UPDATED 9:21 A.M. ET (FEB. 22, 2014 U.S.A.) As the PP Blog reported on July 4, 2013, TelexFree is using a shared office facility in Marlborough, Mass. Promoters of TelexFree, alleged in Brazil to be a massive pyramid scheme that may be using a VOIP product as a front, have shown photos of TelexFree President James Merrill posing outside the building. Some promoters appear to believe that the building somehow serves as proof that TelexFree is legitimate and has a large-scale, brick-and-mortar presence in the United States.
It is somewhat common for MLM schemes to create the illusion of physical scale as a means of instilling confidence in promoters. Other than the facility and suite it shares with other firms, however, TelexFree appears to have no physical presence in the United States.
Apparently flush with cash despite a freeze on funds in Brazil, TelexFree announced last week that it was sponsoring the Botafogo soccer club in Rio de Janeiro. This prompted Brazil’s SporTV to send a crew to Marlborough and to seek comment from Merrill.
The video report that emerged [Feb. 22 edit: If you can’t see the video, look here] appears to show that TelexFree is a tenant with at least 25 other firms in a single suite: suite 200. An August 2011 report at Examiner.com about office options in Marlborough noted that suite 200 “is home to 103 different companies, 45 of which actually reside at the Regus center on the second floor.”
As shown in the screen shot above from the SporTV video, the camera shows the reporter entering suite 200.
After being greeted by a receptionist in the suite — and it’s unclear if the receptionist worked for TelexFree or the leasing company — the reporter sits down with Merrill.
“I don’t want to get into the financial end of the [Botafogo] sponsorship,” Merrill told the reporter.
Some Brazilians have expressed concerns that TelexFree’s sponsorship of Botafogo could hurt the image of Brazil and soccer in the country, which produced the internationally acclaimed Pelé, one of the most famous athletes in the world and soccer’s most enduring figure. (For many Americans of a certain age, Pelé, who briefly played for the New York Cosmos in the 1970s after playing for the Brazilian national team and the celebrated Santos club, represented their first contact with a sport that is hugely popular internationally but less so in the United States, where baseball, American football, basketball and hockey dominate the airwaves. Decades after his stint with the Cosmos, however, Pelé still is spoken about warmly in the United States.)
TelexFree, which has “Inc.” (Massachusetts) and “LLC” (Nevada) versions of its name, appears also to be using the name TelexFree International, including at the Marlborough office facility. Where the “International” version of TelexFree is officially based is unclear. A Nevada entity known as WorldTelexFree LLC is listed as in “default,” according to Nevada records.
A Facebook site dubbed “TelexFree International” forms part of its URL with the slug of “getpaidweeklyguaranteed.”
In other TelexFree news, a Facebook site styled “TelexFreeInUSA” appears not to have been updated since Jan. 10. The site, which is linked to TelexFree promoter and cash-gifting enthusiast Scott Miller, had been updated almost daily prior to the 10th.
At the time of this PP Blog post, the last headline on the TelexFreeInUSA site read, “OVER THIRTY THOUSAND! Positions Under Me! 100% Of Them Being Paid Weekly! STOP Marketing Programs Where Only 1% Ever . . .”
The site appears not to include an explanation for the sudden lack of postings.
Some promos for TelexFree, including promos from Miller’s group, have claimed that $15,125 sent to the firm returns $57,200 ($42,075 plus the return of the full initial outlay) in a year and that lesser sums return lesser amounts. TelexFree promoters claim they get paid for posting ads online about the company. In 2012, Zeek Rewards, a U.S. company with a similar ad-posting requirement, was accused by the SEC of operating a “classic” Ponzi scheme that gathered hundreds of millions of dollars and paid members with incoming funds from other members.
Among other things, Zeek promoters appeared to believe that an office the company controlled in North Carolina somehow demonstrated that Zeek was not a scam. Not only was Zeek a scam, but it may be the largest Ponzi scheme in U.S. history based on the number of victims created, an estimated 800,000. The SEC accused Zeek of securities fraud and selling unregistered securities.
Based on Google search results in July 2013, TelexFree promoters seemed to be confused about the physical presence of TelexFree and how old the company is. These phrases appeared in the July search results:
- “TelexFree is real brick and mortar 9 year old business, a solid program where . . .”
- “TelexFREE itself with its cutting edge products have been around for over 10 years . . .”
- “Telexfree is an 11 year old company . . .”
- “This 13 year old Advertise & Technology company called TelexFREE, will pay you . . .”
- “Telex Free is a multi level marketing company that was established in Brazil in 2002 . . .”
TelexFree appears to have been formed from the shell of an entity known as Common Cents Communications Inc. in February 2012.
