Judicial Trust in the Prosecution led to erroneous evidentiary admissions.
Courts often ignore a defendant’s claims of innocence or allegations of prosecutorial misconduct. However, they respect unfounded assertions made by prosecutors as if they were true. Appeal Courts have to view evidence in the light most favorable to the prosecution, leading to a no-win situation when the prosecution’s evidence was a fraud on the Court. How can the Appeal Court view the evidence in the light most favorable to the prosecution and render fair decision when all the evidence was fraudulent??
Corrupt prosecutors depend on their longstanding relationships with judges, who tend to trust their integrity. This heavily influences the direction of Federal cases in the prosecution’s favor. This was evident in the I2G Court, where the judge consistently referred to his trust in and respect for the district assistant attorneys, believing they would know the law and act with integrity in presenting evidence. As a result, a significant amount of 401, 403(b), and 404 evidence, which was confusing, prejudicial, and unrelated to the offense, was allowed into the proceedings.
Criminalizing Common Practices of All MLM
The court permitted the government to present evidence that highlighted common practices of multi-level marketing (MLM) businesses as indicative of fraud. Prosecutors introduced emails related to standard business transfer requests, suggesting that these practices were fraudulent and not disclosed to the general public, as if an audience unfamiliar with MLM was considering joining I2G. Notably, all the witnesses presented during the trial were already familiar with and actively involved in MLM.
The government admitted emails that included hearsay from non-witnesses regarding customer service issues, such as difficulties accessing products, delays in customer service follow-up, and compliance problems like “cross-sponsoring.” These emails resembled those typically found in any MLM (multi-level marketing) operation, yet the government presented them as evidence of a fraudulent company.
The court also accepted staged complaint emails from non-witness participants linked to Chuck King’s disinformation campaign, such as the email from Bruce Deery. However, it rejected any mention of the $10 million lawsuit against King for spreading the same false claims. Consequently, the jury could not grasp the context of hearsay that was improperly presented as “truth of the matter.” The emails were not connected to any overt act or misrepresentation concerning the purchasers of the emperor package. They were unrelated to the charges and should have been excluded.
Additionally, the court chose not to remove or even reprimand Marissa Ford for her interference in the lawsuit, which included her attendance at the settlement hearing between King and I2G, where she intervened to stop King from signing a settlement. Throughout the proceedings, the court continued to trust that the government would act in good faith and with integrity, despite clear breaches of ethics.
It seems that the government or the FBI colluded with King, as he disclosed information that was “sealed,” such as McClelland’s original lis pendens affidavit and information that would be known only to someone with direct knowledge of the case. For example, King announced the FBI raid on Maike’s home in January 2015 just hours after it occurred, even though this information was not public.
Another instance of the government’s collusion with King occurred when Hosseinipour’s new attorney contacted the prosecution to explore her options during the sentencing phase. King quickly reported on Behind MLM that Hosseinipour’s attorney attempted to negotiate in exchange for testimony against the other defendants. The fact that King was aware of this phone call suggests that someone from the prosecutor’s office provided him with that information.
The Key Evidence Against Hosseinipour- Acquisition of Customer positions at $19.95
As their key evidence against Hosseinipour, the government spent hours discussing the $19.95 “customer” spots they claimed Hosseinipour purchased but “didn’t tell others about.” However, the arguments were absurd, as their records in document 101i showed 2,650 of the “secretive” customer spots purchased by others. Document 101d indicated there were over 12000 such customer spots. In addition, both Reynolds and Anzalone testified that this was a common mlm practice beneficial to the entire team. Despite evidence to the contrary, the government presented this as evidence of fraud by Hosseinipour. The knowing misrepresentation of standard legal practices was a deliberate effort to defraud a jury with no background in mlm without objective evidence.
Customer spots were the best evidence they could come up with against Hosseinipour???
How could the government claim that only Hosseinipour was aware of the $19.95 customer package and did not tell anyone when over 2,650 were purchased, and possibly as many as 12,000, according to their own evidence?
The 2nd key evidence against Hosseinipour was her receipt of an email announcing a leadership bonus change.
The government presented an email notifying Hosseinipour and others about changes to the compensation plan’s bonus structure one week before it took effect. Although no evidence suggests that Hosseinipour spoke to anyone and withheld this information, the prosecution claimed that she failed to “inform others” about the bonus change. This assertion was disingenuous, as they presented testimony from Anzalone, who stated he likely informed others because he was a “networker.”
They minimized the significance of the training video Hosseinipour created right after receiving the email aimed at helping others qualify for the bonus by the end of the year. No witnesses were presented to confirm their awareness of the bonus change. It’s important to note that multi-level marketing (MLM) companies often alter their compensation plans, which is legal. However, whether they notify their top leaders before a bonus change, so those leaders can assist their teams accordingly, is also not illegal. It is concerning that this issue was used as evidence in a case that could potentially result in a 20-year prison sentence for someone involved in the MLM industry.
Evidence of being an “Insider”
The receipt of the bonus change email was used as evidence that Hosseinipour was an “insider.” However, Anzalone clarified that “insider” only applied to being top sales producers, who received the occasional “heads-up” about company announcements that might affect their teams. Anzalone explained that this practice is common in multi-level marketing (MLM).
Evidence of Frigid Relationship between Maike and Hosseinipour
Despite being portrayed as an “insider” and a conspirator with Maike, Anzalone emphasized a non-existent or strained relationship between Hosseinipour and Maike. He stated that Maike often excluded Hosseinipour from meetings and discussions, and that she was frustrated that she had to “cc” or copy him and Susan on emails just to get Maike to review her suggestions for acquiring customers.
Hosseinipour spent over $35,000 on her own “emperor” packages and $35,000 on purchases for others.
The government disregarded Hosseinipour’s loss of $35,000 related to the same bonus that Maike never paid. The argument that she benefited while withholding this information is absurd; if it were true, it would imply that she actually protected others from experiencing a loss similar to her own. Records pulled by the government revealed that Hosseinipour spent at least another $35,000 on packages for others. This means her expenditures were significantly higher than those of the individuals they labeled as “victims.”
Recruiting and Binary Compensation Plans were Deemed Illegal
The government characterized typical multi-level marketing (MLM) practices as fraudulent, specifically targeting the legal activities of recruiting and using “binary” compensation plans. For instance, Keep referred to the binary plan structure as a “binary pyramid scheme structure.” He described standard MLM compensation bonuses—including binary, matching, fast start, and leadership bonuses—as “recruiting bonuses,” which are characteristic of a pyramid scheme. They ignored the testimony of their witness, Reynold, who described these bonuses as product sales-related.
The Upward Flow of Commission Payments was Deemed to be Fraudulent
During their closing arguments, the government argued that the universal hallmark of all mlm commissions flowing “upwards” to the sponsor indicated a pyramid scheme.
A Small Number of Top Earners indicates a Pyramid Scheme
The prosecution instructed the jury on fabricated characteristics of a pyramid scheme, including the idea that only a few distributors achieve top earnings. However, this applies to all multi-level marketing (MLM) businesses and other companies. Additionally, the prosecution claimed that “insiders” at the top of the mlm indicated a pyramid scheme. However, these fabrications are not recognized as characteristics of a pyramid scheme in any legal cases or official guidance. The evidence presented suggested that the entire direct sales compensation model was fraudulent.
Hearsay Complaints from Riccardo Ferrari
The prosecution presented email complaints from individuals like Riccardo Ferrari as evidence of issues faced by the company during its start-up phase. However, Anzalone testified that these problems were resolved within two months after compliance attorney David Koerner joined the team. Notably, the government failed to mention that, just two days prior, Ferrari had praised the company, its products, and CEO Rick Maike in hangout videos. While these videos, which featured Riccardo expressing his admiration for I2G, were part of the evidence, the prosecution chose to withhold them from the jury. By emphasizing the email complaints and excluding Ferrari’s positive remarks, the prosecution showed a willingness to mislead rather than commit to the truth.
The Jury was Misled about the Law surrounding Pyramid Schemes
A jury that lacked background knowledge in multi-level marketing (MLM) and held a certain respect for the prosecutors’ office was misled about what constitutes a pyramid scheme. For example, the jury received incorrect information regarding the law. They were told that only “retail sales” could be considered legitimate sales in MLM, while internal consumption was deemed illegitimate. However, “internal consumption” has long been accepted as the legitimate standard in all MLM. Furthermore, this legal standard was recently upheld in the Neora case, where the company was acquitted of all charges related to being a pyramid scheme, in which they presented evidence that 90% of their product sales were related to internal consumption by the distributors.
Mens Rea was not Required for a Criminal Conviction
Despite the necessity of criminal intent to prove a criminal conspiracy, the prosecution claimed that mens rea (the intention or knowledge of wrongdoing) was not relevant to proving their case in a pyramid scheme. This too is not accurate under the law.
There is no Way for a Jury to Judge False Evidence Fraud on the Court
However, no jury can judge a trial when all the evidence is false. The real crimes were not those of the accused but rather the government’s misconduct, which included lying to the court, manufacturing evidence, and committing perjury. Every statistical representation of i2G to prove the offense was and is provably false.
Government’s Fraud on the Court is Proven By the Data
This heavily data-driven case made the data evidence crucial for proving the offense. Establishing the government’s significant fraud on the court is not just a matter of accusation; it can be thoroughly verified through data, discovery, and testimony. The prosecution knowingly deceived the court by misrepresenting Reynold’s statements to discredit exonerating evidence. They manipulated the evidence to create artificially inflated loss data, which was presented through four key experts—an act that should be considered suborning perjury. Additionally, the loss data related to 12 distributor witnesses was false. The government’s awareness that its data included two years of non-i2G data from an unrelated company, XTG1, which operated after i2G had closed, is indisputable. False representations tainted the entire trial.
40 Pages of The Government Misconduct Evidence Attached Below
Over 60 “VICTIM NOTIFICATIONS” were sent to I2G distributors before the Trial began in 2016, informing them they were Victims of fraud. This went on for seven years with no opportunity for the defendants to defend themselves. This amounts to 60 counts of government witness tampering before the trial.
The government manufactured a criminal case in more ways than just creating fake losses and victims through manipulated data. For seven years, i2G distributors were inundated with “Victim Notifications,” claiming they were alleged fraud victims of i2G. Although a small percentage of distributors sought refunds due to a relentless campaign of disinformation orchestrated by King, the majority were satisfied and, by MLM standards, were achieving above-average success. There was considerable enthusiasm for the new product launches at the first anniversary celebration.
FBI Agent McClelland distributed two biased surveys to encourage alleged victims to come forward. This was followed by 60 “Victim Notifications,” urging people to step forward and sign up for updates about the case. This disinformation campaign persisted for seven years before any individuals were convicted of a crime, leading witnesses to believe that fraud must have occurred. The prolonged period of misleading information, which falsely labeled i2G distributors as victims, should have been brought up in court. King and Agent McClelland assured distributors that they would assist in recovering their money. This assurance was particularly influential after i2G was shut down, as anyone involved in an unsuccessful venture would be eager to recover their losses. Despite the significant amount of witness tampering associated with an alleged $40 million pyramid scheme, the number of people claiming losses remained minimal. Even after the trial, when convictions were announced and distributors were encouraged to submit claims for restitution, the total number of mailed-in claims amounted to less than $1.5 million. This demonstrates the extent of the fraudulent actions committed by the government against the court.
Hosseinipour informed her attorney and sent him the victim notifications so that he could address the witness tampering and unfairness. However, her attorney had no idea what to do or that he could raise this issue with the Court. Hosseinipour has argued that ineffective assistance deprived her of a defense.
The 40 pages of Documentation Proof of Government Fraud includes:
1.) The government obtained USA 7240, which demonstrated that over 38 million commissions were paid to I2G distributors.
2.) The government had access to the list of top earners, which revealed that nearly 260 distributors earned over $10,000 in 2014 alone, totaling almost 20 million in paid commissions. This figure does not include the substantial commissions converted into gift certificates used to pay for their purchases.
3.) The government also possessed I-2G 1099 records for 2014, showing nearly 14 million in paid commissions, with 1,100 individuals earning over $600. This does not include the 1099 records from 2013, which were also in the government’s possession.
Despite having access to three independent sources of commission earnings from Jerry Reynolds that disproved the claims regarding I2G, the government deliberately presented manipulated information. They filtered out a total of $28 million in commissions that were actually paid to I2G distributors.
Instead of acknowledging this, the government only presented $7.5 million in gains by I2G distributors, fully aware that this figure was contradicted by Reynolds’ records, which showed discrepancies of tens of millions of dollars.
Furthermore, although the government had launch information about Xtg1 from 2015, they presented seven spreadsheets that included Xtg1 data for two years after they had already conceded that I2G was closed.
Madison Sewell and Marissa Ford, the prosecutors in the I2G case, may be among the most dishonest and corrupt prosecutors in U.S. history.
They indicted Hosseinipour despite acknowledging that she joined the company with “good intentions”, describing her crime as “staying with the company.” The prosecutors misrepresented the law, the characteristics of a pyramid scheme, and the testimony presented. They made unfounded claims, such as “She never told people about customer spots” or “She didn’t inform others about the bonus plan change,” with no evidence to support these statements. No witnesses who spoke to Hosseinipour were presented to claim she misled them or omitted “customer information.” As crazy as this sounds, the government spends hours on this issue, knowing they had evidence of at least 2650 other distributors represented in 101a as having purchased the same so-called “secretive” customer spots. Over 16,000 customers were represented in their own 101d.
They mischaracterized typical MLM activities, like standard business transfers, as “fraudulent” and insisted that the jury should disregard the fact that this was a “common” practice of other MLM companies. They overlooked the testimony of their witness, Reynolds, who explained the “customer acquisition” and “business transfer” practice of I2G as “common”. They ignored their witness testimony that the I2G plan was product-based and focused on customer acquisition, and told the jury the opposite with MLM-hating expert Keep. They fought against the defense, having their own pyramid scheme expert, or to argue against saturation after they conceded that i2g had no risk of saturation. Instead, they tried to trip up their own witnesses or put words in their mouths to describe something as recruiting instead of product sales. This was done to try somehow to criminalize the act of recruiting.
The government offered complaint emails that Hosseinipour forwarded to I2G’s compliance attorney, David Koerner, during a $10 million lawsuit aimed at discrediting the company, led by Chuck King, as proof of her supposed “deliberate ignorance”. They ignored that Hosseinipour had over 200 people in her group who each earned more than $10,000, which indicates significant effort and work.
They failed to inform the jury that the new individuals working with Hosseinipour would be set up for failure if she neglected her responsibility to support them and chose to leave the company. The prosecutors seemed indifferent to the foundational principles of network marketing or the potential misrepresentation of evidence; their only goal was to win the case. They neglected to inform the jury that the new individuals working with Hosseinipour would fail if she ignored her responsibility to support them and betrayed them by leaving the company. The prosecutors did not care about the fundamentals of network marketing or whether they misrepresented evidence; they were only interested in winning the case.
What actions did the government take compared to Hosseinipour’s, which never alleged any criminal intent? They knowingly provided false information to the court regarding statements made by their witness, Reynold, concerning exonerating data. They disregarded substantial exonerating evidence that disproved their case during the discovery process. Additionally, they manipulated data to create false claims of losses and victims. They also encouraged perjury by presenting manipulated data as “accurate representations” of all i2G gains and losses.
When questioned about data that fell outside the specified timeline, they failed to inform the judge that this data belonged to a completely separate company launched by Maike after the closure of i2G. Additionally, they continued to present Xtg1 data as if it were part of i2G’s information, despite evidence in their exhibits that referenced Xtg1 and indicated their awareness of it. This was not a mere error; the Xtg1 data was included in their critical spreadsheets. How can one prove a data-driven pyramid scheme using data from another company?
