Another High-Flying Herbalife Rep Crashed and Burned... Who's Next?

Michael Burton, another high-flying Herbalife salesman, who claimed to be pulling in 25K a month, and showed off his 6-pack abs, dramatic transformation from his days as overweight car salesman. Both of which he attributed to Herbalife. Even just last week at an Herbalife event in Germany he reported that things are going great. 

NYPost found a very different picture in the US. Burton, and his wife have actually declared bankruptcy over the summer, owing over 8 MILLION dollars, including 1 million to the IRS. Their total assets? Less than 75000 TOTAL, TOGETHER. House was already foreclosed, and less than $100 in the bank. 

Burton owed a LOT of money, several hundred thousand, to lead generator companies that was recently banned by Herbalife. Though in various statements, Burton stated that Herbalife had NOTHING to do with his financial problems. 

ELEVEN Rebuttal Mistakes MLM Marketers Must Avoid

8-ball pyramid scheme model. (Photo credit: Wikipedia)

When one has been exposed to various MLM "opportunities", many of which are really pseudo-MLM pyramid schemes, one can anticipate the "defense points" the participants parrot from their upline whenever you see some real examinations of the scheme. Some of those do come prepared with facts. Unfortunately, they are the WRONG facts as they are often irrelevant. They generally fall into 3 categories:

• Money-related (but irrelevant) facts as defense (3)

All sorts of facts about the company's revenue, advertising budget, payout, bonus, etc, followed by "Still think _____ is a scam?"  When it's completely irrelevant.

• Name-related (but irrelevant) facts as defense (5)

All sorts of names associated with the company... Lawyers, consultants, celebrities, companies that may have done business with the company... Do they prove that the company's legal? No. 

• Logical Fallacy-related facts (irrelevant appeal) (3)

All sorts of facts that form irrelevant appeal, such as appeal to age, appeal to tradition, and so on. 

Let us examine each in detail:

BREAKING NEWS: SEC slaps Troy Dooly of MLMHelpDesk with fines regarding Zeek ponzi

SEC tweeted on 30-SEP-2013

This is none other than "Troy Dooly" of MLMHelpdesk.com (one of the sites listed in "resources" section of this very blog).

Mr. Dooly, self-proclaimed "MLM Advocate", claims to be advocating for the rights of the affiliates and MLM industry in general. However, in the SEC cease and desist, it was revealed that under two successive contracts between Rex Ventures Group, parent company of Zeek Rewards, and Troy Dooly, Dooly was being paid $6000 USD A MONTH to improve the company's image, counter negative press, conduct interviews, and so on and so forth.

And SEC slapped him with a fine for failure to disclose, and actively mislead the public of his involvement with the largest Ponzi scheme in the US (in terms of number of victims).

This is PROFOUNDLY disappointing, not merely to the MLM Skeptic, but to the MLM community at large. Can Mr. Dooly, claiming to advocate for the affiliates, actually be taking money from a company to hide, suppress, belittle, and obfuscate the truth regarding a fraud? According to the SEC, that's EXACTLY what he did.

Can such a trust EVER be regained?

Internet, MLM and FOMO... is that what Rippln's about?

As I was updating my Rippln review I also listened to some podcasts, and one of them mentioned FOMO, or "fear of missing out", and how this social phobia is driving some obsessive behavior such as checking on Facebook / LinkedIn / Twitter constantly, in fear of missing some news updates, social happenings, or such that would somehow instantly make you a pariah among peers. Then the figurative lightbulb lit up over my head: 

Rippln is just a FOMO exploiter. 

Rippln's entire idea is to team up with somebody and market THEIR stuff to its constituents, and if some of the constituents buy the stuff, their upline(s) get a cut of the profit. But this is basically exploiting FOMO, where you subscribe to Rippln and hope you don't miss some special deal. 

Unfortunately for Rippln, in order to make sure that there's enough PROFIT to be split bazillion ways among what they claim to be 1.4 million ripplers, thus far Rippln has picked a couple duds. 

You really think Herbalife Sold That Much Stuff in Mexico? Maybe Not...

Turns out there's a new wrinkle to the "explosive growth" Herbalife enjoyed in Mexico and further south... According to indictment of one of the drug kingpins... Herbalife Account is used to launder money for the drug cartel!

http://www.nytimes.com/2012/01/09/world/americas/us-agents-aided-mexican-drug-trafficker-to-infiltrate-ring.html?pagewanted=all&_r=2&

Really really makes you wonder if that "60% sales by Latino distributors" is for real sales or not, doesn't it?

EDITORIAL OPINION: Where Is A Reputation Tracker For Network Marketing?

NOTE: Editorial Opinion is my personal thoughts on the state of the network marketing industry. 

The entire network marketing industry is overdue for a reputation tracking system, for companies, executives, and affiliates. And this would be maintained, much like credit bureaus track credit history, by similar private entities.

If you join a company that claim to be "started by veterans of MLM that has combined 20 years of MLM industry experience", don't you want to know who they are, and whether their experience are successes or failures? And if they are successes, did their DOWNLINES enjoy success as well? Or are they just cloning themselves with their downlines? If they are failures, don't you want to know WHY they failed? Are they bad at management, operated a scam, or just right business wrong time?

If you are joining someone as a downline, don't you want to know who your upline really are? What schemes / biz have they joined before? What were they promoting? Would you join someone if they have a history of pushing shady businesses, or worse, businesses that turned out to be scams?

Companies can publish their stats, like income disclosure statements, in a COMMON format (right now they are free to mangle the sheet as long as it contains the right fields).

Frankly, a lot of this is just due diligence, which is SORELY lacking, a very surprising fact given that network marketing is founded on social interactions, and thus, relies a lot on trust, and trusting without due diligence leads to one getting scammed.

Now you're probably thinking, no way! That's invasion of privacy! You will want to read on.

HILARIOUS: Ever heard of Comic Book Ponzi?

Yes, there really is such a thing as comic book Ponzi. Three men, WHILE IN PRISON, concocted a scheme where they claim they will buy up old film and comic book rights and recut them and make them into documentaries and license them out to make movies and whatnot. Through some fast talking about up to 150% gain short-term they amassed over 7 million in investments.

The truth is, of course, that they made almost nothing. In two-month period in 2007, out of all the deposits... $8000 was from sale of movies, but $1.7 million was from investors.

All three were serving sentences for some sort of fraud when this scheme was concocted. And in May 2013, they are going back to jail.

http://www.ponzitracker.com/main/2013/5/2/prison-for-illinois-men-who-hatched-comic-book-ponzi-scheme.html