URGENT >> BULLETIN >> MOVING: TelexFree Trustee Says He ‘Has No Intention Of Reorganizing Or Reactivating Their Businesses’

breakingnews72URGENT >> BULLETIN >> MOVING: (1st Update 8:50 P.M. EDT U.S.A.) The TelexFree trustee said in court filings today in the SEC’s civil case against the firm that he has “no intention of reorganizing or reactivating their businesses” and — based on information and belief  — “they were in fact engaged in a Ponzi or pyramid scheme.”

“Based on information currently available to the Trustee, the Trustee admits that the individual defendants operated a Ponzi/pyramid scheme as evidenced by, among other things, the revenues from the retail sales of the VoIP were less than one (1%) percent of the amounts needed to satisfy the promises to the investors who had placed the Internet ads. Further, based upon the information available to the Trustee, it appears that the early investors were paid not from sales of the VoIP services but rather from the money received from the later investors, thus evidencing a classic Ponzi/pyramid scheme,” Trustee Stephen B. Darr said.

Although TelexFree filed for Chapter 11 bankruptcy protection in April, Darr said today that “Debtors have ceased all operations and all other business activities other than to liquidate assets and to pay back creditors.”

Jordan Maglich of PonziTracker.com is reporting tonight that the development may signal a Chapter 11 reorganization may  be off the table.

From PonziTracker.com (italics added):

Thus, it appears that a conversion from a Chapter 11 to a Chapter 7, which liquidates the debtor, is likely.

NOTE: Our thanks to the ASD Updates Blog.

 

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5 Responses to “URGENT >> BULLETIN >> MOVING: TelexFree Trustee Says He ‘Has No Intention Of Reorganizing Or Reactivating Their Businesses’”

  1. Man…what are the ponzitards gonna come up with now?

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  2. Alleged TelexFree pitchman and securities fraudster Sann Rodrigues is trying to get the SEC’s charges against him dismissed — in part by claiming he’s a victim.

    Here is part of what the SEC said about that today:

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    Flouting that legal standard, Rodrigues (like De La Rosa, Crosby and Sloan) offers self-serving factual assertions and improper inferences in his own favor.

    For example, he asserts (on p.2) that the four promoter defendants believed TelexFree “to be a legitimate, flourishing business.” He asserts that the “back. office” information available to him was “limited” (on p.4) and “a single data point” (on p.9). He claims (on p.9) that his public statements “lead to the logical conclusion that he believed those statements to be true.”

    He even claims (on p.9) that “the most reasonable conclusion to be drawn is that Rodrigues himself was a victim of the pyramid scheme perpetrated by the principals of TelexFree.”

    These assertions and inferences by a defendant are plainly inappropriate on a motion to dismiss. Moreover, the latter assertion — that a man who claims to have made $3 million from TelexFree could try to characterize himself as somehow a victim — truly defies belief.

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    Patrick

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  3. they’re really trying to get nehra under that bus all the way.

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  4. He is the “biggest” fish to fry, after all.

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  5. I can imagine the pseudo MLM industry will be looking nervously at the outcome of the Nehra charges.

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