Similar to AiYellow mentioned before, MCA seem to have a valid product, but the compensation plan has many of the signs of a pyramid scheme, and when this is pointed out, there were quite a bit of outrage among its affiliates, who answered with all the sincerity they have, but failed the address the question which we will address...
What is MCA?
MCA is a motor club similar to AAA, with a 3 tier membership (10, 15, or 20 a month), seem to have a long history. However was sold several years ago and turned to MLM marketing. (For reference, AAA membership is about $70 a year)
Most promotional websites touting MCA refer to MCA as an income opportunity / motor club hybrid, or mostly as an income opportunity. I have yet to find a single promotional website that PRIMARILY markets MCA as motor club. Obviously this is subjective to my interpretation, but this is somewhat troubling.
Furthermore, TVC and MCA are used almost interchangeably.
The comp plan basically says for every member you refer (who pays 2 months fee to join, and monthly fee there after), you get 4 months fee as commission. However, if they cancel before completing a full 12 months, you have to pay the commission back. (EDIT: There's a comment that there is no "clawback". Until there's confirmation, clawbacks are "unconfirmed") There are inconsistent talks of "residuals" (i.e. small payment per month).
So what is the problem with MCA/TVC?
The problem with current MCA comp plan is that it has virtually no separation between member (no income) and affiliate (earn income).
Some affiliates claimed that you are TVC affiliates selling MCA membership. However, the agreement that you "sign" when you join makes no such distinction. Other affiliates either use TVC and MCA interchangeably, or just refer to everything as MCA, both the motor club and income opportunity.
There are also questions whether you can join TVC for free (i.e. NOT as a part of MCA) and sell MCA membership and earn just affiliate commission, or must you join MCA first to be a part of TVC. Conflicting answers have been spotted. Some say yes you can, some say "no way".
This complete lack of separation between "ultimate end user" and affiliate is putting MCA in danger of being declared a pyramid scheme like what happened to Burnlounge.
One of FTC's criteria for pyramid scheme is how the thing is being marketed. Would any one buy the motor club membership (the alleged product) WITHOUT the income opportunity attached? As nobody seem to be marketing the motor club by itself, FTC could rule that motor club is merely a disguise for the income opportunity (indeed, it's what they argued in Burnlounge, that the music sales is merely a disguise for the pyramid scheme where "moguls" encouraged others to buy more "mogul" positions, leading to a company with 97% moguls [affiliates] , and sales to non-members a mere 5% of total revenue).
Definition of a Pyramid Scheme
Definition of a pyramid scheme has been established in FTC vs. Koscot (1975), where it can be summarized as:
(1) Payment of money to the company;
(2) The participant receives the right to sell a product (or service);
(3) The participant receives compensation for recruiting others into the program;
(4) The compensation is unrelated to the sale of products (or services) to the ultimate user.
"Ultimate user" in part 4 was later clarified in Webster vs. Omnitrition to mean someone who is NOT an affiliate and thus NOT in the company.
As MCA fits all four criteria (there is virtually no ultimate user, as virtually all MCA members are TVC members) it is, by definition, a pyramid scheme.
But wait! There's more!
There are *some* mitigating circumstances, such as the alleged existence of "TVC only" membership where you can sell MCA membership without being in MCA, but this is NOT confirmed, and it is certainly not mentioned on any official website that I can find (only found in forum posts). It is also unclear whether you have to pay to join this TVC Only membership, or how many people have taken this option (if it exists).
Basically, MCA needs to figure out how many members it has that did NOT refer/recruit any body, vs. how many did recruit.
If it doesn't, FTC will likely audit them, then it may be too late to change.
FTC wants to see at least 51% who did NOT recruit any one. That means they bought MCA for MCA (i.e. auto club services), not the "income opportunity".
If a MAJORITY of MCA members recruited, then MCA is in danger of being declared a pyramid scheme, as FTC can then say, with high degree of confidence, that MCA members did not buy MCA for auto club, but for the income opportunity, thus, it is a pay-to-play pyramid scheme.
Therefore, I would NOT recommend joining MCA until this problem has been clarified / resolved.
EDIT: Update entry has been published:
http://amlmskeptic.blogspot.com/2012/10/update-on-motor-club-of-america-mca-and.html
You know you should really try testing the service before blogging your skeptical analysis of it. If you did, you would know MCA/TVC is not a pyramid scheme. Pyramid schemes require you to recruit in order to make money. You do not have to recruit as a TVC associate, you can just sell the service and get the same commission, without recruiting a soul. In fact, it is true, you can become an associate absolutely free, and sell all you want to. The only reason it is not advertised that way is of course everyone wants you to buy so they can get commission off you. So they make it seem like you have to be recruited in with your $40 payment, but its not true. Any John Doe can go to the tvc matrix website, sign up as an employee for free, and sell the service and get paid the $80 commission. Oh and by the way, the thing about people cancelling before the 12 months is up causing the associate to owe money back...also not true. There is no contract signed by neither customer or employee that states any such matter. Yes the commission is advanced but based strictly on the sale itself, not the life of the sell. Not sure where you're getting your accusations, but I assure and attest that they are false. I am an associate my self..and for those who are interested my page is http://bit.ly/Klyentel
ReplyDeleteAre you sure you actually *READ* my post? I stated very clearly that "MCA seem to have a valid product, but the compensation plan has many of the signs of a pyramid scheme". I never doubted the product, therefore I don't need to try it.
DeleteBesides, I cited actual cases like Burnlounge which was determined to be a pyramid scheme by FTC, and its similarity to MCA.
If you can produce the agreement that says the commission will not be clawed back, I'll gladly make a correction, but it doesn't affect the remainder of the analysis.
The *fact* that you can join TVC for free is listed where exactly? And how many MCA affiliates knows of this option? If very few do, then it doesn't matter.
The key is percentage of affiliate (recruit for income) vs. pure-member (did not recruit), as stated at the end of my post. You have not produced those numbers, nor have you proven that those numbers are not relevant.
You guys are liars, let me preface that with sign up for $6.00 and be on your way to making X number of dollars a day, a week, a month. BS! You failed to say, now spend X number of dollars to give to the one time homeless man so he can buy another car, add a wing to his mansion, and spend his days on a beach in Costa Rica! Now buy into MCA, XXX number of dollars a month 1st and last month, now spend another XXX number of dollars getting licesenced in your state. I talked to my sponser, he informs me that's why he doesn't subscribe to MCA! What!? Check out MyPcBackup...A viable service, no doubt, Sign up for that because all of the vids deal with that anyway.Sign up for GVO, nothing happening there after a month of service except that they charged me another $9.95 for the next month to do nothing and get me no where! Now sign up for "Empower Network" $25.00 a month for a blog! are you kidding me!? When you're not gruaranteed anything unless you sign up for "Inner Circle" $100.00 to $500.00 a month to "Go All The Way"! I wasn't born yesterday, though you probably thought that when i signed up in the first place. Let me give you guys some insite, some people are believing in you 'cause they've been through all of the serch engines to find the negatives, found nothing, ('cause you probably pay them off), Add it up, sign up for all of the programs, sites, and add-ons and a person on a 'fixed' income comes up short at the end of the month and they wouldn't if they didn't believe in all of your BS and don't even reprimand me about if I want to stay in this 'state' then just keep doing what I'm doing! You cost me money I could have used for necessities! Now I'm scraping the bottom of the barrel to come up with the money to meet my needs! I just wanted you people to know, you're really 'screwing' some of us out here in cyber-land that really wanted to believe in you. BTW, I don't buy into that "Empower- Network" at $25.00 a month no matter what you say!
DeleteUh, Anon, can you keep it on topic please? We're discussing MCA/TVC.
DeleteThere isn't ANYWHERE in the upper left corner that says "Become an employee". Just switches me to a page that asks for all my pertinent info PLUS my SSN. I do NOT give that out, unless I KNOW who I am giving it to!
DeleteI don't need numbers, the proof is in the pudding. Go to my website http://bit.ly/Klyentel don't click on any package to buy anything. Just look in the top left corner and click "Become an employee". Signup and BAM! You're in there. You don't have to spend a dime, and you can begin selling right away. The catch is I don't get commission if you do it that way, that's why I said many people don't know this. Again, I'm just giving you the facts, you probably are not interested in even trying, but that's ok. Just know that it's nothing of the nature or anywhere similar to a pyramid scheme as you so thoroughly defined. And its not my job to provide you agreement disclosures or any other documentation about the "clawed back" income for cancelling consumers(which is so not true), don't be a lazy researcher, if you want to know, here is the direct number to the company 1-800-227-6459. They will gladly give you the info and "numbers" you need as proof. Furthermore, my reply was not to insult your blog or opinion as you are entitled to both. But I feel it to be fit to inform the misinformed as it clearly stood out to me that you were upon reading.
ReplyDeleteIn other words, you don't agree with my explanation (we need some percentage), but you can't explain why not, except with cliche like "proof is in the pudding" which doesn't mean anything?
DeleteI'm perfectly happy to know that you *could* become TVC member only and you don't get paid for doing that. THAT is perfectly legal, but where is that stated on TVC's website? (or your replicated subdomain site?)
I already added a update regarding the alleged clawback in the post. Did you see it?
I don't call up companies to ask how legal are they. I prefer to see them in print or on website. Words can always be denied and I prefer not to record phone calls and such as it makes for much awkward conversations. If they are serious about compliance they should make such data public, as well as who is their MLM compliance consultant. Do they even HAVE ONE?
I have not misinformed any one, other than that alleged clawback, which was already corrected to say "unconfirmed", and that does not change the compensation plan model, and thus, its analysis.
So far, the only thing you've proven is you don't like my tone. When I ask for what exactly you are objecting to, you kept harping about the clawback (which I already fixed BEFORE you posted this latest comment).
You say where does it state that you can join for free huh? Well tell me this, where does it state that you have to pay to join? Exactly.
ReplyDeleteIf there were a fee, it would be clearly printed.
The clawback is corrected as unconfirmed because you won't confirm it.
You keep saying I fail to give you proof, but uh...this is not my blog, its yours! Which means you're responsible for verifying your own theories. I didn't join to satisfy the skeptical questions of an anonymous blogger, I joined to make money, which is what I am doing very successfully might I add. Damn right I don't like your tone, which is why I replied in the first place, but as I said you're entitled to your opinion, as I am my two cents (freedom of speech is wonderful isn't it?). Anyway, if you're going to make a perceived observation of someone or something, at least be resourceful about it and if there is something you are unsure of or as you call it "unconfirmed", don't blog it until it is. Good day.
I support my conclusions, therefore they are not mere opinions. Again, you've yet to explain why my conclusion (and analysis) is wrong or irrelevant. You kept picking on the background details, not the analysis itself.
DeleteWhere does it state that it cost money to join? A better question is... how do you become a TVC member? I'd venture a guess that most TVC members joined by becoming a MCA member, then heard about that you can refer other members and earn money. Heck, most of the time MCA wasn't even mentioned. Here's one:
http://www.mcaincomeathome.com/
MCA wasn't even mentioned, muchless TVC. You don't even know it's MCA until you click on "privacy policy".
And this ain't the only one. People join MCA, they don't join TVC. Without a separation between end user and affiliate, as per Omnitrition and Burnlounge, FTC may not be as charitable.
MCA / TVC, as I said before, needs to hire a MLM consultant and go over its comp plan ASAP. And you affiliates should encourage the company to do so to make sure it is operating legally. It's only to your benefit.
Dear Blooger. I am an associate and have an agreement and it actually does state in the agreement that There is absoutely no cost to become a member of TVC to market the motorclub membership. And when you become an associate you can then purchase the product if you like. And when you purchase the product you may become an associte free. But neither is dependent upon the other. As the previous replier stated. You don't know much about what you are talking about. And that is the bad part of free speech is that people can make totally unsubstantiated references about things they have no knowledge of and do harm to people in the process and then hide behind the free speech clause which in lots of cases is merely irresponsible speech.
DeleteYou didn't read my UPDATED review, did you? The link's right at the end.
DeleteGood point. I can honestly respect that answer. I stand corrected.
ReplyDeleteI dont see why people dont understand the concept of a roadside assistance company having a great direct sales program. MCA just has a great optional direct sales program.
ReplyDeleteI don't see why people don't understand the law that a "great" direct sales program can be ILLEGAL if it pays on recruitment of more salespeople instead of more customers.
DeleteTVC Marketing doesn't rely on that formula, people can become free associates and paid customers of MCA
DeleteThere's a big difference between how much it "can" happen, vs. how much it actually happens.
DeleteDear Kasey Chang,
ReplyDeleteHave you ever tried it?
No, but then I never questioned the "product" itself. I merely question the cost and what you get with the "product" and the business model selling the product.
DeleteThere are currently over 9 million members who receive the benefits. ..no where near that many associates...
ReplyDeleteGood to know.
DeleteWELP, THAT ENDED ALL THAT NONSENSE TALK ABOUT A PYRAMID SCHEME "9 MILLION MEMBERS!!!" "NO WHERE NEAR THAT MANY ASSOCIATES!!!!" ENOUGH SAID ROBERT LEWIS YOU THE MAN....LOL I JUST WISH PEOPLE WILL QUIT TRYING TO FIND WAYS TO KNOCK MCA/TVC OR WHO EVA YALL WANT TO SAY OR NOT SAY WHO THEY ARE, WHO CARES, COME GET SOME OF THIS MONEY DAMMIT!!!
DeleteAnd you trust what some random guy says on the Internet, without citing one shred of evidence?
DeleteAt least I bothered pointing out SOME evidence.
Or does that just prove you have confirmation bias, i.e. anything that confirms what you want to be true is accepted as true without further verification?
What makes you anymore believable Kasey Chang? Can we trust "YOUR EVIDENCE" aren't we all "some guy/girl on the internet" faceless, seeking our own fame/personal gain from situations like this. Why do you blog again? Why do you seek to bring down a company you say you've never tried because you've never questioned the "product" itself. I see ulterior motive here, what is your gain on this? Who's paying YOU for this blog? Let's not forget were all about money here.
DeleteI never asked you to believe me. I asked you to LOOK AT THE EVIDENCE YOURSELF and do your own analysis and make your own decisions... AFTER you looked at ALL THE FACTS. I linked to the evidence so you can see for yourself. Are you? or Are you simply going to IGNORE the evidence because you don't agree with the premise?
DeleteYou know what that's called? "Close-minded"
Why would look at more facts "bring down a company"? If the facts I want you to see would "bring down a company", then what you are doing, insulting the people who have such facts? Denying reality? Living in la-la land?
You see ulterior motive... Typical bad argument... One of my first posts on this blog, really... the "Sour Grapes" argument.
http://amlmskeptic.blogspot.com/2012/06/bad-argumentsour-grapes-argument-and.html
It's clear it's money that is motivating you to insult me when all I ask is open your eyes and look for the truth. Money has blinded you to the obvious.
Hey is this the official MCA website http://tvcmatrix.org my friend signed up and the support is good but I dont see the PDF files they for the benefit packages
ReplyDeleteYou have to google it with the site:tvcmatrix.org parameter. That finds all the stuff on that website only pertaining to your search. Then the PDFs should come up.
DeleteI think I linked to it in my updated review:
Deletehttp://amlmskeptic.blogspot.com/2012/10/update-on-motor-club-of-america-mca-and.html
How about all the doubters just start your own business. Let's be clear life is a pyramid scheme. The job you have today is a pyramid scheme. You're working at a job that places you at the bottom and can legally keep you their and yet you don't feel scammed? I guess if I franchise off of mcdonalds I'm being swindled huh? Get the services call them lie and say you're car is broke down if somebody show up there you go ... legal. Oh and yes they front you the money up to 17 months. Keep your customers. But what that's a scam. Tmobile is passing out rebates which means if you stay for such and such time you get "whatever" sooooooooo find creative ways to keep your customers. They won't put you in debt actually if you sell a certain amount then they will discount it and even if you don't then they will only take of a certain percentage. As for me I feel hoodwinked every time I open a bag of doritos and notice the bag half full. scam!!! Life is a scam because the ppl the business owners pretend to care about you and target you through advertising just to get your money. Heck some even go green just to make profits off of tree huggers. Look truth is you've dated scum bags and gave your heart trust me when I say you're not losing much joining mca. Join me www.tvcmatrix. com/jobsnow01
ReplyDeleteThere are specific LEGAL criteria for a pyramid scheme, thus your imagination that "life is a pyramid scheme" doesn't apply.
DeleteI signed up recently and my sponsor is paying back on a lost agent. You are not just paying for the membership, websites and marketing products are necessary if you want to make any money. If you are experiencing financial hardships now, I would not suggest signing up. It takes about 2 to 3 weeks to start making anything other than pocket change.
ReplyDeleteAnd perhaps not ever (make anything more than just pocket change). THAT is a risk everyone need to evaluate for him or herself.
DeleteI thought about it but didn't go threw with it because ,when I spoke to an agent I asked how could I get paid after I get someone to buy paper check or direct deposit ,she said direct deposit only I didn't like that.....I think u should have a choice on how u get ur money if u work for it don't won't any online source having anything with my accounts.
ReplyDeleteLike, cost you extra $5 if you get your check via regular US Mail?
DeleteThis comment has been removed by a blog administrator.
ReplyDeleteThe Motor Club of America has a valuable product. The services are fairly priced when comparing to AAA seeing as how AAA’s service have far less than half the value MCA offers it’s members.
ReplyDeleteThe TVC Matrix is where the price starts to outweigh the product.
When researching any MLM start by asking yourself. Is the MLM’s product more valuable then the price of being an affiliate?
Remember, you want to be a part of a company who provides value. Are you paying for the product and blessed with the opportunity? Or are you paying to be an affiliate who has overpriced the product.?
360 bucks a year vs. 75 for AAA, and it's "fairly priced"?
DeleteI think you read way too much into those benefits that nobody needs, like "pay for bond if you got arrested".
MCA and TVC is the SAME COMPANY.
Maybe you need to ask yourself did you do ENOUGH research?
If someone crates a TVC account without purchasing an MCA Membership, does that someone still get the $80 commission if he/she sells an MCA Membership through his free TVC Account?
ReplyDeleteI'd really appreciate someone clearing up my doubt, thanks guys and keep up the good work
According to the agreement, purchase of membership is NOT required to get commission. See the updated review, linked once already but here it is again:
Deletehttp://amlmskeptic.blogspot.com/2012/10/update-on-motor-club-of-america-mca-and.html
Yes I saw your update and I also went to the TVC page and read the entire page on Terms and Conditions, I simply wanted to gather as much as I can before making my decision, thanks for your help
ReplyDeleteAnd that is all I ask of each and every one of my readers: actually *know* what you are getting into.
DeleteIIRC, Clark Howard the consumer finance guy talked about this a few weeks ago. he never mentions companies by name, but it can only be MCA that a caller asked about, and he's like 300+ bucks a year?!?! Who's going to pay that when AAA is like 80 a year?
Great article even though I don't agree 100%
ReplyDeletehttp://oshanewalker.com/2014/11/17/mca-pyramid-scheme/
Motor Club of America isn't anything near a scam, lol. Obviously many people don't understand how insurance style services work. you are paid an ADVANCE on expectancy of the subscribers to stay a member for at least a year or however long. If you took the MLM part away from the company completely, then you would see no problems at all. Have you all even tried the services before commenting? On top of this, people are saying nonsense like AAA is 80.00 a year. okay, but what do they offer that MCA doesn't? MCA has many more benefits, unlimited tows yearly, and offers benefits comparable to regular insurance like $150 a day if hospitalized. If you want a CHEAP service, sure AAA is your way to go, just remember that you get what you pay for.
ReplyDeleteSo you're arguing MCA has a fine product, but the way it's sold is potentially a scam?
DeleteWhat exactly are you arguing for?
This comment has been removed by a blog administrator.
ReplyDeleteSpam referral nuked.
DeleteYou can join MCA without buying the plans. You still make commissions just like you would if you bought a plan. It is not a requirement to buy the plan. You won't get all the tabs to show up on the TVC matrix site unless you actually register as an associate.
ReplyDeleteSo to FULLY enjoy the compensation you *have* to pay into the plan first?
DeleteTry reading the updated article linked at the end.
ReplyDeleteMost promotional websites touting MCA refer to MCA as an income opportunity / motor club hybrid, or mostly as an income opportunity.
.I think u should have a choice on how u get ur money if u work for it don't won't any online source having anything with my accounts.
ReplyDeleteI think you should study "how u get ur money" is really legal or profitable before you throw your heart and soul into it.
ReplyDeleteAnd please write sentences that actually make sense.