UPDATED 6:23 P.M. EDT (U.S.A.) There are at least three reports in Brazilian media today that say TelexFree has blocked members’ access to their back offices.
A company attorney said the blockages were necessary because hackers had attempted an intrusion, according to reports in Portuguese translated to English by Google Translate.
Here is a link to one of the reports, with the corresponding Google translation. (Please note that Google translations often are imperfect, may appear stilted and may lack subtleties of language.)
Narratives about hackings often accompany HYIP schemes. The AdSurfDaily Ponzi scheme in the United States once claimed it could not make payments because hackers had stolen $1 million. ASD President Andy Bowdoin never reported the alleged hacking bids to police, federal prosecutors said.
In 2012, reports surfaced that the JSS Tripler/JustBeenPaid scheme that purported to pay 730 percent a year (precompounding) had been targeted by hackers. There also were reports in 2012 that accounts at Zeek Rewards (1.5 percent a day) had been hacked and that at least one individual had presented a bogus financial instrument to Zeek.
TelexFree pitchwoman Faith Sloan reported this (see italicized paragraph below) in a Blog post titled “TelexFREE Update: July 15, 2013 with Steve Labriola” that was referenced July 16 in a reader comment at BehindMLM.com.
“There were an increase in number of cashouts last Tuesday which caused the women in the office to get a huge increase in their workload. They will continue pushing out money to our bank accounts Today and Tomorrow. So be patient. He emphasized that this has absolutely nothing to do with Brazil.”
TelexFree has been under investigation in Brazil for weeks and appears to have been blocked by a court order in the state of Acre from making payments to members in Brazil. Now, some affiliates appear to be questioning whether the denial of access to their back offices means that data is being destroyed or records about money owed to affiliates by TelexFree are being changed.
The circumstance at least suggests that TelexFree continued to make payments to Americans and has been hit with a flood of cashout requests by U.S.-based affiliates concerned about the government actions in Brazil. Put another way, TelexFree could be facing an American run on its bank accounts.
Some HYIP schemes have been known to block redemption requests to fend off a bank run, but the precise circumstance TelexFree is facing is unclear. Hackings can and do occur.
Some TelexFree affiliates have claimed the “program” was using Bank of America and TD Bank in the United States to gather funds. That may have changed in April 2013 at least with respect to Bank of America, when TelexFree affiliate reports quoting Labriola surfaced that TelexFree was “pulling out of Bank of America.”
No reason was given for TelexFree’s purported decision to leave Bank of America. In May 2012, the Zeek Rewards “program” reported mysteriously that it was ending its relationship with two banks. About three months later, the SEC accused Zeek of conducting a $600 million Ponzi and pyramid scheme from North Carolina.
TelexFree lists the states of Nevada and Massachusetts as its bases of operation under the names TelexFree LLC and TelexFree Inc.
Some individuals associated with TelexFree appear also to have set up companies that use the TelexFree name. Records in California show entities with names such as ALL-IN TELEXFREE 247 LLC, LIVING-THE-DREAM TELEXFREE 247 LLC and RAIN-MAKER TELEXFREE 247 LLC. Records in Florida, meanwhile, show an entity known as TELEXFREE MARKETING INC.
Whether the United States has opened a probe into TelexFree’s activities is unknown.
Some TelexFree affiliates have claimed that a payment of $15,125 to TelexFree for the purchase of a “contract” results in an income of at least $1,100 a week for a year. TelexFree is one of several “programs” that have been targeted at victims of Profitable Sunrise, which the SEC described in April 2013 as a pyramid scheme that may have collected tens of millions of dollars.