Faith Sloan's trial, the final defendant in the TelexFree pyramid scheme case, was postponed from its original February 11th date. The U.S. Securities and Exchange Commission alleges Sloan misappropriated over $1 million from TelexFree victims. A federal government shutdown forced the delay, rescheduling the proceedings to March 25th in federal court.

The SEC's civil complaint charges Sloan with participating in the TelexFree scheme, which operated as a massive multi-level marketing fraud. Victims were promised high returns for advertising packages, primarily through Voice over Internet Protocol (VoIP) services that often had no real market value. The agency claims Sloan acted as a promoter and key figure, benefiting substantially from the fraudulent structure before its collapse.

Counsel for the Securities and Exchange Commission were furloughed on December 27, 2018, due to a lapse in agency appropriations. This meant attorneys were legally barred from working on the case until the shutdown concluded or they received an exemption. The vast majority of the Commission's staff also faced furloughs. This situation made it impossible to pursue any resolution for the case outside of a trial.

On January 7, the SEC filed a motion requesting a delay. The agency asked for the final trial conference to move to March 21, 2019, and the trial itself to March 26, 2019. Sloan's attorney did not object to the SEC's request. The court granted the motion on January 11, formally pushing back the proceedings.

An outstanding motion from the SEC for partial judgment remains awaiting a ruling. If a judge grants this motion, the SEC believes a full trial might become unnecessary. This type of judgment typically resolves certain claims or issues in a case without a full evidentiary hearing, potentially expediting a final decision.

The government shutdown, which impacted numerous federal agencies, created significant disruptions across the U.S. legal system. Other regulatory bodies faced similar challenges. The Federal Trade Commission, for instance, received a court order to continue its MOBE case without the presence of its furloughed attorneys. This situation created immediate operational hurdles for government litigation during the funding lapse.

TelexFree, a scheme that emerged from Brazil before expanding internationally, defrauded hundreds of thousands of individuals globally. The U.S. Department of Justice also brought criminal charges against its principals, including James Merrill, who was sentenced to six years in prison. The SEC's civil action against individuals like Sloan aims to recover ill-gotten gains and return funds to victims, working alongside bankruptcy trustees.

Pending the government shutdown's full resolution, Faith Sloan's rescheduled trial is now set for March 26, 2019, in federal court.