A judge on Monday ruled that 28-year-old Cleber Rene Rizerio Rocha is a flight risk and held him on a charge of conspiring to commit money laundering in what authorities have said was a billion-dollar pyramid scheme.
Rocha was arrested this month when the money was discovered in an apartment in Westborough, Massachusetts.
The approximate $20 million in cash that was hidden inside a box spring in a Massachusetts apartment was seized as part of a wide-ranging investigation into an internet telecom company that authorities said was actually a massive international pyramid scheme, federal prosecutors said.
Prosecutors said Rocha was part of a scheme to transfer millions of dollars to Brazil by laundering the cash through Hong Kong. The money was from TelexFree, a defunct internet phone company authorities said was a massive pyramid scheme.
The Boston Herald reported that Rocha’s lawyer argued that his client had no criminal record and should be granted bail with GPS monitoring.
The cash was found on Jan. 5 by investigators who had tailed Rocha from New York.
TelexFree had few 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. They were paid with money from new recruits, often friends and family of earlier investors.
Although initially aimed at Brazilian immigrants in Massachusetts, authorities allege almost 1 million people worldwide were swindled out of nearly $1.8 billion.
TelexFree filed for bankruptcy in 2014, its assets were frozen, and its two principals were indicted on federal charges of wire fraud and conspiracy.
One of them, former chief executive James Merrill, pleaded guilty in October and awaits sentencing on Feb. 2. The other, Carlos Wanzeler, fled to his native Brazil where he remains, U.S. prosecutors said.
According to court documents, Rocha, acting as a courier for Wanzeler’s nephew, flew from Brazil to New York City a few days ago. Rocha then met with a cooperating witness at a restaurant in Hudson, Massachusetts, and gave him a suitcase containing $2.2 million.
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Dialect Zone International