Bankruptcy Judge August B. Landis in the U.S. District Court of Nevada made a ruling from the bench yesterday to move TelexFree Inc.’s case to Massachusetts and temporarily suspend proceedings, the Boston Globe reported today. TelexFree filed for chapter 11 protection last month, 2,700 miles away from its main office in Massachusetts, just days before state and federal securities regulators brought civil fraud charges against the company’s principals. Federal agents raided TelexFree’s Marlborough office on April 15, two days after the bankruptcy filing, and regulators soon froze the company’s assets. Massachusetts Secretary of State William F. Galvin accused the company of luring $90 million from Massachusetts residents who signed up for TelexFree’s Internet phone service and opened investment accounts with the company on promises of large returns. The Securities and Exchange Commission said as much as $300 million may have been invested across the country. Federal authorities had urged the Las Vegas court to send the case to Massachusetts, alleging that TelexFree filed for bankruptcy protection in Las Vegas merely to evade regulators and victims in the Boston area.
