WorldVentures skirts Malaysian tourist license, still a pyramid scheme
Last April the Malaysian Ministry of Tourism and Culture declared WorldVentures was operating illegally in the country.
This was based on the fact that, at the time, ‘the Ministry of Tourism and Culture (had not) issue(d) a license to WorldVentures‘.
WorldVentures still doesn’t have a license, but has instead convinced the Domestic Trade Cooperation and Consumerism Minister they don’t need one.
Why?
WorldVentures’ business model itself has nothing to do with travel.
Speaking to the Malaysian press after he officiated the opening of WorldVentures first Malaysian office on July 12th, Minister Datuk Seri Hamzah Zainudin stated;
The problem is, is it not so much the business itself.
We in this Ministry, we are actually monitoring all those people who are licensed to do this kind of business.
World Ventures’ business model sees it sell memberships, which offer access to travel discounts.
World Ventures affiliates do earn a small commission if third-party travel is booked through an affiliate’s replicated portal, however the majority of commissions are paid out on the recruitment of new World Ventures affiliates.
In Malaysia, WorldVentures have partnered with local company SkyZone Travel Sdn Bhd, who do hold a tourism license.
Reiterating this core business model focus, WorldVentures Global Sales president John McKillip told Malaysian media
the company did not sell travel-based products, but sold memberships which had access to travel packages.
“Our product is not travel packages. Our product is merely the (WorldVentures) membership.”
To what extent the Ministry of Tourism and Culture investigated World Ventures’ business model, flow of revenue and core business practices is unclear.
In a 2013-2014 regulatory investigation, the Norwegian Gaming Board found WorldVentures to be a pyramid scheme.
The finding was primarily based on the finding that ‘revenues almost exclusively come from recruiting members and not the sale of travel residence.‘
Despite the likelihood of similar method of revenue generation in Malaysia, Zainudin and the Ministry of Tourism and Culture don’t seem to be concerned.
In response to the Norway finding, WorldVentures was banned from operating in the country. The company filed an appeal but was denied.
Zainudin meanwhile contends that, despite having a business model centered on affiliate recruitment, he ‘see(s) great potential in WorldVentures and also for Malaysians‘.
by partnering with skyzone, world ventures has indirectly got a tourism license to sell tourism products in malaysia.
however travel agencies in malaysia are barred from selling memberships, according to the Ministry of Tourism and Culture (MoTC):
https://behindmlm.com/companies/world-ventures/worldventures-an-illegal-business-in-malaysia/
the fact that skyzone does not sell the memberships but world ventures does, is a mere technicality, as world ventures has gained the right to sell travel packages in malaysia via skyzone.
so, i don’t know how the MoTC has overlooked the fact the world ventures are selling ‘memberships’ under a tourism license.
Good catch. I think the MoTC however is satisfied that technically World Ventures don’t have a tourism license and so aren’t subject to the tourism operator rules.
After the uFun Club mess I don’t think too highly of Malaysia’s regulators. Seems with enough money you can get anything done there.
according to the rakya post, in october 2014,the national director of trade and consumer enforcement team ministry, mohammad ruslan said that though world ventures had a direct selling license to operate in malaysia, they would be checking whether its program was in contravention of the 1993 direct marketing and anti pyramid act of malaysia.
he further said if world ventures was found illegal, they would take action.
ch.therakyatpost.com/national-news/44638
the malaysian chapter of the direct selling association, describes a pyramid scheme to be :
world ventures sells memberships [not a retailable product], and pays recruitment commissions on these memberships. only a small amount of commissions may be derived from the third party travel packages sold, making it a recruitment based pyramid scheme.
so, did the trade and consumer enforcement team ministry really check world ventures MLM plan and have they found it legitimate?
dsam.org.my/industry/what-is-pyramid-selling
JusticeAlwaysLate is all over this. The Central Bank “Bank Maegara” had not retracted their warning about WV, so basically you have one part of government says don’t join, the other granted it a operator license. It’s kinda hilarious.
Guess which part was (probably) paid off!
*coughcough*non-traceable gifts*coughcough*
The sale of the Membership is the only way a representative is paid. It is not on recruitment as this article states – that is inaccurate.
Clearly the Malaysian government is supportive of the WV business model or they wouldn’t have approved it. This is yet more vindication of the validity of the business and the products that it offers.
When only affiliates are purchasing the membership, it’s defacto recruitment.
Getting a tourist license is not approval of a business model. No government approves specific company business models.
There’s nothing stopping a Ponzi scheme registering with the SEC, for example.
There are a lot of Memberships being sold without being Reps. The Membership is able to be purchased by itself.
Okay, but if a company is under scrutiny for being illegal in some manner (think Onccoin, Zeek, etc.), the likelihood of them being approved for anything, including a tourist license, is very low.
No there isn’t. When World Ventures was in its prime in Norway, a Gaming Board investigation revealed 95% of revenue generated by World Ventures was affiliate membership purchases.
End result was World Ventures banned nationally for being a pyramid scheme.
Same story company-wide, affiliate revenue will account for 90%+ of revenue.
Not if a tourist license has nothing to do with analysis of the company’s MLM operations. VenusFX aside, Malaysia isn’t known for timely MLM regulation.
I’ll now ask how many affiliates you’ve recruited vs. retail memberships you’ve sold.
You can be honest and admit you’ve recruited more, or lie and pretend you have more retail customers. Over to you chief.
Just to clarify. NO income is made off of recruiting an affiliate (business owner). None, what so ever.
A person does have the option to be an owner only and only SELL the membership. Like life insurance. You can sell the policy only or have both, sell the policies and have one as well. Same concept.
The company primarily promotes the membership (i.e.ME- I don’t get paid off of you owning the business, I only get paid off of you purchasing the membership.
Today if you only want to do the business, you can be an affiliate but that does not benefit me financially at all) Which means, you can pay your start up business fee with no purchase of a membership (they are separate mind you), sell the memberships only and create income.
You’d never have to promote ‘the business’ to anyone else ever again. There are some top earners who have sold memberships only, not many additional affiliates.
Now to the contrary, yes, most people do end up doing both. Because let’s face it, people want extra income too.
The question always comes up, you’re making money off this? Why yes, just like your insurance person, you purchased a policy(membership) they get a commission override off of your monthly premium (membership monthly fee). But, it’s completely optional.
With that being said, the structure can APPEAR like a scheme because people simply want to make money and vacation too so they purchase both.
Or it can simply be mimicing the same concept and business motto of an Insurance Agency. So, yes I’ve offered the membership only, but yes most have done both. I hope that clears THAT part up.
Thankyou for confirming WorldVentures is a pyramid scheme. An optional pyramid scheme is still a pyramid scheme.
And anyway, you’re late to the party. The Court of Appeal in Norway already revealed 75% of WorldVentures’ members are affiliates, which is well-beyond a an even split.
It’s it can be proven that the concept is similar to your life insurance agent, …unless that’s an optional pyramid scheme too… Please enlighten me.
Unless the life insurance agent you’re referring to is running an MLM company and paying affiliates to recruit new affiliates, you’re wasting both of our time.
Using your reasoning, it can be shown a Porsche shares similarities with a Volkswagen, but, it’s not and never will be.
It is the same business concept. I am both. Thanks for the insight.
An MLM business model has nothing in common with non-MLM business models.