Thursday, 28 May 2009

What happened to Amway apolgoists Tex, ibofightback and their ilk

Amway apologists have been conspicuous by their absence for a long stretch. It seems they are busy with their swindling activity hunting for new victims. Surely, they would not find much people. In India, they are looked down as swindlers and nobody trusts Amway distributors. By and large people realised that they are bound to lose their hard-earned money if they join Amway. But unfortunately, these gullible people did not lose their faith in multilevel marketing and easy get quick rich myths. That is why new local swindlers are coming up in remote places in Andhra Pradesh.
For instance, an incense sticks selling company recently made away with a huge booty of Rs. five crore (Rupees Fifty million recently). Police have already arrested the culprits and it is a long process of law to send them behind bars for some years. The modus operandi is same that of Amway. Here they sold incense sticks in the place of Amway's 'quality' products. The proverbial 'endless chain' broke very soon and the organisers of the scheme landed behind bars.
People always fall for quick buck and they are induced to become members with the lure of get quick rich. Only a pocketful of people became rich at the cost of many thousands of people and somebody dared to lodge a complaint with the police. And it is not necessary to mention that the organisers of the scheme became millionaires overnight.
My fellow countrymen, there is nothing like easy and quick rich and easy and quick good health. You cannot shed your extra weight without working hard for it. That is the weakness these fraudsters are using to make fast buck for themselves. Beware! Do not fall for these tricks of getting quick rich.

Sunday, 24 May 2009

Direct selling aka network marketing recession-proof! My foot!

Unemployment is rising. Loans are hard to get. Foreclosures are skyrocketing; small business owners are closing their doors. Into this sad situation comes multi-level marketing (MLM), claiming to offer consumers a "fall back" or rescue. They call it "direct selling" and they claim it is "recession-proof."
The problem is, the "income opportunity" peddled by most multi-level marketing companies is not direct selling. Direct selling during a Recession is a possible income opportunity, but it is certainly not a safe haven. It is not recession proof. In fact, it is among the hardest jobs in the world, with huge turnover and very little profit potential. What product would people need to buy from a friend or neighbor - at higher prices - than they can readily buy in stores or online? And how much does it cost in time and money to do the marketing, selling, delivering, and servicing?In reality, the "direct selling" offered as "network marketing" is just the age old "endless chain" trick. You pay money to the MLM for the right to sell the MLM opportunity to others who pay money for the opportunity sell the MLM opportunity to others who will pay money to do the same. What is the opportunity, you ask? It's the opportunity to sell the opportunity! Get it?To make a profit each person needs many more people below them. This is also called a pyramid scheme. Later investors pay earlier ones, with each level growing geometrically. The pyramid money is disguised as fees, marketing and sometimes inventory. In nearly all cases, the "inventory" is higher priced than similar goods in stores, yet the direct selling industry claims consumers will buy more when the economy goes down!
In fact, they claim people make money in direct selling when times are good and when times are bad! This may sound familiar. It is exactly the same claim made by billion-dollar-fraudster, Bernard Madoff. He too said his investors would profit from his scheme, in good times or bad.The fact is that the true "product" that is being purchased in most direct selling schemes is the right to sell the opportunity to others. The opportunity to sell the opportunity!
As to the clam that the money is really for "products" and "business costs", not just the opportunity to sell the opportunity, the question must be asked: why would unemployed people, who may be facing home foreclosures, buy expensive and relatively unknown products during a Recession? And, as to why "direct selling" increases during a Recession, the related question must be asked: why would consumers buy more of these higher priced products during a downturn?
Unemployed consumers can be persuaded to buy high priced products ranging from weight loss pills to chocolate - if they are told they will get all their money back plus a big profit when they recruit others to do the same! In other words, this is a classic money transfer dressed up to look like a business. The money a few will get comes from the losses of many others "below" them.
At the end will be the vast majority who will not - and cannot - find enough new "buyers." The promise that everyone can find a "safe haven" in this money transfer scheme is a cruel lie.The result of falling prey to an "endless chain" recruitment scheme will be even greater losses for thousands of people who spend their remaining savings, or take on more debt, to join a MLM scheme.
The Direct Selling Association (DSA) has been selling the bogus idea of a "safe haven" and recession-proof business to the media. Some journalists have bitten the hook. Recently the New York Times took the bait and reported bogus figures about "median income" levels of MLM participants. However, it did at least include a warning about recruitment schemes and included the Pyramid Scheme Alert website as a resource.
However, the New York Times refused to correct the mistaken numbers about "median income". The Times defended the figure on the grounds that it accurately reported what the Direct Selling Association told them!The DSA is not a government agency. It is a lobbyist and PR promoter of multi-level marketing.
The article stated, "The barriers to entry (in direct selling) are fairly minimal. Start-up kits - required by most companies - cost about $99 on average... The median income from direct selling is $2,400 annually, according to the (Direct Selling) association, but those who recruit and manage others can earn significantly more."These two figures - $99 "on average" to start up and a "median income" of $2,400 - are spectacularly misleading. --True start-up costs (the fee is just the first cost) can be in the thousands and may require monthly inventory purchases and even more costs for "marketing and motivation."--As for income, 99% of all MLM participants lose money. The $2,400 figure of "median income" (half of all MLMers would make more if that is the "median") is pure fiction. -- For half of all direct sellers to earn $2,400 (median income), as the DSA told the NY Times, the total sales of direct sellers would have to be far more than $100 billion! And, all the MLMers would have to be retailing all their products!-- The DSA misleads with numbers about "retail" sales, but almost any number used would be fake. Most its members do not track retail sales. This is because most MLMers don't make retail sales! They only recruit other "direct sellers."
The direct selling claim is just a camouflage for recruitment scams. Far from providing a safe haven during a Recession, MLM schemes actually widen the wealth gap; they sap resources from most people who invest and siphon the money to a small group of promoters; they entice people to try to make money off their friends' and family's losses. In the midst of a Recession, MLM has found a great new market - unemployed people, desperate for income. Other industries are also profiting - gambling, lotteries, payday loans, and bankruptcy lawyers.

No More Silence: Take Action
Over the last eight years, Pyramid and Ponzi schemes have grown and spread. The Internet is now choked with "cash gifting" scams and "matrix selling" frauds. Pyramid selling scams have multiplied and now boast that the Recession will bring them more desperate "recruits." The false promise of income from an "endless chain" recruitment scheme is the lure of these multi-level marketing scams. Many of the "job" and "business opportunity" solicitations on the internet are nothing more than pyramid schemes, flim-flam frauds. Consumers now have a way to fight back.

Thursday, 21 May 2009

No pretensions, YTB and Amway are identical twins

In his latest provocative and puerile outburst, Steadson remains true to totalitarian form. In the face of a mountain of quantifiable evdence proving that he is the deluded apologist for thieves, he steadfastly pretends absolute moral and intellectual authority. Predictably, Steadson insists that anyone challenging the authenticity of the 'Amway' myth is an 'ignorant dolt.' To this end, he falsely claims that I have no knowledge of the facts and that 'YTB International' and 'Amway' are completely different, because 'YTB' made most of its money from illegal 'sign-up fees.' However, Steadson's closed-logic position is demonstrably ludicrous, because 'YTB's' own defence was also that 'there were no sign- up fees.'
In reality, the thieves who wrote the frighteningly familiar 'YTB' myth (total financial freedom in just a few years by following a proven plan) camouflaged illegal payments by steadfastly pretending that the $449.95 which all new 'YTB' recruits were obliged to hand over (in order to comply with the plan) was 'for the purchase of their own Website.'
In exactly the same way, the 'Amway' thieves and their bleating apologists still pretend that 'there are no sign-up fees in Amway'. However, all the evidence proves that whilst 'Amway' believers remain under the influence of their group, they are obliged to hand over regular payments for all manner of over-priced merchandise ( including the receipt books in which they record their counterfeit retail transactions). Thus, 'YTB' and 'Amway' are essentially identical, camouflaged pyramid scams shielding even larger, advanced fee frauds. The very existence of relentless sophists such as Steadson is proof that this is so. Indeed, the evidence in the recent California case revealed that the average player of the 'YTB' game of make-believe was obliged to give around $1000 per year. Amazingly, this is about the amount that the average player of the 'Amway' game of make-believe has also been persuaded to cough up each year (in order to comply with the plan).

David Brear

Wednesday, 20 May 2009

YTB is certainly a clone of deceitful Amway

We have come right to the heart of why 'MLM' is impossible and, therefore, illegal.
Mr. Steadson cannot deny that 'Amway' , like its deceitful clone, 'Your Travel', has never had external customers. What he continues to deny is that this makes the 'Amway scheme' economically unviable for the overwhelming majority of participants. However, even a child can understand that, no matter how the money is divided up in any closed-market, the most contributing-participants can hope to receive is what they started with. Steadson steadfastly pretends that sales by 'Amway' to its own agents constitute retail sales, but this is childish drivel aimed at the economically illiterate. In the case of 'YTB' the California courts have rightly concluded that since this particular 'MLM' company has made the vast majority of its sales only to its own agents, it is a camouflaged pyramid scam based on perpetual recruitment. The pretence that 'Amway' and 'YTB' are different, or that persons supporting 'Amway' (including Steadson) tried to expose 'YTB' as a pyramid fraud, is laughable. Exactly ike 'Amway', 'YTB' was shielded by the so-called 'Direct Selling Association'. 'YTB' agents were de facto slave recruiters who were obliged to buy grossly over-priced services from their de facto masters and recruit others to do the same in the false hope that this 'plan' would bring them future financial freedom. Exactly like 'Amway,' sales tax was permitted to be charged by 'YTB' on these internal sales. For years, this devious tactic was used in order to make it appear to casual observers that genuine external retail transactions were taking place and that 'YTB' was acting within the law. Mr. Steadson (an Australian citizen living in Sweden) is the apologist for a gang of US-based thieves. They have demoralized and corrupted their own nation and they are attempting to demoralize and corrupt India. Steadson has taken many steps along a dark road from which there is no turning back. He will have to go on and on, from one madness to another leaving behind a wilderness of misery and hatred.
Mr. Steadon, you and your kind are doomed, and one day soon you will remember my words.

David Brear

Tuesday, 19 May 2009

Really good news from California! Hurray!

The recent good news from California about the humbling of the once mighty member of the 'Direct Selling Association, 'Travel', demonstrates that there are at least some intellectually-rigorous law enforcement agents in the USA who fully-understand that since so-called 'MLM' companies have virtually no external source of revenue, their owners are illegally peddling infinite shares in what can only be their victims' own finite money.
Interestingly, your most-faithful reader, Mr. Steadson (a.k.a. 'IBOFB'), does not even attempt deny that most of 'Amway's' so-called 'sales' are to his fellow 'Amway' agents in an (effectively) closed-market. Steadson's latest precisely-worded post (which again reveals his unquestioning belief in the 'Amway' myth of 'total financial freedom in 2-5 years' ) are so intellectually feeble that they almost require no further comment. However, as I have previously tried to explain, the poor lad is apparently still unable to face the ego-destroying reality that he has been fooled by an updated version of an age-old game of make-believe tailored to fit his existing beliefs and instinctual desires.
The only other explanation is that our Mr. Steadson knows full well that he is telling lies, and that he is willingly taking part in an international conspiracy to commit fraud.

David Brear

Monday, 18 May 2009

MLM Travel Scheme, YTB, may be finished off by State regulators

California Attorney General, Jerry Brown, has struck what may be a fatal blow against the MLM scheme, Your Travel, and provided a great benefit to hundreds of thousands of consumers. Your Travel 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)

Direct Selling lies by fraudsters of Amway

The mystifying lies issued by so-called 'Direct Selling Associations' are a perfect example of economic hocus-pocus designed to shut down the critical and evaluative faculties of all casual observers and convince the wider world that criminogenic cultic organizations, like 'Amway,' are successful retailers offering the public a legitmate business opportunity.
However, the key question for any Indian journalist to ask the smiling representatives of the 'IDSA' is always the same:
What percentage of the alleged 'turn-over' of the member companies of the 'Indian Direct Selling Association' comprises authentic retail transactions (i.e. sales made by agents of these companies to individuals who are not agents) ?
Amazingly, in the recent UK investigation, at least 96% of 'Amway's' claimed 'sales' were proved to be a puerile fiction, yet no one single liar from 'Amway UK' or the 'UK DSA' was charged with criminal fraud.
Given the fact that the price and quality of 'MLM' products have always been controlled in a such a way as to render them (effectively) usaleable on the open market, it is blatantly obvious that the smiling representatives of the 'IDSA', and the corporate officers of 'Amway India Enterprises,' should be charged with conspiracy to commit fraud.

David Brear

Saturday, 16 May 2009

Spreading canards through newspapers by Direct selling companies

An article published on May 14 in the Business Line daily newspaper, published from the stable of the Hindu Group of Publications revealed how newspapers could be utilised to spread canards to the advantage of the Direct selling racketeers. A press meet showering lavishing gifts on the reporters would help these fraudulent companies to get whatever they want published.
The article with the headline 'Direct selling on the go' by Tunia Cherian reveals how best an article could be written hiding the facts between the lines. Indian Direct Selling Association's projection of 20 per cent growth in 2008-09 is highlighted in the article. But the reporter hastily adds that the actual figures will be released only after its annual survey is formally released in July. Lies, lies and more lies, nothing but lies. The journos are generally carried away by the statements of these companies' public relation officers. They never care to check and cross-check to know whether what these people are saying true or not.
Interestingly, there are more than one interviews clubbed together. The statements by the heads of Tupperware, Hindustan Unilever Network, Amway India and the comments of secretary general of IDSA are also included in the story. Interestingly, the direct selling industry claims an increase of turnoever to Rs. 2,851 crore in 2007-08, as against the Rs. 2,522 crore in 2006-07. They never say whether the subscription amount from the new members and renewal fee from the existing distributors also included in the turnover. In fact, that is the biggest racket indulged in by all these companies.
The article also highlights the exorbitant price of these products. However, people who afford them are only buying these products, it is justified.
Readers who go through this article may assume that direct selling is a great idea and they may try their hand to burn their fingers.
Hence, my fellow countrymen, do not fall for the sweet talk of these fraudsters through the columns of newspapers and lose your hard-earned money. Save it for your children or at least enjoy it. Do not help these fraudsters to line their pockets with your money.

Wednesday, 6 May 2009

Consumer court imposed a fine of Rs. 1 lakh on Amway in 2007

In what could be described as a slap in the face of Amway apologists who claim that Amway products are of high quality, a consumer court in the city of Vijayawada, Andhra Pradesh, India, found fault with the quality of Amway products and imposed a fine of Rs. 1 lakh (Rupees one hundred thousand). Here is the excerpts of judgment delivered on October 16, 2007.
CC NO. 140 OF 2007
Consumers' Guidance Society--Complainant
Amway India Enterprises---Opposite party
1. Allegations in the complaint:
Opposite party has been offering variety of consumer goods and food products; for sale through networking marketing including dietary supplements. Opposite parties have been selling their products through its distributors in the form of chain market/network market at an exorbitant price. The complainant being a consumer activist made a petition under Right to Information Act to the State Food Laboratory to elicit the true or otherwise in the representations made by the opposite party. State Food Laboratory clearly stated that some of the products of the opposite party are misbranded and some of them are adulterated. Though as per rules the dietary supplements are prohibited from being sold in the form of tablets and capsules, the opposite party has been offering these products in the form of tablets and capsules. They are much beyond the usage levels prescribed by Indian Pharmacopoeia which is a health hazard. The representations, statements made by the opposite party amounts to unfair trade practice. Complainant wrote a letter to opposite party and there is no reply. Hence, the complaint for a direction to opposite party not to indulge in unfair trade practices and to issue corrective advertisement to educate the public on the true state of its products.
2. Averments in the counter affidavit filed by the opposite party:
Complaint is not maintainable as the complainant is not a consumer. The products are manufactured as dietary supplements for which the license was granted under the Prevention of Food Adulteration Act, 1954. This Forum has no jurisdiction since the matter was referred to the Central Food Laboratory, Pune for reanalysis. The products do not fall within the category of drugs. There is no unfair trade practice.
3. Affidavit and counter affidavits were filed.
4. On hearing the parties and upon perusing the documents available on record the followings are taken into consideration.
a) As per the Consumer Protection Act, the Forum has jurisdiction over the subject matter.
b) The Consumer Protection Act authorises any voluntary consumer association to move the Consumer Forum.
c) Complainant stated that information was obtained from the State Food Laboratory, Hyderabad regarding the products offered for sale and the report clearly stated that some of the products are misbranded and some others adulterated. Nutrilite Protein Tins contained less fat content than the label declaration and hence adulterated. Similarly, Amway Madrid Safed Musli (Apple) contains Class-II preservative which is not declared on the label and hence misbranded. Kohinoor Ginger Garlic Paste did not conform to Class-II preservative, hence adulterated. Nutrilite Salmon Omega-III is a dietary supplement which cannot be declared as proprietary food which is a misleading statement. As the label of the sample do not conform to rule 37 of PFA Rules 1955 and hence misbranded. The same observation is given with regard to Nutrilite Triple Guard Echinacea, Nutrilite Bone Health with Ipriflavone, Nutrilite Glucosamine HCL with Boswellia, Nutrilite Siberian Ginseng with Ginkgo Biloba, Nutrilite Cal Mag, Nutrilite Parselenium E, Nutrilite Iron Folic and Nutrilite Natural B. Except the products mentioned under serial No 3 to 11 the remaining products are either misbranded or adulterated. In view of the findings of the State Food Laboratory we are of the considered opinion that some of the products being offered for sale by opposite party are not true to their statement. Accordingly, we hold that the opposite parties are adopting unfair trade practice in publishing and selling their products.
d) This is also a fit case to impose exemplary damages on opposite party to act as deterrence not to repeat such activities in future. Opposite party is directed not to indulge in such unfair trade practices in future and issue corrective advertisements regardingthe products misbranded or misstated. It is a fit case to impose Rs. 1, 00,000 ( Rupees one Lakh only) as exemplary damages.
This is enough for Amway apologists to realise how the Amway is indulging in unfair trade practices in India.