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| Thu Jan 5, 2017 | 9:10pm EST U.S. arrests Brazilian in fraud probe, seizes $20 million under mattress By Nate Raymond | BOSTON BOSTON U.S. prosecutors on Thursday announced that about $20 million found under a mattress in a Massachusetts apartment had been seized after a Brazilian man was arrested for laundering money linked to a multi-billion-dollar global fraud. Federal prosecutors in Boston charged Cleber Rene Rizerio Rocha, 28, with conspiring to commit money laundering in a case connected to the investigation of TelexFree Inc, which promoted itself as an internet telecom company but prosecutors say was actually a pyramid scheme. Rocha was detained following a court hearing, prosecutors said. His lawyer did
not immediately respond to a request for comment. The arrest stemmed from an investigation into TelexFree, a Marlborough, Massachusetts-based company that sold voice-over-internet telephone service and was founded by James Merrill, a U.S. citizen, and Carlos Wanzeler, a Brazilian. Prosecutors said TelexFree was a massive pyramid scheme, making little to no money selling its service while taking in millions of
dollars from thousands of people who paid to sign up to be "promoters" and post ads online for it. TelexFree filed for bankruptcy in April 2014 owing $5 billion to its participants, prosecutors said.
American Apparel declined to comment. Amazon, Forever 21, Next Level Apparel and Authentic Brands did not respond to requests for comment. A Gildan spokesman said in an email on Wednesday that it is putting together all the necessary information from its due diligence to best position itself in the auction. Amazons acquisition of American Apparel would be a major push for the e-commerce company into branded fashion and apparel.
The Seattle-based company began to launch private label brands last year. Forever 21, founded by Korean-American Do Won Chang, is known for its low retail prices, helped by lower labor costs abroad. American Apparels first bankruptcy in 2015 was due in part to its relatively high labor costs. SWEATSHOP-FREE American Apparel went into bankruptcy for the second time last November with about $177 million in debt. Former Chief Executive Dov Charney founded the company in the late 1990s, when most garment-making was moving offshore.
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