Herbalife Update: Federal Judge Rules that Herbalife can Go on Trial for Operating a Pyramid Scheme
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Former high level Herbalife distributors have charged that Herbalife is an illegal pyramid scheme - a fraud. Herbalife tried to get the charges dismissed. Now a federal judge has ruled that the charge is worthy of a trial. See court documents and an in-depth analysis of Herbalife.
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Pre-Paid Legal Hit with Subpoena from SEC
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The MLM, Pre-Paid Legal, has been served a subpoena from the United States Securities & Exchange Commission (SEC) demanding documents related to its treasury stock repurchase program, marketing practices, membership information, and disclosure practices, among other matters. Pre-Paid's stock plummetted more than 20% when the news became known.
See background reports and developments on deceptive selling related to Pre-Paid Legal
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Consumer Warns Others about MLM, MadeBig.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ In yet another example of individual consumers publicly challenging and exposing MLM schemes, one consumer is exposing the new MLM scheme called MadeBig.com, a division of Transcend Marketing International Inc. (TMII) of Salt Lake City, Utah. TMII has gone through several identities, each offering a different scheme, over several years.
The consumer activist, Mark Williams, an information technology
consultant at Oregon State University, has published a website with information on the MadeBig.com scheme and background facts about the owner. He has also posted his information on a popular consumer awareness site. His investigative work recently attracted media interest and was included in a news report on MadeBig.com in the Oregon newspaper, the DemocratHerald.
Mark Williams stated that he took up
the cause of researching and exposing TMII and MadeBig.com after some of
his friends lost money. He noted the scheme was recruiting people who
recruited others in a pyramid manner, using promises of profit as the
lure.
The newspaper article states that the Oregon Attorney General's office determined in 2007 that TMII's site could be a pyramid and issued a warning, although no other action was taken, and Utah's Better Business Bureau gave TMII an F rating - its lowest.
MadeBig.com includes a feature in which a part of the money invested by participants in "tokens" can be given to charities named by the participant. Under "Terms of Service" on the MadeBig.com website, it states, "Once the Member redeems Tokens for purchases in the MarketExchange, the appropriate number of Tokens will be deducted from the Member's Account. Under no circumstances will purchases be refunded for cash. Tokens have no cash value and are not redeemable in the event MadeBig ceases to do business or is sold, assigned, declared bankrupt or a receiver is put in place."
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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. A petition for stronger regulation is being gathered on
the Pyramid Scheme Alert Website.
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