TelexFree

Posted by ASDUpdates on November 7, 2018No Comments

SEC Obtains Final Judgment Against Two Nevada Companies for Their Role in a Pyramid Scheme

Litigation Release No. 24335 / November 6, 2018

Securities and Exchange Commission v. TelexFree, Inc. et al., No. 14-cv-11858 (D. Mass. filed Apr. 17, 2014)

On November 2, 2018, the SEC obtained default judgments against two entities, TelexElectric, LLLP and Telex Mobile Holdings, Inc., which were both named as relief defendants for the purpose of recovering ill-gotten gains that the entities received from TelexFree, LLC in connection with the TelexFree pyramid scheme. TelexElectric was ordered to pay $2,0222,239, and Telex Mobile Holdings was ordered to pay $500,870. The SEC also voluntarily dismissed its claims for unjust enrichment against a third relief defendant, TelexFree Financial, Inc.

The SEC has previously obtained final judgments by consent against TelexFree, TelexFree’s co-owner and president and its CFOits international sales directora promoter of the pyramid schemeanother promoter of the pyramid scheme, and a third promoter, who also was ordered to serve prison time for civil contempt arising from his repeated violations of court orders.

The SEC’s litigation continues against TelexFree’s other co-owner, and the remaining promoter of the alleged TelexFree pyramid scheme.

The SEC has issued an investor alert warning investors about the dangers of potential investment scams involving pyramid schemes posing as multi-level marketing programs.

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