WorldVentures Pyramid Scheme Lawsuit

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Back in May, a class action lawsuit was filed against multi-level marketing company WorldVentures. This is the travel MLM that encourages distributors to share photos of themselves holding signs saying “You Should Be Here.”  It is marketed as a direct sales travel club, yet the “start a business” part of their website doesn’t even mention what you will be selling or doing. The World Ventures compensation plan mentions making money from selling products and from recruiting others, yet the entire document speaks only to the money that is made from enrolling new distributors (called enrolling new product customers). Making money from selling something seems to be wholly disregarded.

It’s not surprising then, that the lawsuit filed against WorldVentures by Melody Yiru accuses the company of being an endless chain recruitment scheme that is prohibited under California law. The lawsuit says, among other things:

  • WorldVentures rewards recruiting over sales of travel packages
  • The company is nothing more than a site that compiles travel package plans from other sites, with prices in excess of popular travel websites like Expedia and Travelocity
  • 99.7% of World Ventures distributors have average gross revenues (before business expenses) of $140 and average net losses of over $1,000 per year
  • The company has been banned from doing business in Norway because it’s an illegal pyramid scheme
  • Money is paid out based on the recruitment of people and the purchasing of memberships, not on the sale of travel
  • World Ventures is compared to YTB, another travel MLM that what shut down after being deemed a pyramid scheme
  • The company’s income disclosure statement is misleading and confusing, attempting to make people believe more people make money than actually do
  • If you combine all the “representative” levels on the income disclosure statement and include all the people who made zero commissions, the calculated average commission is $140, rather than the larger figures shown on the statement

The case was originally filed in California state court, but was then transferred to federal court in California. It was then transferred to federal court in Texas. This will be an interesting one to follow!

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