Austrailia Acts to Stop Promotion of TVI Express “Pyramid Selling Scheme”

by louabbott on May 20, 2010

This press release about TVI Express was posted by the Australian Competition and Consumer Commission

All professional network marketers need to learn to quickly identify “businesses” that are likely to be considered illegal pyramid schemes, avoid them, and warn others.  The reputation of the industry is at stake.

Here’s the full news release from the ACCC

ACCC obtains restraining orders against operators of alleged pyramid selling scheme ‘TVI Express’

The Australian Competition and Consumer Commission has acted quickly to obtain orders restraining three individuals from promoting an alleged pyramid selling scheme called TVI Express.

On Friday 14 May 2010, in the Federal Court, Sydney, the ACCC obtained ex-parte injunctions restraining Laulhati Jutsen (also known as Teddi Jutsen), Tina Aroha Brownlee and David Graeme Scanlon from promoting the alleged pyramid selling scheme.

Pyramid selling schemes are deliberate scams designed to benefit the originators while taking advantage of later recruits.  They operate on the basis that members receive commissions for recruiting new members. However, they inevitably collapse leaving most participants out of pocket.

The TVI Express scheme is promoted by the respondents through various websites including the site www.tviteamoz.com and the TVI Express Oz group on the site www.facebook.com.  People who wish to participate in the scheme are required to pay a membership fee of $330.  Once an individual has paid the $330, they receive a ‘travel voucher’ and the opportunity to receive commission payments for recruiting other people into the scheme.

The ACCC understands that Ms Jutsen, Ms Brownlee and Mr Scanlon had planned to hold presentations across Australia and New Zealand this week to promote the scheme. The orders obtained by the ACCC will prevent these presentations from going ahead. If the individuals ignore these orders, they risk being in contempt of court.

The court orders also restrain the individuals from knowingly accepting payments from, or making payments to other participants in the scheme.  The individuals are also required to place notices on various websites alerting members of the public to the ACCC’s court action.

The ACCC will now prepare the matter for final hearing. The ACCC will be seeking orders declaring that the individuals engaged in contraventions of the Trade Practices Act 1974 and injunctions restraining them from engaging in similar conduct in the future. The ACCC will also be seeking civil pecuniary penalties against the individuals.

Release # NR 104/10
Issued: 17th May 2010

The words ‘travel voucher’ are the first red flag that the TVI Express business model may be legally vulnerable.

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{ 12 comments… read them below or add one }

Dandy October 30, 2010 at 3:21 pm Thumb up 2 Thumb down 0

Hi, I have redeem three TVI hotel voucher for my group, two was booked for Boulevard Hotel: http://www.blvhotel.com (4 star) in Malaysia on last Oct 8-13, 2010. I booked Triple Room Deluxe – Room Only without breakfast in October 7th 2010 at 7pm! ..yes at 7pm! that’s 5 hour to Oct 8, and surprisingly when check in the hotel, they also got breakfast :). I can show you the booking certificate and you can check it to Boulevard hotel for prove. They pay the tax in the TVI online booking portal for just US$ 100 only, and you don’t need to pay anything when check in the hotel.

One other voucher I booked for Kamandalu Resort and Spa in Ubud – Bali (5 star) on Nov 17th 2010: http://www.kamandaluresort.com. They pay the tax for about US$ 250. After make a booking in the TVI online booking portal, they call the hotel and the hotel confirmed their booking from TVI.
If possible I will make the video when they check in using the TVI Voucher and I will broadcast it in YouTube.

You can found famous hotels like Marriott, Conrad, Hilton, Hyatt, Swissotel, Radisson, Sheraton, Novotel, Four Season, etc. in TVI hotel list. This is the prove TVI is not illegal, the voucher product is real. Giant hotels industry like I’d mentioned before will not accept TVI voucher if the travel company illegal. Also I can find around 50 hotel in Sydney Australia, there should be no hotel list in Australia if it’s illegal.

In the TVI scheme, you can jump over and leave your Upline and get the reward, this can’t be done in pyramid scheme, your Upline is your Upline forever, your can’t jump over it.. So TVI is not pyramid.
The negative responds is all about business competition and politics.

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EmJay07 June 20, 2010 at 3:59 pm Thumb up 9 Thumb down 3

Mr. Abbott, thank you very much for this post for it’s very informative and to-the-point.

As Mr. Gerry Nehra, (an MLM attorney) concludes in his words:

“So—bottom line—do not design, and do not work, a program where e multilevel commissions flow ONLY FROM the movement of money and BEFORE a product or service is delivered to an end user. When in doubt, consult a direct selling skilled attorney for guidance.”

TVI Express business model is in compliance with the MLM laws since one doesn’t have to get additional members in order to be able to use product. You get access to the product instantly and can use the product right after you join. You can use their discount club, avail free 7N8D package even if you haven’t brought in any people. The voucher ensures your position with the company while the booking certificate confirms your booking (without any hidden terms or conditions) One can do instant bookings by themselves in their member account… Great, isnt it?

So, the product eligibility isn’t based on e-multilevel movement of money. As per Mr. Gerry Nehra’s explanation on MLM laws, TVI Express doesn’t qualify to be a pyramid scheme and is very legitimate business.

Thank you again for posting this link!Mr. Abbott, thank you very much for this post for it’s very informative and to-the-point.

As Mr. Gerry Nehra, (an MLM attorney) concludes in his words:

“So—bottom line—do not design, and do not work, a program where e multilevel commissions flow ONLY FROM the movement of money and BEFORE a product or service is delivered to an end user. When in doubt, consult a direct selling skilled attorney for guidance.”

TVI Express business model is in compliance with the MLM laws since one doesn’t have to get additional members in order to be able to use product. You get access to the product instantly and can use the product right after you join. You can use their discount club, avail free 7N8D package even if you haven’t brought in any people. The voucher ensures your position with the company while the booking certificate confirms your booking (without any hidden terms or conditions) One can do instant bookings by themselves in their member account… Great, isnt it?

So, the product eligibility isn’t based on e-multilevel movement of money. As per Mr. Gerry Nehra’s explanation on MLM laws, TVI Express doesn’t qualify to be a pyramid scheme and is very legitimate business.

Thank you again for posting this link!

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K. Chang August 2, 2010 at 7:39 pm Thumb up 0 Thumb down 3

As EmJay07 repeatedly demonstrated, he either has tunnel vision or a blind eye toward the truth.

In TVI Express, the enduser IS the member, who is getting paid for recruiting. There is no “outside customer”. Thus, ANY COMPARISON is moot to a real MLM.

EmJay07 did not care that Mr. Nehra actually meant that commission can only be paid on delivery of product to the END USER (on the OUTSIDE, a consumer NOT in th company). This was obvious in one of Mr. Nehra’s other article:

ABC’s of MLM http://mlmatty.com/abc.php

“C. The company’s compensation plan

1. is designed to reward representatives for the sales of the product or service they are involved in, and

2. includes an incentive and reward for the representative to be the “new representative finder” (legally, another “participant”) in the form of payment to a representative who introduces an additional representative to the company, BASED UPON the sales volume of the second representative.”

TVI Express is NOT compliant with either C1 or C2, because THERE IS NO Therefore it CANNOT be a legal MLM (by US legal standards). Thus, anything about being paid commission or voucher is already useless, because it CANNOT BE legal, even if its commission voucher system may be complaint. It is FUNDAMENTALLY ILLEGAL.

From Mr. Nehra again:

“Some specific points need to be made about C2. No reward can be paid to the first representative for the act of introducing the second representative to the company. Such payments or rewards are called “headhunting fees” and are barred by law. No charge or required product purchase can be imposed on the second representative by the company or the sponsor as an entry fee. (A required purchase of an at-cost, non-commissionable sales or starter kit, or an administration fee, is permitted.) Simply put, neither the company nor the sponsor can profit from the sole act of recruiting. Profit to the company and profit to the representatives must come from the sale of products and services to customers, and only from the sale of products and services to customers.

There are no customers in TVI Express, only members / representatives. So they fundamentally fail the test. Any rationalization about vouchers being legal is irrelevant.

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Campbell Scott May 22, 2010 at 11:47 pm Thumb up 13 Thumb down 2

Yes so what, the government allow casino’s that inflict more pain and damage than any ponzi scheme ever could in a million life times.

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Eileen Marrinan May 23, 2010 at 8:51 pm Thumb up 6 Thumb down 9

It’s true about the casinos BUT the difference is that u (should!!) go into a casino knowing that the odds are stacked against u, u are gambling, taking a punt etc etc.
The problem is most folks dont realise with a true pyramid or ponzi SCHEME (NOT STRUCTURE)-that is the case also-its just a punt and it IS a scam if presented as a business opportunity.
That is NOT the case for a LEGITIMATE network marketing company-the structures may look “pyramid like” as do most of the world’s corporations but they are not pyramid or ponzi schemes. They are specific, highly effective distribution system for both goods and services.
What has led to to the unfavourable comparisons are the unfortunately high attrition rates in our industry coupled with seriously outdated selling and recruiting practises. Thankfully there are many networking companies that are addressing these issues using social media, voip, coaching, video and the like.

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Ricky Torres May 20, 2010 at 10:00 pm Thumb up 10 Thumb down 4

All I can say about PYRAMID issue is that it is just a structure, not all PYRAMID SCHEME is a SCAM!!! if all are, then let’s file a case against EGYPT because PYRAMIDs are scattered around Egypt! heheheh (joke!)

NETWORK MARKETING is one of the best systems ever discovered to move any Product lines or Services. It only becomes ILLEGAL if you are just using the system by getting people’s money without giving them back their money’s worth of at least 70% to 80%. Besides if you are being paid for your recruits, it is because YOU have help the Company sell their products, and as a token, you get paid for your referrals! YOU are being paid because there are PRODUCTS being sold!!! What’s wrong with that! ???
(as long as your product is legitimate/legal)

Let’s say for example, you have asked for your friend to accompany you in the Mall, you have actually invited Him/Her to the Mall and then He/She decided to purchase something in the Mall, YOU have actually gave business to the Mall! haven’t you??? what did YOU get from the Mall as a token? NOTHING!!! but that’s Legal! Now listen, NETWORK MARKETING is the most MORAL, most ETHICAL, Pro-GOD, and Pro-PEOPLE system I have ever known!!! Why??? When you Sponsor someone, You are actually helping that someone realized that there is hope for His/Her dreams to be a reality, unlike being Employed, when YOU apply for the JOB, the very main thing that they will ask your Employer is …
“What is it that YOU have that YOU can contribute to the COMPANY! for us to hire you???” but when you do the NETWORK MARKETING business, what we ask YOU is your DREAMS!, your SUCCESS!, not what you can give to the Company but what YOU CAN HAVE for Yourself and your Love ones! Your FINANCIAL and TIME FREEDOM!

Those people who doesn’t know the real essence of NETWORKING is, they do not really Understand what NETWORKING is… it is just Leveraging. A GREAT SYSTEM that is only being abused by some business people.

for me, JESUS CHRIST is the best Networker of all time! HE has HIS Product as well… “THE WORD OF GOD!” He could’nt spread it alone throughout the whole world, so HE also used the NETWORKING SYSTEM to spread the Word Of GOD through HIS 12 Apostles. HE recruited the 12 Apostles to listen and follow HIM and share the Good News to the world! AMEN!!!

GOD is Good! All the time!

All the time, GOD is Good!

(Let me help you in your true quest for Financial Freedom. If GOD is with you, who can be against you! You can email me at rickygq@yahoo.com)

GOD BLESS!

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louabbott May 21, 2010 at 9:25 am Thumb up 7 Thumb down 4

Thanks for your comments, Ricky.

However, you are missing an important point. There are such a thing as “pyramid schemes.” They have nothing to do with pyramids as in Egypt. They are illegal in most countries in the world and you can go to jail if you start, promote, or participate in one.

And there are also legal, moral and ethical MLM or Network Marketing businesses. You would have much more credibility with people if you knew and understood the difference.

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EmJay07 June 19, 2010 at 7:27 am Thumb up 9 Thumb down 2

Hello Mr. Abbott,

With all due respect and with no intention of being offensive in whatsoever nature, I’d like to say that being a part of “Insider’s Club”, you should have posted the complete story or should have updated it or not posted at all, instead of just convenient copying and pasting from a website since LITTLE Information is always MORE DANGEROUS than NO information.

This is for all those people who think or have been intentionally or unintentionally (I dont want to go there..) misled to think that TVI Express is banned in Australia.

TVI Express is NOT banned in Australia!

ACCC – Australian Competition & Consumer Commission, without making confirmations about the facts or even without initiating any contacts with the company (TVI Express) made allegations on three TVI Express members (not the company) in Australia.

And people, it is not the first time this has happened. ACCC is well known for doing that. ACCC initiated such investigations in the past as well against some of the major names in MLM industry, namely – Amway, ACN and many more.

As was expected, ACCC LOST every such case they filed. What have you got to say about it?

As far as TVI Express is concerned, TVI Express hired a Sydney based professional attorney to render their assistance to these three individuals and for your knowledge, all the court orders have been EVADED.

So people, check for yourselves and make an informed and educated decision.

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louabbott June 19, 2010 at 8:48 am Thumb up 1 Thumb down 9

Thanks for your post, EmJay07. Among other things, we publish here the news that is out there in the world that may affect a person’s desire to join or work an MLM program. This is news that networkers, particularly in Australia, need to be aware of.

If you would like to post a link to the company’s position on the matter, we would certainly welcome it here along with your comments.

As for the word “banned,” the only place it is used on this page is in your comment.

For everyone, I highly suggest reading this article by MLM attorney, Gerry Nehra:

Coupons, Vouchers, Gift Certificates, and Down Payments in MLM

Lastly, thanks for not questioning motivations. That’s most always a position taken on insufficient knowledge.

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EmJay07 June 19, 2010 at 6:10 pm Thumb up 9 Thumb down 3

Mr. Abbott, I realize that the word “banned” has been used only in my comment on this page; however, I’d like to tell you that I used it intentionally for some people have been drawing such impression from this article by ACCC. I’ve myself seen several posts from uninformed/negative people over the net stating “TVI Express busted/banned/or any such synonym in AU”.

Hence, with this opportunity, I wanted to make it clear that the completely story still remains unheard. In the past, ACCC have filed 21 cases against MLM companies in the past and as mentioned most of those companies have been and are major names in MLM Industry.

Shockingly, ACCC lost all the 21 cases!

The court orders on the 3 alleged members have already been evaded. Having said that, it’s clear that the case is going to be resolved pretty soon and all the negativity will come to an end.

K. Chang August 2, 2010 at 7:24 pm Thumb up 0 Thumb down 3

EmJay07 has been spreading some lies on his own blog, and I see he had spread some of that here as well.

NOBODY CAN PROVE ACCC lost 20 or 21 cases. WHERE IS THE PROOF?! Just because some other TVI Express supports say so? That first started on Ted Nuyten’s website, which was taken down by a DDOS attack. Show us some proof or SHUT UP! ACCC filed like 50+ lawsuits in 2008-2009 and got like 60+ settlements. Just read their own annual report. That’s effectiveness of 90+%. They did NOT lose every case. Don’t listen to TVI Express supporters without checking their statements. MORE OFTEN THAN NOT THEY ARE LYING!

Did ACCC really lost 20 cases straight?
http://kschang.blogspot.com/2010/07/did-accc-really-lose-20-cases-straight.html

And where is the PROOF that the their attorney did anything? If the court orders have been indeed evaded, HOW DID ACCC file contempt of court charges? WHO IS LYING?

ACCC files contempt of court charges against TVI Team Oz members for emptying bank account AFTER they were frozen
http://www.accc.gov.au/content/index.phtml/itemId/937473/fromItemId/142

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Dick Bendtzen May 20, 2010 at 6:51 pm Thumb up 3 Thumb down 10

Thank you for keeping us up to date on legal actions against MLM companies. Good way for us to really identify the issues involved.

Reply

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