newscastmedia.com breaking news and current affairs

[HOME ]   [ABOUT]   [PHOTOS]    [VIDEO]   [BLOG]   [HOUSTON]   [TEXAS]   [U.S. NEWS]  [WORLD NEWS]   [SPORTS]  [POP CULTURE  [CONTACT]

   

 

                            

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


SEC halts pyramid scheme targeting Brazilian and Dominican US immigrants

sec

 

by Joseph Earnest  April 21, 2014

 

Newscast Media WASHINGTONThe Securities and Exchange Commission today announced that it has filed charges against the Massachusetts-based operators of a large pyramid scheme that mainly targeted Dominican and Brazilian immigrants in the U.S.  The charges were filed under seal, in connection with the Commission's request for an immediate asset freeze. 

 

That asset freeze, which the U.S. District Court in Boston ordered, secured millions of dollars of funds and prevented the potential dissipation of investor assets.  After the SEC staff implemented the asset freeze, at the SEC’s request the court lifted the seal today, permitting public announcement of the SEC’s charges.

The SEC alleges that TelexFree, Inc. and TelexFree, LLC claim to run a multilevel marketing company that sells telephone service based on "voice over Internet" (VoIP) technology but actually are operating an elaborate pyramid scheme.  In addition to charging the company, the SEC charged several TelexFree officers and promoters, and named several entities related to TelexFree as relief defendants based on their receipt of investor funds. 

According to the SEC’s complaint, the defendants sold securities in the form of TelexFree “memberships” that promised annual returns of 200 percent or more for those who promoted TelexFree by recruiting new members and placing TelexFree advertisements on free Internet ad sites.  The SEC complaint alleges that TelexFree's VoIP sales revenues of approximately $1.3 million from August 2012 through March 2014 are barely one percent of the more than $1.1 billion needed to cover its promised payments to its promoters.  As a result, in classic pyramid scheme fashion, TelexFree is paying earlier investors, not with revenue from selling its VoIP product but with money received from newer investors.

Read or download entire SEC complaint. (pop-up)

"This is one of several pyramid-scheme cases that the SEC has filed recently where parties claim that investors can earn profits by recruiting other members or investors instead of doing any real work," said Paul G. Levenson, director of the SEC’s Boston Regional Office.  "Even after the SEC and other regulators have alleged that such programs are a fraud, the promoters of TelexFree continued selling the false promise of easy money."  Add Comments>>

 

 

 

 

 

 

        

  

         Search

 

       Find newscast media on youtube for houston news and local breaking news        get newscast media news feeds for breaking news, houston local news and world news.          Get our facebook updates on world news, houston news and houston local news including sports         Twitter

 Join the Newscast Media social networks

for current events and multimedia content. 


 

 

 

 

  

 Copyright© Newscast Media. All Rights Reserved. Terms and Privacy Policy