Government Exhibit 7240, which included all I2G commissions, was subpoenaed seven years before the trial by Agent McClelland. This data revealed $40 million in sales and over $38 million in commissions paid to I2G distributors, who were deemed to be alleged victims. The accuracy of this information was confirmed through an affidavit by Reynolds after the trial, despite Assistant District Attorney Madison Sewell’s repeated claims that Reynolds had indicated the data was “problematic.” Independent data analysis of all commissions paid records, pulled by Reynolds after the trial, supported the findings in Exhibit 7240. FBI Agent McClelland acknowledged at trial that Reynolds’s data demonstrated $40 million in commission payments to distributors.
During the restitution hearing, the judge pointed out that Sewell viewed the data as problematic because it did not display the information he wanted it to show. However, despite recognizing this issue, the judge ultimately chose to overlook the significant commission data from Exhibit 7240 in his final response to the restitution matters.
The additional $28 million in paid commissions, which were filtered and used as the source of Emperor purchases, cannot be disregarded in any legitimate I2G loss calculation. These commissions must be deducted from any loss representations on summary charts and revised spreadsheets. One week before the trial, Madison Sewell ordered new data to filter out all commissions except those withdrawn from GPG, which accounted for only 20% of the total commissions earned. The remaining 80% of the commissions earned were used to create gift certificates to fund the alleged victims’ or distributors’ purchases.
Even though these commissions totaled over $28 million in i2G gains, the prosecution concealed this earnings data from the jury in the information hastily prepared before the trial. Instead, the prosecution presented a provably false 96% loss rate, as represented by its expert witness. This data was portrayed as “golden” for their case and critical to the expert’s analysis. Clearly, a fair trial based on accurate data and proof of losses was not possible with radically inflated or fabricated losses.
Within the i2G plan, distributors who purchased more than one Emperor package primarily relied on their own earned commissions to make these purchases. The government was well aware of these “gift certificate” transactions, as Reynolds testified about them. Prior subpoenas had requested information regarding the defendants’ “gift certificate purchases.”
To illustrate the disparity, Jason Syn’s records indicate that only $180,000 was withdrawn from GPG, while $2 million in commissions were used as gift certificates to buy products. Furthermore, $800,000 in transfers were sent by Syn to his distributors to fund their purchases. These were not losses to the purchasing distributor, despite the government’s representations otherwise.
Syn later submitted a sworn affidavit as part of his plea cooperation deal, stating that he was paid over $2 million in cash and that many of his substantial team members, portrayed as “net losers,” were also operating in cash. These gains were similarly not represented in the government’s hastily created document, 101i, which excluded $28 million in commission gains. Additionally, 101i failed to account for $800,000 in waived auto-ships and $600,000 in refunds, misrepresenting them as “losses.”
It also inaccurately categorized millions in “gifted packages,” including those of Syn, Moyer, and Barnes, claiming they were “gifted” but labeling them as losses in 101i. They asserted that Syn earned over $2 million yet represented all 275 of his “gifted” packages as losses in 101i. These false representations do not take into account that all seven government spreadsheets contain over two years of data from another company that operated only after i2G was closed. I2G ceased operations in 2015, but the data in 101i and all its spreadsheets extended until March 2017, representing a separate company, XTG1, which was registered in Hong Kong in September 2015 and operated until March 2017.
Exhibit 7240 can be found below. Download the document in Google Charts, sort by column J, and pull up the data column statistics in J, which will quickly show you totals of over 38 million in commission payments. This represents dramatically higher commissions received by distributors than 101i, which stripped out $28 million to show only $9.5 million in commission payments and only $7.5 million in i2G gains.
The same summary charts by McClelland, which stripped out the “as much as 40 million” in commissions he testified were shown in Reynolds’ record. Instead, he presented the jury with outrageous graphs that displayed virtually all losses. He did not present any underlying data in Summary charts 230 and 232. Instead, the representation was based on his math calculations. The stark false displays presented fake losses and accusations of missing millions of dollars, allegedly hidden in offshore bank accounts, which are contradicted by the 7240 data. I have uploaded Summary Chart 232 so that you can see how outrageously prejudicial this was, with the knowledge that it excluded $ 28 million. It shows that nearly all 2671 earned no money in the contract to government discovery. McClelland’s possessed the top earner list, which showed that 265 people earned more than $10,000, and 1,099 records indicate that 1,020 people earned over $600. The deception allowed dramatically inflated losses to influence the jury and denied a fair trial.