Vemma, Boreyko & Alkazins propose settlement with FTC
It’s increasingly looking like Vemma will not front court to prove they aren’t a pyramid scheme, as alleged by the FTC last year.
On September 6th a joint motion to stay proceedings was filed, requesting 60 days for the FTC to consider the proposed settlement agreements.
Specifics of the settlement agreements are at this time not known. The joint filing only states that Vemma, BK Boreko and Tom and Bethany Alkazin have signed a proposed settlement containing a permanent injunction and monetary judgement.
Whereas Vemma and Boreyko’s proposed settlement might appear out of the blue for those who bought into their marketing, the reality behind the decision to settle is pretty solid.
Upon being ordered to stop paying recruitment commissions and operate as a pyramid scheme, here’s what happened to Vemma’s business over the past year:
BK Boreyko has two options at this point. Continue to fund the legal battle against the FTC and eventually lose in court anyway, or settle now, lose but save some money.
Both scenarios will see Boreyko cop monetary fines so he’s screwed either way in that regard. And Vemma as it was known is toast.
The failure of the business post-FTC lawsuit has conclusively proved Vemma is not viable as a legitimate retailer.
Tom and Bethany Alkazin cannot defend the FTC action if Vemma and Boreyko settle, so they’ve decided to cut their losses too.
The joint motion was granted on September 7th, giving the FTC 60 days to review the submitted settlement proposal and take a vote on it.
In related news on September 9th, Judge Tuchi approved the Temporary Receivership’s Final Accounting filing. Vemma was also ordered to pay the Temporary Receiver $15,000 for supplementary legal costs.
Stay tuned…
Oz. What does that chart show? website hits?
It appears to start at `100K somethings? and increase to 600K somethings? over the period, in spite of showing a descending trend line.
Thanks
Alexa stats: Lower number = more visits to your website. Higher number = RIP.
It shows ranking relative to other sites, so Vemma has dropped from being in the top 100,000 sites to being in the bottom 500,000 sites
I see. Thank you
1. Obviously Vemma sales have dropped, or even stopped. Did another company buy their downline organization, or did the distributers just scatter?
2. How did Brad Alkazin avoid being involved in the FTC action?
3. Is it true that Tom & Brad Alkazin were quietly asked to resign from Xango?
What a sad situation for all of them.
bah. vemma&co can propose anything they like, but the FTC is the Regulator here. they will kick any such settlement proposal out the door! right?
because, the FTC does not ‘settle’ with pyramid schemes. pyramid schemes are Shut Down. if you allow one pyramid scheme to continue with changes, then why not All of them? right?
besides, the ‘recruitment + autoship + low retail’ model of vemma may be the most popular model in the MLM industry. the FTC isn’t bothered with the shutdown of just one vemma amongst many.
the FTC will reject vemma’s ‘overtures’ and continue it’s litigation and go for the kill. it will get the court to find vemma’s model to be a pyramid scheme. in one action it will create caselaw that says all vemma like models are pyramids! this will change the MLM industry in an intrinsic way. obviously the FTC does not want to shut down just one vemma. right?
as if the FTC has time or money or enough staff to go after the same type of pyramid schemes individually, and settle with them one by one! by proving vemma is a pyramid and getting such a ruling from the court, all other such schemes will become illegal! great conservation of time and money and manhours! right??
i mean, if the FTC settles with vemma [with business changes], all the other recruitment + autoship schemes are going to sit in the bar and have a drink and say – cheers guys! the FTC is not really sure our business is a pyramid scheme! they were jus’ pissed with vemma because those schmucks went around recruiting in college campuses. we’re safe guys, the FTC don’t settle with no pyramids! cheers!’
y’now, as it is, FTC actions are few and far between due to paucity of time and money and staff. so, the FTC most certainly wont be wasting this litigating opportunity by ‘settling’ with vemma&co.
haul your ass back to court vemma! this settlement is sooo not happening! right??
on sept 7, 2016 MLM attorney kevin thompson reported on this settlement as if it were a done deal:
thompson had represented vemma at the initial hearing of the case, so he may be close enough to this matter to know whats going on behind the scenes.
with this settlement it will be safe to say that vemma was not ‘clearly’ a pyramid scheme [or it would have been shut down]. with approx 22% retail it may have had ‘enough’ retail to ‘escape’ being a pyramid scheme, but not enough to please the FTC.
we don’t know how much retail will please the courts, because MLM cases barely go to trial in federal courts, and questions are left pending.