YTB (Your Travel Biz) sued as pyramid

[Judge Roy Bean]

http://www.courthousenews.com/2010/06/15/28082.htm

The class claims YTB generates about 75 percent of its revenue by using independent marketing representatives to recruit referring travel agents to buy online travel agencies from the defendants.

I'm shocked!

[Emet]

I'm shocked!

As am I!

While I recognize that the BBB is not exactly an ally for consumers, the YTB page gives a nice summary of some previous litigation; and of 82 "resolved complaints", 50 people were probably unhappy with the "resolution".


Of course, many sheeple, er recruits just quit and go lick their wounds.

[Mike!]

The only way this would shock me is if I were to accidently stick a fork in a light socket at the exact moment I read it. What I find "shocking" is the fact that there still is a YTB to sue at all.

[wserra]

The class claims YTB generates about 75 percent of its revenue by using independent marketing representatives to recruit referring travel agents to buy online travel agencies from the defendants.

I'm shocked!

Don't be. That's what YTB tells the SEC. In its latest 10-Q (filed 5-17-10), YTB breaks down its revenue sources (as the law requires). While the board software doesn't permit much formatting, their own numbers are:

Three months ended March 31, 2010
Marketing Product Parent Total
External and inter-segment revenue $ 7,286 $ 1,999 $ - $ 9,285
Income (loss) from continuing operations 647 (599 ) (476 ) (428 )

YTB defines "Marketing" as "marketing of ITCs [Internet Travel Centers] and PDSs [Product Distribution Systems], including the development of a sales network" - IOW, selling memberships. It defines "Product" as "sales of travel and other products". So this (ahem) "travel agency" by its own numbers gets only 20 percent of total revenue from selling travel, and the other 80 percent by selling memberships. The profit/loss figures are even worse: it lost $600K in the quarter by selling travel.

They are only still in business, Mike!, because they haven't exhausted the pool of suckers.

[Emet]

They are only still in business, Mike!, because they haven't exhausted the pool of suckers.

Which is very sad. If you register and read the threads over at the anti-Mary Kay site, Pink Truth, you will find very smart and educated women who entered that particular MLM to either purchase the products at wholesale, or who were led to believe they might earn pin money by selling to their friends. The deception, pressure, and brainwashing are piled on, and it can be hard to resist.

I don't know all that much about YTB, but I personally have compassion and empathy for many of those that get sucked into any MLM... unless they're just greedy.

(FYI: I have personally never been involved in sales or MLMs.)

[wserra]

you will find very smart and educated women who entered that particular MLM [Mary Kay]

For many years both before and after I joined it, my firm had a legal secretary who, although she did not have the formal credentials, was the best office paralegal I've ever worked with. We could (and frequently did) ask her to do motions, bills of particulars and the like from scratch, and they would be ready an hour later. She was smart, organized and highly efficient. Although we paid her as her value to the firm merited, she got tired of it after twenty-some years. She decided she was going into Mary Kay. I directed her to the PinkTruth and other sites; it didn't matter. "Wes, you'll see, I'll have my Caddy in three years." Well, that was five or six years ago. She has a garage full of product and has made almost nothing. She had saved a bunch of money, and her husband is a retired NYS LEO with a good pension. They'll be OK.

But it's a cult.

[Emet]

But it's a cult.

Agreed.
Mary Kay: The Next Jonestown?

My previous post was meant to gently and respectfully diffuse the term sucker (one easily cheated or deceived). It is used pejoratively and contemptuously.

I hold the MLM kingpins in contempt--not the victims.

As they say over at Pink Truth, does that make sense? Is it clear as mud?

[wserra]

It is used pejoratively and contemptuously.

As I think the example of my forner secretary indicates, I meant to be neither pejorative or contemptuous (except to YTB).

Meaning #2 for "sucker" from dictionary.com:

Informal a person easily cheated, deceived, or imposed upon.

[Emet]

It is used pejoratively and contemptuously.

As I think the example of my forner secretary indicates, I meant to be neither pejorative or contemptuous (except to YTB).

Meaning #2 for "sucker" from dictionary.com:

Informal a person easily cheated, deceived, or imposed upon.

Indeed it does. I think I was attempting to explain why I posted what I did, and perhaps feared that a pro-MLMer might see that and accuse anti-MLMers as resorting to name calling. I really believe we are in agreement, and offer my humble apologies. Maybe I just associate with the wrong people who use the term in the manner I described.

[Mike!]

For the record, I wasn't shocked, it was the Judge.

[wserra]

I really believe we are in agreement,

Me too.

and offer my humble apologies.

No need.

For the record, I wasn't shocked, it was the Judge.

I know. I combined my responses to you and JRB.

[Mike!]

Here's the local paper write up on this...

http://www.thetelegraph.com/news/ytb-41 ... laims.html