Tag Archive for MLM Lawsuits

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German Regulator Freezes IMS – An OneCoin Company For Unauthorized Payment Services

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The BAFIN in Germany regulates financial transactions and according to a German press release, Bafin ordered InternationaI Marketing Services  – a OneCoin company – to freeze and cease its operations in Germany as the company did not and does not have the required authorization for finincial transactions.
The order may still be subject to judicial review.
BaFin is one of the largest financial supervisory authorities in Europe. With its more than 2,600 employees, BaFin takes an industry-appropriate and risk-oriented approach to supervision on the basis of recognised European supervisory standards.
As an integrated financial supervisor for the banking, securities and insurance sectors, BaFin ensures the stability of the largest financial market in continental Europe.
BAFIN did not judge the Direct Sales compensation plan:

BaFin does not have the right to decide as to

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Supreme Court Of India Rules In Favor Of QNET

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In a major development the Supreme Court has ordered a stay on all further proceedings against direct selling company QNET and its franchisee Vihaan Direct Selling Pvt Ltd (Vihaan).
It fundamentally also granted bail to its Indian shareholders Michael Ferreira and Malckolm Desai. QNet, which has been under investigation since 2013, views this with positivity thereby.
The order comes at a timely moment given the backdrop of the model Direct Selling Guidelines issued by the Ministry of Consumer Affairs for proper functioning of Direct Selling companies in India.
In an interim order, a two-judge bench comprising Mr. Justice Pinaki Chandra Ghose and Mr. Justice Rohinton Fali Nariman categorically stayed all FIRs against the business of QNET in India.
The Supreme Court has also stayed further proceedings in all 19 FIRs against the company across India.
As

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Lyoness Plans To Appeal Against Swiss Pyramid Decision

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According to an article in TT.com an magazine in Austria, Lyoness has stated it plans to appeal the decision from the Swiss Court that the company compensation plan is a Pyramid – Snowballl system.
The google translation, partly edited:
Against Lyoness, main sponsor of the Austrian football club Rapid Wien, is an other civil law judgment. This time, the Swiss Obergericht Zug has described Lyoness as a snowball system. Members would only receive money when they recruited other members. Moreover, the business model is intransparent. The judgment is not final.
Lyoness had resisted a corresponding judgment of the lower court and has now cut off with the complaint. A judgment of the Supreme Court of the Canton of Zug (APA), dated February 28, is entitled to appeal “if a legal question is of fundamental importance”.
Lyoness

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5Linx Partners Charged With Cheating Investors

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The original partners of 5Linx, once one of Rochester’s fastest growing companies, cheated investors out of more than $4 million, federal authorities allege according to an article in the Democrat & Chronicle.
The illegally gained money could be as much as $11 million, court papers allege.
The three partners — Craig Jerabeck, Jason Guck and Jeb Tyler — were charged today in federal court with defrauding investors between 2009 and 2015. The three were released on bond of $100,000 a piece.
5Linx was once a highly successful network marketing company, with products ranging from nutritional supplements to wireless security systems. However, there have been clear strains in recent years between past and current 5Linx management.
The Democrat and Chronicle previously reported on allegations in a lawsuit against Jerabeck, who had left the company.
Jerabeck was accused of

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TelexFree CEO James Merrill – Prosecutors Recommend 10 years In Prison

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Organizing a Ponzi in the USA is a bad idea, Zeek Rewards CEO Paul Burks got 14 years, COO Dawn Wright Olivares 7.5 years and 2 years for CTO Daniel Olivares.
Federal prosecutors are recommending 10 years of prison time for James Merrill, the former Chief Executive of TelexFree Inc., for his role in one of the largest pyramid schemes of all time.
Merrill, of Ashland, pleaded guilty in October to multiple fraud counts for his role in the global scheme, in which nearly 1.9 million people from more than 100 countries lost $3.5 billion.
He will be sentenced in federal court in Worcester next week, while his business partner, Carlos Wanzeler, remains a fugitive in his native Brazil.
In sentencing memorandums filed Thursday, prosecutors alleged that from February 2012 to April 2014, Merrill ran

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AdvoCare Distributors File Lawsuit

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According to USA – based magazine The Dallas News 2 former distributors of nutritional supplements from AdvoCare filed suit this week in federal court claiming they lost thousands of dollars in the deal and alleging that the sales program is essentially a pyramid scheme:
Lisa Ranieri of Virginia and Megan Cornelius of California said they each “lost thousands of dollars trying to be a successful distributor,” according to the suit, filed in the Northern District of Texas.
Lindsay Bomar, an AdvoCare spokeswoman, said the company “unequivocally [is] not operating a pyramid scheme.”
“We vehemently dispute all of the claims” about the product and the business model. AdvoCare, a big supporter of NASCAR racing, sells nutritional and weight-loss supplements through direct marketing. That’s a business model in which distributors are paid in part based on

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QNET Has Big Plans For India But Needs Clear-Cut Norms For Direct Seling

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Global direct selling major QNet says it has big plans for India but needs clear-cut norms that differentiate genuine direct-sellers from those involved in illicit investment schemes.
Malaysia-based QNet’s Global CEO Trevor Kuna emphasised that it sells products and services and not into “investment business” and said it has been paying all its taxes and all their payments have been made after deduction of taxes and that too through non-cash modes with full documentation and transparency.
The group and its Indian franchisee has been facing several legal cases in India and has been accused of indulging in fraudulent business activities — the charges which it has been refuting consistently.
“We do have big plans for India, but like many other companies we are waiting and watching how the implementation of the guidelines unfolds on the

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QNET Has Big Plans For India But Needs Clear-Cut Norms For Direct Seling

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Global direct selling major QNet says it has big plans for India but needs clear-cut norms that differentiate genuine direct-sellers from those involved in illicit investment schemes.
Malaysia-based QNet’s Global CEO Trevor Kuna emphasised that it sells products and services and not into “investment business” and said it has been paying all its taxes and all their payments have been made after deduction of taxes and that too through non-cash modes with full documentation and transparency.
The group and its Indian franchisee has been facing several legal cases in India and has been accused of indulging in fraudulent business activities — the charges which it has been refuting consistently.
“We do have big plans for India, but like many other companies we are waiting and watching how the implementation of the guidelines unfolds on the

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Nerium International – Nerium Biotechnolgy Shareholders Deny Allegations

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On 20 February we published court documents (we did not make it up….) in which Jeff Olson – CEO Nerium International is accused of numerous inappropriate transactions by 2 partners / shareholders:
1. Nerium SkinCare (NSC) is a division of Nerium Biotechnology Inc., President is Dennis Knocke.
2. Nerium Biotechnology inc. (NBI) CEO is Dennis Knocke, the company owns 30% of Nerium International.
So there are 3 different Nerium companies, which make the case confusion. Nerium International and NSC/NBI have business disputes with each other that they are addressing in court.
The article got over 100,000 hits and many Nerium network marketing distributors were more than upset.
Business For Home was able to retrieve a letter by a group of shareholders from Nerium Biotechnology Inc represented by Donald R. Gardner, and Gardner represents a large

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Jeff Olson – CEO Nerium International Accused Of Massive Fraud

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Nerium SkinCare and Nerium Biotechnology, partners of Nerium International, accuse CEO Jeff Olson from multi-million dollar fraud and ask in a lawsuit, inspection of the books.
From the law suit:
Nerium (Skincare) has recently obtained concrete evidence of numerous inappropriate transactions—totaling millions of dollars—that were directed or overseen by Jeff Olson, the Company’s sole Manager.
This evidence leaves no room for doubt that Olson is guilty of financial impropriety; now the question is the scope and extent. Nor is there any room for dispute that the Company previously underpaid Nerium by millions of dollars in equity and bonus distributions.
After Nerium filed its application to compel records inspection and served discovery regarding the Company’s equity allocations, the Company was finally forced to admit that its prior equity allocations were wrong. Yet it refuses to provide Nerium

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