MORE FROM MLM LA-LA LAND: Former SEC Defendant In Pyramid-Scheme And Affinity-Fraud Case To Headline TelexFree Event In Spain

Former SEC defendant Sann Rodrigues will be a headliner at a TelexFree event scheduled next month in Spain. Source: TelexFree rolling promo on website.

Sann Rodrigues (right) will be a headliner at a TelexFree event scheduled next month in Spain. Source: TelexFree rolling promo on website.

Calling Sann Rodrigues its “TOP PROMOTER IN THE WORLD,” the alleged TelexFree pyramid scheme curiously has announced that Rodrigues will be a headliner at a TelexFree rah-rah session in Spain on March 1 and 2.

An image of Rodrigues now rolls across TelexFree’s website. But the promo does not mention that Rodrigues was successfully sued by the U.S. Securities and Exchange Commission in federal court in Massachusetts in 2006. The agency alleged that he was presiding over a pyramid scheme known as FoneClub and engaging in affinity fraud targeted at the Brazilian and Brazilian-American communities in Massachusetts.

A federal judge held Rodrigues, also known as Sanderley R. De Vasconcelos, “jointly and severally liable” with FoneClub for “$3,269,459 in disgorgement plus $151,928.49 in prejudgment interest,” the SEC said in 2007.

Prosecutors in Brazil have alleged that TelexFree is a massive pyramid scheme. The purported “opportunity” operates from Massachusetts, the same venue from which Rodrigues was sued by the SEC.

Massachusetts also was the venue from which the U.S. government brought a successful criminal prosecution against the infamous World Marketing Direct Selling (WMDS) and OneUniverseOnline (1UOL) pyramid- and affinity-fraud scheme targeted at Cambodian immigrants. The SEC also filed suit.

In the AdSurfDaily Ponzi-scheme case in 2008, the U.S. Secret Service alleged that neither ASD nor a business partner disclosed that the partner had been an SEC defendant in a successful 1997 prosecution that alleged the partner had pitched three prime-bank swindles, including one that advertised a return of 10,000 percent.

ASD was a $119 million Ponzi scheme targeted in part at the Christian community, federal prosecutors alleged.

In the $850 million Zeek Rewards’ Ponzi- and pyramid scheme in 2012, former SEC defendant Keith Laggos emerged as a key cheerleader. Laggos was sued by the SEC in 2004 in a case that alleged he didn’t disclose he was being paid to tout stock.

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11 Responses to “MORE FROM MLM LA-LA LAND: Former SEC Defendant In Pyramid-Scheme And Affinity-Fraud Case To Headline TelexFree Event In Spain”

  1. >>An image of Rodrigues now rolls across TelexFree’s website. But the promo does not mention that Rodrigues was successfully sued by the U.S. Securities and Exchange Commission in federal court in Massachusetts in 2006<<

    If it did then it would be very interesting as well as unusual.

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  2. I think charges against him was eventaully droped for the disgorgement. There’s a Brazilian report where he calimed he hired a MLM attorney who came out, looked at his comp plan, and told him he does have a pyramid scheme, and he needs to change it to only a tiny bit for membership and the rest have to be goods like phone cards and such.

    (In other words, like TelexFree)

    http://gazetaonline.globo.com/_conteudo/2013/03/noticias/dinheiro/1416356-ex-dono-de-piramide-divulga-novo-negocio.html

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  3. Wait, was that MLM attorney Gerald “I see no Ponzi” Nehra?

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  4. K. Chang: I think charges against him was eventaully droped for the disgorgement.

    From the SEC, May 23, 2007:

    __________________________________________

    “In addition, the final judgments hold De Vasconcelos and Universo FoneClub jointly and severally liable for $3,269,459 in disgorgement plus $151,928.49 in prejudgment interest but waive payment of all but $1,805,612.66 of that sum and do not impose a civil monetary penalty against De Vasconcelos or Universo FoneClub based on the sworn representations made in their Statements of Financial Condition and other documents and information submitted by them to the Commission.”

    Source:

    http://www.sec.gov/litigation/litreleases/2007/lr20127.htm

    __________________________________________

    So, in 2007, he was held accountable for $3.42 million in disgorgement and interest. The judge could have imposed a civil penalty on top of that, but Rodrigues filed a sworn financial statement.

    Based on that statement, he was shown mercy and the amount of disgorgement/interest was reduced from $3.42 million to $1.8 million.

    Patrick

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  5. Quick note: There is something else to reflect on here — that is, the recent Massachusetts action against the WCM777 “program.”

    http://patrickpretty.com/2013/11/15/urgent-bulletin-moving-massachusetts-halts-wcm777-says-it-was-selling-unregistered-securities-and-targeting-brazilian-community/

    One of the key allegations is that WCM777 was largely targeted at the state’s Brazilian community and that hotel pitches were used. The state has not identified the hotel pitchman/pitchwoman.

    There can be no doubt that Brazilians are/were a key audience for TelexFree. It is likely there are Brazilians in both TelexFree and WCM777. Certain members of the Brazilian community in Massachusetts may have exposure to two “programs.”

    As the PP Blog reported on Nov. 21, TelexFree was referenced on a Facebook site styled “Wcm777 Boston.” There was supposed to have been a big WCM777 rah-rah session in Houston in late November, but the Massachusetts action seems to have lessened the zeal. What’s not known is whether the folks who showed up at the Houston hotel got pitched on TelexFree instead.

    http://patrickpretty.com/2013/11/21/special-report-wcm777-says-its-u-s-operations-will-be-on-hold-until-further-notice-because-its-securities-sales-failed-to-fully-comply-with-laws-and-regulations-in-united-states-but-will/

    I’m not sure if the “Wcm777 Boston” group consisted of Brazilians, but it very much did seem that English was a second language in the group. So, the audience members largely could have consisted of folks whose principal language was one other than English.

    Along those lines, it once was claimed that Zeek Rewards had 100,000 members in Brazil alone. Brazilians in the United States also could have had exposure to Zeek.

    For XX number of Brazilians, these could be times of fear and uncertainty. They might have been in Zeek, TelexFree and WCM777.

    Patrick

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  6. I just had a thought over on BehindMLM… Who supplied the phone card and alleged VOIP for FoneClub?

    Can it be DiskAvontade, i.e. Wanzeler?

    If so, Sann Rodrigues is more than top rep. He may be inner circle, even co-mastermind alongside Merrill and Wanzeler.

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  7. K. Chang: If so, Sann Rodrigues is more than top rep. He may be inner circle, even co-mastermind alongside Merrill and Wanzeler.

    If you’re right, it wouldn’t be the first time a Ponzi scheme had a silent partner.

    On a side note, Merrill’s last name is misspelled twice in the TelexFree promo touting Rodrigues. It’s been that way for days now. And Steve Labriola is identified as “INTERNATIONAL OF MARKETING.”

    Meanwhile, the “TelexFreeInUSA” Facebook site hasn’t been updated for a month. It also appears to have pruned of comments in recent days.

    Patrick

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