A federal court has granted the Securities and Exchange Commission (SEC) permission to serve legal documents via email to Emerson Pires and Flavio Goncalves, accused masterminds of the EmpiresX securities fraud scheme. Brazilian authorities failed to locate the men using the Hague Convention, prompting the SEC to seek an alternative method.

The SEC's proposed email service is logical given the nature of the EmpiresX operation. Pires and Goncalves ran their entire scheme online, channeling investor funds through digital platforms and maintaining constant communication via email. Pires himself confirmed regular use of the designated email addresses between January 2018 and September 2021. Goncalves also used his email for correspondence related to the fraud.

This isn't the first time the SEC has pursued this strategy with Pires and Goncalves. In a related case involving Mining Capital Coin, another fraudulent operation linked to the same individuals, the SEC previously obtained court approval to serve Pires at these same email addresses. This prior success bolstered the SEC's confidence in its current approach.

Further supporting the SEC's request, a draft of their motion was sent to both Pires and Goncalves at the proposed email addresses on March 27, 2023. Neither message was returned as undeliverable, indicating the accounts are active. The lack of response, despite the successful delivery of the draft motion, suggested to the SEC that the defendants were aware of the litigation.

On March 29th, a judge approved the SEC's request for alternative service by email. Summons were issued the same day, initiating a 30-day period for Pires and Goncalves to file an answer with the court. Should the defendants fail to respond within the allotted time, federal rules permit the SEC to request a default judgment. This would allow the agency to proceed with collection and other legal remedies without further participation from the accused parties. The court's decision bypasses the difficulties in apprehending the fugitives in Brazil, demonstrating the SEC's persistence in pursuing justice.