Faith Sloan, An Asset Freeze And A Frozen Cocktail
The “Swamp Thing.” Source: “Mobile Upload” to Faith Sloan Twitter account dated today.
A federal judge in Boston today imposed a preliminary injunction and maintained an asset freeze on alleged TelexFree promoter Faith Sloan.
Sloan, 51, apparently was bored by the heavy court matters 1,000 miles to the east. A post on her Twitter account asserts she took in a late lunch and swigged a “Swamp Thing” at Pappadeaux, a seafood kitchen. The SEC says Sloan is from Chicago. Pappadeaux has a restaurant there, near Oak Brook Mall.
Whether Sloan plans to defend against the SEC charges continues to be unclear. When contacted April 17, the SEC said, Sloan complained the agency was “picking on” her.
Our thanks to the ASD Updates Blog. Also see BehindMLM report.
Eight TelexFree figures have been charged with fraud. The Massachusetts Securities Division says the “program” was a combined Ponzi- and pyramid scheme that gathered $1.2 billion.
Me thinks she is going to need more than a frozen cocktail before this is over. Besides Orange is the new Black.
Regarding asset freezes…many Brasilians avoid banks and hold cash at home or other places like safe deposit boxes. Don’t know if Faith Sloan might do the same, or not.
One of the core dangers of TelexFree, I believe, is that it created a black-market economy roughly equivalent to the black-market peso exchange that existed in the David Murcia Pyramid scheme in Colombia.
For background:
https://patrickpretty.com/2010/01/06/blockbuster-arrest-pyramid-scheme-operator-charged-with-laundering-drug-money-david-murcia-extradicted-from-colombia-to-stand-trial-in-new-york/
https://patrickpretty.com/2010/11/24/bulletin-pyramid-scheme-figure-tied-to-international-narcotics-traffickers-pleads-guilty-in-money-laundering-conspiracy-david-murcia-and-co-conspirators-set-up-hundreds-of-companies-to-clean-up/
https://patrickpretty.com/2011/07/12/international-mlm-huckster-who-laundered-money-for-colombian-narcotics-operation-sentenced-to-9-years-in-u-s-prison-david-murcia-also-faces-30-year-term-behind-bars-in-south-america-upon-release/
I continue to believe that HYIP schemes wouldn’t sell as a movie because the audience would be required to suspend too much disbelief.
Profitable Sunrise — 2.7 percent a DAY, and Faith turns a blind eye. Zeek — 1.5 percent a DAY, and Faith turns a blind eye. TelexFree — $15,125 turns into $57,200 in a year, and Faith turns a blind eye. Noobing — an ASD reload scheme aimed at the deaf, and Faith turns a blind eye.
Sann Rodrigues appears to be blaming Gerald Nehra; my guess is that Faith will go that way, too.
This situation is beyond noxious. It is a clear and present danger to U.S. national security. What happens? Some of the “leaders” peel off and start pitching other, equally noxious “programs.”
Patrick
That’s a rather poor defense strategy? “Gerald Nehra endorsed TelexFree” isn’t a valid legal argument. People with normal knowledge will see his endorsement as a red flag. :)
I haven’t looked at the evidence, but the original complaint from SEC (doc-2.pdf) barely mentioned Faith Sloan in 2-3 of the points.
34. Videos:
March 13 2013: “Sann Rodrigues tells his story” (Faith Sloan)
June 12 2013: “Telexfree Global Power Team webinar” (Faith Sloan)
38 d. promoting (June 12 webinar)
40 d. about the same video webinar
The complaint itself was mostly about Telexfree, Wanzeler and Merrill. For many of the others there was clearly a lack of details. The best strategy is probably “So what?”, e.g. “Faith Sloan claimed in a webinar that people didn’t need to build a downline or sell VOIP services, they would be paid weekly from posting ads. So what?”.
“So what?” is about repeating the opponents own descriptions, and to point out that there isn’t anything illegal in itself in the actions described.
The case record may become more fully developed over time. Regardless, the SEC had enough to persuade a federal judge to halt the scheme and freeze the assets.
As for Sloan: My guess is that TelexFree was very willing to throw her and certain others under the bus as a means of rejecting the pre-March 9 “contracts.” But the trouble with demonizing Sloan in this context is that it’s a virtual confession TelexFree was benefiting from the “passive” income claims and willfully turned a blind eye to them. Besides, she’s been photographed with Labriola and basically billed as a TelexFree star.
Sann Rodrigues makes it even worse, so TelexFree has to throw him under the bus, too. I wouldn’t be surprised if Nehra also gets thrown under the bus. Scott Miller, too.
I generally shy away from predictions. Regardless, if TelexFree doesn’t settle in a way the SEC deems meaningful, I’d predict we’re going to see one of the worst litigation bloodbaths not only in MLM history, but in the history of American jurisprudence.
It will be every man for himself, with some folks seeing a federal agent behind every tree and others scouring the skies for black helicopters and drones.
At least one or two states will threaten to leave the Union, and the kneejerk Libertarians will claim that the best way to avoid subsequent spectacles is to legalize HYIP Ponzi schemes and perhaps let them sell reefer, too.
Patrick
Yes Scott Miller. Curious if anything will become of him. Old videos of him still on youtube. He and FS I followed to get a street feel for if/when the crash of running out of money to process payments would come after I realized it was a ponzi. Miller just stopped (around January?) then disappeared, presumably not renewing his annual at 20% fee (wise choice). He saw it coming. His FB posts were mostly mathematical regarding his downline.
In contrast, FS was more enthusiasm and B.S. Was not aware of her long history in HYIP, but given that, biggest surprise IMO is how she badly missed the end coming for Telexfree even with it being in plain sight. There we so many signs even I picked up on them, with no prior experience in this sort of thing. But them as previously said, watched a lot of people double down before March 9 contract changes.
Will never get how they didn’t see it coming at that point. So many signs and clues prior to March 9.
At the very least, Faith Sloan is out of the HYIP business for good. The best case for her at this point is if she is offered and accepts a consent decree from the SEC, and standard in any case is a permanent injunction against violating any provision of the Securities Acts etc… (and almost always involves disgorgement). If she gets off that easily, the next time she comes up on law enforcement radar, she will face serious criminal charges. She can never safely have a downline again. If nothing else, something very god will come out of this.
“So what? Being photographed with Labriola isn’t illegal in itself.” :)
That’s why I introduced the “So what?” argument. It’s a valid legal defense against some types of arguments in a complaint. The trick is to know WHEN to use it.
A quick glance at Sloan’s Facebook page might indicate if the authorities don’t wrap up with her quickly, heart disease might beat them to it:
https://www.facebook.com/faith.sloan.Godschild?fref=ts
I believe (someone is welcome to fact-check me) that Pope Gregory in the 16th century added the “Seven Deadly Sins” to the list of life’s no-no’s, and gluttony is one of them. The pictures are just so Marie Antoinette-ish, with the (misattributed) famous quote of “…let them eat cake…”.
Jerry
Our good friend is apparently paying attention to this and the other blogs. She’s scrubbed her Facebook page pretty well in the past hour…
Jerry
Faith Sloan will soon have to have put her faith in the US Correctional System where she will write her memoirs of being a career ponzi queen