MORE TELEXFREE DISCONNECT: Columnist At Jornal.US News Service Reports That TelexFree Promoters Are Being Coached On Using Proxies And Supplying Bogus Info To Register
The “Aunt Ethels” in the United States — older people with money — will be thrilled to join TelexFree once they see how their relatives, friends and neighbors are prospering, according to a promo.
A columnist at Jornal.US News Service is reporting in Portuguese that TelexFree members are receiving instructions on how to register for the “program” by using location-masking proxies and bogus information on their countries of residence.
Here is the English translation by Google Translate.
TelexFree has been the subject of a pyramid-scheme probe in Brazil since at least June 2013.
The Jornal.US News column raises the prospect that tax fraud aimed at the U.S. government could be occurring. TelexFree has U.S. footprints in Massachusetts and Nevada. Some American promoters have ignored the probe in Brazil and continue to enlist recruits. They’ve also ignored reports of death threats targeted at public officials in Brazil involved in the TelexFree probe.
In December 2013, federal prosecutors said tax fraud had occurred at Zeek Rewards, an MLM “program” that has features similar to TelexFree.
Whether TelexFree is under investigation in the United States is unknown. Some U.S.-based promoters have claimed that $15,125 sent to the “program” fetches a return of at least $42,075 in a year, plus the full return of the initial outlay.
As the PP Blog reported on Aug. 4, 2013, the math of the claim is basically this: After recruits send in $15,125, they purportedly receive at least $1,100 a week for 52 weeks. That computes to $57,200. Subtract the original outlay of $15,125, and emerge $42,075 on the plus side, with the principal also fully returned. In this context, TelexFree essentially triples or quadruples the initial outlay over the course of a year, according to the promos.
Like the 2008 AdSurfDaily Ponzi scheme ($120 million) and the 2012 Zeek Rewards’ scheme (at least $850 million) that led to Ponzi charges in the United States, the TelexFree “program” has a purported “advertising” component. In ASD, members purportedly got paid for clicking on ads; in Zeek and TelexFree, members purportedly get (or got) paid for posting ads online, according to narratives by promoters.
As was the case with Zeek, puff pieces are being used in TelexFree to help the scheme spread.
And as was the case with ASD and Zeek, TelexFree “supporters” are singing the praises of the company and clashing with messengers of “negative” news. There have been at least two instances in Brazil in which apparent TelexFree promoters targeted media reports about suicide deaths of TelexFree members with offers to join the “program.”
On Sept. 9, 2013, the PP Blog reported that TelexFree promoters were encouraging prospects in Brazil to fabricate an address in England to register for the “program” and may be encouraging fellow members to menace public officials.
There were reports last month that a Brazilian prosecutor involved in the TelexFree probe had been targeted in a ghastly intimidation campaign.
I am receiving many request to participate in the telex free “program “and being informed of the lost opportunity of making a lot of money.In Massachusetts,thousands of Brazilian immigrants,most illegals,are being investing thousands of dollars and paying no taxes.No social security is needed,some are reporting income over $5000.00 weekly.
Telex free has opened offices in main Brazilian communities such as Framingham,Somerville,Malden.Many business owners like myself are selling their business and investing.Many pastors from local brazilian churches are deeply involved and targeting their members.
There are daily meetings all over the state and millions of dollars is now being reported as potential income by telex free members.It is named the hottest business now by the Brazilian community.
How is this possible without the government know?
They dont know cause telexfree has only focused on latinos, but now is some americans involved, american is not like brazilian they talk, not between them but to the government.
I knew this wld happen soon or later
I have done many network marketing business and people lose when they quit because the products dont sell and they dont earn the money as promised. TelexFREE tries to correct this and enables the promoters by buying back the products not sold each week. So the promoter is not left empty handed. It is a very clever model as it keeps the promoter afloat as he works to build his business. Does that make TelexFREE a Scam? Also they have a product – a virtual product. Further more who says that if one is making a lot of money in a business then its suspicious? its the rich who have brain washed us to think that way. Just get in and make money and if you lose your money that’s business, there are no guarantees in business – you can lose money at the stock exchange, or in a chicken business, does that make them scams?. the rich get rich and then try to block others. TelexFREE is freeing the poor and the ordinary people. people are posting adverts and getting enough to pay off mortgages and other loans, etc, freeing us from slavery. so while others keep posting blogs that “TelexFREE is being investigated” others are earning money and paying off debts. Having a court case does not make a company a Scam, most large corporations have ongoing or past court cases including the likes of Microsoft, Cisco, etc does that make them Scams? MLM or Network Marketing is an empowering business model and its the fastest way to share wealth in any society. Better than the large corporations declaring large profits which end up in the pockets of a few super rich. Let’s do TelexFREE and when the rich shut it down we say “it was a good ride”
I’d put it another way. I’d say that TelexFree just represents an evolution in the HYIP scam business model, which makes the TelexFree model more dangerous and insidious than other (earlier) models.
Conspiracy theory. HYIP players make versions of this tired argument here all the time. I’d say you might be listening too much American talk radio, but you appear to be posting from Africa. Do the waves reach over there?
If the “rich” are brainwashing people, why do you want to be like them?
At the risk of offending you, I’m calling horse!*5! on this one. It’s like saying robbery or theft is just another business.
TelexFree is freeing no one from poverty and slavery. What it is doing, effectively, is redistributing money from economically disadvantaged people to create a super-wealthy class consisting of about 14 percent of the TelexFree population.
Some people within the environment of losers (the approx. 86 percent) may feel some temporary financial relief. That relief will keep them thirsting for more while the neighbors from whom that relief is drained sink deeper and deeper into poverty and despair.
TelexFree, like Zeek Rewards before it, resembles a Communist Politburo more than it resembles a Capitalist board room.
You’ve learned the diversionary talking points well. Next thing you know, you’ll be telling high-school kids to blow off college or a military career or telling college kids or soldiers/sailors/Marines/airmen to drop out in pursuit of HYIP profits.
If TelexFree collapses, you’ll see who the super-rich are — just like in Zeek Rewards. The Zeek super-rich are getting lawyered up even as we speak.
Yes, ride the Ponzi wave. You must not have seen this 2010 FINRA warning:
https://www.finra.org/Investors/ProtectYourself/InvestorAlerts/FraudsAndScams/P121728
Snippet: “Do not try to ‘ride the Ponzi’ by attempting to get in and get out before the scheme collapses. If you do, you could end up like investors in the Genius Fund, a HYIP shut down by regulators where participants lost some $400 million.”
Patrick
Unfortunatly greed is bigger than honesty and solidarity. Moral values go straight out the window when it comes to make a “fast buck”…these people that know it’s a scam, most of them God believers and defenders, should be ashamed of themselves.
By the way, I’m atheist but seriously concerned about being more moral upstading than most of this scum…
Patrick i respect your opinion but I still dont agree with you. TelexFREE is not a Ponzi scheme. I am a telexfree promoter and am also using the 99TelexFREE software on my laptop and the TelexApp on my smart phone and am calling my family and friends abroad and also local numbers in my country of residence just as the product promises. Ive sold atleast 17 licenses to my friends here in Africa and they are also using it. I thought of sending you the link to download it and use it but i doubt you would because you seem to have made up your mind on TelexFREE being a Ponzi. I dont see how a company would invest so much to develop good working software products just to run a Ponzi scheme – there are cheaper way of running a ponzi.
Secondly all the people who are criticizing TelexFREE and branding it a Ponzi scheme have never been promoters. All promoters ive met are happy with the company because the products work and the compensation works. I didn’t see your response to my statement about the large corporations making millions that end up in the pockets of a few. i’d rather companies that enable us common people to make a better than average earning.
TelexFREE like all business is not perfect but i can see efforts in improving some aspects of the business that are weak and this was ephasized on the company’s launch of the TelexApp on March 9, 2014 in Boston Marriott Copley Place, MA, USA.
I think MLM as a business model is always more challenging business to define and run and most MLM (even the now accepted ones) were at one point or another branded Pyramids or Ponzis or Scams. The difference is when they keep improving their systems and compensation plans and responding positively to probes and investigation – and thats what TelexFREE is doing. Just give this company a more objective look and you may begin to change your prejudice.
Hello reuben,
You’d be wrong if you’ve formed the belief I do not understand your frustration. Many people involved in various schemes over the years have voiced views similar to yours. Please know that I understand your frustration very well.
The Zeekers said the same thing about their “program.” Some of them said it after they’d earlier been in AdSurfDaily, another Ponzi scheme.
If you want to argue that TelexFree is not a Ponzi scheme, you’d better be able to show how $15,125 sent to TelexFree turns into $57,200 in a year — especially since TelexFree also has to pay employees, contractors, vendors, taxes and many other expenses such as webhosting/storage to accommodate what promoters say is 1 million people or more.
Respectfully, reuben, I don’t believe you can do that in any plausible way. Nor do I believe TelexFree can. The simplest explanation that accommodates all the facts is that TelexFree is a Ponzi scheme — like Zeek and ASD before it.
The Ponzi analysis is about mathematics and money flow, not whether the product “works.”
On the pyramid side, the analysis in part is about whether the product is just a means of disguising the investment element. This, of course, naturally brings the discussion about the sale of unregistered securities into play and also securities fraud — just like in Zeek and ASD.
But I also believe — and I haven’t written about this in any detail yet — that TelexFree could be an offering fraud. There have been intracompany loans to fund other businesses. And there was a lot of talk early on about TelexFree building 500 hotels in Brazil.
People clearly joined TelexFree for the returns. What they might not have known is that they were funding other businesses.
Remember Carlos Costa talking about the purported “insurance” policy?
I’d encourage you to read the complaint in the SEC’s 2013 pyramid scheme/offering fraud case against “Profitable Sunrise.”
Here is part of the SEC’s statement:
________________________________________________
“Among other things, the Commission’s complaint alleges that the Profitable Sunrise has promised impossibly high rates of return and misrepresented that investments in the program were insured by a leading investment bank. The fraud appears to have been targeted at religious investors, as Profitable Sunrise’s website contained several Bible verses . . .”
________________________________________________
One of the issues in offering frauds is lies told to dupe/pacify investors. Another is omission of material facts to investors — how the money is being used, for example.
You’ll find the SEC’s Profitable Sunrise statement/complaint here:
http://www.sec.gov/litigation/litreleases/2013/lr22666.htm
Forgive me. One MLM promoter after another has made this claim here for years. It is immaterial to the Ponzi/pyramid analysis.
The launch of the app and the purported implementation of the new compensation plan occurred AFTER the Madrid convention at which former SEC pyramid-scheme/affinity-fraud defendant Sann Rodrigues received an award.
At a minimum, this shows that TelexFree doesn’t have a clue about PR. What TelexFree did was create the appearance that it doesn’t mind a pyramid schemer and affinity fraudster as a headliner and even was willing to give him one last bite of the Ponzi/pyramid apple to help TelexFree with cash flow.
This incongruity was further driven home by comments at the Boston confab about certain TelexFree reps (and possibly executives) having access to a “private jet” that made a Haiti run and was met by the “Prime Minister’s motorcade.”
Taking “private jets” to Haiti, posing in front of giant SUVs, renting limousines and camera crews and booking gaudy hotels is hardly a way to reinforce a message that TelexFree is about “common people.”
Neither is charging $164 for TelexFree commoners in Boston to observe a pitchfest at a Marriott.
Actually, I did respond to it. Today I’ll add that the story that “TelexFree exists for the common person” is going to get old fast if it keeps saddling up private jets, limos and Army-sized SUVs — and keeps making sure a film crew is on hand to capture the limo arrival at the document-signing ceremony with the professional football club.
Patrick
” I didn’t see your response to my statement about the large corporations making millions that end up in the pockets of a few.”
Even the last person hired at a large corporation you hate makes more than the last string of people pushing this scam. And they don’t have to work nearly as hard as you are at just trying to break even.
What happens to the LAST investor? Where is the money coming from to pay him? The so called investors are paid with the money of the people brought in and when there is nobody left to bring in, there will be no money. Typical Ponzi scheme.
I do not doubt that the people who wrote that they are “making money”, are indeed making money. Money paid by the new members.
The problem here reuben, is you don’t know what a Ponzi scheme is. You just somehow know, in your heart, that TelexFree isn’t that… because you cannot ACCEPT that it can be.
Charles Ponzi, whom “Ponzi scheme” was named after, originally wanted to “arbitrage” international mail reply coupons, as they can be bought cheaper elsewhere, but is essentially the equivalent the world over. That *could* have worked… but Ponzi never actually did it. He may have at first, but as his scheme got bigger and bigger, there’s no sign that he actually do it. In fact, some newspaper pointed out that his profits had exceeded the supply of such coupons 10 times over.
Whether the “product” or the alleged profit source is feasible or not is not the question. The question is how much profit can it generate… and can it generate ENOUGH to be paying “everybody” the amount that had been PROMISED. The answer is pretty obviously “no, not even close”.
Zeek Rewards supporters had pointed at the penny auctions and claimed it could have generated such profits. Except many people tried to track the profits it allegedly have generated (it’s easy to calculate based on bids used, final price, cost of item, and so on), and the answer ALWAYS came up short. Not just short, hundred times short, esp. compared to amount they are allegedly paying out, just by their public notes. When SEC closed it, I found out even my most outrageous estimate was 10% of the actual figure. (i.e. it was ten times WORSE than I expected).
Right now you are in denial, much like mothers of convicted murderers would NEVER believe their child could do such a thing, or like relatives of people on MH370, who could NEVER believe their loved ones are gone, and you are relying on your FAITH.
But a man cannot live on faith alone. You will work through the other phases, such as bargaining, depression, anger, and eventually move to acceptance.
As expected, Telexfree has filed for Bankruptcy, just as I warned in a blog post I wrote a couple of months ago.