1.1 million in the Holdback Account.


The Receiver Team is awaiting a ruling on its Motion for an Order Directing NxSystems to Turn Over Receivership Assets and/or Find them in Contempt of the Court’s Order Freezing Receivership Assets regarding the approximately $9 million outstanding.


During the first quarter, the Receiver Team continued litigation against Preferred Merchants and Jaymes Meyer to recover the approximately $4.8 million they improperly transferred and failed to return in violation of the Freeze Order.

One property in the Turks & Caicos Islands has been frozen, and the Court has issued an order directing that it be transferred to the Receiver. The estimated value of this property is believed to be over $2 million. In addition, Mr. Meyer agreed to a lis pendens upon California real property that he purchased with Receivership Assets for over $400,000.


With respect to Solid Trust Pay, the Receiver Team has issued a demand to Solid Trust Pay for approximately $1.6 million in outstanding Receivership Assets and is awaiting additional information from Solid Trust Pay to evaluate its response to the Receiver’s Demand.


Litigation in the SEC Enforcement Action 

The Receiver Team litigated the following matters in the SEC Action:

  • The Receiver Team filed a response brief in the Fourth Circuit Court of Appeals regarding the Belsome movants’ appeal of the striking of attorney charging liens.
  • The Receiver Team continued litigation seeking the return of Receivership Assets from NxSystems.
  • The Receiver’s conflicts counsel filed a Motion for Order to Show Cause or Turn Over Receivership Assets Against Compass Bank.
  • The Receiver team continued litigation to recover Receivership Assets from James Meyer and Preferred Merchants Solutions, LLC.

(emphasis added)

To date, almost 121,000 Affiliate claimants have accepted their claim determinations and have been or will be issued a distribution in the near term. The next distribution date for claimants who have not already received a distribution is April 30, 2015. . However, in excess of 50,000 Affiliate claimants have failed to respond to their claim determinations. Each claimant is required to act further if they would like to receive a distribution from the Receivership Estate. Failure to act further may eventually cause a claimant to forfeit the distribution. 

The Receiver contacted each of the Affiliate claimants who failed to respond to their claim determination to request that such claimants respond to the claim determination by April 15, 2015 and notified them that, pursuant to authority granted by court order, they would be deemed to have accepted their claim determination if they failed to respond by that date.

Approximately 1,800 Affiliates have objected to the claim determination issued by the Receiver Team. The Receiver Team is continuing to address these objections in an effort to resolve such objections before intervention by the Special Master or the Court would be needed. The Receiver Team has been successful in resolving the majority of these objections to date.


Along with the Status Report are 2 Exhibits detailing financial information.  Exhibit A and Exhibit B

BehindMLM – uFun Club

These come from BehindMLM.com 


uFun Club ringleader wanted for pyramid scheme fraud

These days it’s getting more and more difficult to relaunch scams once your name is out there.ufunclub-logo

What with the speed with which news travels these days and just the sheer volume of information available to anyone with an internet connection, serial scamsters have to go to increasingly sophisticated lengths to launch their schemes.

Take for example uFun Club, which now increasingly starting to look like a Ponzi scheme heavily influenced by serial Chinese scammers. [Continue reading…]


uFun Club investigation to be handled by Thai police

Much nonsense has come out of the uFun Club camp these past few days, with claims on social media alluding to the dropping of the investigation currently taking place.ufunclub-logo

The claims, largely made on social media, primarily attempt to plant the seed that the Department of Special Investigation (DSI) are going to drop the uFun Club investigation any day now.

The good news for uFun Club investors still in denial?

The DSI did indeed decide to drop their own investigation into uFun Club.

The bad news?

DSI dropped the investigation in favor of letting the police continue to take the lead. [Continue reading…]


TelexFree: April 2015 Interim Status Report and Change in Conference Schedule

telexfree-logo

Interim Status Report

Since the last status date, the government has produced approximately 45 GB of additional information received as a result of a search warrant executed at an internet service provider. This information consists largely of TelexFree-related YouTube videos and back-up and subscriber data. The government has also produced the contents of a personal email account belonging to defendant James Merrill.
The government recently met with Brazilian prosecutors and law enforcement agents, who are conducting a separate investigation of TelexFree and certain individuals. The Brazilian authorities have produced a large amount of data and will be producing additional materials in the coming weeks. This additional data, mostly derived from multiple search warrants executed in Brazil, will likely amount to 100s of gigabytes. Once the government has received all of the materials from the Brazilian authorities it will copy the materials for the defendant.

Overall, at this stage the following discovery remains to be produced:

• Data contained in two Hotmail email accounts and one Apple email account, also received in response to a search warrant. Production of this material has been delayed by errors in the data as produced by the email providers.
• Data (5-10 TB) received from a cloud-based service that stored data for TelexFree.
• Materials received in mid-March 2015 from the Brazilian authorities. Among other things, this includes a forensic report by Ernst & Young, which was commissioned some time ago by the Brazilian government to opine on whether TelexFree’s operations amounted to a pyramid scheme. (The report is in Portuguese – the government will produce the original and a translation that is currently in process). As noted above, the government expects a substantial additional production from Brazil in mid-April 2015.
• Various recordings made by undercover HSI agents at TelexFree conference and in conversations with a TelexFree promoter.
In light of the above, and in keeping with the Court’s designation of this matter as a “complex case” under 18 U.S.C. s 3161(h)(7)(B)(ii), the government suggests an interim status conference in approximately 60 days. Beyond waiting to receive additional productions from Brazil, the substantial additional data sets, e.g., from the cloud-based provider and the Brazilian government, will take time to process and copy.


Motion to Adjourn Scheduled Status Conference and Exclude the Time Under the Speedy Trial Act

The Court has scheduled a status conference for April 13, 2015. Because discovery is proceeding steadily in this unusually large case, and the parties have been communicating as needed about the production, the parties request that the conference be adjourned to June 12, 2015, or some similar date that is convenient for the Court. Both parties also request that the Court exclude the time from April 13, 2015, through June 12, 2015, from the speedy trial clock, pursuant to Local Rule 112.2(b), the Speedy Trial Act, 18 U.S.C. §§ 3161(h)(7)(A) & 3161(h)(7)(B)(iv), and §§ 5(b)(7)(A), 5(b)(7)(B) & 5(b)(7)(C)(iv) of the Plan for Prompt Disposition of Criminal Cases for the United States District Court for the District of Massachusetts (effective December 2008), on the ground that the ends of justice are served by granting the adjournment and excluding this period, and outweigh the best interests of the public and the defendant in a speedy trial.

An Order was subsequently issued allowing the “exclusion of time pursuant to the below-referenced provision of the Speedy Trial Act from Monday, April 13, 2015 (the date on which the fourth Interim Status Conference was scheduled to occur), through and including Friday, June 12, 2015 (the date of
the fifth Interim Status Conference).”

I have uploaded these documents onto the Files website.

Zeek Rewards: Turks and Caicos Island Vacation Home Transfers to Receivership

On March 11, 2015, Mr. Bell filed this motion:

Kenneth D. Bell, the Court-appointed Receiver (“Receiver”) of Rex Venture Group, LLC d/b/a ZeekRewards.com (“RVG”), respectfully submits this Motion to Transfer Property to the Receivership Estate. The Receiver respectfully requests that the Court impose and enforce an equitable lien on a water-view vacation home in the Turks & Caicos Islands and related assets
(collectively, “Turks & Caicos Property”) that were purchased with RVG assets that Preferred
Merchants Solutions LLC (“Preferred Merchants”) and Jaymes Meyer improperly took from an
RVG trust account and order that the title and ownership be transferred to the Receivership
Estate for the benefit of the victims of the ZeekRewards Ponzi / pyramid scheme.

Today, Senior Judge Mullen issued this order:

ORDER
IT IS, THEREFORE, ORDERED, ADJUDGED, AND DECREED that:
1. The Motion to Transfer Property to the Receivership Estate is hereby GRANTED; and
2. Bella Vita Ltd., and any other party with ownership or other rights to the Turks & Caicos property described below, is hereby ORDERED to transfer to the Receivership Estate title and ownership of the Turks & Caicos Islands real property designated as Title #60609/24 / Norway & Five Cays Section / Providenciales Island along with all improvements, attachments and personal property within and related to the property (including but not limited to furniture, fixtures, a boat and scuba equipment).

It seems that those who purvey these Pyramid/Ponzi schemes like to have ill-gotten homes near some body of water, as ASD’s Andy Bowdoin had a lake house complete with the ubiquitous water toys allegedly for the members of the ASD scam to use if they were ever in the area. And just like the Jaymes Meyer, the home and all water toys were absorbed into the restitution accounts.

While this is not the actual property, it gives you an idea of what is involved:

60609 – Norway and Five Cays: Chalk Sound, Providenciales

Single Family Home
MLS # 1400565

 

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