Business VoIP Featured Article

$20M Cash Found Hidden in Mattress Possibly Connected to VoIP Scheme

January 25, 2017

By Steve Anderson, Contributing Writer

Way back in 2014, claims emerged from both the state of Massachusetts and the Securities and Exchange Commission (SEC) that suggested that TelexFree might have been little more than a pyramid scheme. Fast forward just under three years to the present day, and a $20 million discovery hidden in a mattress that makes that suggestion a little stronger.

A photo from the U.S. Attorney's Office shows $20 million in cash hidden in a box spring mattress, which was in turn hidden in an apartment in Massachusetts. Reports suggest a link between the huge cash stock and the TelexFree operation. The company looked to promote its product line by recruiting promoters, who were to post ads for the TelexFree operation online. Said promoters were required to buy into the company, but were in turn offered regular weekly compensation along a certain scheme, as long as the promoters were putting up the ads for TelexFree's VoIP services.

This represents the basic elements of a pyramid scheme: Cash from the new promoters goes to pay the old promoters, with a skim likely involved for those running the operation. TelexFree reported sales of $1.02 billion in 2013, but virtually all of that came from promoters paying to be part of the operation.

As for the $20 million in the box spring, that was found following a police raid of an apartment in Mass. TelexFree filed for bankruptcy, reports noted, back in April 2014, following the discovery that most of what it had made in incoming sales were actually owed to promoters in payments.

When anyone connected with a company under circumstances like that is found to have eight figures' worth of cash in a box spring in their apartment, it certainly suggests something is awry. Of course, it only suggests; only the practices of a court of law can find out for certain. Still, that kind of cash has to come from somewhere, and chances are it didn't come from returning a large quantity of pop cans found along the side of the road. 

Edited by Stefania Viscusi


Key Benefits

  Unlimited Calling & Faxing
  Number Portability
  Auto Attendant
  Instant Conference Calls
  HD Voice Quality