$90,000 secret backroom affiliate deals @ Jeunesse (lawsuit)
Although it probably comes as little surprise to most, within any MLM company there are typically two or more levels of affiliates.
This is usually an informal arrangement and generally accepted as the status quo by the affiliate-base at large.
Here at BehindMLM we typically engage the lower-rung of this hierarchy. Those who aren’t privy to the inner-workings of the company they’re in, and who are often oblivious to what goes on at the top.
Occasionally there are exceptions, but we’re more often sharing information “with the masses” than not.
Today is one of those days, and we’re going to take a look at what goes on behind the scenes at Jeunesse.
Before we delve into the business dealings of some of Jeunesse’s top affiliates though, I want to preface by saying what is discussed in this article is in no way limited to or unique to Jeunesse. If you’re in an MLM company there’s a good chance some of what follows is going on in it.
You might not be aware of it or unable to identify it, but I’d be willing to bet that it’s probably there on some level.
Keep that in mind as we enter an arena usually sealed off from public consumption by way of NDAs and other private agreements.
Our main character in this story is Matt Nestler.
Nestler, a “25 year veteran in the multi-level marketing industry”, joined Jeunesse in March 2014.
Whereas you or I might join Jeunesse as a regular affiliate and be expected to build our organization from scratch, the same was not true for Nestler.
Nestler joined Jeunesse by way of a secret Business Development Agreement (BDA).
This agreement saw Jeunesse agree to “provide additional incentives” to Nestler, on the proviso he help “develop Jeunesse’s global business” operations.
Specifically, in the event Nestler failed to earn $15,000 a month, Jeunesse would “top up” his earnings to that amount for up to six months (ending August 2014).
This was agreed on the proviso Nestler would generate tens of thousands of points in sales volume during these months.
If Nestler failed to hit the volume targets in the agreement, Jeunesse still agreed to top up his earning pro-rata.
Jeunesse saw the acquisition of Nestler and Kevin Giguere (Nestler’s immediate downline from a previous MLM opportunity) as an investment.
The BDA required Nestler to generate enough sales volume for the company to make back what it agreed to invest in him and Giguere over his first six months with the company.
Once the initial investment was paid off, Jeunesse agreed to split 50% of Nestler’s commission (above $15,000 in any given month). The BDA stipulates that their split will be put into “a position designated by the company to be used as a travel fund for (Giguere’s) downline”.
Until the $90,000 was made back, Giguere’s position in Jeunesse was to be placed under the company. Once the $90,000 was settled, Giguere’s position was then to be transferred under Nestler’s position.
In exchange for guaranteeing Nestler $15,000 a month, Jeunesse demanded Nestler focus exclusively on the company for a minimum of one year.
Nestler was permitted to earn commissions from opportunities he was previously involved in, but was barred from being ‘visible in or actively working as a distributor in them‘.
Should Nestler fail to adhere to the terms and conditions of his BDA, the agreement saw him owe Jeunesse $90,000. That is $15,000 for six months, the dollar amount invested Jeunesse saw itself investing to acquire Nestler as an affiliate.
The reason you or I never hear about these agreements, is because there’s usually a clause like this buried in them towards the end:
Jeunesse Global LLC and Distributor agree to not disclose the terms of this agreement or the terms of any additional compensation to third parties.
So, with that in place, why are we privy to the explicit nature of Matt Neslter’s arrangement with Jeunesse?
Well, in October 2014 Jeunesse locked Nestler out of his affiliate backoffice. He was then sent an email informing him that he had been terminated from Jeunesse, for ‘failure to adequately support the distributors he sponsored‘.
Nestler has now filed a lawsuit against Jeunesse,
In his complaint Nestler claims that, prior to receiving his termination letter, that he
received no communication from Jeunesse’s corporate office, his upline, or anyone else working for or affiliated with Jeunesse regarding his alleged inadequate support for his downline distributors.
He also received no complaints from his downline regarding this alleged failure to support his downline.
So why, without any prior indication or notice, would Jeneuesse suddenly terminate Nestler’s position.
Well, when your leader acquisition strategy sees you attract leaders with secret deals and agreements offering off-the-table bonuses and financial incentives, out come the cloak and daggers.
As per Nestler’s complaint,
On or about October 24, 2014, Giguere asked nestler to meet him at the nearby Crowne Plaza Hotel in order to provide Nestler with his last two week’s compensation.
When Nestler and Giguere met, Giguere gave Nestler his check, and then requested that Nestler sign a settlement agreement with Jeunesse.
First of all, why is Jeunesse corporate sending out one of Nestler’s downline to speak and act on behalf of them? Shouldn’t someone from company management have handled this?
Surely Jeunesse weren’t banking on a familiar face and one last payment to seal the deal on Nestler’s silence?
Nestler was surprised, as there were zero discussions with the company regarding a potential settlement.
He refused to sign.
And that was that.
… or not.
Giguere subsequently informed Jeunesse that Nestler had signed the settlement agreement, nd provided Jeunesse witha copy of the agreement, which included a forged signature on Nestler’s signature line.
For reference, here’s Nestler’s signature as it appeared on the March 2014 BDA agreement between himself and Jeunesse:
Here’s the signature Giguere presented Jeunesse corporate in October 2014:
One thing I did pick up on is that Nestler does appear to have more than one signature. Here’s how he signed his name on February 20th 2015:
Whether there’s anything further to read into that I’m not sure.
The implication however is that Giguere forged Nestler’s signature in October to “get the deed done”. This forgery was then presented to Jeunesse corporate.
Did Giguere himself forge the signature?
That I can’t say for sure.
But what we can look at is the possible motive Giguere might have had to do so.
Within days of Nestler’s termination, Jeunesse (placed) Giguere above Nestler’s former position.
Based on the normal rules of the Jeunesse compensation plan, Nestler’s former position should have “compressed out”.
By creating a higher position in Nestler’s former organization for Giguere, Jeunesse gave Giguere the benefit of Nestler’s substantial volume in the pay plan, dramatically accelerating Giguere’s income.
Ring-a-ding-ding, cha-ching cha-ching cha-ching.
And that’s not even the half of it…
One month prior to Nestler’s termination, Jeunesse, in breach of its own agreement with Nestler, assigned the sponsorship rights of Giguere’s position to one of Nestler’s competitors, Stefanie Nichols.
Within days of Nestler’s termination, two well-known and highly productive multi-level marketers, Rick Ricketts and Cedrick Harris became active in the organization.
Rickets was placed upline of Harris in Giguere’s downline.
Giguere, Harris and Ricketts were each allowed to accumulate over fifty positions between themselves in the Jeunesse genealogy.
You can bet your bottom dollar that all of these players have their own secret BDA deals with Jeunesse.
How much these agreements meant to Giguere financially I can’t say, but it certainly would appear to provide incentive for him to get rid of Nestler by any means possible.
Even if that meant forging his signature and hoping he went off quietly with his last commission checks.
Cloaks within cloaks, daggers within daggers. With so many possible layers of subterfuge, backstabbing and betrayal in play, it’s difficult to get a clear sense of what exactly went down.
Did Giguere, Harris and Ricketts conspire with Jeunesse corporate to snuff Nestler out? With fifty positions in the compensation plan on the table and financially rewarding genealogy agreements, they certainly had the motive.
The amount of BDAs executed throughout the Jeunesse organization numbers into the hundreds.
The terms of Jeunesse’s BDAs varies person to person. The terms typically include the creation of volume in one of the Binary legs, whereby the recipient would only be required to build one of the legs instead of two.
The terms might also include cash advances along with additional properties for significant cash rewards not available in the general compensation plan.
What we do know for sure is that Nestler is none too happy about how any of this went down.
Upon information and belief, Jeunesse and Giguere conspired to fraudulently terminate Nestler from his position in order for Giguere and others to receive larger commissions and for Jeunesse to avoid paying Nestler commissions resulting from the addition of Ricketts and Harris to Nestler’s downline.
This collusion between Jeunesse and Giguere undercuts the foundational principle upon which direct sales is based, namely, that one can derive profit based on hard work and effort to recruit participants and build one’s organization.
Nestler believes he’s owed ‘$275,000 in commissions from the productivity of Rick Ricketts and Cedrick Harris’. Hence the filing of a lawsuit in Florida on February 20th.
Six counts are cited in Nestler’s lawsuit, including
- breach of contract (Jeunesse)
- breach of The Implied Covenant of Good Faith and Fair Dealing (Jeunesse)
- tortious interference with (Nestler’s) contract (Kevin Giguere)
- interference with Nestler’s business relationships (Jeunesse and Giguere)
- tortious and civil conspiracy to interfere with Nestler’s business relationships (Jeunesse and Giguere) and
- violation of The Florida Deceptive and Unfair Trade Practices Act (Jeunesse)
In addition to claiming he’s owed $275,000 in commissions, Nestler has also asked the court for additional damages to be awarded on all six counts.
How’s this all going to play out? Buggered if I know, but with Nestler’s lawsuit having only been recently filed, Jeunesse have yet to file a reply.
With all the secret deals going on over at Jeunesse, I imagine a secret settlement is not out of the question. Secrecy does after all seem to be par for the course with Jeunesse management.
How much it will take to make the case go away, well that’d be interesting to know.
Meanwhile what of Jeunesse’s affiliates? In this snapshot of the upper echelons of the Jeunesse affiliate-base, what hope does a regular affiliate just starting out to compete?
It certainly sounds like if you’re not getting your own secret backroom deal when you join Jeunesse, then you’re probably under someone who is.
And can you be sure they’re then acting in your best interest, or theirs?
As per Nestler’s BDA, Jeunesse dangle commission top-ups on the proviso of generated sales volume. That’s sales volume you as a downline are tasked with creating.
And you’re not getting anything extra for it. Your upline though…
As to this particular case, I guess we’ll wait and see how Jeunesse respond.
The take-away from all of this though? Like I said at the start of this article, this sort of behavior isn’t limited to Jeunesse.
Keep that in mind the next time you read a headline about so and so leader announcing they’ve just joined a company.
How much do you really know about their arrangement and, more importantly – What aren’t they telling you? What can’t they tell you?
Update 5th January 2016 – A settlement agreement has been reached between Matthew Nestler and Jeunesse in late 2015.
Unfortunately due to its agreed upon confidential nature, the terms of the settlement have not been made public.
For what it’s worth… When Dr. Darryl See, disgraced from his botched study used by Sam Castor to promote Mannatech products, finally left Mannatech after being sued by Castor himself… See went to Jeunesse before eventually losing his med license for several years due to ethical concerns.
Sounds like ethics in general takes a back seat to “SHOW ME THE MONAY!” over at Jeunesse.
true, these deals take place across the board whether the company is legal like amway, or an illegal ponzi scheme.
top MLM leaders are headhunted, wined and dined, flown to headquarters for corporate meetings, to encourage them to come in with their downlines.
even in india, i see these local MLM satraps weild a good bit of power, while negotiating with some new MLM scheme. they can ask for changes in the compensation plan, ask for changes in management , and mostly always ask for a monthly travel expense for themselves and their top teams.
this is because they are NOT going to travel around, selling the company, on their own pockets. if the company has deep pockets, it may also pay a lumpsum welcome cash gift!
the top leaders consider these things to be a matter of right! they feel they have earned this seniority, and can get miffed, if the director of a corporate doesn’t treat them with the proper respect due to them!
I feel deals are fine but the reps/company should disclose them to people and let people make an informed decision.
I don’t see anything wrong with reps getting up front money and paid travel expenses and a monthly income till their residual gets to a livable agreed upon level.
Since some people are real talents at this vs other people. We don’t need now the money value of issue contract but we should know at least a deal was made and why.
I am a rep in Jeunesse but did not do a deal with them. I have been offer deals with other companies like double volume and up front money for so many months in past companies.
If I took these deals which I did not, I should disclose this fact to people. To me deals are good if done right because it shows a true commitment between both parties.
Not just leaders. Help *cough* Desk *cough*. 😉
To some “in the know” this is “old news”. The majority have no clue these back door deals are an industry-wide practice.
Perhaps in the name of “full disclosure”, it might be helpful to inform prospective distributors, members, and affiliates, that only after they have gotten enough experience under their belt, and have developed a large distributorship in a company(ies), can they then expect companies to lure them in with very attractive incentives, making it less difficult achieve the top pay ranks in any MLM company.
Then again, might not be such a good idea and should remain one of the “unspoken realities of MLM”.
What of the majority who are told to expect to devote 2 to 5 years developing their distributorships with the expectations of achieving the sought after dream of financial independence?
to be fair, dave, the MLM leaders, who strut around demanding princess treatment from corporate, are people who have 15/20 years experience in MLM, and have worked their way up, and built massive teams.
naturally corporate will want to nurture them, and this is comparable to a non MLM corporate honcho, getting shares of the company, or freebies etc.
but, i agree the secrecy should go. let MLMers know, that as they move up, they could get a deal with corporate too, but need to earn it.
i have heard of several instances, where upline leaders, on seeing sales talent, will fund the travel budget of a downline member, from his own pocket.
The company which I work for lost one of their top leaders to Jeunesse last year. This post sounds very similar to what went on with the leader in question.
However, I believe justice was served as Jeunesse were actually operating without a SUIPL, which is a license required by all MLM companies in Indonesia, and hence have been told to cease operations.
Oh, I’m with you, anjali.
It happens in all industries from sports, to entertainment, and the corporate world. Top experienced talent will always be courted with the best perks over the new talent.
It’s just not advertised openly.
And then, after a few years of having a very experienced MLMer make a lot of money, some companies decide that person makes way too much and finds a reason to throw him out.
But that’s the way it should work isn’t it? That’s the mlm strawman argument against teh ebil coporate world.
How else will the ‘little guy’ advance in mlm as promised if that isn’t done?
There are two sides to every story…right now this is all speculation!
Right now it’s a lawsuit filed in court, backed by a number of exhibits.
Your move Jeunesse…
instead of exclaiming! you could say something about the other side of the story.
BTW nestler has accused jeunesse of:
that sounds like pyramiding charges! jeunesse’s reply will be interesting to read.
details aside, it’s still a story of grubby little people doing grubby little things to other grubby little people.
Definitely not a situation into which potential members will want to become involved
So what’s your side, eh?
The fact that every MLM company out there gave some folks “special deals” isn’t the issue, nor is that a problem.
The real issue/problem is that most of those companies portray the deal-recipients as having accomplished their “big-time earnings” from the regular compensation plan, and that is FRAUD.
Hell, the deal-recipients do it as well!
Jeunesse just happens to be the “company of the moment” that got caught doing this, as the result of a lawsuit made public.
I have no doubt that hundreds of other companies and many thousands of deal-recipients right now have a severe case of “sphincter-tightening” in hopes that THEY don’t get caught.
That’s another issue prospects may have to contend with.
However, companies have a right terminate distributors who violate the agreed upon terms and conditions of the company, up to and including garnishment of a distributor’s earned commissions.
Usually, a distributor is involved in the practice of cross-recruiting team members into one company while still an active member of the company in question.
And that practice is usually frowned upon.
There are plenty of backroom handshake deals too. Vemma had the Alcazins (sp?) who was with Boreyko in his previous MLM. Herbalife had a whole f***ing flock of Tartols.
Heck, their favorite speaker had wife and daughter making 12K a month from Vemma. Godfather Tartol was on Board of Directors of Herbalife having started with the founder, and there’s like a dozen of his family (extended) in high-level Herbalife positions.
They can’t all have made it to the top through their sales techniques.
Would I be wrong in thinking the “other side of the story” may be the conclusion in an out of court settlement with some very enticing “hush money” paid to sweep it all under the rug?
Has any other big company lost such a case publicly?
Perhaps it is time to make such deals public…how would it change the industry?
What about all the deals that JUST went down over at Vemma! A certain few just stepped into TOP positions with LARGE sweet heart deals.
The bottom line is this goes on in just about Every Company out there and will continue going on for the foreseeable future…
Simple: Require every top affiliate (and the company) to track retail sales and subject to random audits.
In age of computers, it can be done with touch of a button. The only reason it wasn’t done is because they don’t want to.
Did you know Kevin “The MLM Attorney” Thompson asked two state legislators sponsored a bill in Tennessee back in 2010 to make Amway safeguard rules into law? I.e. retail requirement to get commission? It got killed by DSA.
If any one got sweetheart deals their retail record wouldn’t match their rank.
Don’t know how well it’ll go over if some top guy or gal stood in front of a crowded room and stated excitedly…
“A little background about me. I was a top distributor in x company and generated $100 grand a month with a downline of about 50 thousand. Took me five years to reach that level.
But in this company, I got an irresistible sweetheart deal to bring my downline over, bypass multiple levels, and max out the comp plan in the blink of an eye. Who could resist?
I come from a humble background. If I can do it, you can certainly do it too!”
I wonder how much they have paid Tremayne D Anderson to bring his big WUN downline into this also.
Suggestions from a long time networker.
Don’t let others steal your dreams. Networkers fuss and fight all the time. Some love each other and some hate each other and its all about jealousy.
Stop listening to bullshit. This is just a spoiled networkers who are angry because contracts come with tough performance rules and some preformed and got paid and some did not preform.
This is the same as a football player who does not preform. Low production and the team trades him.
Companies are in the business to make money not baby someone who commits forgery, misses goals, does not preform.
Work together in your team and drive hard to meet your goals. Support your up-line and your down-line and look ahead to win for yourself and your family.
Winners follow winners not whiners…….keep dialing and spreading the word about Jeunesse Global Products they help people stay young and improves the quality of life. Stay focused……………Worry about yourself–dial, dial,dial.
But there’s no indication in the lawsuit that Nestler did not reach his specified volume targets?
Well Jeunesse didn’t seem to have a problem building up Giguere’s business after he presented them with what appears to have been a forged copy of Nestler’s signature.
I’m guessing you only half read the article… kinda embarrassing hey.
“Pay No Attention To That Man Behind The Curtain!!! He’s Merely A Disgruntled MLM Reject!!! They Come In All Shapes And Sizes!!!”
Here is the rub. What is the difference between a professional althele that has spent years perfecting his trade and receiving a “signing bonus” plus other perks, than that of a professional networker that has done the same and has a proven track record? I personally think they are one in the same.
What many do not understand that when a industry leader decides to make a move (for whatever reason) there are inherent risk, on both sides.
In order for a leader to move his team over, most of who are earning an income, there must be some short of bridge to help in the process. This bridge makes the transistion a smooth and successful one for both distributor and company.
The bottomline is that this is a common practice within the industry and it is not out of the norm. I just wish I had not been exposed to this as I built a MASSIVE team world wide, the old fashion way, organically.
My how times have changed.
Athletes don’t parade around and falsely tell people “you can do this too” by joining whatever company the athelete signed on with.
Comparing non-MLM to MLM is a waste of time. Don’t do it.
Exactly. Big company CEOs and CFOs bring their best people with them to new company and they get perks for doing so.
The difference with MLM, it is all in the open and it is just a few best and brightest, not the whole kit and kaboodle moving.
You forgot that winners do not follow, they watch and learn and then break their own trail. That how it is in the successful business except for cronyism cases.
And by dial, dial,dial do you mean sell,sell,sell or recruit,recruit,recruit?
Just make sure dreams are actually achievable, else you’re just being reckless.
Remember, calling any one asking you “are you sure” dreamstealers is a way to avoid criticism, even if they are genuine and helpful. And if you avoid genuine criticism, you are reckless and prone to being lead down the wrong path by lovebombers.
Simple difference: professional athlete have a shelf life. Professional Networker does not.
Wow, this was sort of discouraging. I have never been in MLM before but signed up on Dec 24 and have worked my ass off and signed up 250+ people in 10 weeks and now have a team of 650+…
I watched a team call the other night where Cedric was announced as making Diamond level in only TWO months! I didn’t realize you could be appointed that position… I don’t even get any recognition for what I’ve done and my sponsor sucks.
Wow. That’s all I can say.
And how much product was sold to retail customers by those 650 people ??
* Legally an MLM in which a greater proportion of income is from recruitment fees, rather than retail sales (i.e. actual product sold to non affiliates) is defined as being a pyramid / endless chain recruitment scheme.
* Practically, such schemes are guaranteed to fold up and sooner rather than later.
While the company itself may appear to be profitable and its’ founders and leaders making money, the “on the ground” members who are doing as you have done and working their little as*** off are going to a) waste their time and b) be left holding the bag through no fault of their own.
Pyramid / endless chain recruitment schemes are illegal for a reason.
Based solely on mathematics, they don’t (and can’t) work for more than 90% of the participants, not because said participants don’t work hard enough, but simply because there’s not enough people on the planet so sustain them.
Hi, no, then that is not the case. We sell more product than we sign up people… I’ve earned good money.. so based on what you just said, I feel confident I’m in the right place.
My experience to date has been extremely positive so I’m going to assume this is just one of those things where people don’t believe a good thing when they see it.
The Instantly Ageless product line has catapulted the company upward and people are coming back for more.
Thanks for the info. Jeunesse is definitely not a pyramid scheme.
So apparently Jeunesse has bought Monavie, including their sub-brand Mynt.
Had Mynt on my review list but will probably just put all of this together with a review of Jeunesse once this all settles.
I disagree with the concept of a company recruiting or rewarding a leader of another MLM or non-MLM by giving them reward or perks other than the established affiliate compensation plan.
Their reward is that they may be bringing a large down-line with them and therefore through their team meeting the specified goals of the plan getting compensated.
If that leader built their down-line through true relationship (even if only a business level relationship) and taught honest marketing and sales techniques, then the foundation is set for the opportunity of success and longevity.
If a non-MLM is being sought after because of their skills and abilities, then they should be hired as an employee of the company, not slotted into a top EARNING position.
Notice the emphasis on EARNING a position. That is the foundation of the proposed compensation plan in the first place. Keep the playing field as equal as possible for all parties involved.
I’m a big supporter of you making a review of Jeunesse, Oz!
What gets me is when Jason Marks, a huge promoter of the Flexkom scam, is or was also with Jeunesse. No doubt there are many others similar to him. Doesn’t that raise red flags?
And as posted earlier, the “successful” MLMers do not walk the talk. They tell the wide-eyed peons that “THIS” company is going to change the world and allow you to retire in 2-5 years if you follow the plan.
I would ask why they aren’t on a beach somewhere? And, why have they changed companies so many times?
What they preach is fraud and the system, clearly explained in this review, is corrupt.
I know what you are saying, but do you realize what you are saying?
These statements only reinforce the fact that it’s all about recruiting and building teams. Shouldn’t we also be commenting about the relationships they had with their retail customers?
The entire idea of a leader bringing over a team suggests that this “business” is ONLY about marketing and sales techniques for recruiting; and it’s without regard for the product and customer.
They’re on my review list.
I’m working towards older company reviews over the coming months.
I am also concerned that a new Jeunesse distributor can buy a higher level of rank for 3 mths by spending more on a product package.
A leader approached me and recommended the package that costs over $1,000.00 U.S. The pressure is on in these meetings.
Not once did I hear anyone say what the average income per distributor is, only that you too can make many thousand a wk, mth…
You would be wise to review companies with proven track records, full disclosure on their income stats and companies whose management teams have strong corporate backgrounds that are not jumping from one venture to another.
BehindMLM turns 5 tomorrow, I plan to address this in an update on the site.
I’m reading Alex Morton, Vemma’s top affiliate, has jumped ship for Jeunesse.
I wonder what secret deal they gave him… and RIP Vemma?
Vemma has problem convincing that the affiliates NEED the autoship to keep the company going, IMHO.
After renaming itself affiliate marketing, it has definitely NOT retailed anything from the affiliates, thus, some people are seeing through the bull**** that they are “helping” the company market the stuff to customers.
THEY are the customers. Been saying that for MONTHS, even before Revanchist got silenced.
Similar to the deal that guy got to jump from some other outfit, other outfit will recruit away from Vemma.
acting FTC chairperson Maureen Ohlhausen has made the commissions stand about backroom deals clear in their first ever settlement with individual online influencers of an online gaming company, ‘CSGO Lotto’:
of course, this conclusion^^ applies to upline ‘influencer’ affiliates in MLM too. if they have any backroom deals, they have to disclose them.
the FTC has also blasted off several individual warnings to paid influencers:
MLM managements and top backroom deal affiliates better wake up before the FTC marches in to kick their butts.