Vemma Scam Reviews – BK Boreyko CEO.
Of course writing about Vemma Pyramid Scheme is like flogging a dead horse. So why am l writing about the collapsed pyramid scheme?
Well, the proof is in the pudding. There is a lot learn from the Vemma court case.
It is a great idea to show people that these product based Multi-level Marketing and Network Marketing Companies (NWM) are always at risk of being labeled pyramid schemes. My role is to bring attention to those who want to join or are already in the MLM or NWM business of the risks involved.
Most Vemma reviews covered most of the aspects of the pyramid scheme.
My review will be focused on the comedy that ensured during the trial period. Share lessons that l got from the closing of Vemma.
What is Vemma?
Vemma is or was a product based network company selling health supplements, energy drinks and diet shakes. Created in 2004 by Benson Keith “BK” Boreyko whose previous MLM company New Vision was shut down by Federal Trade Commission (FTC).
The products where sold through a network of ‘consumers’ cum ‘distributors’. Distributors (customers) had the responsibility to buy mandatory product packs each month to remain active. They also had a responsibility to recruit or convert customers into distributors in the hope that the new members will do the leg work of selling products while they enjoy commissions earned from the sales.
Just like many other network marketing companies, MLM or Pyramid schemes, a matrix was used to calculate bonuses which comes usually with the number of people you signed up on your down-line. For this reason, Vemma’s compensation plan ended up resembling a pyramid.
In the long run, those at the top of the pyramid looking structure can earn residual income without lifting a finger save for purchasing the mandatory stock. Furthermore, the matrix allowed the owners of the program to siphon millions from the scheme without being noticed. You do not find directors anywhere on the compensation plan yet they take the largest chunk.
As Donald Trump once said ‘… all companies are pyramid schemes …..’. That was before he learned it through the hard way, when the Trump Network – a supplement network marketing company he had formed failed to live up to the hype. He realized that those companies’ structures are shaped like pyramids but they don’t operate as pyramid schemes . Looks can be deceiving. Ask Benson Keith “BK” Boreyko, CEO of Vemma, he will tell you.
It is not disputable that most co-operates do have a pyramid like structure. However, it is based on competence NOT because you joined the company first and invited me to join your down line. In real corporate world, a learned and experienced manager can join the company at a later date but will be at the top of the ladder. In MLM, Pyramids or NWM nomatter how competent one is ….. you join the pyramid from the bottom. A newbie to Internet Marketing who joined the scheme now is better off than a Guru joining a minute later.
Of course, in the corporate world everyone is paid according to their competence, that is if all things are equal. No one is forced to be an employee, a customer and at the same time personally recruit people into the company. In MLM, NWM or pyramid schemes most affiliates only end up worse off than they were when they got started.
Vemma’s compensation plan.
You can see for yourself the pyramid resembling structure in the video below. The video was created by Tom Alkazin, who was one of Vemma’s top earners.
Vemma manufactures and sells various supplements plus drinks. I will not stir the hornet nest by discussing whether there is any efficacy of using the product. As usual, the laboratory tests to demonstrate that it works were carried out by Brunswick Laboratories. Independent tests however confirmed the presence of dangerous levels of lead. The company was fined and stopped manufacturing that product line
There are also lots of parroted testimonials by the consumers cum distributors and recruiters. Unless these networks only recruit people with chronic deficiencies which they only discovered they had after taking the supplements. Rumour has it that inside MLM and Network Companies, affiliates will buy even donkey manure as long as they can sell it to the next sucker at a profit.
Nothing is far from the truth because on the day l joined Empower Network, l was told to pay $19/month so that l can sell Pure Leverage to others, Host my website with GVO … so that l can sell it to others, buy ……. Inner Circle package .. so that l can sell it to others.
Common’, l had just joined the program a few minutes ago and haven’t even used the first product l paid for.
Besides, some networks create the MLM or NWM program before they even create ‘God’s recipes’ which are said to cure ALL diseases. They purchase companies manufacturing products even if there are bedeviled by customer complaints citing the products as ‘dog poo’.
You are never turned away nor do your condition improve to the extent that you are advised to stop taking the supplements. Auto-shipping or becoming a distributor is always offered as a cheaper alternative.
What can we learn from Vemma’s Legal case.
1. Vemma was formed in 2004 by CEO Benson K. Boreyko and had its headquarters in Arizona, United States. The Federal Trading Commission reported Vemma for operating an ‘illegal pyramid scheme’ in August and was eventually closed at the end of 2015.
Lesson: No matter how LONG an illegal pyramid scheme has operated or how much people are making money out of it. When the time comes, it will be prosecuted and if it is found on the wrong side of the law it will be shut down …. period. The best lawyers and advocates will not manage to save the sinking yatchs, burning mansions and overturning sport cars. NEVER, join a ‘pyramid scheme’ or similar programs because ‘they have been operating for years’ under the rudder. Years of operation are NOT a reflection of the legitimacy of a business. Vemma survived for more than 10 years before swallowing the hook, line and sinker.
2. FTC directed the company to establish a balance between forced sales to affiliates (distributors) and direct sales to clients. Vemma, frantically tried to beat the system by converting failed distributors to ‘real’ customers arguing that they joined the company to benefit from the discounted prices. Using the OVER PRIZE and offer hard to resists DISCOUNT model.
Unfortunately, FTC read the game and told management to request distributors to ‘opt-out’ on their own. Vemma had a point though, 75% of people claiming to be ‘distributors’ where sorely consumers and failed to sell a single product after joining. Vemma’s income disclosure Pdf indicate so. Gobbling drums of the highly energizing and mentally stimulating Verve drinks for months didn’t help either. They literally distributed products to themselves and enjoyed consuming them as customers.
Lesson: This is what exactly the MLM, NWM or Pyramid scheme owners view you …. as their brainwashed freebie seeking customers! You are NEVER part of the team, distributor or sales person to them. Worse still if you fail to make a dimme and continue gobbling your monthly forced allocation. Your level (diamond, silver, iron, steel….) and compensation are dependent on the fulfillment of those two responsibilities…. being a consumer and recruiter.
So stop senselessly defending the efficacy of using every product the company sells on every forum. Consumers like you must give honest reviews. Always remember that the
opportunity responsibility is for you to consistently buy their products WITHOUT FAIL. Recruit more CUSTOMERS as loyal as you. Probably a reason they want you to start with your ‘warm leads’ comprises your friends and family members.
Nothing less; nothing more.
As for those at the end of the food chain, QUIT before you convert yourself into a consumer. You are just a pawn waiting to be sacrificed when things get tough. Failed distributors are the most loyal customers any MLM or Net Work Marketing business can have. That is what keeps them running.
MLM and NWM companies, be warned. Affiliates are not synonymous with customers. They signed contracts and bought into the free car HYPE…. You will rather demote non-performing ‘distributors to consumers’ to balance out ratios while the sun shines. Hold compensation if distributor is selling more than 50% of products to down-line. You can even have spill overs of real customers to cushion those only depending solely on down-line sales.
3. Vemma top earners where also targeted by authorities and had their accounts frozen.
Lesson: Participating in Pyramid schemes is a great risk, not only for the company owners. You are also liable to prosecution.
4. Vemma’s CEO, BK Boreyko had another similar MLM or Pyramid Scheme in 1999 called New Vision closed by FTC.
Lessons: When one pyramid scheme collapses, the owners are likely to move on and create a new program under a new name. The money the owners of an MLM, NMC or Pyramid scheme is worth the risk. The owners of the scheme are well aware that they are running a scheme, save for brain washed affiliates. BK Boreyko was well aware that he was creating another New Vision which will be closed by FTC if the get to know about it.
5. All companies have pyramid like structures.
Lesson: Yes, most companies do have a pyramid looking structure but the don’t operate like schemes. Needless to say, they don’t get closed by FTC.
6. Vemma’s products were found to be containing unsafe levels of lead. It was fined and the products banned.
Lesson. Multi-level Marketers will sell any product to anyone and claim that it is safe to consume even if it is lethal. They only parrot what the owners of the MLM tell them. NEVER trust testimonies given by ‘patients’ converted into ‘distributors’.
Was Vemma a Scam or Legit?
I don’t think it was a scam. It fulfilled its promises, paid distributors and supplied the products. FTC and the learned judge said it was an ‘illegal pyramid scheme’. It focused too much on recruitment and turned a blind eye to consumers. The deception used in recruiting school children however leaves a lot to be desired. Promises of Vemma cars stole your people’s hearts.
You may also like: Kyani Product Review another MLM similar to Vemma.
What else can we learn from closed Multi-level Marketing scheme? l have done my part.