Lyoness affiliates prey on Estonian deaf community
It might not be standard-practice for an MLM affiliate enquire as to the source of funds newly recruited affiliates are using to sign up with, but surely there’s at least some level of evaluation on affordability going on?
The internet goes some way to distance the obvious, but if you’re meeting face to face and actually engaging with your recruits – you don’t really have an excuse.
Common-sense would dictate that if you got the inkling your prospect couldn’t really afford to get involved, you’d abort. Thank them for their time and perhaps jot them down for a followup in six months or so.
Unfortunately there some MLM affiliates would rather realize short-term profits regardless. Their reasons are their own, but their actions reflect poorly on the MLM industry as a whole.
Especially when it blows up in their faces.
This is one of those depressing MLM stories I wish I didn’t have to cover, but here goes…
On the 23rd of October 2014, Lyoness affiliates in Tallinn, Estonia held a marketing presentation.
Prospective affiliates who attended were told that they could get a Lyoness shopping card, which entitled them to cashback at well-known retailers Maxima and Lukoil.
Lukoil claims to have since severed ties with Lyoness, and Maxima have since stated they’ve never had anything to do with the company.
Regardless, affiliates attending the presentation were also told that for buy into Lyoness for €2500 EUR.
This got them a Lyoness “gold card”, which qualified them earn commissions when they recruited new affiliates who also paid €2500 EUR.
What was of particular significance at this presentation was the audience was made up of about fifty members of Tallinn’s local deaf community.
After meeting with “representatives of the deaf community”, it was agreed Estonia’s deaf community would be prime candidates for Lyoness’ €2500 EUR gold card scheme.
Lyoness affiliates Natalja Dickensile and Peep Neimanile then began making preparations for the October 23rd presentation, which saw them enlist the services of a sign-language speaker.
Eager family members of Tallinn’s deaf community urged their deaf relatives to attend, telling them that the placement in Lyoness offered was “extremely good value”.
At the presentation, prospects were then told that ‘the gold card can be used to earn money‘, but they weren’t told it required the recruitment of new affiliates.
One attendee of the presentation, Jaan Pärgma,
says that he did not realize at the beginning that will need to earn money to find new members. “Kuuljatel it would be easier to do, but the deaf community is so small.”
“It’s like a pyramid scheme, that if you are able to quickly get people to join, then its earnings could be higher there.
In the beginning was the fact that four people bring up to 800 euros. But after it became clear that there is still a need to broaden and to the need of people.
Within one month, you had to at least 4-5 people to enlist in order to get their own revenues.
This provision was beyond comprehension to me.”
Knowing full well the limitations members of Tallinn’s deaf community would face marketing the scheme, Dickensile and Neimanile signed up fourteen attendees anyway.
To fund the €2500 EUR Lyoness gold card fee,
many took loans from a bank, with at least one applying for an instant loan.
Others had relatives pay for them in cash.
Needless to say that over the next twelve months, none of them recouped their investment through the Lyoness business opportunity.
Following complaints to the Estonian Consumer Complaints Board, they recommended that Lyoness refund the investors in full.
Five of the deaf affiliates approached Lyoness about a refund, with the company agreeing to returning only half of the €2500 each invested.
Eight other affiliates have hired an attorney and are now pursing legal action.
In an attempt to get answers from Lyoness, Estonian media outlet Delfi approached the CEO of Lyoness Estonia, Ott Neeme.
Neeme told Delfi ‘Lyoness Europe would not allow him to give an interview‘.
Delfi also reached out to Natalja Dickensile and Peep Neimanile in an attempt to get their side of the story.
Upon being contacted Dickensile hung up on them. Neimanile at least attempted to justify his involvement, stating he
himself does not feel guilty because the deaf people had very big plans for around the world.
They allegedly planned to recruit Lyoness members from around the world, not only in Estonia.
No doubt the €35,000 EUR or so Dickensile and Neimanile solicited from Tallinn’s deaf community pushed through a good number of their respective Accounting Units.
With cash ROIs paid out on the maturity of those units, who cares whether those they recruited recouped their investment or not.
Onto the next victims…
Update 29th December 2015 – Sometime recently, Delfi pulled the published article used as source-material for this story.
To date we’re not sure why, with Delfi themselves having not issued a public statement on the matter.
Following removal of the article in question, another article on Lyoness was published in Delfi on December 27th. Delfi readers were quick to label the article a paid advertisement, with one suggesting Lyoness had threatened to sue Delfi over publication of the deaf community article.