Vemma, the dietary supplement MLM, was shut down by the Federal Trade Commission this week. The FTC alleges that the company was operating as a pyramid scheme. More information about the Vemma shutdown and investigation at Truth In Advertising and across the web.
“Rather than focusing on selling products, Vemma uses false promises of high income potential to convince consumers to pay money to join their organization,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “We are also alleging that Vemma is an illegal pyramid scheme.”
I suspect high-level Vemma affiliates are scrambling to find other “opportunities” to latch onto as the Vemma ship goes down. I wonder what YPR Pariah, a critic of Vemma whose website was mysteriously shut down last year, thinks about the news.
Kudos are in order to the FTC and everyone who assisted in making the case that Vemma might be operating an illegal pyramid scheme. There are so many more companies out there operating in this fashion; it’s a shame that the government can’t stop them all. If you suspect a company is an illegal pyramid scheme, file a complaint with the FTC and your state’s attorney general.
Robert Fitzpatrick from Pyramid Scheme Alert forwarded me this video from comedian John Crist. Pretty humorous and spot-on:
Dennis Eugene Long, Million Dollar Scammer and Former Amway Diamond Sentenced to 12 Years in Prison for Drug Scam
Another former Amway Diamond was in the news recently for all the wrong reasons, and this one didn’t change his name.
A reader posted a comment about a Dennis Eugene Long from Encinitas, CA, who was sentenced at the end of April to 12 years in prison for swindling his church friends out of over a million dollars on investments with an imaginary Viagra-type herbal drug. The commenter said that they were Direct Distributors under the same Dennis Long that was an Amway Diamond back in the mid-90’s.
My wife and I were in Amway and sponsored by a guy/couple who I always knew/believed to be dishonest; Dennis and Connie Long. They went diamond and we were a direct leg. We got out after years of drawing circles and losing friends. Dennis of course bad mouthed us on the way out. Turns out I was right all along he is, was and always will be a crook! http://www.sandiegoreader.com/news/2015/jun/16/ticker-how-churchgoer-dennis-long-preyed/
Looking at the Amway Wiki website, there is indeed a Dennis and Connie Long who were in the ILD group and downline from Jack & Rita Mae Daughery and “River House” Ron & Georgie Lee Puryear. I could not find a photo of Dennis from the Amway days, but there are photos of him in the articles from the sentencing hearing. On Intelius, I found a listing in Encinitas, CA, for Dennis E Long, age 65 (same age as the one being sentenced), who is related to a Connie Long. It’s reasonable to assume then, that this is the same person.
Long originally plead not guilty to 69 felony charges, but he later changed his plea to guilty in the attempt to get a reduced sentence. At the hearing, a number of Long’s victims told similar stories of getting their life savings stolen by the charismatic Long. One victim said the following about Long:
Debra Sims quoted scripture as she said, “Beware of false prophets, they come in sheep’s clothing but inwardly they are ravenous wolves. Dennis, you truly are a wolf in sheep’s clothing … He is a liar, a deceiver, a cheater, a charlatan.”
Judge Michael Popkins was sympathetic to those affected by Long’s misdeeds, and he rejected the plea deal and sentenced Long to 12 years in state prison. It’s unknown if Long is still an Amway distributor, but chances are that he is not. He’s certainly not going to be selling anything from his prison cell for the next decade!
Holmes is a first-time commenter who posted his story about going to a LIFE opportunity meeting this past week. He gave me permission to re-post the story in a separate post.
Minor spelling corrections have been made, and paragraph breaks have been added for clarity.
I went to a presentation at Claude Hamilton’s house recently for this LIFE Leadership “business”. I have to say, the person that brought me to the meeting made the business sound full of opportunity and had me intrigued, though it sounded like a pyramid scheme right off the bat. But I was assured it wasn’t and I was interested enough to go to the meeting. Now this Claude guy is definitely rich. The first thing that came to mind is if someone owns a business that is successful why would they want to bring more people into it that would simply be competition to them? Nonetheless I sat there waiting for this presentation in his beautiful home, and I actually felt a little self-conscious because I dressed casual and didn’t wear a business suit as most others had.
What I expected was an overview of the business, with perhaps charts, financial information and statements, how much the business was making, who the business owners were and how they started the business, maybe some future projections of where the company was headed or at least how the hell it worked and what the hell it was that they were selling. Did Claude talk about any of that at all? No most definitely not. Instead I sat through an hour of what I could best describe as some sort of motivational speech with a crap ton of promises and no real substance to how though promises could ever be kept or made, other than of course to pay $230 a month to be a part of it.
The next thing that got me was how you would “own your own business”. For me I suppose that takes a different meaning, because for me unless you are paying yourself and your employees you do not own your business. It is actual quite laughable for them to talk about owning your own business or how your actual job is a pyramid when at least you boss at work isn’t getting loaded rich from your own hard earned money. The other thing that made me chuckle was how Claude said not to quit your job at first, because then how would you pay for subscription fee of course right?
Sadly I left the meeting almost as excited as everyone else, but luckily for me all that excitement quickly faded. I got home and realized how much bullshit he was spewing from his mouth and then I started to get angry and how rich he is and how great he has it preying on other peoples hopes and dreams. See LIFE leadership isn’t even really selling a product whatsoever. They are selling hopes and dreams to people that will never get fulfilled, and it pains me to see so many hardworking people giving their hard earned dollars to these parasites such as Claude and Lana Hamilton, Chris Brady and Orrin Woodward.
I did some minor research later that night, and haven’t really stopped since, and that’s when I came across this website and am some glad I did. All I really had to do though was search Orrin Woodward’s name in Google and my suspicions of the LIFE leadership scam were confirmed. It is almost unfathomable to me that people are actually being fooled with this stuff. But I’m a skeptic by nature that likes to ask a lot of questions, and I tend not to trust people whatsoever until I have good reason to.
I can see how people could trust Claude Hamilton though, he seems like a very good person at first. He is charismatic, cheerful, and I could see how he could easily gain someones trust. But the first question I asked myself when I pulled up to his house was: “how did he become so rich?”, and all you have to do is ask yourself that question and think long and hard. All successful business people have had to step all over other people, stab people in the back and at times at least be dishonest and untruthful to get where they are at. That is unfortunately just how business works.
Like The Frugal Nexus, who concluded that LIFE “is one of the worst business decisions you could ever make,” Holmes saw through the motivational speeches and promises and determined that LIFE is in the business of “selling hopes and dreams to people that will never get fulfilled.” Recall the Forbes article on Orrin Woodward back in 2008 when they were hawking MonaVie juice:
“What I try to give most of all is hope and encouragement,” says Woodward.
Hope is an expensive commodity. Most Team members spend more buying its motivational aids and MonaVie’s juice than they ever take in. Roger Lareau, a Michigan alarm company employee, says his wife has rung up $20,000 in debt buying Team sales tools and Amway products and is now on to selling MonaVie juice. Their marriage has fallen apart as a result. “She still thinks Team is going to set her free one day,” he says.
Our analysis of the LIFE Income Disclosure Statement (IDS) from 2012-2013 showed that the majority of money was made by only a select few. Our upcoming analysis of the 2014-2015 IDS will show that this remains the case — something like 0.5% of the membership make 60% of the available income to the field. Read the fine print in the new IDS, and you’ll learn that 42% of members received no income from the compensation plan in 2014. This is up from 31% in the previous IDS.
Thank you to Holmes for sharing his story, and I hope others will do what he and The Frugal Nexus did. They didn’t take the LIFE presenter’s words at face value. They conducted their own independent research. They analyzed the numbers from the IDS themselves. They asked and sought answers to those nagging questions in the back of their mind regarding the business. And, after deciding what to do (i.e. not participate in LIFE), they took the time to write about their experience so that others can learn from them.
A trackback was posted on my site the other day, pointing to a review of the LIFE business written by The Frugal Nexus. It so happens that the author, who writes about frugality, anti-consumerism, and authenticity, was recently prospected by a LIFE member in Canada.
His review of the LIFE business gets straight to the point and is highly recommended reading. The Frugal Nexus (TFN) takes a rational and analytical look at the business from several angles and concludes that getting involved with LIFE “is one of the worst business decisions you could ever make.” He compares the 40% turnover rate with that of the 26% turnover rate in the call-center industry. The 40% figure is actually out-of-date, as there is a new IDS (our detailed analysis is coming soon) that shows that 51% of LIFE members do not renew after a year!
He also addresses the tactic used by LIFE to create honey-pot websites that are designed to persuade people that LIFE is really a good business and “how Orrin Woodward is the best thing to ever grace the earth.” This is something that I’ve written extensively in the past, and it’s good that others can see the true motive behind these defensive click-bait websites. I especially liked TFN’s rebuttal to the tired MLM argument that the corporate world is a pyramid.
Their main point was “every organization is a pyramid” is true, but in most conventional pyramids you get “fairly” (at least minimum wage) compensated for your time and you often would not have to spend your time recruiting others for no pay. I think they are mistaking hierarchy for pyramids, hierarchy are a feature of human society, in all facets of life. However the difference between a normal pyramid in Acme corp, verses a MLM pyramid is that a MLM pyramid has to grow necessarily, even exponentially for any of the lower echelons to expect payment. So while a pyramid is a hierarchy, not all hierarchies are pyramids in the MLM sense.
I want to publicly thank The Frugal Nexus for taking the time to write this review of the LIFE business. Prospects need to see both sides of the story and hard facts and analysis of the numbers that LIFE provides in its IDS. The LIFE member that prospected TFN has been in the business for two years but still has a full-time job. I can only imagine how much money this person has “invested” in the LIFE business over that time period. All those books, CDs, weekly seminar tickets, and major function tickets — how could the LIFE member have invested that money and time differently to better his life today? The Frugal Nexus has a similar wish for the LIFE member:
I hope the LIFE rep eventfully ‘wakes up’ from the ‘financial matrix’ he created for himself. LIFE demands that you double down to try to recoup anything, like a problem gambler taking another spin, forever chasing it.
Update July 20, 2015: Dean Grey no longer appears on the Allysian Sciences management team webpage. This article will remain intact for historical purposes.
I received the following comment the other day:
Amthrax something called allysian sciences popped up and I thought you might find a certain “Dean Grey” on the management team familiar. Worth checking out looks very familiar
Clicking to the Allysian management page, there’s a Dean Grey listed as Master Architect. The photo bearings a striking resemblance to former Amway Diamond, Dean Kosage. The bio attached to the photo sounds like something Dean would say about himself too — heavy on the accolades without much detail on the actual companies he was previously involved with (Amway).
Here’s a portion from Dean Grey’s bio on Allysian’s management page:
Seeing a need for entrepreneurs to be discovered in a faster and more simplified, way instead of trying to be ranked high on Google for example, Dean developed TAGS, a 100 million dollar plus platform, with some of todays largest and well known Investors and CEO in North America.
TAGS looks like it’s the new name for Zooplr, Dean’s last company as far as I know. The Zooplr website doesn’t seem like it’s very active today. I’d like to see some concrete facts regarding this $100 million dollar platform and a list of the investors in this company. Anyone care to share these facts with us?
Dean’s personal website at DeanKosage.com seems to have been shut down at some point between May, 2014, and today. His Twitter page hasn’t been updated since July, 2014, either. Did Dean officially change his name from William D. Kosage to Dean Grey? Is this what he’s been up for the past year?
Update May 20, 2015: A Google search turned up a 2014 legal notice announcing Kosage’s intention to change his name in La Presna San Diego, a weekly bilingual newspaper in San Diego. Check it out here:
Here’s a brief excerpt from the notice:
ORDER TO SHOW CAUSE
FOR CHANGE OF NAME
TO ALL INTERESTED PERSONS:
Petitioner: WILLIAM DEAN KOSAGE
filed a petition with this court for a decree
changing names as follows:
WILLIAM DEAN KOSAGE TO DEAN GREY
The hearing was held on November 25, 2014 at 8:30 AM at the Superior Court of San Diego. Based on this evidence, it’s reasonable to conclude that Dean Grey is indeed the former William Dean Kosage, formerly of Amway, Freestyle, Zooplr, and more.
As for Allysian, the company sells various pills, powders, and chocolates using an MLM system. Olympian speed skater, Apolo Ohno, is listed as one of the founders. The other founder is Rod Jao who was previously involved with All In Energy and Amway Global. Oz at BehindMLM goes into more detail about Allysian’s MLM compensation plan and ultimately concludes that it’s a “product-based pyramid scheme” and “perhaps should be avoided altogether.”
Remember at the beginning of the year, MonaVie CEO, Mauricio Bellora, talking about all of the great things planned for the acai juice company? Remember how they poo-pooed the talk of financial crisis that former distributor turned Master Distributor turned distributor, Randy Schroeder, was spreading? Recall the spin around the acquisition of MonaVie by Jeunesse Global just a little while back?
Well, the Salt Lake Tribune has new details on the real backstory behind the New Year’s video from MonaVie and the sale to Jeunese Global, detailing the spectacular rise and fall of MonaVie as it faces foreclosure and lawsuits.
BehindMLM has additional details on the downward spiral of MonaVie.
A reader writes that all “MonaVie distributors are being encouraged to start promoting Jeunesse skin care products and start de-emphasizing MonaVie’s line.” Is this the end of the line for the purple juice concentrate company?