La Republica, a newspaper in Peru, is citing information from police and reporting that a TelexFree promoter in the country was kidnapped Thursday afternoon and held in a van. The PP Blog cannot independently verify the report, which suggests the kidnapping was carried out by TelexFree members who ordered the man to withdraw money from a bank to make them whole.
In Peru and across the world, individual TelexFree members recruited others into MLM downlines. La Republica’s report suggests the kidnappers’ extortion plot failed, but one person reportedly was captured while others fled.
Court records in the United States allege that some TelexFree sponsors collected money from individual recruits, rather than directing the recruits pay TelexFree directly. Such a practice may establish a dangerous black-market economy while setting the stage for scams to occur inside of scams.
How the asserted Peruvian kidnapping victim handled TelexFree transactions is unclear. Even if recruits paid TelexFree directly, however, it’s no guarantee against an angry mob. In a 2009 Ponzi case in the United States, the FBI warned against Ponzi victims taking matters into their own hands. Four persons were charged criminally in an alleged shakedown bid associated with the 2009 case in California.
“In their guilty pleas the defendants admitted to creating an environment that was intimidating and causing the individuals to believe that they were not free to leave,” the FBI said in 2010.
On April 1, 12 days before TelexFree declared bankruptcy in the United States, unhappy affiliates jammed the “program’s” office in Massachusetts. Police were called to defuse the situation.
Here is La Republica’s May 24 report in Spanish. Access the Google Translate tool here.
It’s often the case in the HYIP sphere that individual promoters push multiple scams simultaneously, potentially setting the stage for recruits to take multiple baths. It is known, for example, that some TelexFree promoters also were pushing WCM777 and Wings Network.
The SEC has called WCM777 an $80 million fraud scheme. Wings Network has been accused in Massachusetts of selling unregistered securities as investment contracts. Vulnerable populations often are targeted in HYIP scams.
There have been reports of at least two TelexFree-related suicide deaths. Some TelexFree affiliates spammed reports of the deaths with offers to join the “program,” which the Massachusetts Securities Division has described as a combined pyramid- and Ponzi scheme that gathered more than $1.2 billion.
In April, the U.S. Securities and Exchange Commission sued TelexFree and eight managers/executive or promoters, alleging a massive fraud scheme.
Some promoters continued to promote TelexFree after a Brazilian court froze TelexFree-related assets last year and suspended new registrations in that country. Promoters’ solicitations to prospects to join the “program” continued even after a judge and prosecutor in Brazil were threatened with death.
As the PP Blog reported on May 22, the FBI and the U.S. Department of Homeland Security have established a website for TelexFree victims. So has the Massachusetts Securities Division, as the PP Blog reported on April 25. As the PP Blog reported on May 15, the U.S. Securities and Exchange Commission has published TelexFree information in English, Spanish and Portuguese.
NOTE: Our thanks to the ASD Updates Blog.