Carlos Costa, a co-founder of TelexFree, told the Legislative Assembly of Acre that "god used him" to create the company. He then declared that "nobody will take it" away from him, speaking by invitation from State Representative Moses Diniz, himself a TelexFree affiliate investor. This claim of divine mandate became a recurring theme for the company.
The "god factor" often surfaces in schemes targeting South American investors. Phil Ming Xu, another promoter of alleged Ponzi schemes, previously used Christ the Redeemer imagery to market WCM777. Xu's social media accounts, particularly his Twitter feed, were frequently filled with religiously themed messages. He once accepted a large "Jesus sword" at a religious event, posing with it for cameras. This type of religious appeal helps build trust, often leading individuals to invest significant life savings despite the absence of a clear, sustainable business model.
Costa also offered the Legislative Assembly a series of unusual justifications for TelexFree's operations. He drew direct comparisons between TelexFree and major technology companies such as Google and Facebook. Costa asserted that these companies "only sell communication and entertainment," and, in his assessment, "have no product." He questioned why such multi-billion dollar entities faced no legal closures, unlike TelexFree, which he maintained sold a legitimate Voice over IP (VoIP) service.
This comparison overlooks critical distinctions. Google and Facebook do not recruit affiliates who invest capital in exchange for guaranteed weekly returns. TelexFree, however, promised a $20 weekly return to individuals who paid an upfront fee and then spammed the internet with advertisements for the company. While TelexFree did offer a VoIP service, its function was largely nominal. The service itself generated little revenue; the primary source of funds for the promised affiliate payouts came from new investor money, a defining characteristic of a Ponzi scheme. The Massachusetts Securities Division later charged TelexFree as a "billion dollar Ponzi" scheme. This charge revealed the alleged fraudulent nature of its operations.
