Spinding launch delayed due to compliance issues
Spinding, an MLM opportunity that offers affiliates participation in a series of $30 to $1890 cycler queues, has been having issues securing a credit card payment option for its affiliates.
Promised late last week, it turns out that the company was initially approved, however pending further compliance review, the terms of the agreement were then changed by the processor and subsequently rejected by Spinding.
The reason for the change?
In an email sent out to affiliates over the weekend, Spinding owner Paul Nash advised
As you may know, we have been working hard to bring you a credit card option for payment in our launch. We were approved by a major merchant account provider last Wednesday for an UNLIMITED account and for the last 48 hours we have been working on the integration of the payment gateway into our pages.
On Friday morning, we planned to start live transactions and take payments. Our integration was complete and we requested that the compliance department of the merchant account provider give us the final approval to go live. We expected an immediate approval, as our integration was completed and they had already approved and agreed with our business.
The final approval did come later in the day, but one of the key people in the compliance department changed the terms of our deal. Unfortunately, we are still in discussions with the provider, and have requested that they adhere to the original terms that we signed back on Wednesday.
Reading between the lines, it would appear Spinding was given preliminary approval, but when somebody with a clue went over their comp plan, red flags prompted increased security measures to be added to the agreement; something Nash wasn’t keen on:
The new terms would have introduced a significant delay in our ability to pay commissions on a timely basis, and we wanted to make sure that our affiliates are our top priority as we make strategic decisions to manage this company.
What’s interesting to note is that, rather than address the glaring compliance issues evident within Spinding’s six queue cycler compensation plan, Nash is instead trying to find a processor that’s willing to take on the risk:
Since we have multiple merchant account applications in process, and the expectation that we will be approved by additional providers as early as next week, we chose to continue negotiating with this provider while working on our other approvals instead of agreeing to terms that would have effected our affiliates.
Uh yeah, good luck with that.
Another point of interest is that, whilst credit card processors are citing compliance issues with Spinding, payment processor i-Payout have already signed them up as a client. i-Payout recently claimed to be taking compliance seriously and even hired Kevin Thompson to ‘to provide up-to date compliance guidance to their new and existing clients in the Direct Selling and Multi-Level Marketing industry.’
Whether or not Thompson has personally approved Spinding’s compensation plan compliance wise is unclear, however the signing of companies like Spinding is doing nothing for i-Payout’s fast growing reputation as the darling processor for MLM’s underbelly.
Just how risky is Spinding for payment processors?
Paul Nash told an affiliate back in January that he “hopes” ‘a small percentage of “active” members (will) actually try to build this thing…‘
Everybody else is just in it for the cycler positions, which will no doubt collapse shortly after launch and the initial position-buying frenzy.
Spinding affiliates can be observed on social media getting increasingly agitated with the delays, worried they they’ll miss out on funding their accounts (getting in at the top of the queues):
Do you personaly (sic) think that one or 2 days are enough in order to see most of the members activating their accounts before the launch? It’s weekend..and if most of the members have plans and forget to check their mails…then what happens?
Is there any possibility that Mr. Paul might extend this period if the percentage of active members is too small?
I wonder how much time will be available to buy the packages UNTIL THE LAUNCH TAKES PLACE…
If the credit card deposits are not instant I hope this is considered when they set the launch date and time.
None of this of course would appear to bother i-Payout though, their compliance policy still doesn’t seem to extend beyond “show me the money!”