RECOMMENDED READING: 50,000 Spaniards Reportedly Plowed Money Into TelexFree

recommendedreading1In February 2014, the PP Blog reported that TelexFree had planned a purported “international convention” in Spain in early March.

The pitch for the convention, hosted in Madrid, was voiced by Sann Rogrigues, whom the U.S. Securities and Exchange Commission successfully had sued in 2006 amid allegations he was operating a pyramid scheme and engaging in affinity fraud aimed at the Brazilian community.

Rodrigues, now accused of securities fraud and a defendant in the SEC’s TelexFree civil case announced in April, reportedly was one of TelexFree’s top hucksters and had “earned” millions of dollars.

As the PP Blog reported in February (italics added):

The promo [for the Madrid convention] curiously is playing against the backdrop of an image of the Pyramids of Giza. For good measure, images of other famous world landmarks are thrown in. These include St. Basil’s Cathedral (near the Kremlin) in Moscow; Big Ben in London; The Eiffel Tower in Paris; the Empire State Building and the Statue of Liberty in New York; the Leaning Tower of Pisa; and the Burj al Arab Hotel in Dubai.

Despite the fact TelexFree was under investigation in Brazil and almost certainly knew its days were numbered in the United States because investigators were closing in, TelexFree proceeded with the Madrid event. The confab was held under a cloud growing increasingly black. On Feb. 28, the eve of the convention, the PP Blog reported that Massachusetts securities regulators were investigating TelexFree, the first confirmation of such a probe by a regulator in the United States.

James Merrill, TelexFree’s former president, attended the Madrid event with at least two other TelexFree executives or managers: Carlos Wanzeler, now described as an international fugitive who’d engaged in a criminal wire-fraud conspiracy with Merrill, and Steve Labriola, another defendant in the SEC’s fraud case.

Here is part of what Merrill said from the stage in Madrid, as reported by the PP Blog on March 3, 2014 (italics added):

Carlos Wanzeler was up here talking about Carlos Costa . . . two of the greatest leaders that I’ve met in my life,” Merrill said. “They’re very strong. They’re courageous, and they’re fighting for you. And I want you all to know that they didn’t join my team, I joined their team. OK. They’re great leaders.”

Racketeering allegations later would surface in the United States, questioning the greatness of all three men. MLM attorney Gerald Nehra, billed as an honoree at the Madrid convention, is another defendant named in the RICO actions, which were brought as prospective class-action lawsuits by TelexFree members.

Despite the fact Nehra had been billed as a star attraction of the Madrid confab, he appears not to have shown.

Instead, Labriola, who suggested from the Madrid stage that TelexFree was suited for the impoverished people of Haiti, strolled out to accept Nehra’s award.

“I was asked to come up and receive this for Jerry,” Labriola told the crowd.

Labriola did not say who asked him to accept the award for Nehra. Precisely how long TelexFree had been operating in Spain remains unclear. But only in MLM La-La Land does the juxtaposition of the images of a recidivist securities violator-in-waiting (Rodrigues) and an MLM lawyer (Nehra) make sense in marketing materials, especially since TelexFree promoters were claiming $15,125 sent to the firm returned $57,200 in a year without the need for members to sell a single product.

Rodrigues later appeared in a YouTube video in which he recorded himself tooling around in a Ferrari. He also allegedly claimed “God” started MLM and “binary.”

Now, El Pais, Spain’s largest newspaper, is reporting that TelexFree might have fleeced 50,000 Spanish investors.

Read the El Pais story. (Use the Chrome browser for a translation from Spanish to English or another language or access Google’s translation tool here.)

NOTE: Our thanks to a longtime PP Blog reader who provided the El Pais link.

ALSO: Coming soon on the PP Blog: a Special Report titled “How TelexFree’s ‘Big Revolution’ Dragged The MLM Trade, Lawyers, Payment Vendors And Service-Providers Into A La-La Land Rabbithole.”

Here’s a snippet (italics added):

On at least one occasion — in March 2014 — undercover [Homeland Security Investigations] agents were in the same conference room as TelexFree “speakers,” including alleged owners James Merrill and Carlos Wanzeler, both of whom were charged criminally in May with wire-fraud conspiracy. The room was part of the Marriott Copley Place Hotel in Boston, according to an affidavit. It turned out that, on the same date agents were in the room, a TelexFree speaker claimed from the stage that certain affiliates had been provided a private jet and that the jet had flown between the Dominican Republic and Haiti. Passengers on the jet were said to have been greeted by “the Prime Minister of Haiti’s motorcade.” The rep was pitching a TelexFree-related credit-repair “program.” Just two days earlier, on March 7, a TelexFree-related Blog falsely claimed that the TelexFree “program” at large had gained “SEC Approval from USA.”

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4 Responses to “RECOMMENDED READING: 50,000 Spaniards Reportedly Plowed Money Into TelexFree”

  1. Carlos Costa presented his name to apply for federal deputy (congressman)
    declared assets of 6 millions dollars

      (Quote)

  2. TelexFree back in the news in Peru:

    Original in Spanish:

    http://www.losandes.com.pe/Sociedad/20140710/81305.html

    Google Translation to English:

    https://translate.google.com/translate?hl=en&sl=auto&tl=en&u=http%3A%2F%2Fwww.losandes.com.pe%2FSociedad%2F20140710%2F81305.html

    Looks as though the Peruvians are tired of getting scammed by MLMers.

    Patrick

      (Quote)

  3. Quick note: Alleged TelexFree racketeer/scammer Carlos Costa now running for political office in Brazil:

    From iG (Brazil) in Portuguese:

    http://economia.ig.com.br/2014-07-08/telexfree-socio-tenta-ser-candidato-a-deputado-federal.html

    Google Translation in English:

    https://translate.google.com/translate?hl=en&sl=es&tl=en&u=http%3A%2F%2Feconomia.ig.com.br%2F2014-07-08%2Ftelexfree-socio-tenta-ser-candidato-a-deputado-federal.html

    It is not unusual for Ponzi figures to show an interest in politics. ASD’s Andy Bowdoin once purchased what effectively were banquet tickets from the National Republic Congressional Committee. With Bowdoin’s knowlege and participation, ASD’s MLMers whipped Bowdoin’s campaign donations into an endorsement of ASD by then-President George W. Bush.

    This naturally caught the attention of the U.S. Secret Service, which quietly opened a probe into ASD in early July of 2008.

    It’s also common for HYIP purveyors to drop the name of prominent politicians.

    The Costa narrative in Brazil — like many HYIP narratives — is impossibly tortured. It generally follows these lines:

    * MLM is legal. It therefore follows that TelexFree was legal.

    * The governments do not understand MLM. It therefore follows that the governments are corrupt.

    * If anything was wrong with our “program,” it’s only because the governments didn’t issue clear guidelines.

    The narrative, of course, completely ignores both the mathematics and the fraudulent nature of Ponzi schemes.

    Lots of MLMers also have been conditioned to believe that a “program can get legal later” — that is, it can sell unregistered securities and operate a Ponzi or pyramid scheme so long as it is incorporating a “compliance” plan.

    No “compliance plan” can undo bells of illegality rung earlier. Beyond that, “compliance” often is a buzzword to dupe affiliates.

    Some of this will be discussed in an upcoming Special Report on TelexFree.

    Patrick

      (Quote)

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