Dissecting a JubiRev “we are not a Ponzi” webinar
It’s no secret that following the regulatory shutdown or organic collapse of several “revenue-sharing” MLM companies over the past year, those left in the niche are doing everything they can do distance themselves from the “Ponzi points” model.
That is, everything short of abandoning the re-worked Ponzi scheme model itself.
Just days after GoFunRewards shutdown operations in the US after “being advised” by their lawyers that their revenue-sharing model was “illegal”, JubiRev Video Manager T. LeMont Silver hosted a JubiRev webinar, titled “Why I believe Jubi will pass the regulatory test when it comes”.
Clocking in at one hour and twenty-four minutes in length and with JubiRev running a near identical business model and compensation plan to Zeek Rewards (shut down by the SEC for being a $600M Ponzi scheme), I was curious to hear how Silver was going to distance JubiRev from a Ponzi scheme.
Silver (right) opens the webinar by informing the audience that it’s aimed at those “building the business online”. Specifically, to JubiRev affiliates who aren’t marketing to their “friends and family”.
Or in other words, people who are likely to do their own due diligence and won’t just blindly follow JubiRev affiliates into the company (‘some people will join you from your warm market because you say “hey you need to join”‘ [00:47]).
To his credit, Silver acknowledges that in running a business model that has already come under regulatory scrutiny and found to be a Ponzi scheme in the US, that a regulatory test isn’t a matter or “if” but “when” [1:36].
As with a lot of the comments we get from supporters of Ponzi schemes here on BehindMLM, Silver then launches into a lengthy “history lesson” on Amway’s legal troubles in the 1970s [3:25].
Amway doesn’t use a revenue-sharing compensation plan so I’m not going to waste any timegoing over it, suffice to say that reasoning other companies with completely different business models winning in court has nothing to do with the resurrection of “revenue-sharing” Ponzi schemes 33 years later (Zeek Rewards launched in 2011).
Next up is the MLM binary compensation plan and regulatory troubles it ran into in the 1990s [6:45]. Again, the idea here is that Ponzi schemes in 2013 are also new, and thus are going to face similar regulatory scrutiny before being vindicated.
Like the Amway comparison, the binary comparison is irrelevant because Ponzi schemes (which all “points” style revenue-sharing MLM models are built on) first appeared on the US regulatory radar back in the 1920s.
Structuring the affiliate-funded model around points and attaching products distributed via an MLM company might be new, but the core mechanics of investors being rewarded with other investors money, proportionate to what they initially invest in themselves and continue to re-invest, remain the same.
You’re welcome to listen to the next fourteen minutes of the webinar, in which Silver talks about MLM attorneys, consultants, how much they charge and how binary flushing works – none of which has anything to do with JubiRev or why it’s not a Ponzi scheme.
Entering the realm of the bizarre, at [21:30] Silver introduces Zeek Rewards and Fortune Hi-Tech Marketing (whom the FTC recently busted for being a pyramid scheme) into the discussion:
[20:45] (Zeek Rewards) ran into some regulatory headwinds… the company abruptly stopped doing business.
(Ozedit: They were shut down by the SEC for being a $600M Ponzi scheme, but go on…)
[21:03] What some of the detractors of the revenue-sharing model would say is “see, see, see, they’re no longer around, that means that model’s no good.”
Well, if that is what you’re going to say, then what do you say about Fortune Hi-Tech?
Uh… what?
Given that Fortune Hi-Tech Marketing (FHTM) didn’t use a Ponzi points revenue-sharing compensation plan, I’d probably say “stop wasting my time”.
Silver then mentions “YTB” (another busted pyramid scheme), also acknowledging it “doesn’t have a revenue-sharing model”.
Sitting here watching the minutes of my life I’m never going to get back go by as Silver waffles on and continues to fail to address why JubiRev is not a Ponzi scheme…
[22:18] We could go through a litany of companies that were here in the network marketing space that are not here because of some type of regulatory issue.
But, those bloggers aren’t saying the industry’s no good, are they?
No, we’re not. And I’d have thought that was obviously due to the fact that not every MLM company is a pyramid or Ponzi scheme. T. LeMont Silver has his own theory:
[22:37] Maybe that’s because 90% of the folks in the traditional MLM space don’t make money.
Whilst I can’t speak for “those bloggers”, I can tell you that here at BehindMLM we don’t care if you make money or not. All reviews, analysis, commentary and discussion is based on the mechanics and structure of an MLM company’s business model and compensation plan.
Coming up next on BehindMLM, we ask those bloggers “why is chocolate milk brown?” and “why are some books taller than others?”
Almost twenty-five minutes into the webinar, and we’re still no clearer on why JubiRev isn’t a Ponzi scheme – or why it would pass an SEC unregistered securities investigation.
Continuing to ignore JubiRev’s Ponzi points business model and compensation plan, Silver then launches into a lengthy rant about affiliates “not making money” in the industry [22:46-29:00].
The cliff-notes are essentially “the whole MLM industry is against us because people make money with Ponzi points revenue-sharing compensation plans”.
MLM attorneys (Silver singles out Kevin Thompson as a hypocrite at [57:35]), consultants, “those bloggers”, other MLM companies… Silver appears to believe the entire industry and everyone in it has it personally in for him and the revenue-sharing business model.
[26:38] There’s an element in this industry that wants this model to fail because if there is a company or two that is successful with this model and are successful from a regulatory standpoint, there will be a lot of leaders and a lot of folks from other companies that say “hey, let me come over to Jubi”.
[27:05] Then what they may have to do is either change their model.
[27:37] Understand, ladies and gentlemen, that this model is not readily accepted in our industry. And it reminds me of a company called A.L. Williams.
A.L. Williams, which is now Primerica Financial Services (Ozedit: yet another irrelevant non revenue-sharing MLM company), when they got into this industry they were not accepted in the insurance world. They were looked at as a major threat to how the traditional insurance world did business.
[28:19] A.L. Williams, now Primerica, changed the face of the life-insurance industry in the US. [28:30] There was a group of people, a small group of folks, Art Williams, tremendous leader, and a small group of seventy part-time folks that eventually changed the entire industry.
I submit to you that you and I have the opportunity to link arms with J. Joshua Beistle and change the face of the industry.
Painting a somewhat dire vision of what he believes will be the future of the MLM industry, T. LeMont Silver apparently sees it densely populated by Ponzi schemes using the revenue-sharing business model.
I didn’t think it was possible to derail your own webinar (the insurance world…?), but once again I’ll simply point out that making money has nothing to do with analysis of a revenue-sharing Ponzi points compensation plan.
And on the subject of failure, it’s entirely a moot point because the Ponzi points revenue-sharing model has already failed regulatory scrutiny.
The SEC did not shut down Zeek Rewards because it was worried “other companies” were going to lose money or that affiliates would leave them, they shut it down because (primarily) 98% of the revenue generated and subsequently paid out as a ROI to affiliates was affiliate-funded.
Affiliates put in money (invested) and earnt a >100% ROI over a fixed number of days, paid out of new and continued re-investment by existing and newly recruited affiliates.
JubiRev uses this exact same Ponzi points model, replacing Zeek Rewards’ “sample bids” with “JubiBucks” (see BehindMLM’s JubiRev review for a more detailed explanation).
Continuing his “everyone is against us making money” tirade and further derailing the webinar from its original topic of why “JubiRev is not a Ponzi scheme”, Silver then launches into a deceptively light-hearted diatribe against those of us who analyse and report on the MLM industry at large.
Primarily targeting Troy Dooly (MLM HelpDesk) and myself (the “other blogger”), Silver launches into a series of ad-hominem attacks:
[29:17] I had a conversation, those of you who with that company (Zeek Rewards), the Thursday before they abruptly stopped doing business.
We had a webinar and our feature guest that night was Troy Dooly. Troy’s one of the bloggers out there. He’s one of the well known bloggers that talks about our industry.
I actually happen to like Troy. I am very disappointed in how Troy’s reporting certain things now and I’m not telling you anything I did not text to Troy. And if Troy would take my phonecall, I would tell him myself.
But he hasn’t been taking my phonecalls, he says he’s very busy, even though we’ve texted back and forth back and forth, even though we’ve had a couple of appointments that we were supposed to have, that he couldn’t make and he never rescheduled and so on and so forth. I actually like the dude.
Now there’s another blogger out there I don’t like. Now my faith says I gotta love him but that don’t mean I gotta like him (extended laughter).
I don’t like the way he does business, he’s a horrible journalist, he lies, he doesn’t tell the truth or he takes half-truths, uh which if you just tell half of the story you haven’t told the whole story, now it becomes deception – which is still not true.
Okay, but I’ll leave that alone.
Echoing Zeek Rewards’ “acting” COO Greg Caldwell (“All our critics (are) self-appointed with no standing in the professional community (and are) behaving unprofessionally by acting on false information”), Silver of course doesn’t elaborate on any of his claims or how they relate to JubiRev not being a Ponzi scheme.
Instead Silver continues to rant on, attempting to portray Dooly and myself as part of some kind of MLM industry conspiracy against Ponzi schemes:
[30:46] My point is, ladies and gentlemen, that there is a segment that doesn’t want to see this model do well.
Now Troy came onto a webinar that we had for our team on Thursday, previous to the Friday that the company (Zeek Rewards) ah, uh, uh, ah… (Ozedit: I believe the words you are looking for are “was shut down for being a Ponzi scheme”), closed its doors.
(a brief indecipherable interruption from Silver’s co-host occurs at this point)
[31:22] Troy had been doing some post about that company (Zeek Rewards) and they had been fairly negative once upon a time. And then he started doing more and more posts that were more in the accepting position. Almost kind of promoting it if you will.
Alright, and I couldn’t figure out why, I had a conversation with him, and it turns out that with some of these bloggers what happens is, and I don’t know what the details of the arrangement was, but it turns out that with some of these bloggers what happens is they’re making posts, they’re making posts and then a company contacts them and says “hey you’ve been talking junk about us, you’ve been talking bad about us, hey we’re not a bad company why don’t you come over here and check us out.
And then that starts a conversation and in many cases, the blogger or the consultant (Ozedit: not the subtle transitional change there) who is talking bad about a particular company, might pick up a consulting gig.
And ladies and gentlemen, that’s how that works.
T. Lemont Silver only barely stops short of accusing Dooly of “extortion” and “bribery” [33:04].
This style of corporate leadership appears to be common throughout JubiRev, with President J. Joshua Beistle having this to say about GoFunRewards’ recent announcement on their pulling out of the US due to legal concerns about their revenue-sharing business model:
Let me first extend my condolences to those left standing in the cold last week when their company, without regard to those that BUILT them (their distributers), terminated all US distributers- SHAME ON THEM.
First of all the other company was not SHUT DOWN, and if they had been SHUT DOWN it wouldn’t have been for their comp plan.
The other company simply decided to keep the money and TERMINATE the distributers who worked so hard to help them grow.
In the rant Biestle labels Troy Dooly a “hired pitchman”, following an MLM Helpdesk video he published confirming GoFunRewards terminated their US business due to concerns about the legality of their compensation plan. A view directly at odds with Beistle’s claims above.
T. LeMont Silver echoes Beistle’s rant, branding GoFunRewards’ closure a “money grab” by management [48:28].
So far removed from the initial topic of the webinar that we’re now on another planet entirely, it should be noted that Dooly’s involvement in Zeek Rewards as a consultant was heavily criticised here on BehindMLM.
The most infamous example being when, on live radio, Dooly prevented Zeek Rewards’ then COO Dawn Wright-Olivares from answering whether or not Zeek’s daily ROI mostly consisted of affiliate money (it did).
It’s worth noting that, unlike Silver who, let’s call a spade a spade, is trashing Troy Dooly to serve his own purposes (somehow that it proves JubiRev is not a Ponzi scheme… yeah I know, like I said – we’re not even on the same planet we started on at this point), our coverage was purely based on objectivity and extended no further than to analyse and deconstruct events surrounding one of the most damaging and far-reaching Ponzi scheme hybrids the MLM industry has ever seen.
A company Silver hopes to see many more of and in whose footsteps JubiRev proudly follows.
In the aftermath of the shutdown of Zeek Rewards, Troy Dooly has apologised on multiple occasions and by all accounts moved on and learnt from the experience, wholly acknowledging the mountain of issues that were raised during the months he was an official consultant there.
Mistakes are made in this industry and the analysis and commentary of it (myself included) and whilst some people learn from them, others don’t.
Of course none of that matters though when you’re trying to discredit individuals rather then the analysis they put forth.
As someone wishing to know why JubiRev is not a Ponzi scheme, I’d have given up on Silver’s webinar a long-time ago (probably when he started talking about Amway in the first five minutes). As a researcher though, even though we’re almost forty minutes in and I’ve written nearly 2300 words, I’ll press on.
Lest I be accused of “not telling the whole story”.
Silver continues on, resurrecting many of the silly arguments we saw shortly after the SEC shut Zeek down. You know the ones, “Paul Burks’ didn’t know he was doing”, “if Burks fought the SEC he would have won”, “the SEC threatened Burks so he had no choice” etc. We’ve all heard the post-Ponzi scheme nonsense that flies around when Ponzi participants lose their investments.
Again, the SEC shutdown Zeek Rewards because (primarily) 98% of the revenue generated and subsequently paid out as a ROI to affiliates was affiliate-funded.
And that pretty much shuts down every argument Silver makes between [33:40] to [39:45], most of which revolves around a “social uprising” somehow refuting the fact that 98% of the ROI revenue paid out was affiliate-sourced.
Finally, at forty minutes into the webinar Silver finally gets to what he should have opened with. A direct comparison of Zeek Rewards and JubiRev.
Or at least that’s what it started off as…
[39:47] Let’s talk about what was problematic, and then let’s talk about what Jubi has done to address what we know was problematic.
This comes from the SEC:
[40:03] 1. They said that one fourth of one percent of all of the bids, they said only one fourt of one percent excuse me, only, only, only one fourth of one percent of all of the bids that were purchased were ever used.
(Ozedit: if you thought travelling to another planet was far enough from the original topic of the webinar as we were going to get, brace yourself as Silver takes us to another solar system…)
Now, I’m going to tell you and you’ve probably figured this out by now, I love, I’m proud to be an American… I can’t say the rest of it I used to, I was going to say at least I know I’m free but uh, I don’t think I can say that anymore unfortunately.
[41:08] Please understand that I’m not being non-patriotic, okay. I am eternally grateful for all that men and women of them have made for all of us to have the opportunities that we have here in the US.
But I think that our government here in the US has proven itself to not be trustworthy. Uh, weapons of mass destruction, you ever heard of that?
Did we find them? Oh okay.
Okay, oh, okay. Alright, so I don’t necessarily believe that just because they said that these were numbers that these were the numbers. But I have no way to contradict their numbers.
If these numbers were true or anywhere close, this is problematic. If only one quarter of one percent of the bids were ever used that’s problematic, because the product the company had was bids.
I think it’s worth pointing out that the SEC only revealed the above figures after
a “period of cooperation” resulted in the production of “hundreds of thousands of documents, including financial records, e-mails, and all manner of electronic files
passed between Zeek Rewards and the SEC, as filed by Zeek Rewards CEO Paul Burks’ attorney, Noel Tinn, in a US court of law. Furthermore after the figures were presented to a judge by the SEC, they were then signed off on.
Hundreds of thousands of documents, including financial records, emails and electronic files? Pssh what do they know. I’m T. LeMont Silver and I’m proud to be an American.
In any case, Silver’s reponse to this “problem”?
[42:19] With that particular we had a monthly subscription. With our monthly subscription we got bids. We were able to give those bids away, to generate more points in the revenue pool.
So what did you do with your bids? I can tell you what I did with mine (laughter), I gave them away. I gave them away so I could get more points,I didn’t use them.
The distinction Silver tries to make here is that JubiRev pays out affiliates MaxBucks with affiliate’s monthly subscriptions. MaxBucks cannot be given away and have to be spent by an affiliate on products.
The problem is that the vast majority of bids in Zeek Rewards were directly purchased by affiliates. Bids might have been given away with monthly membership but as an investment vehicle what affiliates initially invested into the scheme was far more important.
The sample bids invested in via initial investment and ongoing re-investment in bids dwarfed whatever piddly sum of bids Zeek gave to affiliates with their monthly subscriptions.
When you consider the point balances someone paying the top-tier monthly membership fee in JubiRev (or Zeek Rewards has), is a few hundred a month in the face of hundreds, if not thousands of JubiBucks (not MaxBucks) being generated via re-investment a day going to matter?
“What?! What do you mean I invested money in JubiBucks? So what if I generated thousands of points a month, didn’t you see the 200 MaxBucks the company gave me each month with my subscription?”
In the above quote I’ve highlighted what is probably paramount in significance when it comes to establishing affiliate participation in both Zeek Rewards and JubiRev. That is, the motivation behind affiliates pumping money into these schemes.
Wink wink, nudge nudge compliance would have you believe that ultimately it it is to attract retail customers to the scheme (be it Zeek Rewards or JubiRev or any other revenue-sharing Ponzi points company out there).
But there, right there in T. LeMont Silver’s own words is the real reason:
They do it to generate points, so as to receive a greater share of the money all the other affiliates are spending to generate more points.
In Zeek Rewards affiliates invest in bids, in JubiRev they invest in JubiBucks. If you follow the money, whatever else happens after that, whatever products are attached mechanically the flow of money is the same.
It is sourced from affiliates on the expectation of increasing their share in a daily ROI pool and paid out to affiliates from invested affiliate money.
This point, fundamental to why points based revenue-sharing companies are nothing more than disguised Ponzi schemes, is entirely ignored by Silver.
Well, not entirely:
[53:22] What they (the SEC) said, and again I don’t necessarily believe their numbers but I have nothing to contradict their numbers, they said 95% of all the revenues that came into that company’s coffers (Zeek Rewards), came from internal purchases.
For the record, the SEC complaint stated that
Approximately 98% of ZeekRewards’ total revenues, and correspondingly the purported share of “net profits” paid to current investors, are comprised of funds received from new investors.
But I digress,
[53:43] What they (the SEC) were basically saying is there wasn’t enough revenue coming in from outside sources. And as a result, if those numbers are true, as a result they were saying it wasn’t a real business. It was more of a, of a
Ponzi scheme“transferring of money”, more of a money game.Now I know the owner of the company and that was never his intent. I also know that they did not come out of the gate with a customer-centric focus.
And as a result early on, they built a climate and a culture that was more people looking for a passive income opportunity or a high-yield investment program and what have you.
To quote Silver, Zeek Rewards wasn’t a real company because of its business model and compensation plan. A business model and compensation plan (and I know I’m repeating myself here) that allowed affiliates to invest money and earn a ROI over 90 days, paid out of newly invested and re-invested money by affiliates.
What the intent of the owner was or how “customer-centric” they were is irrelevant as this is how Zeek Rewards functioned. Furthermore a paradox is created in attempting to distance JubiRev from Zeek Rewards culture wise, in that it’s no secret pretty much all of the JubiRev affiliate base came from Zeek Rewards.
And for those ex-Zeek Reward affiliates who joined other reload scams in the aftermath of the SEC action, Silver regularly refers to them as “low-hanging fruit” and regularly appears in self-uploaded videos urging JubiRev affiliates to encourage them to join JubiRev.
At the end of the day, JubiRev affiliates invest in JubiBucks on the expectation of receiving a ROI over 85-105 days. Customers, mostly seen as a regulatory annoyance are usually purchased from third-party vendors, with JubiBucks routinely dumped onto the accounts to generate more Ponzi points.
What the intention of the owner of JubiRev or whether the company is customer-centric has no bearing on affiliates using it as a Zeek Rewards reload scheme.
And that, is solely what will pique the interest of the SEC when they come knocking. If anyone thinks the SEC stopped to ask Paul Burks how he felt about Zeek Rewards and the “culture” of the business, or whether or not the company engaged in *winkwinknudge nudge* “we’re all about customers” psuedo-compliance, they’re delusional.
The SEC simply requested Zeek Rewards financials, followed the money and came to the only conclusion there was.
It was a giant Ponzi scheme paying out affiliates with newly invested affiliate money, based on how much they directly invested themselves.
Singing the praises MLM attorney Gerry Nehra (who has a prolific history of involvement with several Ponzi schemes), Silver also touches on the 125% guaranteed ROI Zeek Rewards initially launched with. This is yet another easily dismissable argument (as it was with Zeek Rewards when they eventually ditched the guarantee), if one simply looks again at the motive behind affiliate’s investing in JubiBucks.
Simply put: Nobody is investing in JubiBucks without the expectation of receiving a >100% ROI over the specified ROI period (dependent in JubiRev on an affiliate’s membership rank).
A concept that these Ponzi points revenue sharing compensation plans would not be able to function without is being able to pay out >100% of the money an affiliate spends on points, over a specified period of time. Without this mechanic affiliate’s point balances would drop and nobody would invest.
Even without an explicit ROI guarantee mentioned, there’s still very much a >100% ROI implied guarantee present, without which the company would be unable to attract new investors into the scheme or retain existing investors.
Whatever you attach to that fundamental core of the revenue-sharing business model, be it a travel portal, rebate portal, grandma’s strawberry jam, a penny auction… the bottom line is it doesn’t matter. You can paint a rotten apple any color you want, underneath it’s still just a rotten apple.
Replace a rotten apple with Ponzi scheme, and T. LeMont Silver would have you believe your biting into the freshest of fresh fruit.
But don’t just take my word for it (and please don’t, review the facts and figures yourself), the following “JubiRev sizzle video” was uploaded by T. LeMont Silver himself less than 24 hours ago:
With JubiRev JubiMax, the more you give the more you get.
JubiRev JubiMax shares up to 50% or even more of its daily commissionable sales volume with all of our qualified promoters.
As you give samples to customers, you earn JubiPoints. The more samples you give away, the more JubiPoints you will earn. The more JubiPoints you earn, the more your daily potential rewards.
After determining the total revenue that will be shared that day, this amount is divided by the total amount of JubiPoints in the system.
We then pay our daily rewards with what we call JubiBucks. You can convert up to 60% of your daily JubiBucks rewards into commissions.
You can use your daily reward of JubiBucks to provide more samples to of our products to your registered customers. This allows you to earn even more JubiPoints, so you can increase your pro-rata share of the Daily Leadership Bonus.
The larger your JubiPoint totals, the larger your potential rewards. Your points can earn for as many as 105 days!
Remember, the more you give the more you get.
The more you give the more you get.
THE MORE YOU GIVE THE MORE YOU GET!
The more you give (to JubiRev), the more you get. Not a Ponzi scheme? Right.
What TLS actually MEANT was traditional LEGAL MLMs don’t make their affiliates rich. The ILLEGAL Ponzis can make you rich. I mean, just listen to him talk
He’s basically saying that if a company doesn’t have regulatory issue, then the folks in it are not making money.
Thus, he said that to make money, the company had to have regulatory issues, thus illegal.
That’s my interpretation and I’m sticking to it. 😀
Isn’t “the more you give the more you get” mantra of “cash-gifting” i.e. pyramid scheme?
Gee, if that’s the sort of drivel they put on a “webinar”, I’m sure you and I can actually make one that makes SENSE, Oz. 😀
I’d have thought it was “recruit more you get more” for pyramid and gifting schemes.
Giving more to a company to get more only really works in Ponzi schemes, and only if there’s a constant stream of new people always “giving more”.
What, a BehindMLM webinar? The hell am I going to put on that? This whole website’s pretty much a communal webinar :).
Turns out TLS mangled the quote. The original quote is about love, not cash.
The definition of a Ponzi scheme is “fraudulent investment plan, where the money paid out as ROI to investors derives entirely or primarily from other investors”. Or actually, ROI can’t derive from investors at all, other than their own principal investments being returned to them.
If the ROI derives from real work it’s not an investment. Giving away JubiBucks is “marketing efforts”, and CAN qualify as “real work” if the marketing attracts real customers paying for the products (with real money), and the profit generated from that is used to pay out ROI.
Giving away JubiBucks isn’t real work in itself. Using it to generate a virtual “profit” where SOME investors can withdraw real money is fraudulent.
Paying for products with JubiBucks isn’t real TRADE in itself. It’s “marketing efforts”, similar to giving away free samples to potential customers. They’re only POTENTIAL customers of the company even if they have received some samples.
“Marketing efforts” do not generate any profit for the company directly. They are EXPENSES rather than revenue. They should normally NOT generate any “profit sharing points” on their own. If they do, that part is simply fraudulent.
Zeekler had a few real penny auction customers, and JubiMax may have some real customers too. “A few” will not make this scheme become more legitimate. There has to be a significant number of customers spending significant amounts of money, enough to back up the profit points with real money.
This is the *winkwinknudgenudge* marketing line which was also present in Zeek Rewards.
The problem is of course affiliates over time are going to want to dump more and more JubiBucks on customers, so there’s little to no incentive for them to spend any of their own money.
Affiliate’s don’t care if customers spend money because they are paid out a ROI on their own investment and re-investment, as well as that of other affiliates.
In effect what happens is a devaluing of the product over time. Nobody spent money on retail bids in Zeek Rewards because affiliates were generating thousands a day they had to dump somewhere.
Same thing in JubiRev, but replace retail bids with JubiBucks. There is some cap $750 but, and admittedly I haven’t looked at it in a while so unless it’s changed this information is still accurate, it’s circumvented by customers paying some piddly amount like $30 or something.
Affiliates who have hit that JubiBucks dumping cap just sign up someone in their family, divert $30 or whatever it is of their ROI to paying for something and then go back to dumping JubiBucks on the account.
On the topic of legitimacy, it’s also worth noting Silver’s implication at the [01:12:00] mark that in the face of regulatory action in the US, “consultants” have advised him to bank offshore, use offshore servers to host a company’s website and set up “interdependent companies” in “countries where you’re generating a lot of revenues”.
JubiRev is “a British Virgin Islands” corporation.
Silver claims this is all necessary because “nobody wants to do business with the US” due to regulations, and that if a “regulatory body comes in and just shut everything down and had an issue with the US, okay but we still have these other areas that are operating”.
Silver states that J. Joshua Beistle is being advised by ex-Zeek Rewards consultants and is already operating certain aspects of JubiRev “outside of the US”.
He claims “this is not about hiding anything” and hopes that “in time, every affiliate in our organisation can set up offshore corporations”.
Offshore banking, offshore corporations, hiding assets from US regulators when they shut down Ponzi schemes… this is T. LeMont Silver’s vision for the MLM industry.
BUSINESS LOGICS
To all the MLM attorneys out there, there seems to be some flaws in your business knowledge? False profit should normally not be part of any compensation plan.
A: People are putting money IN, as affiliate investors. OK.
B: People are earning “points” for marketing efforts. NOT OK.
C: The points are used to calculate a daily profit share. NOT OK.
D: The daily profit share can be withdrawn as money. NOT OK.
The only money an investor legally can withdraw in point D will be his own investment. Non-investors (affiliates with real customers) can withdraw sales commissions too, from real sales to real end users.
Selling JubiBucks to other investors isn’t real sale when the PRIMARY motive for buying them is to earn “points”, rather than the desire to own and use JubiBucks for personal use or for resale.
* Using the JubiBucks to get free samples later won’t change that fact, and neither will giving the JubiBucks away do.
* Whether or not some “customers” are using the JubiBucks to get free samples isn’t very important.
Paying with JubiBucks = getting the products for free (virtual value in exchange for samples).
Paying with real money = TRADE (real value exchanged for real products). It doesn’t really matter whether the “samples” and the “products” are the same or different. TRADE will require an “exchange of values” to be real.
TO PARTICIPANTS
To minimize the effect of clawbacks, follow the Howard Kaplan advice for ZeekRewards about keeping track of your own business (documentation for TIME, EFFORTS and MONEY).
Recruiting investors isn’t real work, but recruiting real customers is. So keep first of all track of real customer purchases (including commissionable purchases derived from your downline’s customers).
A court in the US can have Subject Matter jurisdiction in a case, even when the company is registered outside the US. So it will actually have the jurisdiction needed to shut down the company if the scheme is being marketed in the US.
He’s trying to get people MORE involved in fraudulent business themselves, making them less likely to complain to authorities if they lose money?
Having the company registered in BVI or other offshore tax havens will HIDE transactions from U.S. authorities, and that’s clearly illegal when the scheme is being marketed in the US to US citizens. It can actually cause the scheme to be shut down FASTER than a US registered company.
TLS is trying to solve his own problems with authorities by involving MORE people into his own illegal solutions. That’s normally a recipe for disaster.
A company registered in the BVI can’t easily be shut down by US authorities, e.g. by SEC. But it CAN be shut down if it clearly involves different types of fraud (e.g. money laundering, tax evasion, investment fraud).
I’m not familiar with BVI as a tax haven, but most tax havens won’t allow companies to run scams under their protection.
JubiBucks aren’t “products” or “services”, neither tangible nor intangible. So they should normally not generate any commissions in themselves either, whether they are sold to affiliate investors in a downline or to real end customers.
It will be a bona fide sale if the customer is PAYING for the JubiBucks, and then is using traceable JubiBucks to purchase products. Customers won’t have any other motives than to use the JubiBucks to buy products.
Affiliate investors paying for JubiBucks will primarily be motivated by the chance to earn JubiPoints (as an investment). That’s NOT a bona fide sale. The investor is expecting to earn a ROI greater than his own principal investment. It’s an investment rather than a purchase.
Any product “purchases” where there haven’t been any money involved will NOT be bona fide sales, e.g. earning daily profit + use it to purchase samples. There’s no money involved in that transaction.
In most of these scenarios, the products’ primary function is to act as SAMPLES, something to give away for free without any exchange of values. That should normally not be commissionable either.
TLS is doing some name dropping, e.g. Gerald Nehra, Jeff Babener, Kevin Thompson and others. As long as he is rather vague about WHAT they have been involved in here, it won’t tell us much. “Consultant” can be about “Your plan is completely flawed. $500 please”. 🙂
T. LeMont’s upline might want to ask him a simple question: Have YOU ever been in the same room with the JubiMax person who makes the revenue-sharing calculations to observe the process and check the math?
The reason is simple: “Revenue sharing” Ponzi schemes are infamous for being run by men behind green curtains who fudge numbers to create an unusually consistent “return” that dwarfs the marketplace.
In the ASD case, the U.S. Secret Service addressed this very issue. And the SEC addressed it in the Zeek case.
The professional Ponzi players have to hear a certain number or they won’t play. And if they won’t play, the enterprise won’t gain the traction it needs.
Oz, notice how JubiMax is calling itself a “movement?”
People love to be part of movements. The Club Asteria scam was going to eradicate poverty with its 8 percent a week (roughly) “program” that traded on the name of the World Bank. And the AdViewGlobal scammers — some of whom likely are in JubiMax after being in Zeek and ASD before it — were going to save the rain forest.
With its “movement,” JubiMax is sending signals that the serial scammers and “sovereign citizens” will not be able to ignore. The “program” already is on the Ponzi boards — and that in itself means eventual death.
T. LeMont also is creating a bogeyman — the evil government. That theme may help to sell the scheme in the early stages. But like a presence on the Ponzi boards, it signals death.
PPBlog
TLS is actually trying to be a crank, not to create a movement. Though the boogieman is quite accurate. Dug up this article “Crank Howto” from ScienceBlog’s Denial Blog that documents denialism. The tactics are the same:
1) Develope a wacky idea — Yes, this is a ‘legal’ Ponzi scheme that will make you money. Forget about real MLMs.
2) Disseminate your idea — through blog, mailing list, video, webinar, website, etc.
3) (Not) respond to criticism — instead of replying to criticism with facts, use bad arguments, logical fallacies, accusations of conspiracy, and so on
4) Claim persecution — almost anything can be spun into “evidence” of such persecution. Government action? Persecution of the “genre”. Media coverage? persecution of the genre. Etc. etc.
http://scienceblogs.com/denialism/2007/05/31/crank-howto/
Denialism never change.
Blah Blah Blah man it all sounds the same from one new profit daily return scheme to the other the leaders of these programs are the cancer.
if no one is leading the sheep into the pen no one would get slaughtered. So you must get the sheep herder and banish him from the internet good luck. No matter how hard you fight these programs new ones pop up everyday.
The only thing I can figure out that there life span will be shorter than the previous ones but unfortunately there will still be the cool aid drinkers and you cant change that.
As the above article reviles its all a spin everyone of these programs just beware of what your doing and if you get bit you cant say you weren’t warned.
It’s no wonder that scammers often retreat to “conspiracy” as a catchall explanation. Conspiracy, when wound tight enough, is “self-healing”, in that ANY fact you can produce to dispute the conspiracy will be cast in the light that it’s PROOF that conspiracy is even bigger than they described (and your attempt to prove there is no conspiracy means you’re a part of it) and any data you provide is automatically suspect of confirmation bias (by your side).
There’s no arguing with cranks, as a scientists found out. He studied conspiracy theorists, and his study was, as expected, pillories by conspiracy theorists who claimed he’s a part of a conspiracy to discredit conspiracy theorists. 😀
http://scienceblogs.com/denialism/2013/02/26/what-happens-when-you-study-conspiracy-theories-the-conspiracy-theorists-make-up-conspiracy-theories-about-you/
Great article, Oz
Here we go again!! The Haters are out and full of venom!! You hate that we actually made it easier for the average Joe to make it. You hate that we may finally break up to 2% club.
Problems with your JubiRev is a Ponzi arguments. I have more REAL customers than referrals who are enjoying real products who have committed to becoming regular customers of mine since they like the product so much. Hurts doesn’t it? A true ponzi needs more and more promoters to keep the revenues coming in.
However, since JubiRev has a REAL product line and if JubiRev only had two promoters who could generate millions in sales, then it would still survive as a company. OUCH! Really hurts!!
Oh, and the entire business w
(Ozedit: I didn’t cut the above comment off, it’s published as is)
You do get that even without SEC action Zeek Rewards was poised to collapse within 2 months at best, according to their own financial records.
You can use silly dismissive terms like “haters” and what not, facts are facts.
As long as you keep feeding them JubiBucks… right?
Whatever products the Ponzi points model is attached to, it becomes massively devalued over time due to hoardes of affiliates clamouring to dump JubiBucks/sample bids/whatever onto “customers”. Why on Earth would customers spend their own money (other than the min spend a JubiRev affiliate might convince them to cough up so they can continue to dump more JubiBucks on them).
Not really. The Ponzi model is fundamentally flawed and we’re no stranger to supporters of Ponzi schemes here.
Do you really think I’d object to an MLM business model that held up to scrutiny and increased sales and the reputation of the industry?
Carrying the “entire industry is against us because we make people money” torch is nothing new, and it’s a strawman argument.
Yeah… “could”.
As Ponzi point balances grow, good luck convincing people to spend their own money on products without the attached income opportunity.
Dumping hundreds of bids a day soon becomes thousands, multiplied by the affiliate base becomes hundreds of thousands and then millions.
You’d have to be a complete schmuck to spend your own money as a customer, and therein lies the rub.
But please, continue to carry on about “haters” and other such childish rhetoric.
And how long did TLS talk about products in this webinar?
Sounds like none to me.
So what does your evidence mean?
Probably nothing. TLS didn’t seem to have mentioned them at all.
He did mention coffee for about 20 seconds and something about signing up your family as customers (to dump points on, cheaper than buying generated accounts from vendors).
A travel and shopping portal were also briefly mentioned.
Like I said though, doesn’t matter what you attach, affiliates are still investing in JubiBucks on that 85-105 day >100% ROI implied guarantee.
That’s “problematic”, as Silver puts it. And as long as JubiRev are offering that ROI (by using a revenue-sharing compensation plan), the motive behind JubiBuck investing isn’t going to change.
My point is he didn’t bring up the “we have products therefore we’re not a Ponzi” argument, unlike “Behind” here. Thus, TLS likely didn’t think that argument is very persuasive (again, unlike “Behind” here).
Dissension in the ranks? Difference in intelligence? 🙂
No of course not.
First we had Amway, then a bunch of other companies, a rant about binaries, how the entire MLM industry is against Ponzi schemes because they “make people money”, nearly a quarter of an hour all up or so dedicated to ad-hominem criticism and insult-hurling at Troy Dooly and myself… and then some stuff about why Jubi isn’t a Ponzi scheme.
And even then, Silver still failed to address the devaluation of the products as more and more JubiBucks are invested in and dumped on customer accounts – and overall lack of retail activity this creates (as evidenced in Zeek Rewards).
That’s how I felt when I observed an American sitting in a poolside lounge chair bad-mouthing his own country on foreign soil (Dominican Republic) by calling its currency “funny money,” defining “real money” as “silver” and “gold” and declaring Social Security a “Ponzi scheme.”
It is axiomatic in the United States that “politics ends at the water’s edge.” In pursuit of the new and better MLM, however, T. LeMont appears not to be the least bit concerned about protocol. In his post-OneX, post-Zeek, post-GoFunPlaces days, he wants to demonize the greenback and the U.S. government from the Dominican Republic while praising something called JubiBucks — but he still wants Americans to sign up and pay with the greenback.
And since T. LeMont raved in the Dominican Republic that he was making “over 3,000 a day in commissions” from GoFunPlaces before putting on the JubiMax hat, my presumption is that GoFunPlaces paid him in greenbacks and that he accepted them happily.
Now he’s positioning British Virgin Islands-based JubiMax as a “movement” — this after his trek to the Dominican Republic and an apparent bid to defend the JubiMax faith poolside before venturing to Chile.
To me, perhaps the most interesting thing about some of the Zeekers (like T. LeMont) is that they position themselves as great entrepreneurs and capitalists and then serve up a bunch of “programs” only a Politburo could love.
Zeek created an environment in which about 86 percent of participants became losers, with the winners now the potential targets of legal actions. Hell, Lenin probably is rolling over in his tomb with delight observing the purported capitalists sticking it to each other in the name of the purported new and better MLM.
PPBlog
Note the use of the singular I in Mr “behind OZ” defense of the JubiRev “comp plan”
Apparently in JubiRevland having ONE person with retail customers absolves the company from being accused of being nothing but a recruitment based “opportunity”
So none of them have actually bought anything yet, spending any real money?
How can giving away samples for free generate any profit for the company? People are just exchanging monopoly money for products (free samples).
It’s generating profits off Behind’s own money. He bought the products to give away. So Behind’s getting SOME of his own money back AFTER everybody else gets a share of HIS profits. He just hopes that there’s enough people like him so he can get more than he put in.
Now for a shot that should sink this “the more you give the more you get” lie…
Spencer Reese, of Grimes and Reese, MLM Lawfirm
http://www.mlmlaw.com/saleswatch/omnitrition.html
Having affiliates buy stuff and give them away to participate in the comp plan is a sign of DISGUISED PYRAMID, not promotional scheme.