AFRICAN NATION NOT ON MLM FIRM’S ‘RADAR’: TelexFree Pushes Back On Reports In African Media Of Rwanda Ban And Money-Laundering: ‘Mistaken Identity’

UPDATED 8:45 PM EDT (U.S.A.) Already under investigation in Brazil and Massachusetts and linked to at least one affiliate allegedly involved in an earlier pyramid- and affinity-fraud scheme aimed at the Brazilian community, TelexFree acknowledged in a news release this morning that it had a presence in the economically challenged nation of Rwanda.

But TelexFree said it was not the firm banned from the African country by the Ministry of Trade and Industry on March 14.

TelexFree’s pushback at African media reports came on the same day the SEC announced a pyramid- and Ponzi case against WCM777, another MLM “program.” WCM777, which has some promoters in common with TelexFree, was accused of targeting Asians and Latinos and using multiple names to gather and move money.

A recent ad on an auction site offered 550 TelexFree “AdCentrals” for $16,760, a purported discount of $8,190. The AdCentrals, according to the ad, would provide a “minimum” return of $56,100. Where the ad originated is unclear.

Rwanda, TelexFree claimed, was not even on its “radar” until reports of tax evasion and money-laundering linked to the TelexFree name surfaced in African media.

“As far as we can tell, this has nothing to do with us other than the fact that somebody is making illegal use of our name,” TelexFree said in a news release. “We have in the neighborhood of half a million customers worldwide, and 121 of them are in Rwanda. But we have no connection with P.L.I. Telexfree Rwanda Ltd., the company shutdown in Rwanda. That company allegedly has been in business for 14 years, whereas we just celebrated our second year in business. We’ve checked our records and find no evidence of the names of the persons associated with that company registered as either our customers or agents. Rwanda wasn’t on our radar until this report hit the Internet.”

TelexFree did not say how it defined “customers.” Some promoters have claimed $15,125 sent to the firm returns $57,200 in a year through the purchase of “AdCentrals” offered alongside a VOIP service.

Massachusetts-based TelexFree said it believes the Rwanda matter “to be a case of mistaken identity” and that it had “not been contacted by the Rwandan government.”

Nor does TelexFree “have any reason to believe any action has been taken against it” in Rwanda, the firm said.

TelexFree, an MLM company, says it is in a number of businesses, including VOIP, an Internet telephone system.

Claims in the TelexFree news release were not attributed to a TelexFree corporate officer or executive. Rather, the assertions were attributed only to TelexFree itself. Why the firm chose not to quote an executive to refute the serious allegations in news reports was not immediately clear.

“It’s both the power and the challenge of VOIP,” TelexFREE explained in its news release. “Virtually anyone can register and use the system. The best we can figure out right now is that somebody is using our sales program to channel their own agenda, and that kind of repackaging is strictly prohibited by our Policies and Procedures. Our attorneys are doing all they can to find out what is going on.”

A Facebook site styled “telexfreerwanda” and dubbed “Telexfree Rwanda Team” has been promoting TelexFree since at least Jan. 17.

Here is one of the claims on the Facebook site (italics added):

A 14 year old Company with an Opportunity for YOU to get hired (as a Promoter) and you start getting paid on average 100 US$ each week for 52weeks. JOIN IT.

The prompt to “JOIN IT” appears to be a reference to TelexFree itself. And the assertion of a “14 year old Company” appears to reflect similar claims about TelexFree that have appeared on the web since at least July 2013, even though TelexFree says it is only two years old.

American MLMers have made claims similar to the claims on the Facebook site.

Any number of TelexFree affiliates appear to be confused about how long the company has been operating. Last summer, some affiliates claimed nine years. Others said 11 and 13 years.

In addition, the Facebook site says TelexFree can be visited “above Viva Supermarket.” On March 18, RwandaEye reported that the banned Rwandan enterprise operated from the top floor of a Viva supermarket in Remera. At least three links from the Facebook site resolve to the website of TelexFree, suggesting the operator or operators of the Facebook site are TelexFree affiliates.

The Facebook site uses affiliate identifiers such as “innosantana,” “innosanta01” and “innosanta1301.” Here is one example of a URL from the site: http://www.telexfree.com/innosantana

TelexFree did not say whether Haiti was on its radar. At a Boston pitchfest earlier this month, a man claimed from the stage that TelexFree reps recently flew on a “private jet” from the Dominican Republic to Haiti, perhaps the poorest nation in the Western Hemisphere.

TelexFree is based in a shared-office facility in Massachusetts, sharing a suite with at least 25 other firms. Promos have sought to plant the seed that TelexFree occupied the entire structure.  The firm has been associated with a growing list of companies in various states, some of which use the name “TelexFree” and others that simply use “Telex.”

A document dated-stamped March 20 and on file at the Idaho Public Utilities Commission claims “[a]pplicant’s legal name is TelexFREE Telephone Company, LLC, with its principal place of business located at 225 Cedar Hill Street, Suite 200, Marlborough, MA 01752.”

That’s also the address of TelexFree Inc. at the shared office facility. There’s also a TelexFree LLC in Nevada.

The Idaho filing stressed in all-caps that TelexFree wanted its financial information kept “CONFIDENTIAL.” In Washington state, the Utilities and Transportation Commission published a document in February that asserted TelexFree LLC had made millions of dollars in intracompany loans to other TelexFree-related enterprises, including to TelexElectric LLLP, Telexfree Financial Inc., TelexMobile and Ympactus.

Filed by a self-identified TelexFree “consultant,” the Washington document also claimed TelexFree LLC had “21,613,289.00” in “Federal Income Taxes Payable” and another “3,924,262.30” in “State/Local Income Tax Payable” on its balance sheet as of Dec. 31, 2013.