It looks like the TelexFree bankruptcy case is headed to Boston.
According to a story by Beth Healy in the Boston Globe, a judge in Las Vegas has decided that the controversial company’s bankruptcy would be better off being heard in their home state of Massachusetts.
TelexFree is a purveyor of free Internet telephone service, but accusations of a Ponzi-like swindle have been flying.
TelexFree filed for Chapter 11 protection in Las Vegas in April, 2,700 miles away from its main office in Massachusetts, just days before state and federal securities regulators brought civil fraud charges against the company’s principals.
Then, Federal agents raided TelexFree’s Marlborough office on April 15, two days after the bankruptcy filing, and regulators soon froze the company’s assets. Secretary of State William F. Galvin accused the company of luring $90 million from Massachusetts residents who signed up for TelexFree’s Internet phone service and opened investment accounts with the company on promises of large returns.
According to the Globe article, TelexFree was shut down by a judge in Brazil in 2013 and then shifted its attention to US investors, according to the lawsuits filed by regulators and Bonsignore. The company has thousands of victims around the world, according to the regulators.
In Massachusetts, the company appears to have targeted predominantly Brazilian and Dominican immigrant communities.
by Doug Beaton