MLM - Network Marketing Blog

New York State Sues Social Network Tagged

By Dan Mitchell, MLM Blog Correspondent

From AFP:

WASHINGTON (AFP) — The attorney general of New York state announced plans on Thursday to sue social network Tagged for deceptive email marketing practices and invasion of privacy.

Attorney general Andrew Cuomo, in a statement on his website, said a lawsuit was being filed against the San Francisco-based social network for "an illegal plan to lure new members and artificially inflate traffic on its site."

"Consumers who visited Tagged were tricked into providing the company with access to their personal email contacts, which the company then used to send millions of promotional emails," the statement said.

"Tagged disguised these solicitations to make them appear as if they were coming from a personal contact, when they were actually spam," it said.

Between April and June, Tagged sent "tens of millions" of misleading emails stating that Tagged members had posted private photos online for their friends to view, the statement said. "In reality, no such photos existed and the email was not from their friends.

"When recipients of these fraudulent emails tried to access the photos, they were forced to become a new member of Tagged," the statement said. "The company would then illegally gain access to their personal email contacts to send more fraudulent invitations."

"This company stole the address books and identities of millions of people," Cuomo said. "Consumers had their privacy invaded and were forced into the embarrassing position of having to apologize to all their email contacts for Tagged?s unethical -- and illegal -- behavior.

"This very virulent form of spam is the online equivalent of breaking into a home, stealing address books, and sending phony mail to all of an individual?s personal contacts," he said. "We would never accept this behavior in the real world, and we cannot accept it online."

The statement said the lawsuit aims to stop Tagged from engaging in "fraudulent practices" and seeks an unspecified fine from the company.

Tagged suspended the email marketing campaign in June.

Tagged chief executive Greg Tseng, in a blog post on Thursday, called Cuomo's announcement "disheartening."

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Celebrating 50 Years of Amway India Scam

By Dan Mitchell, MLM Blog Correspondent

Sounds like Amway reps are up to their old tricks in India.

From Corporate Frauds Watch:

Amway India indulges in the same blame game whenever a distributor fails to do business. He did not work hard that it is why he had failed in his mission. The truth is the scheme itself inherently deceitful. Amway India distributors all the time tell their new members about motivation and soon they are going to become rich soon.

Nirmala, the school teacher, stated in her letter that though both are working they hardly had five thousand rupees in their bank account and her husband was still in the illusion that they are going to become millionaires soon. And he keeps on bringing pressure on her to sell products to their kith and kin.
The housewife who tried to join the auto rickshaw driver told him that she has been earning thousands of rupees every month. She was killed in her own flat by the same man for money. But he did not find any money in her home not even jewellery and that was what he told the police during interrogation.

Another housewife told me that she was earning Rs. 68,000 every month. But she rides a battered scooter and lives in a tin-roofed rented house. People who earn Rs. 20,000 a month lead a decent life in India.

Lambada ladies were lured to become members with the promise of becoming rich by some Amway distributors. It is not their poor choice. But the distributor has wrongly chosen them to become distributors. His aim is to enroll more members and earn commission.

These are all facts which could not be skipped or taken lightly. People who lost money in such transactions would never trust the persons who introduced them to such schemes. That is why such schemes are damaging the social fabric of our society. Is there any need to interview each and every distributor in the country to come to such conclusion. Not at all.

Anyway, IBOFB agreed that all is not well with Amway UK and it is better they close shop before cheating many more people. So is the case with Amway India.

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iJango vs. Tampogo

By Dan Mitchell, MLM Blog Correspondent

I stumbled upon a network marketing opportunity called Tampogo this morning while trying to get to the bottom of the so-called iJango scam.

 You can check it out at Tampogo.com.

It seems to be identical to iJango and it doesn't cost anything to join. And you don't have to sit through a black & white video of an earnest huckster - Cameron Sharpe - claiming he had the original idea to "network" Google.

Tampogo and iJango are so similar their respective Terms & Conditions are almost identical. They must share the same legal team. They certainly share the same destiny.

This from TamPogo:

3.1 - Adherence to the TamPogo Marketing and Compensation Plan

Network Partners must adhere to the terms of the TamPogo Compensation Plan as set forth in official TamPogo literature. Network Partners shall not offer the TamPogo opportunity through, or in combination with, any other system, program, or method of marketing other than that specifically set forth in official TamPogo literature. Network Partners shall not require or encourage other current or prospective Direct Customers or Network Partners to participate in TamPogo in any manner that varies from the program as set forth in official TamPogo literature. Network Partners shall not require or encourage other current or prospective Direct Customers or Network Partners to execute any agreement or contract other than official TamPogo agreements and contracts in order to become a TamPogo Network Partner. Similarly, Network Partners shall not require or encourage other current or prospective Direct Customers or Network Partners to make any purchase from, or payment to, any individual or other entity to participate in the TamPogo Compensation Plan other than those purchases or payments identified as recommended or required in official TamPogo literature.

This from iJango:

4.1 - Adherence to the iJango Marketing and Compensation Plan

Representatives must adhere to the terms of the iJango Marketing and Compensation Plan as set forth in official iJango literature.  Representatives shall not offer the iJango opportunity through, or in combination with, any other system, program, or method of marketing other than that specifically set forth in official iJango literature.  Representatives shall not require or encourage other current or prospective Customers or Representatives to participate in iJango in any manner that varies from the program as set forth in official iJango literature.  Representatives shall not require or encourage other current or prospective Customers or Representatives to execute any agreement or contract other than official iJango agreements and contracts in order to become an iJango Representative.  Similarly, Representatives shall not require or encourage other current or prospective Customers or Representatives to make any purchase from, or payment to, any individual or other entity to participate in the iJango Marketing and Compensation Plan other than those purchases or payments identified as recommended or required in official iJango literature.

Who will win the iJango Scam ?

By Dan Mitchell, MLM Blog Correspondent

Yesterday Ty blogged about the so-called iJango scam and how it was similar to AGLOCO. As a former Director of Sales at one of the top MLM Leads companies in the industry I've spoken to thousands and thousands of Network Marketing and MLM Professionals and I can still remember the hype and lies surrounding AGLOCO. And then the eventual collapse...

I just hope people aren't duped into this latest get-rich-quick-scheme called iJango from Cameron Sharpe and Steve Smith. With the state of the economy these days the $150 it takes to get started could buy a lot of food and essentials.

The iJango scam is a lot like a game of Jenga - it's fun and exciting to begin with but it's not over until the pieces fall down. iJango!

Read the TechCrunch article here that discusses AGLOCO...

iJango Scam = Failed AGLOCO Toolbar?

iJango appears to be some sort of toolbar that will allow you to monetize the web, right?

Sorry to report that it's been tried before, twice.

Read this TechCrunch article from 2007.  it will shed a lot of light on iJango:

If it was a bad idea the first time around, it’s probably a bad idea the second time around too. Mike was harsh on AGLOCO, a variation of the failed AllAdvantage pyramid scheme from a few years ago, when he wrote about their launch. He was right to question the business - they’re closing down. The following email was sent to at least some AGLOCO members:

We would like to update you on the status of AGLOCO’s operations. We continue to believe in the AGLOCO concept, but our revenue is currently not sufficient to give Members a meaningful distribution. And though there are increases in membership, the resulting revenue is not enough to support operating costs. As a development team we are unable to continue to use our savings to fund the operations. If any Member would like to pursue continuing the operations of AGLOCO, you may contact us at agloco1@live.com .

We would like to thank every Member for supporting our effort to bring a piece of the Internet directly to the user. We hope that we can find a way to keep the operations going.

AGLOCO is the reincarnation of AllAdvantage (complete with some of the same founders), a Web 1.0 company that paid users for viewing advertising through a toolbar. The founders, who blamed the stock crash in 2000 for the AllAdvantage faiure, claimed they’d get it right this time around. In particular, the ability to highly target advertising would allow them to generate enough revenue for a sustainable business.

Apparently they were wrong. AGLOCO joins the TechCrunch Deadpool.

Efusjon Scam Hype and Lies?

I am getting a little tired of the apparent hype and lies surrounding Efusjon

Here is an example from a Hubpage written by an Efusjon rep:

Derek Broes, colleague of Bill Gates and inventor of SKYPE became a VP at Paramount Pictures.

Colleague of Bill Gates? The guy was a director level at Microsoft and Microsoft has over 90,000 employees.  Was Derek Broes really a colleague of Bill Gates?

Maybe Broes was a colleague of Gates.  Good for him.  However the second piece of information about SKYPE appears to be a lie.

Here is information on the founders/inventors of SKYPE (from Wikipedia):

Skype was written by Estonia-based developers Ahti Heinla, Priit Kasesalu and Jaan Tallinn, who had also originally developed Kazaa.[1] The Skype Group, founded by Swedish-born entrepreneur Niklas Zennström and the Dane Janus Friis, has its headquarters in Luxembourg, with offices in London, Tallinn, Tartu, Stockholm, Prague,[2] and San Jose.

No mention of Broes.  In fact the SKYPE entry on Wikipedia makes absolutely no mention of Derek Broes.  

Kind of odd that the "inventor of SKYPE" is not even listed on the SKYPE entry on Wikipedia, don't you think?

Folks, it is not hard to become a fast growing business when you build on hype and lies. 

Like my boys from Public Enemy always say: Don't Believe The (Efusjon) Hype.

The Streamline Funnel System Exposed

By Dan Mitchell, MLM Blog Correspondent

Here's an excerpt from a great post by Brian Davis about the Streamline Funnel System:

Update 9 July 2009: Streamline funnel system. I don't want to say I told you so, but I told you so! A business associate of mine, was on the last streamline funnel system conference call, and guess what, the cost is not $9 it's more like $30+ and you're not getting 10,000 prospects your only getting 400 or 500. How many more times will people fall for this guys pie in the sky systems.

This is my opinion based on my personal experience. I'll get straight to the point, be very careful with any program Paul Birdsall launches, runs or is behind.

I had joined a program quite a while back called payitforward4profits, I enrolled 325 active members in a short period of time, but little did I know Paul Birdsall and Joe Broughton, his partner in crime, had this big scam going on.

Ok, here is what was happening. A prospect would join Payitforward4profits through my personal link and would start to receive automated messages, which was wonderful, but just one thing, some of the messages contained Paul or Joel's affiliate links. For example several of the messages contained their GDI affiliate link, GDI was one of the programs that Paul Birdsall's system promoted. When asked why the messages contained their GDI link and not mine, the response I got was that someone else maintained the autoresponder messages, can you believe that crap.

Read the whole blog post...

iJango and Steve Smith Launch iJango in Vegas

By Dan Mitchell, MLM Blog Correspondent

 Here's an update on the alleged iJango pyramid scheme...they are launching Saturday, August 1, 2009 in Las Vegas at the Encore Hotel. Steve Smith of Excel Communications fame has partnered with the guy who started The Relationship Company.

iJango claims they will be the center of the online universe and that this will be the most powerful event in the history of network marketing.

Hype and hyperbole. Hype and hyperbole. Why has someone in China registered over 650 domains that have the word iJango?

You have been warned.

Twitter Phishing Scam Alert

By Dan Mitchell, MLM Blog Correspondent

The latest phishing scam to hit the popular micro-blogging site, Twitter, involves a Tweet that says "omg!! is it true what they wrote about you in the tweet blog?" This Tweet includes a link to a phishing site: twitterblogs.com, which looks like Twitter's login page.

If the person submits his or her login information, then their account will hijacked - thus allowing these scam artists to continue posting malicious links. Always be cautious when clicking on an unknown link.

Pre-Paid Legal Services a Pyramid in Collapse?

By Dan Mitchell, MLM Blog Correspondent

From Eworldwire via Trading Markets:

Pre-Paid Legal Services Inc.'s (NYSE:PPD) "Pyramid in Collapse" status - as characterized by nationally recognized and internationally known expert Robert Fitzpatrick - is re-confirmed in second quarter of 2009 figures, affirms Fraud Discovery Institute (FDI).

Since 2007, Fitzpatrick has characterized the current business cycle of Pre-Paid Legal Services Inc. (NYSE:PPD) based on published data, as "pyramid in collapse." The second quarter of 2009 data adds to this portrait and further confirms this status.

All key indicators for the second quarter compared to the same period one year ago show significant and continuing declines:

. Recruiting of salespeople (called Associates), which is the engine of the entire business model, were down nearly 4% from the same period last year.

. The total number of Associates is not reported quarterly but only at the end of each calendar year. At the end of 2008, Pre-Paid Legal Services claimed a total of 425,018 Associates which represented a 4% decline from 2007.

. Recruitment of Associates for the first two quarters of 2009 is down over 23 percent from the same period last year. Recruitment of new Associates for all of 2008 was down 18 percent from 2007.

. The number of new members (retail customers) dropped 9% from the same period last year and the Q-2 of a year ago was down 4% from the previous quarter. The total number of memberships is down 4% from a year ago. Total new memberships sold in all of 2008 was down 10% from the year before.

Declines Stand Out in Business Sector:

Though the recession has damaged sales of many companies, Pre-Paid Legal Services's accelerating declines stand out within its business sector of "direct selling." Pre-Paid's steep decline conflicts with the trends of large companies also in direct selling.

According to a May 15, 2009, article in USA Today, "Direct-sales businesses that rely on home-based representatives to peddle their wares are seeing their sales forces rapidly expand as the nation's unemployment rate soars ..." The president of the Direct Selling Association, of which Pre-Paid Legal Services is a member, stated, "Unfortunately as the unemployment rate rises to 10 percent or higher, we'll be picking up more people ..." An Avon official told the newspaper, "Right now, our direct-selling opportunity is really the No. 1 product that we have to sell." In fact, Avon reports that its U.S. sales force is now the largest in its history.

Insider Sell-offs:

Not only has Pre-Paid Legal Services shown definitive signs of irreversible market deterioration, but the maneuvers of its top officials also reveal classic pre-collapse patterns. In the midst of continuing and accelerating sales force and customer drop-offs, insiders have used company funds to buy up stock, driving up the share price artificially, and then have sold off many of their own personal shares at the high prices.

In its latest disclosures, Pre-Paid Legal Services announced that the company used $524,824 of revenue during the second quarter to repurchase 13,315 shares of common stock at an average per share price of $39.42. In this same quarter, company CEO Harland Stonecipher sold personal shares equivalent of 23 percent of this total. The buy-back/sell-off price was approximately 50 percent above the year's low trading price.

Despite dismal numbers, Pre-Paid Legal Services's stock price was artificially pushed upward with the company's re-purchases while critical recruitment of its sales force dropped 22 percent and enrollment of new customers dropped 9 percent over a year before.

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