Tags: james merrill | guilty | sentenced | telexfree | scam

James Merrill Guilty, Sentenced to 6 Years for TelexFree Scam

Image: James Merrill Guilty, Sentenced to 6 Years for TelexFree Scam

In this Tuesday, April 15, 2014, photo, Homeland Security Investigators raid telecommunications and marketing firm TelexFree in Marlborough, Mass. (AP Photo/MetroWest Daily News, Allan Jung)

By    |   Friday, 24 Mar 2017 11:00 AM

James Merrill was sentenced to federal prison Wednesday after he pleaded guilty last October to one count of wire fraud conspiracy and eight counts of wire fraud in U.S. district court in Worcester, Massachusetts.

Authorities accused Merrill, 55, the former president of TelexFree Inc., of being involved in a global pyramid scheme posing as an Internet telecom company, according to a U.S. attorney's statement. Merrill agreed to forfeit about $140 million and other assets as part of the deal.

U.S. District Court Judge Timothy S. Hillman sentenced Merrill to six years in prison and three years of supervised release.

The Massachusetts-based TelexFree, created by Merrill and business partner Carlos N. Wanzeler, sold internet phones service and paid themselves millions from investors, according to MassLive.com.

Merrill was president of the company between February 2012 and April 2014, MassLive.com noted. Wanzeler is believed to be hiding in Brazil.

"Despite knowing that Telexfree was a pyramid scheme, Mr. Merrill profited for years at the expense of the hard-working individuals who invested in the fraudulent company," acting U.S. Attorney William D. Weinreb said in a statement.

"For the hundreds of thousands of investors, here and around the world, who were taken in by the lies promoted by Mr. Merrill and Telexfree, today's sentence provides a measure of justice. Mr. Merrill's greed damaged the livelihoods of thousands of people who were simply struggling to make ends meet," Weinreb continued.

The TelexFree scheme, which initially targeted Brazilian immigrants, allegedly swindled about 1 million people worldwide, according to The Associated Press. More than 20,000 people had signed up in Worcester and thousands more in Boston, Framingham, Chelsea and other communities in Massachusetts, according to the U.S. attorney's statement.

The company had few actual customers and made most of its revenue from people buying into the company with a promise of payouts for posting online ads for it, prosecutors have said.

"While the harm and damage James Merrill caused by stealing more than $3 billion from innocent investors can never be repaired, his victims in more than 240 countries around the world can take some small measure of satisfaction that he is now looking at six years in federal prison and a substantial forfeiture as repayment for his crimes," Matthew Etre, special agent in charge of Homeland Security Investigations in Boston, said in the U.S. attorney statement.

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James Merrill was sentenced to federal prison Wednesday after he pleaded guilty last October to one count of wire fraud conspiracy and eight counts of wire fraud in U.S. district court in Worcester, Massachusetts.
james merrill, guilty, sentenced, telexfree, scam
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2017-00-24
Friday, 24 Mar 2017 11:00 AM
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