One of the recurring questions that arises whenever a shadier MLM company attempts to market itself on the reputation of their lawyer, is “what on Earth are they thinking?”

Often times these are individuals who have practicing law for decades, yet there their names are – intertwined with what are obviously business models bound to fail regulatory scrutiny.

It’s a question many of our readers ask and, not being an MLM lawyer, it’s one I really don’t have a concrete answer to. These are professionals who are supposed to know MLM regulation both inside and out, so why does this keep happening?

Well, from an amended complaint filed by the Zeek Rewards Receivership yesterday, here’s one reason:

Grimes and MLM Compliance received approximately $843,000 from RVG.

[Continue reading…]

There is no information on the Race Cycler website indicating who owns or runs the business.

The Race Cycler website domain was registered on the 24th of June, however the domain registration is set to private.

Research into the company reveals affiliates naming a “Kent Brown” as the owner of Race Cycler in their marketing presentations. Brown (right) can also be heard hosting several Race Cycler affiliate update calls, so this seems to fit.

Brown appears to be no stranger to the MLM “cycler” niche, mentioning he’s been in “some other programs in the past” on a Race Cycler affiliate call ([1:17], July 31st).

One example appears to be TNT Rotator, for which Brown left a glowing testimonial on the company website:

TNT Rotator is a matrix-based opportunity that uses 2×2 and 2×3 matrices. Under the guise of selling “text-ads and software”, affiliates pay $89.97 and are then paid to recruit new affiliates into the scheme.

A Facebook account that appears to be run by Brown shows his progression datewise from TNT to Race Cycler:

Whether Brown is still involved with TNT Rotator is unclear, but his participation in the scheme (and other “programs”) has likely influenced the setting up of Race Cycler.

Read on for a full review of the Race Cycler MLM opportunity. [Continue reading…]

When I first began researching Leafit, I wasn’t sure if I was looking at a reincarnation of 2012s vLeaf Ponzi scheme or if it was something else altogether.

Digging up the archives, I headed over to vLeaf’s old website domain (“vleaf.com”), which confirmed that these two companies were indeed one and the same:

Why the vLeaf and Leaf International branding was abandoned I have no idea, but today the company is going by the name Leafit.

One possible reason is vLeaf’s business model:

Building on the traditional Ponzi scheme “buy advertising and earn a ROI” model, Leaf International introduces a retail offering to the recipe, throws in some online marketing tools and pairs it with a 3×9 pyramid scheme.

That vLeaf was destined to collapse was a given, however when exactly that happened is unclear.

The Leafit website domain (“leafit.com”) was first registered way back in 2006, however the domain details were only recently updated on July 27th. This is probably a good indication of whereabouts the domain was re-purposed to begin marketing Leafit as an opportunity.

That said, the Leafit website in its current state isn’t all that helpful:

What are we about? Well, we are creating a new type of social network that helps users actually make money from their content!

By posting content socially, like people do everyday on other social networks, Leaf It users will automatically be able to earn from what they post themselves, and even from what they share from others!

Hmm.

The website Leafit affiliates are pushing, “leafit.biz” is a bit more useful, offering up some basic information about the opportunity.

One pleasant change from vLeaf is that ownership of the company is now fully disclosed. Heading up Leafit is Founder and CEO Lawrence Sowell (right).

Somewhat curiously, on his LinkedIn profile Sowell only cites involvement with Leafit beginning January 2014.

Sowell’s Twitter meanwhile reveals he was most definitely involved in vLeaf:

Sowell’s background appears to be in marketing and promotion. Before vLeaf and Leafit, Sowell launched Get2Marketing in 2007.

Taken from Sowell’s Get2Marketing corporate bio:

Lawrence’s passion for marketing and promotions began when he was 18 years old in College. Little did he know, by the age of 22 he would have done 2 musical tours and over 20 promotional events with headline names like Nelly (hip hop), Sawyer Brown (country).

Lawrence has since moved his passion to the internet where he is an expert at ad concept creation, branding strategy’s, website analysis, online and offline marketing, ad placement, and reporting.

This advertising background is probably what laid the foundation for the failed vLeaf Ponzi/pyramid hybrid attempt.

As far as MLM goes, I wasn’t able to find any involvement by Sowell on the affiliate or executive side. This indicates that vLeaf was Sowell’s first MLM venture.

Some of Sowell’s co-workers are also worth mentioning too. On Leafit’s Fundable investor page the company advises that it’s ‘interested in raising funds from accredited investors.‘

At least one investor seems to have jumped in, with Sowell noting in a July 16th update about a “Private Placement Memorandum” (PPM) that

The PPM has been launched after recently closing the Friends and Family Offering. On it’s first day one investor purchased stock in the amount of $50,000.

If you scroll down the main Leafit Fundable page, management is listed along with Leafit’s master associate, Vaughn Tarver.

Research reveals that Tarver was heavily involved in the penny-auction scheme BidXcel:

After being in the industry for 24-plus years, I would say in the last six months I have seen more change than I did in the previous 20 years combined.

BidXcel wasn’t as bad as some of the more obvious Ponzi scheme penny auctions that launched in the post Zeek Rewards era, but still permitted affiliates to directly invest and receive a ROI if they created dummy customer accounts.

Launched in September 2012, BidXcel ran out of new affiliate funds to pay off existing affiliate investors a few months later in March 2014. Abruptly and without forewarning or clear communication to its affiliate-base, BidXcel management did a runner and left those who had invested hanging.

Speaking of Zeek Rewards, also listed on the Fundable website is Mike Green. Green is credited as Leafit’s VP of Sales and lists his location as Spokane, Washington on his LinkedIn profile:

Green also currently appears to be one of the net-winners in the Zeek Rewards Ponzi scheme. Clawback litigation was recently launched against net-winners in the Zeek Rewards Ponzi scheme who failed to negotiate a settlement with the Receiver.

Green’s name appears on the Receivership’s list of net-winners who earned $1000 or more and refuse to return the stolen Ponzi funds they were paid back to the scheme’s victims.

Steve Heiman is named Leafit co-founder and COO, and is also co-owner of Sowell’s Get2Marketing company. MLM wise I’m not entirely sure but Heiman might be an ex-affiliate of StemTech International. Various replicated affiliate pages for a Steve Heiman in StemTech (affiliate ID: 1004901) are currently cached by Google (they are otherwise no longer publicly available).

Heiman’s LinkedIn profile also credits him with involvement in vLeaf.

As is clear from the above, Leafit’s management and master associate certainly have a colorful history. We know what’s attracted them as MLM marketers in the past, but has Leafit changed from vLeaf’s original advertising-based Ponzi points model?

Read on for a full review of the Leafit MLM business opportunity. [Continue reading…]

Last month I was contacted by ISN Coins founder and CEO Matt Barkes:

My name is Matt Barkes. I’m one of the founders of ISN. I apprecite (sic) you taking the time to evaluation ISN, however almost everything you have written is out dated.

After hiring Kevin Thompson as our MLM attorney we’ve made many changes to better the company for our members.

This being the case I respectfully request that you either modify the information to to (sic) reflect ISN currently or remove the blog.

I first reviewed ISN Coins back in 2012, so it wasn’t surprising to learn that the business might have changed since then.

Today we take a look at ISN Coins as it stands in 2014, read on for the review. [Continue reading…]

ACN (an abbreviation for “American Communications Network”) launched all the way back in 1993, initially operating as ‘a marketing arm for a long-distance reseller called LCI Communications‘.

That relationship ended in 1998 until LCI was sold off, at which point ACN broadened their product and service offering. Today ACN are involved in a number of MLM niches, including utilities, communications, home entertainment and security “and more”.

Based out of the US state of North Carolina, ACN was co-founded by four individuals who, to their credit, have retained their executive positions within the company.

Greg Provenzano (second above) serves as President, Robert Stevanovski (fourth) as Chairman and Mike (third) and Tony (first) Cupisz (twins) as Vice-Presidents.

Chip Barker (right) was brought on as CEO in 2007. Prior to his CEO appointment, Barker served as ACN’s Chief Operating Officer of European Operations.

Due to the age of the company and a lack of information provided in their ACN corporate bios, what each of the four ACN co-founders did specifically before launching the company is a bit of a mystery.

Taken from Greg Provenzano’s personal website (“gregprovenzano.com”):

Greg is a born entrepreneur who had a very successful career in the network marketing industry that began in 1984. He spent nearly a decade examining the industry before founding his own direct sales company

A biography for Robert Stevanovski on an ACN marketing site reads:

After entering the network marketing arena in the late 1980s, Robert held senior positions with two highly successful marketing companies.

ACN Founder Robert Stevanovski These experiences positioned him as one of the driving forces behind the formulation of ACN.

The biography also credits Stevanovski with having ‘managed several businesses throughout the 1980s, directly influencing growth and expansion‘.

In his ACN corporate bio that appears on replicated ACN affiliate websites (which differs from the main corporate bio), Mike Cupisz is credited with having ‘built several successful companies prior to founding ACN.‘ Tony Cupisz bio claims he ‘has worked in direct marketing since 1986‘.

I wasn’t able to find any information on what Chip Barker was up to prior to ACN.

On the regulatory front, ACN has run into problems with the Montana Commissioner of Securities and the Bureau of Consumer Services in Pennsylvania.

In August, 2010 the Montana Commissioner of Securities and Insurance Monica Lindeen announced the issuance of a Cease and Desist Order and Notice of Proposed Agency Action against ACN, Inc. and several of its founders for allegedly operating a “pyramid scheme.”

In September, 2010 the Commissioner moved to vacate the Cease and Desist Order in full settlement of the case.

In the course of the Commissioner’s investigation, the Commissioner determined that the actions giving rise to the initial concerns were not part of the ACN business model, but instead were isolated instances taking place by certain ACN’s independent representatives in Montana.

The Commissioner and ACN agreed that ACN would implement additional training with its independent representatives.

On June 13, 2002, ACN settled a case with the Bureau of Consumer Services in Pennsylvania wherein it was alleged that a small number of IBOs were “slamming”, or switching consumer services without authorization.

ACN disputed the allegations and the exact details of the settlement are under court seal.

Nothing too serious, although the settlement under seal indicates a likely “we’ll pay the fines but don’t admit to anything” resolution. The Montana cease and desist appears to be related to marketing efforts by the company’s affiliates.

ACN haven’t been pinged since for this, so hopefully that indicates the company and it’s affiliates have cleaned up their act.

For additional information, a read of ACN’s Wikipedia entry is recommended. Otherwise, read on for a full review of the ACN MLM business opportunity. [Continue reading…]

Identified as the “the people behind” OneBiz on the company website are Heiko Häusler, Thomas M. Duda and Tobias Knoof.

As per their supplied corporate bios, all three have internet marketing experience, however any MLM credentials are noticeably absent.

The OneBiz HangOuts are broadcast out of Germany, indicating that this is where Häusler is operating the company out of.

Contact details provided on the OneBiz website clash with this, and instead point to an address in St. Gallen, Switzerland.

Possibly due to language-barrier issues (I believe all three owners are German), I was unable to independently track down an MLM history for any of the company’s owners.

In any event, read on for a full review of the OneBiz MLM business opportunity.

[Continue reading…]

Talk Fusion launched in 2007 and operate in the digital communication MLM niche.

The company is based out of Florida and headed up by Founder and CEO, Bob Reina (right).

According to Reina’s corporate bio, the idea behind Talk Fusion came from

a simple desire to put video in an email.

America Online said “that’s impossible!” but Talk Fusion Founder & CEO Bob Reina didn’t believe that for a second. Enlisting an expert IT mastermind, Bob set out to prove AOL wrong.

He did. Impossible achieved; video email sent! That was just the beginning of Talk Fusion’s legendary story.

Prior to Talk Fusion Reina launched Travel Reaction (2001) and Cash Card Worldwide (~2005).

Travel Reaction are still in business and operate in the travel MLM niche. The company charges affiliates $249 to access third-party travel discounts, and pays out commissions when those who have purchased membership book travel.

Cash Card Worldwide was a similar venture, providing affiliates access to third-party travel discounts for $499.

Taken from a Cash Card International affiliate presentation:

You will receive up to a 50% commission split on every cruise, vacation package, hotel accommodation, car rental, airline ticket and travel insurance policy that you refer to us, and in which Cash Card Worldwide receives a commission.

You’ll also receive commissions every time you refer a friend or business colleague that also enrolls in the program and purchases our independent travel agent program.

When exactly Cash Card International shutdown I’m not sure, but today the company is no longer in business.

On the legal front, Talk Fusion sued some iWowWe affiliates back in 2011. The complaint against J.J. Ulrich and Joe Read alleged that they had left Talk Fusion and were using trade secrets to encourage Talk Fusion affiliates to join iWowWe.

iWowWe also operate in the online communication MLM niche.

Talk Fusion won a requested injunction against Ulrich and Read, which prohibited them from raiding Talk Fusion’s affiliate-base.

The company also went after popular Russian social network VKontakte in March of 2013.

Seeking $290,980 in damages, Talk Fusion claimed

that some posts on the VKontakte site are untrue and damaging to Talk Fusion’s business reputation.

According to Talk Fusion, certain posts on the VKontakte site refer to it as a “covert financial pyramid” and say that any information promoting it on the social network will be blocked.

The case was dismissed in June of the same year after one of the defendants alleged his VKontakte account ‘was hacked and damaging information was placed on it by unidentified individuals‘.

As for VKontakte themselves,

a representative of VKontakte told the court in May that they did not publish any defamatory information regarding Talk Fusion, but only replied to users who asked why Talk Fusion ads were blocked.

During the June 4 hearing, a VKontakte representative said these technical letters pointed to “elements of a financial pyramid” in the operations of Talk Fusion, but did not describe it as a Ponzi scheme.

That was apparently enough to get Talk Fusion’s complaint against them dismissed too.

Read on for a full review of the Talk Fusion MLM business opportunity. [Continue reading…]

There is no information on the BrandOnline365 website indicating who owns or runs the business.

The company does have an “about” section on their website, however it only provides a short marketing spiel. No information about the company itself or its management is provided.

The company’s website domain, over at “brandonline360.com” was registered on the 30th of January 2014, however the domain registration is set to private.

Further research reveals that in the BrandOnline365 compensation plan video embedded into the company website, J. Joshua Beistle introduces himself as the President of the company.

Why Beistle’s name does not appear anywhere on the BrandOnline365 website is unclear.

Long-time readers of BehindMLM will immediately recognize Beistle as the (former?) CEO of JubiRev. JubiRev launched in launched in early 2013 as a Zeek Rewards Ponzi reload scheme.

The idea behind JubiRev was to meld Zeek’s Ponzi points business model together with a mishmash range of cheaply produced products under the brand “JubiMax”.

The company launched in March but, as most reload scams do, failed to attract the momentum of the company it was modeled on. By June 2013 JubiMax had all but run out of funds to pay investors with, and consequently announced they were abandoning their passive revenue-sharing model.

A new compensation was launched shortly after that, however the attempt to push a retail customer focused business model onto an affiliate-base who were initially attracted to passive investment failed.

The details of how JubiRev collapsed remain sketchy, with J. Joshua Beistle going into hiding shortly after the compensation plan change. I myself don’t recall ever seeing any clarification on the status of the company in the months that followed their comp plan change.

Today the JubiMax website is still live, however if one tries to visit JubiRev the account comes up suspended:

As I understand it, affiliates who invested in JubiRev were simply left in limbo.

Prior to JubiRev, Beistle launched Dream Style Vacations Club with Randal Williams in 2009. Providing access to third-party travel discounts, Dream Style Vacations was a recruitment driven scheme that paid affiliates based on how many new members they brought into the scheme.

Beistle also markets lead generation services through his company MyPhoneRoom, which he launched in 2009 (non-MLM).

Read on for a full review of the BrandOnline365 MLM business opportunity. [Continue reading…]

Despite Plastic Cash International’s objection and concerns their litigation might delay payments, Judge Mullen has come through and ordered that the first payments to Zeek victims will go out on September 30th.

Plastic Cash International’s claim wasn’t ignored, with Mullen observing [Continue reading…]

As the Zeek Rewards Receivership continues to pursue financial settlements with insiders who should have known better, news broke today that those at the top have already settled.

In his status report for the second quarter of 2014, Receiver Kenneth Bell has revealed that

By the filing date of this report, the Receiver had reached settlement agreements with Paul Burks, Dawn Wright-Olivares, and Daniel Olivares, pending Court approval.

Each of these defendants agreed to a consent judgment of $600 million to be satisfied with substantially all of their assets.

How the $600M figure will be paid back, in particular who is paying what amount, is unclear. Ditto how much of the judgement will be distributed to the scheme’s victims by the Receivership.

What is clear though is that it appears to be a lump sum, and after it’s paid – those primarily responsible for the creation and operation of the Zeek Rewards Ponzi scheme will have absolutely nothing left to show for it.

As someone who was actively covering Zeek Rewards during the height of the Ponzi insanity that gripped so many within the MLM industry, this latest judgement is a far cry from the hype and cheerleading that went on during Zeek’s heyday. [Continue reading…]