A Tallahassee-based political committee supporting Broward State Attorney candidate Sarahnell Murphy received $110,000 in contributions from a company tied to Ponzi schemes. Last week, Broward Democrat voters received pro-Murphy mailers from the Victims Have Rights committee. Murphy is seeking the Democrat nomination to replace longtime Broward State Attorney Michael Satz.
According to official campaign records, the Victims Have Rights Committee is chaired by lobbyist Foyt Ralston. On June 24, 2020, Victims Have Rights received a $25,000 contribution from International Payout Systems, Inc of Fort Lauderdale. The company is better known as “I-Payout.”
In July, International Payout Systems, Inc. gave two contributions totaling $55,000 to the Victims Have Rights committee. Another $30,000 contribution was made by Integrated Data Technology, a company with the same address as I-Payout.
The only other major contribution to the Victims Have Right political committee came from the candidate herself. On March, 10, 2020, Sarahnell Murphy gave $10,000 to Victims Have Rights.
In 2014, Canadian authorities arrestedNicholas Smirnow on numerous charges involving a $70 million dollar Ponzi scheme:
In 2010 it was reported that Nicholas Smirnow, who was also a resident of Florida, was facing a total of 10 fraud and conspiracy charges in the United States.
The United States Attorney General’s office alleges the accused, through the online company Pathway-2-Prosperity, also known as the P2P Network, promised annual rates of return in some cases as high as 17,000 per cent with little risk.
While some people made money, most investors lost everything, according to a press release. The alleged value of the Ponzi scheme was $70 million.
According to published reports, Smirnow’s victims numbered more than 40,000 people from 46 states:
Those investors, including people in Missouri, almost half of the counties in southern Illinois and 46 other states, were lured in by a website that promised returns of 500 percent to 700 percent or more in the “Pathway to Prosperity.” The website cited the investment savvy of a mysterious figure who was offering opportunities long denied the “common man.”
But, prosecutors say, investors were never told that the man running the investment was a convicted burglar, robber and drug dealer who told a former employee that he was involved in a double homicide.
A 2010 affidavit from a U.S. Postal Inspector details the role I-Payout played in Smirnow’s scheme:
International Payout Systems, which was located in Florida, provided the infrastructure necessary for P-2P Energy, Ltd. to operate. Solid Trust Pay and International Payout Systems provided spread sheets which identify deposits and withdrawals from the accounts ofP-2-P and P-2-P’s customers.
In 2015, a Federal class action suit was brought by victims of an Internet telephone based Ponzi scheme:
Internet phone company TelexFree ran a $1 billion Ponzi scam based on “mindless spamming” by people it “ostensibly paid” to recruit new suckers, a member claims in a federal class action.
Lead plaintiff Rita Dos Santos, of Massachusetts, claims she lost $350,000 to “TelexFree’s pyramid scheme.”
She sued TelexElectric and Telex Mobile Holdings on Wednesday, and a slew of banks, attorneys and others, including 13 top officers and promoters. Many of the individual defendants in the 244-page lawsuit are sued at their “last known address.”
TelexFree Inc., TelexFree LLC and TelexFree Financial (of Massachusetts, Las Vegas and Florida) are not named as defendants because they are in bankruptcy.
One of the named defendants was International Payout Systems, Inc. of Fort Lauderdale.
In the complaint, the defendants alleged International Payout Systems (IPS) performed a legally required background check of TelexFree which, “discovered indicia of fraud, illegality, and red flags. Despite this knowledge, and despite having a history of being involved in past Ponzi Schemes, IPS took on TelexFree as a customer.”
The lawsuit alleges I-Payout “held as much as $31,640,92,000 in assets.
In 2013, I-Payout attempted to defend its role in the TelexFree matter in emails to a financial watchdog website. I-Payout claimed to have performed its “due diligence” into the company. The financial watchdogs were not impressed:
Affiliate investors across America are dumping their life savings into TelexFree on the expectation of a $20 a week ROI paid out for every $289 invested with the company. But i-Payout would have you believe TelexFree is wholly compliant because they had a few beers with the owners down at their Massachusetts virtual office space.
Sounds bulletproof to me.
International Payout Systems, Inc. was never charged with any crime for its role with Nicholas Smirnow or TelexFree.
YOU COULD BE A HITMAN!
REDBROWARD wanted ask I-Payout CEO Edwin Gonzalez about his company’s $110,000 contribution to support Sarahnell Murphy. “I have no clue how you got my cellphone number,” Gonzalez said. At first, Gonzalez claimed to have no knowledge about the contributions.
“I will have to ask my finance department about it and get back to you,” he said.
This reporter asked if he knew Sarahnell Murphy or her husband, Richard Merlino and why he was interested in the Broward State Attorney’s race. Gonazalez refused to answer the simple questions.
Gonzalez refused to say whether someone instructed him to make the huge contributions to the Victims Have Rights committee.
Gonzalez said, “I have no clue who you are. You say you’re a reporter, but for all I know you could be a hitman!”
According to Sarahnell Murphy’s official campaign finance reports, Edwin Gonzalez is well aware of Murphy. On June 18, 2020, Gonzalez gave a $1,000 personal contribution to Sarahnell Murphy. On the same day, I-Payout gave another $1,000 directly to Sarahnell Murphy’s campaign.
Sarahnell Murphy told REDBROWARD she would comment after working hours at the Broward State Attorney’s Office. We will update story if Murphy does respond.
Why does a Broward State Attorney candidate need $110,000 from a controversial company? That amount will buy more than a mailer or two. Is I-Payout funding a TV advertising blitz for Sarahnell Murphy?