Nerium International launched in 2011 and operate in the anti-ageing MLM niche. The company is is based out of the US state of Texas and is headed up by Founder and CEO, Jeff Olson.
Olson’s MLM career appears to have started in the late eighties, with Olson starting out in National Safety Associates (also known as “NSA”) and then Qurom.
A problematic characteristic shared by both these companies appears to be affiliates being required to purchase stock they don’t need and/or can’t sell (front-loading).
According to the Wikipedia entry for NSA;
NSA had some legal troubles in 1993, as the Attorney General’s office followed up on complaints that the company was deceptively requiring new distributors to make large upfront purchases of air and water filters.
Each of the 32,000 distributors in Florida purchased an average of $7,000 worth of water filters, and many of these distributors were unable to sell all of them.
And on Quorom, Rod Cook over at MLM Watchdog writes;
The little hand held alarms at $25 sold like hot cakes (to quote Raymond Hung) but they were easy to copy and sell in discount stores.
Meantime most distributors were looking at that pile of $450 house alarms gathering dust in the garage! They were looking at top dogs making $1-$2 million and saying “I think I have been had!”
Consumer electronic companies never spun off the main item, the house alarm! Period zip zero, just the hand held and “bike” alarms. So quit the B.s.
Now, another unique front end load with a $450 dust collector?
The WatchDog helped people file complaints to get some of the piles of dust collectors out of people’s garages.
NSA are still in business today (although they no longer market water filters), with Quorom filing for bankruptcy in 1996.
In a fluff piece on Olson (right), Marketing Merge credits him with having ‘one of the largest organizations in the history of’ NSA and a ‘gigantic organization’ in Quorum (which is for some reason incorrectly referenced as “Coram” on the site). In Quorum, Olsen is specifically referred to as
the #1 money earner in the company. He was so successful; he was eventually made the Chief Executive Officer of the company.
After the Quorum bankruptcy Olson then went on to launch The People’s Network, which later merged with Prepaid Legal. After the merger Olson stayed on as a trainer and consultant for the company, eventually leaving around the time PrePaid Legal was sold to MidOcean Partners (who then changed the company’s name to “Legal Shield”).
I couldn’t find out exactly why Olson left PrePaid legal, but he did so at a time when a whole bunch of top-affiliates also left the company – so I’m assuming it has something to do with the sell off to Mid Ocean.
This was in 2011, with Olson then going on to form a “partnership” with Nerium Biotechnology later that year. That partnership culminated with the launch of Nerium International.
Since then I believe it’s been smooth sailing for the company, with the exception of a lawsuit filed against them by actor Ray Liotta last month.
Around Oct. 13, 2013, Liotta claims in his complaint that as part of a marketing campaign, Nerium, “by and through its agents, distributed photographs and related materials that identify, name, and/or describe, and purport to show [Liotta] ‘before-and-after’ using Nerium AD skin cream.”
In the before photo, Liotta’s skin is blotchy while in the “after” photos his skin appears to be smoother.
Several exhibits in the court filing are photos of the same “before-and-after” photo shared by individuals on social media site Facebook, Twitter, Google+ and Pinterest.
Nerium are claiming ignorance, indicating that this might be a rogue affiliate advertising campaign issue:
In a statement provided to ABCNews.com, a spokeswoman for the company said, “Nerium was surprised to learn through the media about a lawsuit filed by Mr. Ray Liotta. We take claims against our company seriously and we are committed to investigating this matter promptly.”
In the lawsuit, Liotta claims Nerium is “a product-based pyramid scheme”.
Nerium sells its products to “Nerium Partners,” sales agents who recruit new partners “in an ever-growing pyramid.”
To the best of my knowledge, as at the time of publication the lawsuit remains unresolved.
Read on for a full review of the Nerium International MLM business opportunity. [Continue reading...]
The Dominican Republic is emerging as one of the hardest hit TelexFree investor markets. Yet, despite a significant number of Dominicans investing in TelexFree, local authorities failed to take any action against the company or its top local promoters.
Not because they didn’t know TelexFree was an unsustainable Ponzi scheme mind, but rather because their hands were tied behind their backs due to the shortcomings of Dominican law. [Continue reading...]
You’re at the top of a global billion dollar Ponzi scheme that recently collapsed, and was then shutdown by US regulators.
If you’re Randy Crosby or Santiago De La Rosa, you disappear off into the night and are never heard from again.
If your Faith Sloan, after attempting to brush off the severity of situation as a play-date with regulators, you quietly begin to selectively delete all of the incriminating evidence you’ve uploaded to the internet these past two years.
And if you’re Sann Rodrigues, who is perhaps facing the greatest threat of retribution from those he recruited into the scheme, you first pretend to be a victim of the scam you were a leader in, and then start making all manner of promises to your downline. [Continue reading...]
Yesterday saw the continuation of the first day hearings in TelexFree’s bankruptcy application. Barring any additional information being made public, it looks like the hearing saw three significant events take place:
- The DoJ have formally objected to KCC’s fees and compensation
- Some of KCC’s actions have been “troubling” to the Judge presiding over the application
- A “final hearing” date has been set for May 2nd, with no relief being granted in the interim
As demand for reliable updates on the case surges, below you’ll find my break down of the April 21st bankruptcy hearing and what’s next in the road ahead. [Continue reading...]
In a last-ditch attempt to appease regulator and reduce the impact of the fraudulent activities the company had engaged in over the last two years, TelexFree began filing applications to register itself as a telecommunications provider in US states.
The question of why this was only done now of course lingers, but that’s not the focus of recent developments regarding TelexFree’s applications.
Contracted as a consultant to assist TelexFree to file these applications was Joseph Isaacs, who is ironically widely credited as a catalyst in the demise of the Fortune High-Tech Marketing pyramid scheme.
Isaacs, working through his company ISG Telecom, filed the telecommunication registrations on behalf of TelexFree. As cited on the Washington registration form, the reason TelexFree needed to register with the state is because
All telecommunications companies must register with the Utilities and Transport Commission (UTC) prior to beginning operations in the state of Washington.
To that effect, on the 21st of March an application was filed, requesting permission for TelexFree to provide “long distance interLATA” services in the state of Washington. On the application, Carlos Costa, James Merril and Carlos Wanzeler were cited as officers/directors of TelexFree. Isaacs was listed as a “regulatory contact”.
In a letter addressed to Jim Merrill dated April 16th, Steven King, Executive Director and Secretary of UTC, advised
Effective April 20, 2014, the Utilities and Transportation Commission grants TELEXFREE, LLC registration in Docket UT-140457 as a competitive telecommunications company.
Just one day earlier both the Massachusetts Securities Division and SEC had filed respective Ponzi and pyramid scheme complaints against TelexFree.
Upon learning about the cases, particularly that of the SEC, Isaacs appears to have hit the panic button. He now wants nothing to do with TelexFree’s telecommunications applications – in Washington or anywhere else. [Continue reading...]
When news broke that TelexFree’s Chief Financial Officer had been caught trying to escape with management’s retirement funds, the evidence the FBI presented in court was pretty conclusive.
Filed in a Massachusetts District Court on April 16th, Scott Stanley, an attorney with the SEC filed the declaration of John Soares, a special agent with the Department of Homeland Security.
Soares’ declaration details the attempted escape of Joseph Craft, aforementioned TelexFree CFO, and covers what went down when HSI and a number of other agencies raided TelexFree’s offices last week:
During the exercise of the search warrant, a Bristol County Deputy Sheriff encountered Joseph H. Craft, the Chief Financial Officer of TelexFree, entering an office and attempting to grab a laptop and bag.
Craft stated that he was a “consultant” helping TelexFree prepare for bankruptcy and that the laptop and bag were personal items.
The Deputy Sheriff told Craft he could not take the laptop and bag and that these items were subject to search.
HSI agents searched the bag and identified ten Wells Fargo bank, N.A. cashier’s checks totaling $37,948,296.
Included in the court-filed declaration, viewable over at the Boston Globe, are photos of all the checks the agents found.
This declaration was filed in support of the SEC’s ex-parte emergency motion for a temporary restraining order (TRO) against TelexFree, which was granted the same day.
Now, in response to the filing, TelexFree are accusing the Department of Homeland Security, the SEC and a Bristol County Deputy Sheriff of lying. [Continue reading...]
I’m seeing a whole bunch of crazy information getting pushed out there by TelexFree affiliates about the next tax hearing date. Dates in late April and May are all over the place, and many are citing some list of nine things that are apparently to be discussed.
Meanwhile in reality, a single Judge has signed the order for a continuance of the motion, to be held on Monday April 21st. That’s it, so take any additional information with a dumptruck full of salt (such as five judges voting on anything…etc). [Continue reading...]
Turns out the SEC don’t trust TelexFree management at all. And after the revelation yesterday that Joseph Craft lied about his position in the company while trying to make off with $37.9 million dollars, who can blame them?
The SEC pyramid scheme complaint against TelexFree was originally filed on the 15th of April, meaning it was filed on the same date as the Massachusetts Securities Division Ponzi complaint (double-whammy).
The reason we didn’t hear about it until yesterday, is because it was filed “under seal”.
Why did that happen? [Continue reading...]
As agents from the FBI, Department of Homeland Security and Immigration and Customs Enforcement burst through the door of TelexFree’s Massachusetts head office, Joe Craft looked up from his laptop.
Craft had been running his laptop day and night in anticipation of a raid, deleting the mile-long paper trail that he hoped would throw regulators off the scent.
Realizing he was out of time, Craft slammed the laptop case shut and began scooping up the checks he’d written into the black sports bag he’d kept under his desk.
This is what they’d rehearsed and early or not, it was going to work. It had to. [Continue reading...]
Hot on the heels of the Massachusetts Securities Division alleging TelexFree to be a $1 billion dollar Ponzi scheme, now comes a new complaint from the SEC.
Filed on the 15th of April in a Massachusetts District Court, the SEC have named eight defendants in the case, and have grouped them into three distinct categories:
- The company – TelexFree
- Four principals (owners and employees) – James Merril, Carlos Wanzeler, Steve Labriola and Joseph Craft
- Four primary promoters – Faith Sloan, Randy Crosby, Santiago de la Rosa and Sann Rodrigues
Noticeably absent from the list is Carlos Costa, the third owner (principal) of TelexFree. [Continue reading...]