Telexfree

{{Expand section|Federal Police operations starting in July/2014 and criminal charges|date=July 2014}}

The Secretary for Economic Monitoring of the Brazilian Treasury Ministry (SEAE/MF) released the Memorandum 118/GABIN/SEAE/MF,{{cite web|url=http://www.caldeiraopolitico.com.br/arqs/materia/8661_a.pdf|title=Memorandum about Ponzi Scheme Activities from Telexfree |language=pt |publisher=SEAE/MF Brazil|access-date=March 5, 2013}} on March 5, 2013, about Ponzi scheme activities carried on by Telexfree Brazilian subsidiary, "Ympactus Comercial Ltda".{{cite web|url=http://economia.ig.com.br/2013-03-14/negocio-da-telexfree-nao-e-sustentavel-afirma-ministerio-da-fazenda.html|title=Treasury Ministry states Telexfree business is not sustainable |language=pt |publisher=IG News Portal Brazil|access-date=March 20, 2013}}{{cite web|url=http://economia.uol.com.br/noticias/redacao/2013/03/14/ministerio-pede-investigacao-sobre-suposto-esquema-de-piramide.htm|title=Ministry ask investigation about Ponzi Scheme |language=pt |publisher=UOL News Portal Brazil|access-date=Dec 6, 2013}} The memorandum triggered several investigations into the company's operations, leading Telexfree to hire Multi-level Marketing lawyer Gerald P. Nehra to review its marketing plan.{{cite web|url=http://economia.ig.com.br/2013-03-21/nos-eua-telexfree-contrata-advogado-com-experiencia-em-casos-de-piramide.html|title=Telexfree hires in USA the best lawyer in Pyramid Schemes |language=pt |publisher=IG News Portal Brazil|access-date=March 28, 2013}}{{cite web|url=http://behindmlm.com/companies/telexfree/gerry-nehra-gives-legal-blessing-to-telexfree/|title=Gerry Nehra gives "legal blessing" to Telexfree |publisher=Behind MLM |access-date=Dec 21, 2013}} Nehra is a lawyer who is known in the U.S. for defending closed down Ponzi and pyramid schemes, such as Zeek Rewards,{{cite web|url=http://www.businessforhome.org/2012/08/zeekrewards-closing-down-the-mlm-attorney-speaks-out/|title=ZeekRewards Closing Down – The MLM Attorney Speaks Out! |date=August 17, 2012 |publisher=MLM Skeptic|access-date=Dec 21, 2013}} Ad Surf Daily,{{cite web|url=http://amlmskeptic.blogspot.ch/2012/07/scam-study-ad-surf-daily.html|title=Scam Study - Ad Surf Daily |date=July 4, 2012 |publisher=MLM Skeptic|access-date=Dec 21, 2013}} Universo Foneclub and others.

On June 13, 2013, Telexfree's operations in Brazil were suspended.{{cite web|url=http://economia.ig.com.br/2013-06-19/justica-bloqueia-pagamentos-da-telexfree-e-impede-entrada-de-novos-participantes.html|title=Telexfree blocked by Brazilian Court |language=pt |publisher=IG News Portal|access-date=Dec 7, 2013}} The company released a note on its website explaining the court's decision. The note says as follows (translated from the original Portuguese):

{{blockquote|text=By judicial decision issued on June 13th, 2013, Judge Thais Queiroz B. de Oliveira Abou Khalil, in the records of the Preparatory Action No. 0005669-76.2013.8.01.0001, filed by the Prosecutor of the Acre State, in the 2nd Civil Court of Rio Branco - AC, new subscriptions to the Telexfree network are prohibited in the Partner or Promoter conditions; receiving of Returnable Deposit Funds and Costs of Reserve Position by Telexfree are forbidden; sales of 99Telexfree VoIP accounts in ADCentral and ADCentral Family modalities are prohibited; payments are prohibited, both to partners and promoters, of commissions, bonuses and any benefits derived from the Telexfree network (from sales of VoIP 99 Telexfree accounts, from new registration, ad postings, forming new direct or indirect binaries, royalty, Team Builder, among others which may be owed); that the breach of any of the above determinations will incur in the payment of a fine of R$ 100,000.00 (one hundred thousand Reais) for each new registration or re-registration and each improper payment.{{cite news|title=Injunction did not stop: assets and payments of Telexfree remain suspended by the Justice (in Portuguese)|url=http://www.bk2.com.br/noticia/10266/liminar-nao-caiu-bens-e-pagamentos-da-telexfree-seguem-suspensos-pela-justica|language=pt|access-date=December 16, 2013|newspaper=BK2 Economia|date=June 24, 2013|archive-date=March 4, 2016|archive-url=https://web.archive.org/web/20160304033646/http://www.bk2.com.br/noticia/10266/liminar-nao-caiu-bens-e-pagamentos-da-telexfree-seguem-suspensos-pela-justica|url-status=dead}}{{cite web|title=Telexfree promoters protest again in Recife (in Portuguese)|url=http://www.leiaja.com/noticias/2013/divulgadores-da-telexfree-voltam-protestar-no-recife/|language=pt|work=Leia Já|access-date=December 16, 2013|archive-date=March 1, 2021|archive-url=https://web.archive.org/web/20210301134426/https://www.leiaja.com/noticias/2013/divulgadores-da-telexfree-voltam-protestar-no-recife/|url-status=dead}}|sign=Telexfree Brazil, via a splash page on its website{{cite web |url=http://www.telexfree.com/ |title=TelexFREE |access-date=2013-12-04 |url-status=dead |archive-url=https://web.archive.org/web/20131205135017/http://www.telexfree.com/ |archive-date=December 5, 2013 |df=mdy-all }}}}

In response to the seizure of the company's operations, Telexfree promoters protested throughout the country. On July 23, 2013, a group of protesting promoters in Brasília blocked operations at Juscelino Kubitscheck International Airport. Marcus França, one of Telexfree's top promoters, stated, "we won't go back to the hoe, like the system wants us to", referring to the labor of weeding grass commonly performed by lower class Brazilian countrymen.{{cite web|url= http://g1.globo.com/distrito-federal/noticia/2013/07/protesto-em-apoio-telexfree-fecha-acessos-ao-aeroporto-de-brasilia.html|title=Telexfree Promoters Close Brasilia Airport Access |date=July 23, 2013 |language=pt |publisher=G1 Portal|access-date=Dec 2, 2013}}{{cite web|url= http://economia.uol.com.br/noticias/redacao/2013/07/23/manifestantes-da-telexfree-bloqueiam-acessos-ao-aeroporto-de-brasilia.htm|title=Telexfree Promoters Block Brasilia Airport Access |language=pt |publisher=UOL Portal|access-date=Dec 2, 2013}} Immediately after blocking operations, Telexfree tried to divert {{USD|88 million}} to other parent companies in Brazil, one of them named Worldxchange Intermediação de Negócios Ltda,{{cite web|url=https://commons.wikimedia.org/wiki/File:WORLDXCHANGE_-_CNPJ.pdf|title=Worldxchange Public Registration Company Record |language=pt |publisher=Receita Federal|access-date=Dec 10, 2013}} belongs to Telexfree founder and director Carlos Nataniel Wanzeler.{{cite web|url= http://www.patrickpretty.com/2013/07/03/report-telexfree-diverted-88-million-after-brazilian-judge-blocked-payments/|title=Telexfree diverted 88 million after brazilian judge blocked payments |date=July 3, 2013 |publisher=Patricpretty MLM|access-date=Dec 5, 2013}}{{cite web|url= https://translate.google.com/translate?sl=auto&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&u=http%3A%2F%2Feconomia.ig.com.br%2F2013-07-03%2Fministerio-publico-pede-fim-da-telexfree-socios-tentaram-desviar-r-88-milhoes.html|title=Prosecutor urges end to Telexfree and members try to deflect R$ 101 million (PT/EN)|publisher=IG News Portal|access-date=Dec 4, 2013}}

In the last week of July, 2013, Telexfree decided to appeal again (regimental appeal) in Acre state, but Telexfree did not pay a U$20 fee in order to get the appeal accepted to be judged. The appeal was rejected by the judges of Tribunal de Justiça of Acre{{cite web|url= http://economia.uol.com.br/noticias/redacao/2013/07/24/por-falta-de-r-40-tj-do-acre-deixa-de-julgar-recurso-da-telexfree.htm|title=For lack of R$ 40, TJ Acre stop judging Telexfree appeal|language=pt |publisher=UOL News Portal|access-date=Dec 15, 2013}}{{cite web|url= http://g1.globo.com/ac/acre/noticia/2013/07/telexfree-tem-novo-recurso-negado-notj-ac-e-permanece-suspensa.html|title=TJ stops judging Telexfree resource for non-payment of fee |date=July 24, 2013 |language=pt |publisher=G1 News Portal|access-date=Dec 14, 2013}} citing lack of payment and causing severe damage to the image of company lawyers before its promoters.

Also in July 2013, a lawyer from Rondonopolis, Mato Grosso, won in court the right to have his invested money returned; according to the decision of the court 3a Vara Cível, which ordered a Telexfree Brazilian company representative to reimburse him the amount of R$101,500 (about {{USD|50,000}}.{{cite web|url=http://economia.uol.com.br/noticias/redacao/2013/07/25/justica-do-mt-obriga-telexfree-a-devolver-r-1015-mil-a-consumidor.htm|title=Mato Grosso State Court obliges Telexfree to return R$ 100 thousand to an investor |language=pt |publisher=UOL Website|access-date=Dec 2, 2013}} Later that month, the ninth appeal to reverse the ban on operations was dismissed,{{cite web|url=http://economia.ig.com.br/2013-07-30/telexfree-sofre-9-derrota-no-acre-e-apresenta-novo-recurso-bloqueio-segue.html|title=Telexfree suffer 9th lost in the court |language=pt |publisher=IG News Portal Website|access-date=Dec 5, 2013}} and weeks later the tenth appeal was also denied.{{cite web|url=http://www.ebc.com.br/tecnologia/2013/08/justica-do-acre-mantem-suspensao-de-todas-as-atividades-da-telexfree|title=Acre State Authorities Maintains Telexfree Suspension |date=August 13, 2013 |language=pt |publisher=EBC Website|access-date=Dec 5, 2013}}

In an attempt to unfreeze its assets and continue operations, Telexfree offered the court its own brand as a guarantee of payment that according to the company was worth 660 million Brazilian reals or approximately {{USD|300 million}}.{{cite web|url=http://gazetaonline.globo.com/_conteudo/2013/07/noticias/dinheiro/1454070-garantia-da-telexfree-e-sua-propria-marca.html|title=Telexfree offer its brand to the court|language=pt|publisher=Gazeta newspaper|access-date=Dec 2, 2013|archive-date=February 26, 2021|archive-url=https://web.archive.org/web/20210226042809/http://gazetaonline.globo.com/_conteudo/2013/07/noticias/dinheiro/1454070-garantia-da-telexfree-e-sua-propria-marca.html|url-status=dead}} The offer was refused and Telexfree remained suspended. Four months later, news reported rumours of logo plagiarism by the company (see section below).{{cite web|url=http://behindmlm.com/companies/telexfree/carlos-costa-god-used-me-to-create-telexfree/|title=Good Used Me to Create Telexfree says Carlos Costa |publisher=Behind MLM|access-date=Dec 7, 2013}}{{cite web|url=http://veja.abril.com.br/blog/radar-on-line/internet/telexfree-depois-da-piramide-financeira-agora-esta-as-voltas-com-plagio/|title=Telexfree after Ponzi Scheme, a Plagiarism case|language=pt |publisher=Veja Magazine|access-date=Dec 7, 2013}}{{cite web|url=http://www.canaldootario.com.br/blog/telexfree-ou-bwf-world-championships/|title=Telexfree or BFW ?|language=pt|publisher=Canal do Otário|access-date=Dec 7, 2013|archive-date=February 28, 2021|archive-url=https://web.archive.org/web/20210228152036/http://www.canaldootario.com.br/blog/telexfree-ou-bwf-world-championships/|url-status=dead}}{{cite web|url=http://exame.abril.com.br/marketing/noticias/telexfree-muda-identidade-visual-em-meio-a-rumores-de-plagio|title=Telexfree announces re-brand after rumors of plagiarism. |date=November 21, 2013 |language=pt |publisher=Exame Magazine|access-date=Dec 7, 2013}}{{cite web|title=Acre's governor declares support Telexfree, suspected of financial pyramid|url=http://economia.ig.com.br/2013-11-22/governador-do-acre-declara-apoio-a-telexfree-suspeita-de-piramide-financeira.html|work=IG Economia|access-date=December 12, 2013}}

In August 2013, Telexfree was fined by ANATEL, the Brazilian telecommunications regulatory agency, for lacking a license to provide VoIP services in the country. ANATEL released a public statement saying, "Offering Services of Internet Connections (SCI), which is a value-added service defined in Article 61 of the General Law of Telecommunications (LGT), regardless of which medium or technology used, such as dial-up connection, radio frequency, cable, among others, it must be associated with a telecommunications service properly regulated by ANATEL".{{cite web|url=http://g1.globo.com/economia/negocios/noticia/2013/08/anatel-multa-e-denuncia-telexfree-por-prestar-servico-sem-autorizacao.html|title=Anatel fines Telexfree by offering VoIP services without authorization |date=August 23, 2013 |language=pt |publisher=G1 News Portal|access-date=Dec 2, 2013}}{{cite web|url=http://www.cidademarketing.com.br/2009/extras/fiscalizacao_voip_telexfree_irregularidade.pdf|title=Anatel fiscalization report|language=pt|publisher=ANATEL|access-date=Dec 2, 2013|archive-date=July 17, 2013|archive-url=https://web.archive.org/web/20130717143513/http://www.cidademarketing.com.br/2009/extras/fiscalizacao_voip_telexfree_irregularidade.pdf|url-status=dead}}

After 13 attempts to overturn the injunction that shut down its operations in Brazil, Ympactus Comercial Ltda declared bankruptcy on September 20, 2013, when judicial recovery was requested in the court Vara de Recuperação Empresarial e Falência of Vitória.{{cite web|url=http://g1.globo.com/espirito-santo/noticia/2013/09/diretor-diz-que-telexfree-vai-recorrer-para-recuperacao-judicial.html|title=Diretor diz que Telexfree vai recorrer para recuperação judicial |date=September 25, 2013 |trans-title=Telexfree Director says that they will request bankruptcy |language=pt |publisher=G1 News Portal|access-date=Dec 9, 2013}}{{cite web|url=http://exame.abril.com.br/negocios/noticias/concordata-da-telexfree-sera-uma-maravilha-diz-diretor|title=Telexfree bankruptcy will be wonderful, says company director |date=September 20, 2013 |language=pt |publisher=Exame Magazine|access-date=Dec 9, 2013}}{{cite web|url=http://economia.uol.com.br/noticias/redacao/2013/09/20/telexfree-entra-na-justica-com-pedido-de-recuperacao-judicial.htm|title=Telexfree ask judicial recovery |language=pt |publisher=UOL News Portal|access-date=Dec 9, 2013}} This request focused on releasing the company's assets and paying its debtors, according to a bankruptcy plan presented to the Ministry of Justice. According to Carlos Roberto Costa, company director, in a video, the company will only pay to its investors the money that they have in their back-office and not the total money invested.{{cite web|url=https://www.youtube.com/watch?v=YPzRdSKR_pc|title=Plantão Telexfree #14 |language=pt |publisher=Telexfree|access-date=Dec 9, 2013}}{{cite web|url=https://www.youtube.com/watch?v=IFjmHZk6xJc|title=Plantão Telexfree #15 |language=pt |publisher=Telexfree|access-date=Dec 9, 2013}} The court immediately blocked this maneuver to protect company assets and guarantee the maximum "pro-rata" amount would be returned to its investors when the time came.{{cite web|url=http://exame.abril.com.br/brasil/noticias/justica-nega-pedido-de-recuperacao-judicial-da-telexfree|title=Court denies Telexfree judicial recovery request|language=pt |publisher=Exame Magazine|access-date=Dec 9, 2013}}{{cite web|url=http://economia.ig.com.br/2013-09-24/caso-telexfree-justica-nega-pedido-de-recuperacao-judicial.html|title=Telexfree Case: Court denies judicial recovery request|language=pt |publisher=IG News Portal|access-date=Dec 10, 2013}}

In November 2013, as a last attempt to avoid auditing in its operations, Telexfree in Brazil tried to arrange a mediation with Brazilian legal authorities and return to business. The meeting was held in Rio Branco, Acre state capital, but the company and the Ministry of Justice did not reach an agreement.{{cite web|url=http://behindmlm.com/companies/telexfree/judge-rejects-telexfrees-mediation-proposals|title=Telexfree Mediation Proposal |publisher=Behind MLM website|access-date=Dec 2, 2013}}{{cite web|title=Mediation hearing ends with no agreement between Telexfree and Public Ministry in Acre|date=November 14, 2013|url=http://g1.globo.com/ac/acre/noticia/2013/11/audiencia-termina-sem-acordo-entre-mp-e-telexfree-no-ac.html|publisher=G1|access-date=10 December 2013}} Following this, the company began undergoing an audit, done by BDO, and the findings will be sent to Acre's public prosecutors to analyze.{{cite web|url=http://diario.tjac.jus.br/display.php?Diario=3050&Secao=374|title=Diário da Justiça do Acre|language=pt |publisher = Tribunal de Justiça do Acre|access-date=Dec 5, 2013}} After the mediation meeting ended, the Telexfree promoter Flávio Arraz was arrested, being accused of insulting the public prosecutor of the case, Alessandra Marques, calling her "Blond Devil".{{cite web|url=http://g1.globo.com/ac/acre/noticia/2013/11/promotora-do-caso-telexfree-manda-prender-divulgador-por-desacato.html|language=pt |title= Public Prosecutor arrests Telexfree promoter |date=November 14, 2013 |publisher = G1 News Portal|access-date=Dec 16, 2013}}

Two cases of suicide linked to the stoppage of the company have been reported in the Brazilian newspapers.{{cite web|url=http://www.patrickpretty.com/2013/12/02/disturbing-new-low-for-mlm-telexfree-affiliate-spams-sign-up-offer-in-comments-thread-about-tragic-suicide-death-of-fellow-affiliate/|title=Tragic Suicide Death Telexfree Affiliates |date=December 3, 2013 |publisher=Patrick Pretty Website|access-date=Dec 3, 2013}}

In September 2015, the company was convicted by the Justice of Acre State for operating a Pyramid Scheme.

In early June 2013, the insurance company Liberty Seguros released a note on its website, in response to statements made by Telexfree representatives that both companies had started a partnership:

{{blockquote|text=Liberty Seguros informs that has no partnership with the company Telexfree. The announcement disclosed, pointing Liberty Seguros as its business partner, is unfounded and constitutes false advertising. Liberty Seguros sells insurance only in partnership with brokers duly registered in SUSEP (Superintendence of Private Insurance). Any offer of Telexfree products or services in the name of Liberty Seguros should be disregarded.{{cite web|title=Liberty Seguros is not a partner of Telexfree|url=http://www.sindsegsp.org.br/site/noticia-texto.aspx?id=10243|publisher=Sindsegsp (Union of Insurance, Pension Plans and Capitalization of the State of Sao Paulo)|access-date=December 19, 2013|language=pt|archive-date=November 30, 2022|archive-url=https://web.archive.org/web/20221130003024/http://www.sindsegsp.org.br/site/noticia-texto.aspx?id=10243|url-status=dead}}{{cite web|title=Liberty Seguros is not a partner of Telexfree|url=http://www.sincor-es.com.br/noticias-ver.asp?cod=14101|publisher=Sincor-ES (Union of Insurance brokers and Insurance Companies of Espirito Santo State)|access-date=December 19, 2013|language=pt}}{{cite web|title=In an attempt to circumvent the injunction, Telexfree attacks|url=http://jornalggn.com.br/blog/na-tentativa-de-burlar-medida-cautelar-telexfree-ataca|work=GGN|date=June 24, 2013|publisher=Luis Nassif Online|access-date=December 19, 2013|language=pt}}{{cite web|title=Liberty Seguros is not a partner of Telexfree|date=June 4, 2013|url=http://www.cqcs.com.br/noticia/liberty-seguros-nao-e-parceira-da-telexfree/|publisher=CQSC (Center of Qualification of Insurance broker)|access-date=December 19, 2013|language=pt}} |sign= Liberty Seguros, via its newsletter}}

On July 21, 2013, right after the Acre State Court cautionary injunction, director Carlos Costa released a video presenting an alleged contract between TelexFree and insurance company Mapfre Seguros, supposedly guaranteeing TelexFree affiliate's investments and the company's suitability. "Your business will be ensured. You, who was 100% Telexfree, will also be 100% safe", Costa says in video. "Would you think that Mapfre would do a insurance of something that was not 100% legal? Of course not. So here's it for you to see. People, [this] is the legality of our company."{{cite web|title=Insurance contract with Telexfree is false, says Mapfre|url=http://economia.ig.com.br/2013-06-24/contrato-de-seguro-com-a-telexfree-e-falso-afirma-mapfre.html|publisher=IG Economy|access-date=December 19, 2013|language=pt}}{{cite web|title=Executive Telexfree displays contract with Mapfre in video, but insurance company says it is fake|url=http://www.administradores.com.br/noticias/economia-e-financas/executivo-da-telexfree-exibe-contrato-com-a-mapfre-em-video-mas-a-seguradora-diz-que-e-falso/77197/|publisher=Administradores Notícias|access-date=December 19, 2013|language=pt}}{{cite web|title=Mapfre Seguros denies partnership with Telexfree Brazil| date=June 24, 2013 |url=http://cenariomt.com.br/noticia.asp?cod=298718&codDep=1|publisher=CenarioMT|access-date=December 19, 2013|language=pt}}{{cite web|title=Mapfre lawyer visits MPAC and reaffirms that the insurer has no contract with Telexfree|url=http://www.oriobranco.net/acre/32838-advogado-da-mapfre-visita-o-mpac-e-reafirma-que-seguradora-nao-tem-contrato-com-telexfree.html|publisher=ORB|access-date=December 19, 2013|language=pt|archive-date=December 20, 2013|archive-url=https://web.archive.org/web/20131220070704/http://www.oriobranco.net/acre/32838-advogado-da-mapfre-visita-o-mpac-e-reafirma-que-seguradora-nao-tem-contrato-com-telexfree.html|url-status=dead}}{{cite web|title=Acre judge decides to keep the suspension of Telexfree; Mapfre says contract with Telexfree is false|url=http://www.portalrondonia.com/noticias/31606.htm|publisher=Portal Rondonia|access-date=December 19, 2013|language=pt}}{{cite web|title=Mapfre has no commercial relationship with Telexfree, says lawyer|date=July 25, 2013|url=http://www.ac24horas.com/2013/07/25/a-mapfre-nao-tem-qualquer-relacao-comercial-com-a-telexfree-diz-advogado/|publisher=AC24horas|access-date=December 19, 2013|language=pt}} In response, Mapfre released a note on its website, stating the contract was false:

{{blockquote|text=Mapfre Seguros advises that does not have any business relationship or partnership with Telexfree and Ympactus Comercial Ltda companies. The dissemination of information that is suggesting a contractual obligation between the group insurance with these companies is not true. There was only a receiving of documents to study an insurance proposal, which was not executed. Mapfre Seguros also informs that it will take appropriate legal action for misuse of its brand and all damage eventually caused. We also point out that in the portfolio of Mapfre Seguros Guarantee there is not a product that ensures the company, under the conditions disclosed".|sign= Mapfre Seguros, via its website{{Cite web |url=http://www2.mapfre.com.br/comunicado?redirect=%2Fhome%3Fp_p_id%3Dsearch_WAR_mapfresearchportlet%26p_p_lifecycle%3D2%26p_p_state%3Dnormal%26p_p_mode%3Dview%26p_p_cacheability%3DcacheLevelPage |title=A MAPFRE Seguros informa que não tem nenhum tipo de relação comercial ou de parceria com as empresas Telexfree e Ympactus Comercial Ltda. |date=June 24, 2013|access-date=December 19, 2013 |archive-date=July 26, 2014 |archive-url=https://web.archive.org/web/20140726141439/http://www2.mapfre.com.br/comunicado?redirect=%2Fhome%3Fp_p_id%3Dsearch_WAR_mapfresearchportlet&p_p_lifecycle=2&p_p_state=normal&p_p_mode=view&p_p_cacheability=cacheLevelPage |url-status=dead }}}}

The Public Prosecutor of the Telexfree case, Alessandra Marques, and the Judge of 2nd Civil Court, Thais Queiroz B. de Oliveira Abou Khalil, have reported death and kidnapping threats after the court's decision to freeze Telexfree assets and operations in Brazil.{{cite web|url= http://economia.uol.com.br/noticias/redacao/2013/07/24/promotora-do-caso-telexfree-diz-ter-sido-ameacada-de-morte.htm|language=pt |title= Public Prosecutor Reported Death Threats |publisher = UOL News Portal|access-date=Dec 16, 2013}}{{cite web|url= http://g1.globo.com/ac/acre/noticia/2013/09/juiza-do-caso-telexfree-volta-ser-ameacada-de-morte-no-acre.html|language=pt |title= Telexfree case judge began again to receive death threats |date=September 12, 2013 |publisher = G1 News Portal|access-date=Dec 16, 2013}}{{cite web|url=http://gazetaonline.globo.com/_conteudo/2013/09/noticias/dinheiro/1460456-juiza-do-caso-telexfree-recebe-novas-ameacas-de-morte-e-ate-de--feiticaria--contra-os-filhos.html|language=pt|title=Telexfree case judge received new death threats and witchcraft against her kids|publisher=Gazeta Newspaper|access-date=Dec 16, 2013|archive-date=December 17, 2013|archive-url=https://web.archive.org/web/20131217221736/http://gazetaonline.globo.com/_conteudo/2013/09/noticias/dinheiro/1460456-juiza-do-caso-telexfree-recebe-novas-ameacas-de-morte-e-ate-de--feiticaria--contra-os-filhos.html|url-status=dead}}{{cite web|url= http://www.correiodoestado.com.br/noticias/juiza-que-bloqueou-pagamentos-da-telexfree-e-ameacada-de-mor_186587/l|language= pt|title= Judge that blocks Telexfree payments received several death threats|publisher= Correio do Estado Newspaper|access-date= Dec 16, 2013|url-status= dead|archive-url= https://web.archive.org/web/20131217221406/http://www.correiodoestado.com.br/noticias/juiza-que-bloqueou-pagamentos-da-telexfree-e-ameacada-de-mor_186587/l|archive-date= December 17, 2013|df= mdy-all}} According with the Public Ministry, those threats arrived through e-mails, phone calls and online posting done by Telexfree promoters.

GAECO (Special Action Group to Combat Organized Crime) and the police started to investigate the threats and some suspects have been identified. Since these threats began, the police have been assigned to provide protection to the Judge and Public Ministry Prosecutor.{{cite web|url=http://www.olhardireto.com.br/juridico/noticias/exibir.asp?noticia=Gaeco_e_Policia_Civil_investigam_ameacas_a_juiza_do_caso_Telexfree&id=11018|language=pt |title= GAECO and the police are investigating the threats against Telexfree Judge |publisher = Olhar Juridico Website|access-date=Dec 16, 2013}}

In December 2013, the Public Ministry issued an official statement denying the false information that Alessandra Marques, Telexfree case prosecutor, had been supposedly killed and that her body had been found by the police. The Public Ministry asked for a criminal investigation against the authors of the rumours, understanding that this practice is a "virtual terrorism" and "an attempt to coerce and intimidate the public prosecutors in its relevant challenge to defend the interests of society" The note concludes by stating that "given the gravity of the fact presented here, the Public Ministry calls on all its members to remain united around the ideals that guide the institution and not to be intimidated by any threat, recalling that only two species of people fear the actions of the Public Ministry: the ignorant, who do not know it; and the criminals, who know it too well".{{cite web|url=http://g1.globo.com/ac/acre/noticia/2013/12/mp-ac-repudia-falsa-noticia-sobre-morte-de-promotora-do-caso-telexfree.html|language=pt |title= False news about the death of public prosecutor in the Telexfree case |date=December 13, 2013 |publisher = G1 News Portal|access-date=Dec 16, 2013}}{{cite web|url=http://terramagazine.terra.com.br/blogdaamazonia/blog/2013/12/13/mp-pede-investigacao-criminal-de-%E2%80%9Cterrorismo-virtual%E2%80%9D-contra-promotora-do-caso-telexfree/|language=pt |title= Public Ministry ask for a criminal investigation against terrorism with Telexfree prosecutor |publisher = TERRA News Portal|access-date=Dec 16, 2013}}{{cite web|url=http://cenariomt.com.br/noticia.asp?cod=332561&codDep=1|language=pt |title= Acre Public Ministry rejects false news about the death of the promoter case Telexfree |publisher = Cenario MT Website|access-date=Dec 16, 2013}}

In a December 2013 interview regarding her tenor as General Prosecutor for the Brazilian Public Ministry, Patrícia Rêgo said:

{{blockquote|text=Regarding to Telexfree, this case was to close the year with a flourish. Prosecutors [participating in the investigation] are 100% convinced that it is a Pyramid Scheme. In addition the false news about the death of Public Prosecutor from Acre Public Ministry, Alessandra Marques, hurt me a lot. You don't play with something like that. The Public Ministry is investigating and will give a pedagogic answer to the society.{{cite news|title=Patrica Rêgo Interview (in Portuguese)|url=http://agazeta.net/noticias/noticias/2080-nao-tenho-a-g-7-como-operacao-do-ministerio-publico-diz-patricia|language=pt|access-date=December 16, 2013|newspaper=A Gazeta Newspaper|date=Dec 18, 2013|archive-date=December 19, 2013|archive-url=https://web.archive.org/web/20131219150837/http://agazeta.net/noticias/noticias/2080-nao-tenho-a-g-7-como-operacao-do-ministerio-publico-diz-patricia|url-status=dead}}|sign=Patricia Rêgo, via Gazeta Interview }}

{{Expand section|More details and updates on the trial and criminal charges|date=April 2014}}

Telexfree has its worldwide operations, excluding Brazil, operated by Telexfree LLC Brazilian operations are held by Ympactus Comercial Ltda.

The owners of Telexfree Inc.{{mdash}}Carlos Roberto Costa, Carlos Nataniel Wanzeler and James Matthew Merrill{{mdash}}also have companies in the UK, named TelexFree Ltd and in Canada, named TelexFree Canada Inc.

In April 2014, Telexfree's US business unraveled amid accusations by the US government and regulators in Massachusetts that the company was a massive pyramid scheme. Telexfree's US assets were frozen on April 16, and it declared bankruptcy two days later. Co-owner James Merrill was arrested, and Carlos Wanzeler fled to his native Brazil. Carlos Wanzeler's wife Katia Wanzeler was arrested in the airport in New York while trying to board a plane heading to Brazil. Authorities said the company claimed to provide Internet telephone services, but actually made money only from the fees paid by investors, who were told they would be paid for approving ads that would allegedly appear on the Internet.{{cite news|url=https://www.bostonglobe.com/business/2014/05/09/telexfree-owner-arrested-worcester/EFuEWcbcvBlvQuCrhtUGdP/story.html|title=TelexFree owners charged with fraud|publisher=Boston Globe|access-date=June 18, 2013|last1=Dayal McCluskey|first1=Priyanka|last2=Ailworth|first2=Erin|date=May 9, 2014|archive-date=March 27, 2019|archive-url=https://web.archive.org/web/20190327091429/https://www.bostonglobe.com/business/2014/05/09/telexfree-owner-arrested-worcester/EFuEWcbcvBlvQuCrhtUGdP/story.html|url-status=dead}}{{cite web|url=https://www.bostonglobe.com/business/2014/05/15/attorney-office-wife-telexfree-owner-arrested-she-tried-leave-country/ZIIjvl3TZ4EPQMlwaUoEaM/igraphic.html|title=TelexFree money, operatives were on the move: Timeline|publisher=Boston Globe|access-date=June 18, 2013|date=May 15, 2014|archive-date=March 27, 2019|archive-url=https://web.archive.org/web/20190327090137/https://www.bostonglobe.com/business/2014/05/15/attorney-office-wife-telexfree-owner-arrested-she-tried-leave-country/ZIIjvl3TZ4EPQMlwaUoEaM/igraphic.html|url-status=dead}}

{{Expand section|Governments warnings in Portugal and islands in the UK, Rwanda case, and news released in Spain|date=April 2014}}

In Dominican Republic two local TV Channels, TV Color Vision and TV Teleuniverso, reported that Telexfree launched in August 2013 its marketing plan in the country in an event where Carlos Wanzeler, Sanderley Rodrigues (Sann Rodrigues) and Steve Labriola where present. The company was promoting its business model saying that people would get a high rate of return on their investment without sales requirements. Furthermore, the Color Vision investigation showed that Telexfree does not have a local office or authorization to sell VoIP services in the country and their office in Massachusetts is only a virtual one.{{cite web|url=http://cachicha.com/2013/09/telexfree-un-negocio-multinivel-en-alerta-roja-video-nuriapiera/|language=es|title=Red Alert to Telexfree Multi level business|publisher=Color Vision TV - Nuria Piera Show|access-date=Dec 19, 2013|archive-date=September 26, 2013|archive-url=https://web.archive.org/web/20130926165335/http://cachicha.com/2013/09/telexfree-un-negocio-multinivel-en-alerta-roja-video-nuriapiera/|url-status=dead}}{{cite web|url=http://cachicha.com/2013/09/estafas-en-las-redes-alerta-por-telexfree-addisburgos-codigocalle-video/|language=es|title=Scams Alert in TelexFree Business|publisher=Teleuniverso TV - Addis Burgos / Codigo Calle Show|access-date=Dec 19, 2013|archive-date=September 21, 2013|archive-url=https://web.archive.org/web/20130921132653/http://cachicha.com/2013/09/estafas-en-las-redes-alerta-por-telexfree-addisburgos-codigocalle-video/|url-status=dead}}{{cite web|url=http://www.diariolibre.com/noticias_det.php?id=397916&l=1|language=es|title= TelexFREE - Fraud or Business ?|publisher=Diario Libre Newspaper|access-date=Dec 19, 2013}}

In November 2013, a Colombian magazine released an article about Telexfree operations in Colombia comparing its method of operation and the high rate of return with other local broken Ponzi schemes, D.M.G. Grupo Holding S.A. and Proyecciones D.R.F.E., that had previously affected the country's economy.{{cite web|url=http://www.semana.com/nacion/articulo/telexfree-es-una-piramide-virtual/364449-3|title=Is Telexfree a Virtual Pyramid Scheme ? |date=November 13, 2013 |language=es |publisher=Semana Magazine|access-date=Dec 16, 2013}}

According with news by Peruvian Press in December 2013, World Capital Market 777 (WCM777), a recently shut-down Ponzi scheme based in Hong Kong,

{{cite web|url=http://behindmlm.com/companies/massachusetts-sec-halts-wcm777-blgm-closed/|title=Massachusetts SEC "halts" WCM777, BLGM closed?|publisher=Behind MLM|access-date=Dec 15, 2013}}{{cite web|url=http://www.businessforhome.org/2013/11/wcm777-closed-down-by-usa-authorities/|title=WCM777 closed down by USA authorities|date=November 16, 2013|publisher=Business Home Magazine|access-date=Dec 15, 2013}}{{cite web|url=http://www.patrickpretty.com/2013/11/15/urgent-bulletin-moving-massachusetts-halts-wcm777-says-it-was-selling-unregistered-securities-and-targeting-brazilian-community/|title=Massachusetts Halts WCM777, Says It Was Selling Unregistered Securities And Targeting Brazilian Community|date=November 15, 2013|publisher=Patric Pretty MLM News|access-date=Dec 15, 2013}} and Telexfree LLC, had their operations prohibited by Superintendencia de Banca, Seguros y AFP (SBS) in Peru.{{cite web|url=http://behindmlm.com/companies/telexfree/telexfree-and-wcm777-banned-in-peru/ |title=Telexfree and WCM777 Banned from Peru|publisher=Behind MLM|access-date=Dec 15, 2013}}{{cite web|url=http://www.andina.com.pe/Espanol/noticia-empresas-wcm777-y-telexfree-no-estan-autorizados-para-captar-dinero-del-publico-486768.aspx#.Uq4lwPRUdQQ|title=WCM777 and Telexfree are not allowed to collect money from people|language=es|publisher=Agencia Peruana de Noticias|access-date=Dec 15, 2013|archive-date=December 15, 2013|archive-url=https://web.archive.org/web/20131215221313/http://www.andina.com.pe/Espanol/noticia-empresas-wcm777-y-telexfree-no-estan-autorizados-para-captar-dinero-del-publico-486768.aspx#.Uq4lwPRUdQQ|url-status=dead}}{{cite web|url=http://peru21.pe/actualidad/sbs-advierte-que-telexfree-no-esta-autorizada-captar-dinero-2161439|title=WCM777 and Telexfree are not allowed to collect money from people|language=es|publisher=Peru 21 News Portal and Newspaper|access-date=Dec 15, 2013|archive-date=June 12, 2016|archive-url=https://web.archive.org/web/20160612233023/http://peru21.pe/actualidad/sbs-advierte-que-telexfree-no-esta-autorizada-captar-dinero-2161439|url-status=dead}}{{cite web|url=http://www.patrickpretty.com/2013/12/14/bulletin-peru-issues-alerts-on-telexfree-wcm777/|title=BULLETIN: Peru Issues Alerts On TelexFree, WCM777 |date=December 14, 2013 |publisher=Patrick Pretty MLM News|access-date=Dec 15, 2013}} Peruvian authorities asked the population to report any local operations from both companies to the National Police and the Public Ministry in order to close the schemes.

Regardless of its operations worldwide, Telexfree was developed on the same basis as the Ponzi scheme named Universo Foneclub, designed and owned by now Telexfree promoter Sanderley Rodrigues de Vasconcelos (aka Sann Rodrigues).{{cite web|url=http://veja.abril.com.br/noticia/economia/para-justica-possivel-mentor-da-telexfree-e-especialista-em-piramides|title=According to Court Justice, possible Telexfree mentor is an "expert" in Pyramid Schemes|publisher=Veja Abril Magazine|access-date=December 9, 2013}}{{cite web|url=http://gazetaonline.globo.com/_conteudo/2013/03/noticias/dinheiro/1416356-ex-dono-de-piramide-divulga-novo-negocio.html|title=Pyramid Scheme Owner promotes Telexfree|language=pt|publisher=Gazeta On-Line Newspaper|access-date=December 10, 2013|archive-date=February 28, 2021|archive-url=https://web.archive.org/web/20210228175541/http://gazetaonline.globo.com/_conteudo/2013/03/noticias/dinheiro/1416356-ex-dono-de-piramide-divulga-novo-negocio.html|url-status=dead}} Universo Foneclub was registered in the US and targeted the Brazilian community. It was shut down by the U.S. Securities and Exchange Commission in May 2006.{{cite web|url=https://www.sec.gov/litigation/complaints/2006/comp19715.pdf|title=SEC Report - Universo Foneclub |publisher=U.S. Securities and Exchange Commission|access-date=December 9, 2013}}{{cite web|url=https://www.sec.gov/litigation/litreleases/2007/lr20127.htm|title= SEC Litigation Release No. 20127 / May 23rd, 2007 |publisher=U.S. Securities and Exchange Commission|access-date=December 9, 2013}}

File:Comparing telexfree and badminton tournament logos.jpg

In November 2013, Telexfree, which started its operations in 2011, was accused of having plagiarized its brand identity from 2010 BWF World Championships because of the striking resemblance between the logos.

After this episode, Telexfree and the logo's designer Vixmais Soluções (a company that belongs to one of Telexfree promoters Dilhermano Gonçalves) announced its re-branding without any official explanations about the case or any legal action brought by the logo owner Badminton World Federation or the marketing agency responsible for the creation (Taïo Design Consulting).{{cite web|url=https://www.youtube.com/watch?v=3s5Pl6OEH9k|title=Telexfree re-brand - Official Video |language=pt |publisher=Vixmais and Telexfree|access-date=Dec 7, 2013}}{{Primary-source-inline|date=December 2013}}

{{Portal|Companies}}

• Ympactus Comercial Ltda - Portuguese Wikipedia page
• List of Ponzi schemes
• High-yield investment program
• Direct selling

{{Reflist|30em}}

• [https://web.archive.org/web/20131205135017/http://www.telexfree.com/ Telexfree official website]
• [http://mlmhelpdesk.com/telexfree-review-is-telexfree-a-ponzi-or-pyramid-scheme-some-regulators-think-so/ MLM Professionals - Telexfree Analysis] {{Webarchive|url=https://web.archive.org/web/20170702195350/http://mlmhelpdesk.com/telexfree-review-is-telexfree-a-ponzi-or-pyramid-scheme-some-regulators-think-so/ |date=July 2, 2017 }}
• [http://behindmlm.com/companies/telexfree/carlos-costa-god-used-me-to-create-telexfree/ Logo issue with Badminton World Federation]
• [http://mpra.ub.uni-muenchen.de/14420/1/ponziMSS.pdf "The Mathematics of Ponzi schemes"], Artzrouni, April 2009

• [http://corp.sec.state.ma.us/CorpWeb/CorpSearch/CorpSummary.aspx?FEIN=000832397&SEARCH_TYPE=1 Telexfree INC - Massachusetts Company Official Register]
• [http://corp.sec.state.ma.us/CorpWeb/CorpSearch/CorpSummary.aspx?FEIN=001105166&SEARCH_TYPE=1 Telexfree LLC - Massachusetts Company Official Register]
• [https://www.ic.gc.ca/app/scr/cc/CorporationsCanada/fdrlCrpDtls.html?corpId=8556636&V_TOKEN=1386248733307&crpNm=Telexfree%20Canada%20Inc&crpNmbr=&bsNmbr= Telexfree Canada Inc. - Canada Corporations]
• [https://www.sec.gov/litigation/complaints/2006/comp19715.pdf SEC Shutdown Report - Universo Foneclub]
• [https://www.sec.gov/litigation/litreleases/2007/lr20127.htm SEC Litigation Release No. 20127 / May 23rd, 2007 - Universo Foneclub]
• [http://www.caldeiraopolitico.com.br/arqs/materia/8661_a.pdf Memorandum 118/GABIN/SEAE/MF from SEAE/MF Brazil about Ponzi Scheme activities of Telexfree Brazilian subsidiary] - in Portuguese.
• [http://www.cidademarketing.com.br/2009/extras/fiscalizacao_voip_telexfree_irregularidade.pdf ANATEL Supervision Report] {{Webarchive|url=https://web.archive.org/web/20130717143513/http://www.cidademarketing.com.br/2009/extras/fiscalizacao_voip_telexfree_irregularidade.pdf |date=July 17, 2013 }} - in Portuguese.
• [https://www.sec.gov/investor/alerts/ia_pyramid.htm SEC Investor Alert: Beware of Pyramid Schemes Posing as Multi-Level Marketing Programs]
• [https://www.sec.state.ma.us/sct/current/scttelexfree/Administrative-Complaint-TelexFREE-4-15-14.pdf SEC-MA Telexfree Administrative Complaint]
• [https://www.sec.gov/litigation/complaints/2014/comp-pr2014-79.pdf SEC Telexfree case report]

MDL 2566 In re TelexFree Securities Litigation consolidated all civil claims by the victims of this Pyramid scheme into one Federal court docket. Robert J Bonsignore, Esq was appointed Lead Counsel.

{{Multi-level marketing}}

Category:Pyramid and Ponzi schemes

Category:Financial crimes

Category:Privately held companies based in Massachusetts

Category:Defunct multi-level marketing companies