California Attorney General, Jerry Brown, has struck what may be a fatal blow against the MLM scheme, Your Travel Biz.com, and provided a great benefit to hundreds of thousands of consumers. Your Travel Biz.com is a classic pyramid in which consumers buy the right to become "travel agents" and then make money when they recruit other "agents." The California Attorney General sued YTB in August of 2008, calling the company a "gigantic pyramid scheme". Now it has settled with the company. The result will likely lead to the company's ceasing operations.
According to the California AG press release, the settlement includes "Significantly limiting how much people can make from individuals they have recruited and who have become recruiters themselves. Sixty percent of recruiters' sales must come from persons who are not themselves recruiters;"This requirement goes to the heart of the classic MLM fraud which is perpetrated by many other MLM companies. Most MLMs have little external revenue (nobody buys the products except the salespeople!).
If this requirement were imposed on other companies in the Direct Selling Association, it would lose most of its members; the public would be free of the plague of false income propositions, all based on "endless chain" recruiting and masquerading as "direct selling." A full explanation of the settlement and its potential impact on other MLMs can be read at the False Profits Blog, "MLM Travel Scheme, YTB, May Be Finished Off" (05/15/2009 09:25 AM Filed in: Economics/Financial)
1 comment:
I met Jerry Brown once, he's a great man. It's good that someone is looking out for the interests of people who just get in over thier heads with these slick scam artists.
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